Lessons for successfully executing digital transformation in Healthcare

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Many common perceptions about digital transformation are
actually myths. Fortunately, our global survey of nearly 400 large firms, supplemented by 157 in-depth interviews
with senior executives in more than 50 large companies, provides factbased answers.

Published in: Health & Medicine
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Lessons for successfully executing digital transformation in Healthcare

  1. 1. THE DIGITAL ADVANTAGE HOW DIGITAL LEADERS OUTPERFORM THEIR PEERS IN EVERY INDUSTRY Transform to the power of digital
  2. 2. Introduction 2
  3. 3. The Dutch Healthcare system is in its present design not sustainable In it’s present form the Dutch Healthcare system will be: Unpayable (long-term conditions, growing demand and increasing possibilities) Unfeasible (growing number of elderly people and decreasing working population) Untenable (changing care demand and costumer attitude request a different way of care provision) Is e-Health the solution and if so what are the preconditions Copyright © 2012 All rights reserved. 3
  4. 4. WHAT IS DIGITAL MATURITY?
  5. 5. Digital maturity is a combination of two separate but related dimensions: Digital Intensity and Transformation Management Intensity Digital Intensity is investment in technology-enabled initiatives to change how the company operates – its customer engagements, internal operations, and even business models. Location-based marketing Customer Service in Social Media Connected Products Mobile sales Digital Design … Transformation Management Intensity consists in creating the leadership capabilities necessary to drive digital transformation in the organization. Digital Vision New skills Cultural change Cross-silos coordination … Copyright © 2012 MIT CDB and Capgemini Consulting
  6. 6. The two dimensions spell out four different types of digital maturity • • BEGINNERS Fashionista have implemented or experimented with many DIGIRATI Digital Intensity FASHIONISTAS Beginners do very little with advanced digital capabilities, although they may be mature with more traditional applications such as ERP or electronic commerce. Although companies may be Beginners by choice, more often than not they are in this quadrant by accident. sexy digital applications. Some of these initiatives may create value, but many do not. While they may look good together, they are not implemented with the vision of gaining synergies among the items. CONSERVATIVES • favor prudence over innovation. They understand the need for a strong unifying vision as well as for governance and corporate culture to ensure investments are managed well. However, they are typically skeptical of the value of new digital trends, sometimes to their detriment. • Digirati Transformation Management Intensity Conservatives truly understand how to drive value with digital transformation. They combine a transformative vision, careful governance and engagement, with sufficient investment in new opportunities. Copyright © 2012 MIT CDB and Capgemini Consulting
  7. 7. DIGITAL MATURITY MATTERS
  8. 8. We quantified the digital maturity of 391 companies and analyzed their financial performance We analyzed financial data from all the publicly-traded companies in our sample* Digitally-mature companies are achieving statistically significantly better financial performance** * Of the 391 companies in our sample, 184 were publicly traded ** Industry adjusted FY2011 financial performance for 184 publicly traded firms, controlling for geography Copyright © 2012 MIT CDB and Capgemini Consulting
  9. 9. Digital Intensity and Revenue Generation Companies that are mature on the digital intensity dimension are better at driving revenue through their existing assets +6% +9% -4% -10% Basket of indicators: • Revenue / Employee • Fixed Assets Turnover (Revenues / Property, Plant & Equipment) Copyright © 2012 MIT CDB and Capgemini Consulting
  10. 10. Transformation Management Intensity and Profitability Companies that are mature in the transformation management intensity are more profitable -11% +26% -24% +9% Basket of indicators: • EBIT Margin • Net Profit Margin Copyright © 2012 MIT CDB and Capgemini Consulting
  11. 11. DIGITAL MATURITY MATTERS IN EVERY INDUSTRY
  12. 12. Digital transformation is moving more rapidly in some industries than in others… Digital maturity, by industry, for our survey Fashionistas Digirati Each dot represents the average maturity of industries for which we have 20 or more data points. Travel and hospitality Telecomm High Technology Retail Pharmaceuticals Banking Consumer Packaged Goods Insurance Beginners Utilities Conservatives Manufacturing Copyright © 2012 MIT CDB and Capgemini Consulting
  13. 13. …but every industry has firms that have already begun to gain the benefits of digital transformation Percentage of firms in each industry by quadrant. “Digital Beginners in any industry are several years from gaining the digital maturity that their Digirati competitors already possess" Copyright © 2012 MIT CDB and Capgemini Consulting
  14. 14. BUILDING DIGITAL MATURITY: THE DIGITAL DNA
  15. 15. Digital Leaders show common patterns: the Digital DNA “Digirati status is more than simply a combination of sound management and digital capability. There is something inherently different about Digirati DNA that separates them from the rest" Focus Investments on where they choose to Excel Digitally Invest 100% in transformation management Digital Leaders Combine Digital Capabilities to Exploit Synergies Use Digital Technologies to Transform their Business Models Copyright © 2012 MIT CDB and Capgemini Consulting
  16. 16. CONDUCTING YOUR OWN DIGITAL TRANSFORMATION
  17. 17. Our two-year research program provides some useful pointers for successfully executing a digital transformation. Conducting your digital transformation requires taking action in four key areas: framing, investing, engaging, and sustaining. “CEOs and other senior executives are increasingly asking practical questions about what digital transformation means for their businesses” Sustain the Transformation Frame the Digital Challenge • Build Capabilities • Measure & Monitor Sustain Frame • Understand the impact • Assess Digital Maturity • Develop & Align around a Vision Engage Focus Engage the Organization • Signal and Mobilize • Govern across silos • Evolve Culture/ adapt Work Practices Focus Investments • Invest in Digitally-Enabled Initiatives • Adapt your Business Model Copyright © 2012 MIT CDB and Capgemini Consulting
  18. 18. We discovered that many common perceptions about digital transformation were actually myths, which can lead executives to make unfortunate and costly decisions. “Many common perceptions about digital transformation are actually myths Fortunately, our global survey of nearly 400 large firms, supplemented by 157 in-depth interviews with senior executives in more than 50 large companies, provides factbased answers” Myth Reality Digital is primarily about the customer experience Huge opportunities exist also in efficiency, productivity & employee leverage Digital primarily matters only to technology or B2C companies Opportunities exist in all industries with no exceptions Let 1000 flowers bloom; bottom-up activity is the right way to change Digital transformation must be led form the top If we do enough digital initiatives, we will get there The how of transformation is more important for driving overall performance Digital transformation will happen despite our IT Business/IT relationships are key, and in many companies they must be improved Digital transformation approach is different for every industry and company Digital Leaders exhibit a common DNA In our industry we can wait and see how digital develops There are digital leaders outperforming their peers in every industry today Copyright © 2012 MIT CDB and Capgemini Consulting
  19. 19. Digital Transformation Global Healthcare Survey 2013 Why Understanding how healthcare providers are gaining advantage from digital technology. – How digital mature are healthcare providers globally; and – How do they perform against their peers and other industries. What We will be conducting a global online survey in the Summer of 2013 (in English) – 200 – 300 providers globally (e.g.hospitals, physician practices, mental healthcare, elderly care) When – End of June: potential participants – Publish survey and reach out to providers July 1st – Survey completion deadline September 15th – Survey results and publication date December Copyright © 2012 All rights reserved. 19

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