IT Strategies for an Uncertain Future -Embracing Change and InnovationScott Lundstrom, GVPIDC Health Insights
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Mega-Trends Driving HealthcareAgin...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.3
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Source: IDC4Source: U.S. Bureau of...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.55
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.From IT Productivity to BusinessPr...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.The Parable of the 7 Blind Menand ...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved. Many IT organizationsreaching en...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Cloud: Long Term Inflection Points...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Cloud Investment PlansPayer N = 36...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.From IT Productivity to BusinessPr...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Big Data in Healthcare – The NextF...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Big Data Healthcare Use CasesWaste...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Health Information Exchange:Aggreg...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.ACOs Will Lay FoundationalGroundwo...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Home Health Home Sensors Body Sens...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Big Data/Analytics InvestmentPlans...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Big Data/Analytics:Long Term Infle...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.From IT Productivity to BusinessPr...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Social Business:Long Term Inflecti...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.0% 5% 10% 15% 20% 25% 30%Drive rev...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.From IT Productivity to BusinessPr...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Mobility:Long Term Inflection Poin...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Consumers Begin to Abandon PCs,Emb...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved. 41.7% of respondents to an IDC H...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.The CIO Perspective
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.By 2016, LOB executives will be di...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.CIOs and CFOs will move to “zero c...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Consumer Engagement– Solution Evol...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Questions?Scott LundstromGroup Vic...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Appendix
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Acronyms ACA Affordable Care Act ...
© IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Terms of Use PolicyExcept as other...
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iHT2 Health IT Summit Boston 2013 – Scott Lundstrom, Group Vice President Presentation, IDC Health Insights "IT Strategies for an Uncertain Future - Embracing Change and Innovation"

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iHT2 Health IT Summit Boston 2013 – Scott Lundstrom, Group Vice President Presentation, IDC Health Insights "IT Strategies for an Uncertain Future - Embracing Change and Innovation"

Presentation "IT Strategies for an Uncertain Future - Embracing Change and Innovation"
The widespread changes demanded by reform continue to create angst and opportunities for healthcare providers. Quality, cost and compliance initiatives, changing business models, and new care delivery technologies are all demanding our attention. Uncertainty is high, but the call to action is strong, and there is tremendous pressure to show broadly based progress across the technology portfolio. How can IT and the business move forward on a common plan in these uncertain times? Leading organizations are already building a platform for the future. By focusing on reducing costs, improving quality, and supporting business innovation technology, significant progress can be made to support a broad range of possible post reform business models. By focusing on a core group of enabling technologies health organizations can become better prepared to survive in the post reform market. What are the core key enabling technologies required by any health organization in the future? Where should resource constrained organizations focus their attention?

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iHT2 Health IT Summit Boston 2013 – Scott Lundstrom, Group Vice President Presentation, IDC Health Insights "IT Strategies for an Uncertain Future - Embracing Change and Innovation"

  1. 1. IT Strategies for an Uncertain Future -Embracing Change and InnovationScott Lundstrom, GVPIDC Health Insights
  2. 2. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Mega-Trends Driving HealthcareAgingPopulationStaffShortagesPatientSafetyGovernmentRegulationsChronicConditions$300 billioninredundantorineffectivehealthcareOne in fourseniorstakebetween10 and 19pills a day1.5 millionannualavoidableadversedrug events100,000annualavoidabledeathsCostPressures$2.5 trillionor 17.6% ofU.S. GDP in2009Doubling to$4.5 trillionor 19.3% ofU.S. GDP in2019
  3. 3. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.3
  4. 4. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Source: IDC4Source: U.S. Bureau of LaborStatistics, Employment ProjectionsProgram; annual growth in $ outputNow the IT Marketplace That Matters
  5. 5. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.55
  6. 6. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.From IT Productivity to BusinessProductivityMedicineSupplyChainSmartBuildingsSocialMobileCommercePaymentFraudManagementConnectedHealth– Cloud– Big Data/Analytics– Social Business– MobilityThe Four Pillars and the GrowingSignificance of “The 3rd Platform”Intelligent Industries
  7. 7. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.The Parable of the 7 Blind Menand the ElephantThe blind men and the elephant. Poem by John Godfrey Saxe (Cartoon originally copyrighted by the authors; G. Renee Guzlas, artist).It’s aPortalIt’s a DataAggregationIt’sPlatform-as-aServiceIt’s aCustom SIIt’s anIntegrationPlatform It’s ClinicalandFinancialConnectivity
  8. 8. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved. Many IT organizationsreaching end of consolidation• “Last mile” requires robustinfrastructure andconservative VM densities• Greenfield opportunitiesbecome exception 2nd phase of virtualization isabout application portfoliomanagement, elasticity andmodularity Put “soft” benefits ahead ofhard cost savings Looking for value in convergedsystems0%10%20%30%40%50%60%70%80%90%100%0 10 20 30 40 50 60 70 80 90 100PercentofRespondentsPercent Applications VirtualizedSource: IDC Server Virtualization StudyQ. Approximately what percent of your entireapplication portfolio is virtualized today?25%Private Cloud: the 2nd Phase ofVirtualization
  9. 9. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Cloud: Long Term Inflection PointsOver 50% of U.S. companies will have more than 50% ofall their IT assets in third party data centers by 2016By 2016, over 60% of the enterprise class storage capacityships to cloud service providersPublic cloud dominates the Big Data marketplace, and BigData emerges as a primary driver of cloud adoptionCloud players engage in a data "arms race" toaccumulate (via self collection and acquisition)strongest portfolio of public and "for fee" data setsIn 2017, almost 30% of all high end data center space (100million sq ft) will be in service provider data centersRegional and national data sovereignty requirementsprevent consolidation of cloud service providers
  10. 10. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Cloud Investment PlansPayer N = 36, Provider N = 234Source: IDC Global Technology and Industry Research Organization IT Survey, 2012Is Cloud computing currently on your organizations technology roadmap?Currentlyusingthis technology/service (30.6%)Planningimplementation ofthis technologywithin the nextyear (22.2%)Researching andevaluatingpurchase of thistechnology/service (33.3%)Not evaluating orusing technology/services(13.9%)Currentlyusingthis technology/service (16.5%)Planningimplementation ofthis technologywithin the nextyear (18.8%)Researching andevaluatingpurchase of thistechnology/service (33.0%)Not evaluating orusing technology/services(31.7%)Payer ProviderPayers are investing more in cloud technologies than providers
  11. 11. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.From IT Productivity to BusinessProductivityMedicineSupplyChainSmartBuildingsSocialMobileCommercePaymentFraudManagementConnectedHealth– Cloud– Big Data/Analytics– Social Business– MobilityThe Four Pillars and the GrowingSignificance of “The 3rd Platform”Intelligent Industries
  12. 12. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Big Data in Healthcare – The NextFrontierVolumeVelocityVarietyValueMobile devices, patientreported, remote monitoring,genomics , sensorsReal time data on patientoutcomes, social media,medication complianceUnstructured medical recorddata, social andpsychological dataDrivers of medical errors,best practices based ongenomics, fraud and abuseCSP = communications service provider
  13. 13. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Big Data Healthcare Use CasesWaste and abuseOutcomesTechnologyPatient engagementFraud detectionChronic diseaseAvoidable deathsRegulatory complianceQuality of careMedical researchDrug discoveryClinical trialsPersonalized medicineEnvironmental impactRe-admissionsTranslational researchPublic healthAdverse health eventsPatient complianceSource: IDC, 2012.Activity
  14. 14. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Health Information Exchange:Aggregating Data Across the Ecosystem
  15. 15. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.ACOs Will Lay FoundationalGroundwork Before Investing Widely Analytics will play an importantrole in consumer engagementstrategies. Top technology investments for2013 include analytics, riskidentification, and predictivemodeling, which will helphealthcare organization withconsumer segmentation Investment in connected healthtechnologies for consumerengagement will be limited in thenext 18 months while ACOsdeploy their analytics strategies.
  16. 16. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Home Health Home Sensors Body SensorsSocialMedical KiosksmHealthProliferating Technology = Exploding Data
  17. 17. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Big Data/Analytics InvestmentPlansPayer N = 12, Provider N = 113Source: IDC Global Technology and Industry Research Organization IT Survey, 2012Do you plan to invest in Business Intelligence/Analytics applications in the next 12 months?Providers trail payers in investing Big Data/Analytics technologiesNo (16.7%)Yes, investing inenhancements/upgrades to theexisting solution(58.3%)Yes,maintenance onlyof the existingsolution (25.0%)No (49.2%)Yes, investing ina newsolution forthe first time(2.0%)Yes, investing inenhancements/upgrades to theexisting solution(34.6%)Yes,maintenance onlyof the existingsolution (14.2%)Payer Provider
  18. 18. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Big Data/Analytics:Long Term Inflection PointsValue-based and transaction-based pricing for analyticsservices will become wide spread. Think price perrecommendation.By 2017, 25% of F500 companies will have artificialintelligence question & answer systems in place acrossconsumer industries, operating within call centers, inretail stores, etc.Real time monitoring of streaming data will becomepervasive by 2020 (today a combination of off lineand real time)Lines between service firms and software firms blur.Data finally becomes an asset.
  19. 19. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.From IT Productivity to BusinessProductivityMedicineSupplyChainSmartBuildingsSocialMobileCommercePaymentFraudManagementConnectedHealth– Cloud– Big Data/Analytics– Social Business– MobilityThe Four Pillars and the GrowingSignificance of “The 3rd Platform”Intelligent Industries
  20. 20. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Social Business:Long Term Inflection PointsSocial is redefining marketing and support to create a360° customer view.By 2020, 40% of the G2000 have redefined themarketing and customer support functions.The majority of applications become socialSocial enterprise software grows 40+% through 2016A next generation platform redefines applications aswe know them - componentizing apps into services.Merging of transaction, decision, and relationshipsystems to create the next generation platformfor the enterpriseCompany listening skills need to mature and require betterresponse capabilities – Social listening becomes animportant skill
  21. 21. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.0% 5% 10% 15% 20% 25% 30%Drive revenue generationAcquire knowledge/ask questionsMonitor conversations/activitiesSocialize with friends/industry colleaguesShare knowledge/contribute ideasCommunicate with internal colleaguesIt is a requirement for my jobConduct employee trainingMake decisionsCreate awareness about company product or serviceCommunicate with customersCommunicate with partners/suppliersCompetitors are doing itRespond to customer/partner inquiriesGather feedback on company product or serviceHow Businesses Leverage SocialSoftwareQ: Why do you conduct social media/networking initiatives forbusiness purposes?#1 in 2011#8 in 2011#10 in 2011#13 in 2011#11 in 2011
  22. 22. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.From IT Productivity to BusinessProductivityMedicineSupplyChainSmartBuildingsSocialMobileCommercePaymentFraudManagementConnectedHealth– Cloud– Big Data/Analytics– Social Business– MobilityThe Four Pillars and the GrowingSignificance of “The 3rd Platform”Intelligent Industries
  23. 23. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Mobility:Long Term Inflection PointsConsumers embrace mobile as there principal form ofcommunication and data accessCustomer engagement is key. Focus moves to real timeupdates and context.Single platform solutions melt away as devices convergeand morph, with 12.5 devices in use per connected WWhousehold2 out of 3 smart devices shipped are gesturecontrolled by 2020Customer engagement is key. Focus moves to real timeupdates and context.PCs stabilize; Win 8 is the next developer “hot spot”platform opportunityMobility fuels private cloud with a 50% CAGR
  24. 24. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Consumers Begin to Abandon PCs,Embrace Mobile for Internet Use In the U.S., the number of peopleaccessing the Internet through PCs willshrink from 240 million consumers in 2012to 225 million in 2016. In 2015, for the first time ever, there will bemore U.S. consumers accessing theInternet through mobile devices thanthrough PCs.Source: Worldwide New Media Market Model 1H-2012Highlights: Internet Becomes Ever More Mobile, Ever LessPC-Based (IDC #237459), In 2013, consumers will begun toabandon PC-based Internet usage infavor of mobile devices as theirdefault gateway to the Internet Consumer engagement strategieswill increasingly include mobilehealth applications Payers and providers will partnerwith mobile health vendors toaccelerate their mobile strategies Consumers connect to healthcentric communities and socialmedia sites
  25. 25. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved. 41.7% of respondents to an IDC HealthInsights consumer survey indicated thatthey were somewhat interested (32.9%)or extremely interested (8.8%) in a virtualonline visit. Convenience was cited as aprimary benefit Payers (and employers) will increasinglybegin to add online care services toprovide low cost alternatives to moreexpensive care settings, increase accessto providers, and support health andwellness initiatives Forward thinking providers willexperiment with online care to reduce re-admissions within 30 days, managepatients with chronic conditions, andcreate new revenue streams for theirpracticeConsumers are gaining familiaritywith videoconferencing technologyservices: 31 million Skype users as ofJanuary 20121 50 million Skype enabled TVs2 9% of mobile device users usevideo chat on their phone at leasttwice a week3Sources:1, 2 Skype Journal, Skype Numerology Research Date:9.28.20123 Qualcomm Research (8.23.2012)The Doctor Will See You Now…Online
  26. 26. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.The CIO Perspective
  27. 27. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.By 2016, LOB executives will be directlyinvolved in 80% of new IT investmentsOf the new internal IT projects initiated at yourcompany this year, what percentage will be ledunder the following scenarios?N = 57Source: IDC 2013 CIO SentimentSurvey, Fall 2012 58% of new IT investments in 2013 willinvolve direct participation by LOB executives Companies will initiate an average of 40 newIT projects in 2013 (with or without IT) Line of business’ participation in IT projectswill grow to 80% in 3 years The implications are vast on how the CIOworks with the line of businessSituation Assessment Cloud, social and mobile services are thegreat equalizers, the balance-wheel of thecorporate machinery Notable instances of CEOs and CFOs drivingthe migration to Cloud and Managed Services8%17%33%42%0% 10% 20% 30% 40% 50%Project solely led /managed by the LOBsProject led / managed byLOBs, but subject toreview by ITProject jointly led /managed by IT and theLOBsProject solely led /managed by IT9
  28. 28. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.CIOs and CFOs will move to “zero capital”and transform the IT financial modelPrediction The IT financial model is fundamentally changing Businesses will transform the IT financial model by adoptingan IT “service-based” IT operational and financial model Zero capital model will enable the business to produce trueproduct-line profitability by assessing IT (services) costsSituation Assessment In mature economies, 50%+ of all capital equipment is IT As expensive as IT is, most orgs do not fully allocate capitalor expenses to business units There are major business and economic issues with broadimplications Strong business impetus to shift computing platforms tomore capital efficient models – cloud, outsourcing, etc.Capital LeanCapital Intensive11The Zero-Capital IT financial model meansIT shifts from SG&A to a true product lineexpense
  29. 29. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Consumer Engagement– Solution Evolution 2012-2020AnalyticsActionable InformationCommunications / AlertsDataWarehouseBusinessIntelligencePayer ProviderConsumerProvider PortalPayment /Revenue CycleManagementProvider andContract NetworkManagementHealth 2.0 / SocialNetworkingCore /AdministrativeProcessingHealth / WellnessPHR / PatientPortalTraditional CRMRisk SegmentationAnd ManagementCustomer Salesand AcquisitionProvider PatientEngagement/ConnectedHealthReferralManagementContractManagementHIEHospital ISClinical IS / EMRPopulation Health,Care and DiseaseManagementThrough 2020, the caremanagement vendor marketwill lead consumerengagement investments.Additional markets activelyincorporating consumerengagement strategies andtechnologies will include:• Traditional CRM• Portal• Health and Wellness• Analytics and BusinessIntelligence• CommunicationsExpect active partnerships,if not acquisitions, amongthese vendors through atleast 2016.
  30. 30. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Questions?Scott LundstromGroup Vice President – IDC Health InsightsPlease feel free to email me at:slundstrom@idc.comOr join me and your peers and theconversations in ourIDC Health Insights CommunityThe Business of Healthcare + Technology(http://idc-insights-community.com/health)
  31. 31. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Appendix
  32. 32. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Acronyms ACA Affordable Care Act (aka PPACA) ACO Accountable Care Organization AHA American Hospital Association ALOS Average length of stay ARRA American Recovery and ReinvestmentAct of 2009 BYOD Bring your own device CMS Centers of Medicare and MedicaidServices CER Comparative effectiveness research EHR Electronic health record EMR Electronic medical record FQHC Federal qualified health centers GDP Gross domestic product HCO Healthcare organization HIE Health information exchange HIX/HXE Health insurance exchange HIMSS Healthcare Information andManagement Systems Society HIPAA Health Information Portability andAccountability Act HITECH Health Information Technology forEconomic and Clinical Health H&W Health and wellness HIS Indian Health Services IHI Institute for Healthcare Improvement IOM Institute of Medicine JCAHO Joint Commission on Accreditation ofHealthcare Organizations, now knownas the Joint Commission OCR Office of Civil Rights OIG Office of the Inspector General ONCHIT Office of the National Coordinator ofHealth Information Technology PaaS Platform-as-a-Service PCMH Patient-Centered Medical Home PPACA Patient Protection Affordable Care Act of2010 (also ACA) PHI Protected Health Information PHR Personal Health Record RHIO Regional health information organization SaaS Software-as-a-Service
  33. 33. © IDC Health Insights. Reproduction is forbidden unless authorized. All rights reserved.Terms of Use PolicyExcept as otherwise noted, the information enclosed is the intellectualproperty of Health Industry Insights, an IDC company. Copyright 2012 -Reproduction is forbidden unless authorized. All rights reserved.Please refer to Health Industry Insights’ Terms of Use policy athttp://www.idc.com/HII/PR/PRtermsofuse.jsp for more informationabout our terms and conditions.If you have any questions regarding permissions and restrictionsregarding our brand and content, please contact Mary Conroy at508-988-6746.

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