hiddenAs a US taxpayer, Information Technology professional, and one who feels that healthcare spending is waaaay too high and increasing too rapidly, I have high hopes for the latest push on healthcare IT.  High hopes, but, frankly, tempered expectations!

Process Literacy and Automation

Marketplace business competition is a wonderful thing.  It forces operational excellence – to beat your competitors, you have to have the highest quality, lowest cost ways of providing your product or service.  This competitive pressure has led companies, industry by industry, to reengineer their business processes.  Manufacturing, discount retail, high technology, financial services – all stepped up to the reengineering challenge over the last 10 to 15 years.  In some cases, it was a strategic preemptive strike designed for a major competitive advantage – think WalMart and its supply chain initiative, or Federal Express and its reinvention of overnight package delivery.  In other cases, it was a response to someone else’s first move – think the US auto industry response to Japan, Inc. in general, and Toyota in particular (In retrospect, too little, too late?)

The point is that throughout industry and commerce, across the globe, competition has forced process discipline.  It was not just that these companies reengineered their major business processes – they also institutionalized “process thinking.”  They manage their work through end-to-end processes (e.g., order-to-cash, procure-to-pay, hire-to-retire, supply chain), and have a culture of continuous process improvement.  They are lean, cost-effective and agile – these were perhaps the most valuable legacies of the reengineering movement.  They busted silos (see my recent post on Bustin’ Silos With The Role Bomb!), established metrics that drive improvement, flattened their organizations, and engaged their entire workforce (and suppliers and customers) in the relentless push for continuous process  improvement.

Many Healthcare Institutions Lack Process Discipline

And there’s the rub!  While industry and commerce have either jumped into process management, or been dragged into it by their competition, most healthcare institutions have not traditionally focused on end-to-end process management.  Within silos, you will often find good processes, and, to be clear, most institutions are staffed by highly trained and dedicated professionals who do an excellent job providing healthcare.  However, they have not had to tackle the kind of cross-functional reengineering that competitive industries have been dealing with for a decade or more, and that are necessary for deploying and gaining benefits from Electronic Health Records.

And yet, with Electronic Health Records and the US government’s $17 billion stimulus package for doctors and hospitals that adopt EHRs, processes will have to be reengineered (and then continuously improved).  And this has to be done against a highly accelerated timeframe.  And that’s what worries me the most.

How Long Does it Take to Master Process Discipline?

From my experience and based on many enterprise system research projects I’ve been part of, most enterprise reengineering efforts take about 3 years of “heavy lifting” and about another 2 years to “settle down” and really start to deliver their benefits.  Many health care institutions are on a much faster fuse than that – I hope they make it!

Is There a Fast Path to Healthcare IT?

In industry, some viable alternatives to wholesale process reengineering and ERP deployments surfaced about half-way through the primary reengineering era (say 1990 to 2005).  These included business process outsourcing.  Companies from American Express to BP outsourced their “back office” processes.  And it was not just back-office processes that were outsourced.  Companies such as Solectron (now part of Flextronics) and Flextronics took over electonic design, manufacturing and logistics services from many household names in electronics, freeing them to focus on sales and marketing.

Perhaps we will see similar moves in the heathcare industry.  In fact, earlier this year I posted on The Wal-Martification of Healthcare IT and one particular initiative targeted at small physician groups.  This may just be the beginning of a major restructuring of the healthcare industry.

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