NASHVILLE, November 29, 2018 – Seventy-eight percent of healthcare enterprises say their digital initiatives are failing, according to results of the first healthcare-only Digital Transformation Readiness Survey released today by emids, which commissioned Everest Group for the research.
Surprisingly (and unique to healthcare) 57 percent of respondents cited internal alignment as one of the biggest barriers to digital transformation. Conversely, digitally mature healthcare organizations that have embedded digital into their very DNA are making quantum leaps, the survey found, compared to less digitally mature organizations.
“The results of this survey have been stunning,” said Abhishek Singh, vice president of Everest Group. “Industries have always conflated digital and IT transformation. The idea that they should be driven by discrete objective functions is a clarion call from healthcare executives participating in this study. Digital is primarily centered on business goals – patient experience, membership growth, or revenue maximization – largely (if not entirely) led by technology. IT transformation is one step that enables this ‘digital’ goal.”
Not surprisingly, the survey found that healthcare lags behind other industries in transforming business models through technology. Core banking and retail marketplaces were outcrops of sound strategies that broke barriers of business friction and enabled data-driven collaboration. However, the results of the Digital Transformation Readiness study show that senior healthcare executives are warming up to enabling operational transformation and business transformation through technology.
“There’s a growing awareness among healthcare organizations that digital is an enterprise-wide business mindset and not just a series of siloed digital projects and pilots,” said Saurabh Sinha, founder and CEO of emids. “This research confirms that if you really want to impact cost then you have to design for it. That starts with a vision of your future state so that you can reverse engineer systems and solutions to reach that goal. Even more important to digital success is an embedded culture of innovation across the organization, supported with investments that enable that journey.”
Leading healthcare enterprises think about their journey to digital transformation as a series of many smaller steps (not necessarily a big bang), with commonly defined, accepted and communicated goals. The survey of 76 healthcare organizations (including providers, payers, clinical research organizations and health tech enablers) revealed that leading enterprises that have embraced digital transformation generated two times higher impact in strategic areas and are three times more likely to achieve improvements in operational metrics.
Four key principles emerged that leading organizations use to reach success in digital transformation:
- CEO and Board Buy-In: Leading enterprises have 30 percent higher CEO involvement in outlining the IT strategy versus other enterprises. Leading enterprises are increasingly focusing on aligning their IT strategy with the overall corporate strategy, thus having higher CEO involvement in the IT strategy development.
- Empower Market-Facing Units: Leading enterprises take a more federated model with ownership of financial decisions and empower market-facing units to fund and execute digital objectives
- Digital Transformation Fund: Instead of funding the innovation efforts from the annual IT budget, leading enterprises are 30 percent more likely to have established separate funds for innovation and digital transformation initiatives.
- Ecosystem of Third-Party Relationships: Leading enterprises are three times more willing to tap into external innovation ecosystems.
The research findings, which were first revealed at the emids 5th Annual Healthcare Summit in early November, were very much in sync with perspectives shared throughout the Summit. During panel and hallway discussions throughout the day, top executives from across healthcare industry organizations, along with digital leaders from top consumer brands such as Under Armour, Lyft and Fitbit, said mindset and culture were more important to successful digital transformation than digital technologies and toolsets.
Healthcare organizations interested in taking the survey to see how they compare to their peers can do so at https://www.emids.com/digital-transformation/.
About the survey
The Digital Transformation Readiness survey—conducted by Everest Group with sponsorship from emids—is based on learnings from the Everest Group Pinnacle Model™ analyses and assessments, which help enterprises across multiple industries understand how much opportunity they may be leaving on the table with their current strategies and capabilities. The core utility of the survey results is to help senior healthcare executives build internal business cases to drive their digital agenda and achieve outcomes. This is the first such study that evaluates the digital readiness of healthcare enterprises. Learn more here.
emids is a global provider of healthcare technology expertise and consulting services and solutions that serves payers, providers and tech enablers. Headquartered in Nashville, emids helps bridge the critical gaps in accessible, affordable, high-quality healthcare by providing advisory consulting services, custom application development, and data solutions. Services include EHR application deployment and management, analytics, data integration and governance, digital solutions, software development and testing, and business intelligence. Visit emids.com.