Principal, CIO Advisory
I spend half of my time meeting with IT leaders and consumers talking about trends and industry practices, trying to understand the challenges and successes around running IT in the healthcare industry. The other half is spent delivering technology and business solutions that help healthcare payors, providers, and life sciences companies improve their IT and business operations.
A common theme I hear from healthcare IT leaders is their desire to be seen as more relevant and strategic. Coincidentally, that’s exactly how the business indicates they want to see IT evolve. Since both constituencies have the same goal, why isn’t that happening? Common symptoms we hear include skill set gaps, credibility, and trust. When we dig deeper into trust, we find IT organizations lack the necessary tools and processes to communicate with their business counterparts about the business of IT. This lack of transparency, or a common language, is really the root cause of the trust issue.
Run IT like a business
Organizations challenge their CIOs every day to create greater value more quickly and show a better return on the investments. Meanwhile, the pace of business and regulatory change in healthcare continues to increase while prospective policy buyers expect new and potentially disruptive technologies to be part of the overall policy package.
These changes put tremendous pressures on CIOs. IT needs to support the business with greater speed, agility, and efficiency, while ensuring quality, compliance, and security. The past few years of reacting to the Affordable Care Act has been a hindrance to advancing the business of IT and, as a result, healthcare IT executives are more likely to perceive themselves as being behind the curve in leading this transformation.
IT organizations must have a team with an integrated set of capabilities that enables leaders to holistically manage the business of IT. These capabilities must then connect practices and information from various areas of IT to effectively enable the business of a technology organization. Running IT like a business creates a transparent environment–both from a delivery and cost perspective–and allows the business and IT to have informed business discussions on technology investments, often leading to better alignment with the business goals and greater return. This transparency, along with accurate IT cost information, is a cornerstone of Technology Business Management (TBM).
TBM is the foundation
TBM is a purpose-built platform for IT that enables a practical, customer-focused approach to IT management with the use of data to analyze the cost of running the business. This sort of transparency provides IT with the insights to have informed discussions about the return and total cost of ownership of potential IT investments and the impact it will have on medical loss ratios.
Healthcare payors have been slow to adopt TBM relative to other industries. Recently, an industry-agnostic TBM Council of more than 600 CIOs and senior IT leaders met to continue the evolution of TBM and TBM standards. Industry specific work groups were commissioned, including one for healthcare that Mike Brady (Kaiser Permanente) and I co-chair.
While other industries have had a head start, healthcare should have little problem advancing in this space, and can reap the benefits by learning from other industries’ transformation journey experiences before they embark on their own.
Denis Berry is KPMG LLP’s U.S. Healthcare & Life Sciences Technology Leader. Learn more about KPMG’s Technology Business Management approach by reading Moving Information Technology from a Cost to an Investment.