This article is about healthcare analytics, based on the IBM Institute of Business Value report by James Cortada, Dan Gordon and Bill Lenihan. The article helped to set the scene for our first healthcare SmartCamp event in Miami last month.
Healthcare organisations around the world are challenged by pressures to reduce costs, improve coordination and outcomes, provide more with less and be more patient-centric. Yet evidence is mounting that the industry is increasingly challenged by entrenched inefficiencies and suboptimal clinical outcomes. Building analytics competency can help these organisations harness "big data" to create actionable insights, set future vision, improve outcomes and reduce time to value.
With increasing demands from consumers for enhancedhealthcare quality and increased value, healthcare providers and payers are under pressure to deliver better outcomes. Primary care physician and nursing shortages require overworked professionals to be more productive and efficient. The cost dynamics of healthcare are changing, driven by people living longer, the pervasiveness of
chronic illnesses and infectious diseases, and defensive medicine practices.
Analytics can provide the mechanism to sort through this torrent of complexity and data, and help healthcare organisations deliver on these demands. To determine how to apply analytics to their current challenges, gain insight and achieve faster time to value, we asked 130 healthcare executives from around the world the following questions:
l How are healthcare providers and payer organisations applying analytics?
l How do high-performing organisations use it differently from their peers?
l What are the barriers to adoption?
l What forward-looking analytics innovations can healthcare organisations apply to meet their mounting challenges?
Through our analysis of our interviews with executives, we advanced our understanding of:
l Why analytics competency is more important than ever.
l The analytics sophistication model.
l The barriers to analytics.
l How top-performing healthcare organisations are using analytics to influence outcomes, create differentiation and drive revenue growth.
Healthcare organisations need to use analytics to accomplish a broader range of objectives than industry at large. In analysing healthcare responses to the 2010 MIT survey, we found healthcare professionals use analytics to set their future vision, define their brand and drive revenue growth to achieve specific clinical and administrative objectives. Among executives surveyed, 58% of healthcare high-performers stated business information and analytics differentiate them from others in the industry, compared with only 36% of other healthcare organisations.
The difference between top performers and others is even more distinct when measuring how rigorous their approaches to decision-making are. Among high performers, 42% said their decisions were based on rigorous approaches, compared with only 28% of others.
Additionally, top-performing organisations use analytics to guide strategy, perform product research and development, and for sales and marketing. Again, the difference between top-performing organisations and others in the industry is pronounced. For example, 54% of top performers said they used analytics to guide future strategy, compared with only 32% of others. Further, 59% of top performers used analytics for product research and development, compared with only 36% of others. And 65% of top performers used analytics for the development of sales and marketing, compared with only 40% of others.
Despite the advantages that can be offered by the application of analytics, a number of barriers can halt or slow adoption. Even in the midst of the information explosion, the ability to get relevant data was cited by almost 40% of study participants as the biggest stumbling block for widespread analytics adoption. This is not to imply that data is not available, but goes back to the data paradox,
in which the sheer amount of data that must be analysed inhibits the development of meaningful insights.The key capabilities in getting the right data were the ability to integrate data from multiple disparate sources
and standardise it to ensure consistent definitions throughout the organisation. Interestingly, high-performing organisations are more likely than underperformers to say they are not adept at capturing appropriate information – 35% of healthcare high performers said their organisations performed poorly in capturing information, compared with 14% of others.
Many of the biggest barriers to analytics adoption are organisational. Chief among these is a culture that does not encourage information sharing, cited by 35% of our respondents as a primary obstacle. Lack of understanding about how to use analytics to improve business is an additional barrier experienced by more than a third of our study participants. Other organisational barriers include insufficient management bandwidth due to competing priorities, absence of executive sponsorship, lack of skills internally in a line of business, and not knowing where to start the quest for analytics excellence.
No matter what the analytic sophistication, an analytics vision and information agenda is a necessary tool to align the efforts of the many stakeholders, who will need to mould both structured and unstructured data into an integrated, consistent and trustworthy information foundation. Every phase of implementation needs to align its data foundation to an overall information agenda that accelerates the organisation’s ability to share and deliver trusted information across all applications and processes.
As a result, integration of disparate information is a necessity, as are consistency and standardisation of data throughout the organisation.