A quick Google search for “innovation in health care” will return upwards of 500 million results in just 0.5 seconds. Innovation has become a buzzword that encapsulates all of health care’s cutting-edge happenings, including technological developments, consumer-friendly physical locations/touchpoints, different payment models, new pharmaceuticals, trendy executive titles, and so much more.
Amid all the noise surrounding the topic, three key questions quickly surface:
- Does being innovative really matter for hospitals and health systems, or is it all just hype?
- If innovation does matter, how can my organization “get good” at it?
- Even if we become a more innovative organization, it seems like many people are doing the same. How do we stand out?
How would you define innovation and why is it important in the health care space?
Innovation is doing something outside the box—pushing the envelope. This can be packaged any number of ways depending on what your organization’s capabilities and priorities are—but any way you slice it, it’s highly important.
Health care has become increasingly competitive on all sides. To name a few: physicians and nurses are in high demand; there are more types of care sites than ever before; new competitors are breaking in suddenly and forcefully; the shift to value is changing both volume and payment; and the increasingly consumerist patient population is taking the reins to demand more ease, access, and affordability all at once.
As these changes swarm and hospital margins threaten to shrink further, focusing on innovation might feel counterintuitive—but it’s really the only way to survive.
What is the “bread and butter” or the “basics” for becoming a more innovative organization?
There are a few early steps I’d recommend.
First, everyone from leaders to entry-levels need to buy in. Executive support is crucial for gaining the financial and operational traction needed to take innovations from ideas to real steps and metrics. Engagement from the rest of your clinical and nonclinical staff is also critical because they are the ones who are often closest to the problems that need to be solved or the opportunities that can feasibly be capitalized. Their minds are often full of untapped potential—we just need to ask and really listen. The practice of listening intently is crucial if you want to succeed in this space.
Furthering that, a second piece is that you need is a structure and process that supports smart and sustainable innovation. While you can make small changes without an intentional foundation, truly innovative companies empower and enable innovative efforts by:
- Creating a framework, process, and strategy for how innovative ideas and projects will be captured, vetted, pursued, launched, and measured
- Building a dedicated or a focused team (and governance) that carries out that framework
- Spreading the word internally to rally the troops, inspire creativity, and detail the requirements for idea submission and processing
Lastly, I’m reminded of a Harvard Business Review report that gives five key traits and accompanying action steps for innovation leaders. It recommends linking some compensation to innovation, only making data- and customer-based decisions, embracing necessary failures, and more. Definitely worth a read.
As a quick “case study” if you will, what has that process of diving deeper into innovation looked like at SCP Health?
My position—at least in its formalized “VP of Innovation” state—is only about ten months young at this point, and that was a big step forward. SCP leadership was willing to say that thinking differently is a priority—and take action to prove it.
Once that role was established, the first thing that Lisa [Fry, Chief Growth Officer], my colleague Monica Nash, and I worked really closely on was an innovation playbook—which is in a sense a strategy. We looked comprehensively at company goals, enterprise values, and our current diversification state in order to lay out this whole framework of how the two sides of the innovation team’s accountabilities would look.
We determined that 50% of our duties would be to develop internal ideas, as well as new solutions for our current and prospective partners—organically grown things. We set a specific set of sequential steps, as well as processes and resources within each step, for soliciting/receiving an idea and either moving it all the way through to maturity or deprioritizing it. As mentioned, this included developing intake forms, evaluation criteria, performance trackers, a centralized inbox for employee ideas, and more.
We mapped the other 50% to fall under partnerships and acquisitions. The initial process looks similar here; there are still a set of steps that we laid out to ensure that we follow the same blueprint of due diligence each time. We examine these prospects from all angles: consumer/patient demands, economics (cost avoidance, savings, new revenue), market trends (saturation, growth), scalability, and value alignment—just to name a handful. We are a bit of an incubator—we serve as relationship builders, project managers, negotiators, evaluators, pilot runners… you name it. We help run the show until it’s time to either terminate the trial or transition a successful project from the innovation team’s oversight to the operations team’s for further incorporation into the heart of the business.
I recently read a Becker’s post sharing why 31 hospital and health system leaders believe innovation is increasingly influential . How do you think outside the box differently than everyone else?
To start, you have to decide to do it and then really do it. There’s often talk and big ideas without action and big follow through… so stand out by living it out.
You also can’t worry too much about what everyone else is doing. While it’s good to be engaged in competitor and industry analysis, you have to stay primarily focused on who you want to impact, the real reason you’re innovating: your patients. Look at your specific community demographics and needs, lean on the brains of a diverse set of people in your organization, and be willing to challenge “the way we’ve always done it.”
It might sound simple, but it can’t be easy. Is there anything to be wary of when it comes to the innovation journey?
Absolutely—and thinking that there won’t be road bumps is naive.
Change fatigue is real. Organizations in general are going through tectonic transformations in the business climate we are in, and driving the way is the push to digitization. Hospitals specifically have seen this in a big way with EHR implementations, optimizations, and upgrades. I think Rosabeth Moss Kanter and David Garvin, Harvard Business School Professors, summarize change fatigue the best;
“Change efforts fail for two main reasons:
- Poor design. These include the failure to address the underlying processes used to get the work done (for example, the performance management system, or the way resources are allocated), relying on IT to provide the magic bullet, and not explicitly tackling the necessary behavioral changes.
- Poor communication. A change initiative is like the start of a marathon: change will be occurring rapidly in some units, whereas in others it won’t even have gotten under way. Change leaders need to be prepared to give the same speech at least six times or it won’t get heard.”
As SCP’s innovation leader, I especially like that last part—and six times for the same speech is an underestimate in my opinion. For large organizations who are getting innovative inside and outside their four walls, it’s probably more like sixty over the course of a year.
Risk-orientation is important to be aware of too. You can’t be afraid to fail, but you do have to have some sort of barometer that asks “if all five of these innovations don’t work out, will we have learned anything from them still… is the value coming in worth the cost of trying?” You can’t jump at any shiny new things, but you also can’t be afraid to jump at the right things.
