Healthcare executive inboxes across the country are filled with newsletters highlighting articles that cry, “Apple, Google, and Amazon are coming for your physicians and patients!” Between the attractive growth opportunity offered by the massive $3.3 trillion US healthcare market, and the aging technology infrastructure, tech companies are eagerly making plans to solve the persisting problems in healthcare. Incumbent healthcare executives have every right to be nervous. In just the first half of 2018, a number of initiatives and new innovation collaborations involving technology-focused competitors were announced:
- January 24, 2018: Apple launches a significant update to the Health app that allows patients to access health records via their iPhone
- January 30, 2018: Amazon, Berkshire Hathaway, and JPMorgan announce a partnership to tackle challenges in employer-sponsored health plans
- February 27, 2018: Apple announces the launch of AC Wellness, a chain of clinics available to employees and their families and presumably a test bed for future Apple health products
- March 5, 2018: Salesforce partners with Cerner (and an early-adopter provider if they’re smart) to better manage patients and their data in-between healthcare encounters
- March 5, 2018: Google launches its Cloud Healthcare API to drive interoperability
- June 4, 2018: Apple opens up the Health Records API to developers, potentially enabling the creation of a functional Health App Store
These newly emerging adversaries have an enviable track record in bringing new technologies to market and a focus on delivering value over a long-time horizon, not to mention possessing significant profit dollars that can be reinvested in R&D. However, healthcare organizations have assets that all of these technology companies covet, including access to patients, physicians, and the most precious currency of the 21st century, data.
The prospect of combining tech companies’ new product development expertise with healthcare organizations’ people, patients, and data makes one excited about the future of healthcare. Assisting healthcare organizations in partnering with technology companies is one of the most satisfying parts of my work at Healthbox. However, all too often, organizations limit their choices to buying technology off the shelf or hiring a development team to build a custom solution. When thoughtfully executed, innovation collaborations can yield tremendous results. To maximize the odds of successfully building solutions with technology partners, healthcare organizations should focus on these key steps:
- Problem / Opportunity Identification
Organizations absolutely should not rush to adopt the latest technology for the sake of appearing innovative (I’m looking at you AI and blockchain). By immediately jumping to potential solutions, organizations run the risk of investing resources in a solution without a clear problem. Begin by identifying and understanding the core pain points preventing your organization from achieving its strategic goals.
- Asset Inventory
Once you have highlighted the problem(s) worth solving, take inventory of your organizational assets. This serves two purposes: first it identifies the people, processes, or technology that can be leveraged to develop a comprehensive solution, and second, it sheds light on gaps to be addressed before the solution can be commercialized.
- Business Model Ideation and Partner Selection
The final step to craft a successful collaboration is to explore alternate business models and identify best-fit partners. It is common for new technologies to struggle to gain broad adoption until customers get comfortable with new business models. For example, cloud-based software didn’t take off until large organizations got comfortable with the SaaS business model. Spend some time discussing how your collaborative product could be monetized and be sure both organizations stand to benefit. Lastly, an innovation collaboration partner should have complementary assets. Most of the time, your organization will have data and access to patients, while your prospective partner will have technology expertise, but use the asset inventory developed in step 2 to ensure you are thinking beyond the obvious.
At Healthbox, we strongly believe the only way to make innovation repeatable is to apply a disciplined decision-making process to your innovation efforts, including partnerships. Without a repeatable process, you won’t be able to discern the role that luck played in the ultimate outcome.