When we went on a cruise four years ago, one of the items we distinctly remember was that there were two things in every port. They were advertisements to buy discounted jewelry at select stores, and a Señor Frog’s. Señor Frog’s is a Hard Rock Café for grownups. For those of you who were not around before the Internet, Instagram, and online ordering were pervasive, one of the ways to advertise you had been to a certain city was to buy a t-shirt from the Hard Rock Café there. They even had two separate lines for those who wanted to eat, and those who wanted t-shirts.
Señor Frog’s is the 21st century equivalent, except you drink and get souvenir glasses along with the t-shirts. Considering a cruise spends anywhere from 4-8 hours in port, visiting there is literally stepping off the ship, going there, drinking, eating, and getting back. You budget in some extra time to get ahead of the people who spent a large amount of money on jewelry and other items in port. At the end, you get your swag that says you spent time in an exotic locale just like the kids in school with Hard Rock Café shirts from London or Cancun. However, it was the most cursory of visits. It is the equivalent of visiting cities just to see the train stations and what ketchup they serve, like Dr. Sheldon Cooper did on The Big Bang Theory.
The Hard Rock Café and Señor Frog’s experience is very much like how the business has structured engagement with IT. Instead of experiencing the whole workflow with them, often they do the equivalent of buying margaritas or the same Double Bacon Cheeseburger from us that they could get back in their home cities. They do this while getting the t-shirt or matching set of shot glasses as evidence.
How did we get here?
When IT first came into the healthcare environment, it was to support business functions. It has traditionally been thought of as a transactional service. With the advent of Electronic Medical Records, IT began to have a seat at the table and took some part in strategic initiatives focused on digitization of patient health records. However, with the emphasis on Cloud Services and outsourcing, especially with several major health systems outsourcing their technology business functions, we’re seeing IT take a back seat once again. It’s as if now that the organizations have the big EMR systems in that they can go back to how things were. Technology is now so pervasive, especially with the use of Intelligent Systems, that it is no longer transactional like a trip to an island-themed bar with swag on a cruise. We need to include technology in our strategic plans to better increase their ability to fulfill the mission in concordance with the values of our organizations. This is no longer the time of silos and keeping IT behind the Data Processing door in the basement of the building next to the hospital.
IT has evolved from being just a service to being and supporting the digital hub that enables information flow from numerous sources to numerous destinations. As healthcare expands to include telemedicine, remote monitoring, patient access to Application Programming Interfaces (APIs) via the CURES Act, advanced analytics, command centers, and the extensive use of Internet of Things and Medical Things to improve patient care, we can no longer operate like we did before. With the added pressure to be excellent stewards of the finances entrusted to us, we have to expand the role of IT to cover the whole journey, not just a small part of the trip.
This article covers the pitfalls of the traditional approach, how it causes multiple issues with initiatives, and how we can use strategic management and planning to address them. As health systems evolve from the hospital where people go for care on-site to facilitating a continuum of outpatient and inpatient care, IT needs to be a part of the discussion and strategy as to how to meet the evolved mission while still living the values.
What does the traditional approach lead to?
This leads to a lot of technology that gets put into place to support customers, with no forethought as to the effects of our actions. Today we want to cover this by first, looking at the root causes behind the Señor Frog’s approach, which are: focus on short term profits by health systems and vendors, focus on long-term project Return on Investment by cutting costs, and trying to emulate larger health systems. We will then cover what we can do to address these concerns.
Both health systems and vendors are driven by the market. Health systems that offer bonds are governed by covenants that require them to have a certain funding amount in the bank. They also have to maintain a large amount of Days Cash On Hand, which according to Becker’s is 211.8 days on average. Moody’s and S&P consider this ratio in the credit rating of health systems, which directly affects the amount of interest they are charged to borrow from the markets. The emphasis on financial performance is significant. This blinds people to the effects of their actions.
Likewise with vendors, many of them operate on a quarterly sales cycle. There is a lot of emphasis on getting deals closed before the end of the quarter. There have been some companies that got into significant trouble by booking in-flight deals as occurring in previous quarters. However, this means that companies will put as much pressure as possible to get deals signed and systems live, no matter the cost. This can lead to rushed implementations and lack of preparation as due diligence is bypassed in favor of saving 20%. The sales trick of dangling end of quarter incentives almost always works.
To justify these expenses, organizations will often assume that IT expenses are sunk costs. What this means is that many of the categorized expenses for specialized IT resources are taken out of the costs and assumed to be part of IT standard work. This has the effect of shifting the expenses from a potential profit center in the project or initiative to a cost center. This increases the Return on Investment by a few percentage points. As they are evaluated for profitability, this makes them look more appealing to senior executives and the board and increases the probability of their selection. From experience, this also means that IT managers will be contacted outside of standard project governance, often by a call to the CIO or other C-suite members and asked for a favor to get this important project for someone with a title completed.
This leads to disengagement because often the team has spent significant time and resources explaining to the customer exactly what needed to be done. All that work gets thrown out and they are asked to complete the work with little, if any, of the resources needed. Security and management processes are not budgeted for or even thought of. The potential for a data breach significantly increases because any thought of budgeting for operational management, upgrades, or security is thrown out.
Also, what happens is that managers or directors who care more about upward mobility and face time with senior leadership to look good, even at the expense of their teams’ well-being, will likely be consulted instead. They will be asked if they would complete the project without even looking at the scope of work. Many times, they will do it.
The project will not meet expectations, and IT takes the blame. This leads to further disengagement because of work being heaped on top of people with little planning or forethought. We would not want to be working for one of those upwardly mobile managers, because likely any issues would be blamed on their team members. This means that people who are in the unlucky position of working for one of them get disengaged and find someplace else to work. This also rewards bad leaders focused more on being promoted, and less on their team.
Another common occurrence is that there are managers or executives who make quick decisions. They will see a presentation about what a larger academic health system has done to address one of their concerns and decide to implement what they have done almost immediately. They do not take into consideration that these larger academic health systems have significant resources and processes providing support that contribute to those improved results. They just see that buying the magic product helped <insert large system name here> improve. These products get pushed through senior leadership, and often it is IT that tells the customer that what they want is not possible or feasible due to the supporting structures not being there. Attempts to bring quick equivalents into existence will often fail. So will the project.
This turns IT’s involvement from organizational initiatives from a journey along with the client teams to the equivalent of a trip to Señor Frog’s for the business. Instead of understanding the client’s needs, or getting a deep understanding of the business, IT is viewed as a group of tech people that are separate from it that are only called when someone important wants something. They are viewed as a 4-hour stop on a 7-day cruise where you get t-shirts and glasses to prove you were there. That bad hangover and sickness from the bender is blamed on IT/ Señor Frog’s, not the people who overdrank, impulse bought swag, and then went back on a ship.
How do we evolve?
This starts from the top of the organization. The CEO and board need to communicate that no initiative goes through without the involvement of IT. They need to have a CIO that will stand up to the other members of the C-suite and be an actual leader that stands up for their team. The C-suite needs to agree that project and initiative requests will have realistic breakouts for IT, networking, security, and operational management resource needs. IT needs to be involved from the initial discussions to the project completion. Management or leadership that take shortcuts will be made examples of, and not in a good way.
There are two ways to do this. One is through governance of scarce technology resources. An IT organization that is continually chasing projects for People Who Think They Are Important does not have time to do this level of analysis. They are lucky if they get funding for team member raises for the ones who will stay and deal with the dysfunction and lack of leadership. Having a CIO who maps out the resources they have and determines along with other members of the C-suite which initiatives are important is critical. If someone decides that the initiatives they need to execute on exceed the resources IT has, they have to pay for additional ones to get them completed. Leveraging C-suite governance to determine importance and where scarce resources go is an important first step. Also, asking departments to pay for resources they need determines what is important to them.
The second is through shared strategic planning. The IT plan must support and be a subset of the organization’s. It must map to the same core pillars and support the same key strategic initiatives. This is important to communicate what the organization is doing to move forward. Resources and budgets need to be mapped to them. This has to be supported by the C-suite.
This takes forward-thinking leadership. For many years, IT was thought of as Data Processing, or an outgrowth of finance. As healthcare organizations have evolved, the dependence on technology has had an exponential increase. The old leadership who came of age when doctors charted on paper and used computers for payroll and accounting have mostly retired. In their place we have Electronic Medical Records, Internet of Medical Things, Intelligent Systems, and digital strategies.
Supporting them as part of a long-term organizational strategy to survive in a highly competitive and regulated environment takes more than a 4-hour trip to Señor Frog’s. It takes being there for the entire journey and planning for it, not just claiming you’ve been there and showing t-shirts and swag to prove it.
