A recent Accenture survey showed that 90 percent of healthcare chief strategy officers think new technologies will disrupt the industry over the next five years, but only 13 percent feel they are prepared—far less than peers in other industries. Worryingly, another study identified Healthcare as the ninth most susceptible industry to future disruption.1 One clear signal of disruption? Over 120 hospitals have closed since 2012.2
One reason for worry is new healthcare players, particularly technology companies and startups, are more agile. These players often measure product lifecycles in months while incumbents work with products that are years or even decades old. The shorter product lifecycles are directly related to the new entrants more nimble governance and decision-making processes. If traditional healthcare companies want to compete with relevant new products and services of their own, they must start with reinventing how decisions get made and who makes them.
Death by a thousand cuts
Health leadership is often very focused on the big investments (e.g., precision medicine, AI, new facilities) while neglecting the basics of good governance and decision-making processes. Current approaches are not nimble enough for the consumer-focused health economy, that is more digital, more consolidated, and with increasingly blurred payer/provider lines. This new reality creates infinite opportunities for players to serve members and patients in new ways, with enhanced products and services, and drives a need for speedier decision making.
Slow decision-making that builds consensus in traditional ways is akin to death by a thousand cuts. One payer faced six-month delays in its over $200M project portfolio that threatened loss of market share. Requirement review calls at this payer routinely had up to 100 attendees, effectively paralyzing decision making.
Three things health leaders need to change
Accenture Strategy research shows organization with strong decision-making structures perform better.3 Leaders can improve governance and decision making by focusing in three areas.
Slow Down to Go Fast: Harness the Power of Networks While Maintaining Accountability
Addressing increased customer expectations with more responsive products and services requires cross-functional solutions. Successful leaders will harness the power of their personal networks to build relationships and decision-making structures across the organization. While collaboration is often perceived to be slower than unilateral decision making, it is essential to create innovative, cross-organizational solutions required to address healthcare’s most pressing problems and to move from a compliance culture to an accountability culture.
The risk of dispersed accountability can be mitigated by assignment of decision rights. One leader needs to be identified as responsible for decision making and held accountable for results. Doing this right unleashes the transformative power of clearly assigned decisions rights.
For example, one payer established a new customer experience committee that set the strategy and coordinated activities across all member-facing departments. The intent was to increase focus on customer experience by establishing accountability for a common customer satisfaction metric and breaking down organizational silos. While initially perceived as an additional decision-making layer, results showed that the increased collaboration and accountability had the desired goal of improving customer satisfaction.
Fail Fast for Long-term Success: Use Analytics to Act with Agility
Leaders must be able to react rapidly to elevate the patient experience and build customer loyalty. This means installing a member-focused, data-driven, iterative design approach that allows the organization to fail fast and build on those learnings. This applies across the spectrum of activities from strategy development to detailed process designs. Leveraging data and analytics enable decision-making in a more agile way.
For example, a regional payer facing membership churn of over 30 percent installed an analytics-driven member retention program and identified members at risk of switching health plans. Leaders leveraging insights could make quicker decisions to design and trigger member retention campaigns and improve customer service interactions.
Keep Your Eye on the Prize: Use Data and Analytics to Focus on Outcomes and Empower the Front Lines
Organizations need to be outcome-obsessed. Data and analytics help quantify value and allows for decisions to be pushed down and made at the appropriate organizational level. The insights empower the front line and improve transparency across the organization.
For example, nurse managers often labor over spreadsheets to create and manage the staffing schedules, balancing a range of factors such as the current forecast for services, the nurse resources available and various union rule constraints. A west-coast health player is developing an analytics-driven Nurse Scheduling Solution that increases operational efficiency in hospitals by analyzing patient data and forecasting number of patients, care hours, and other relevant variables.
The decision speaks for itself
Accenture research found that 85 percent of providers and 91 percent of payers are feeling extreme competitive pressure to extend innovation into their workforce and corporate structures.4 Leaders who pivot to harness the power of personal networks, learn and act with agility, and focus on value enabled by the appropriate technologies, enable more rapid decision making to drive innovation and bottom line performance.
How will you help your organization speed up and win against the emerging wave of more agile, technology-enabled competitors? That’s a decision worth making.
1 Accenture, "Healthcare CSOs feel unprepared as disruption surges”, 2018.
3 Accenture Strategy analysis of data from Accenture’s Organizational Value Assessments shows significant correlation between healthy decision structures and strong financial performance as compared to industry.
4 Accenture 2017 Technology Vision research