Doing More With LessDoing More With Less

Non-Traditional Approach To ITNon-Traditional Approach To IT

Dr Alan LloydDr Alan LloydChief Systems OfficerChief Systems Officer

Sonic Healthcare GroupSonic Healthcare Group

The Sonic GroupThe Sonic Group

• Pathology & Radiology Service ProviderPathology & Radiology Service Provider• 15 Yrs in business & ASX listing15 Yrs in business & ASX listing• A$1bn RevenueA$1bn Revenue• 37% growth in revenue37% growth in revenue• 20% growth in earnings20% growth in earnings• 10,000 employees10,000 employees• Operational in :Operational in :

• AustraliaAustralia• New ZealandNew Zealand• United KingdomUnited Kingdom• Hong KongHong Kong

Sonic Healthcare Pathology Sonic Healthcare Pathology LaboratoriesLaboratories

40,000 PATIENTS / DAY40,000 PATIENTS / DAY

TDL UK

Pathology & Radiology is Big Pathology & Radiology is Big BusinessBusiness

• Major Laboratories in:Major Laboratories in:– Sydney (Douglass Hanley Moir)Sydney (Douglass Hanley Moir)– Brisbane (Sullivan Nicolaides)Brisbane (Sullivan Nicolaides)– Melbourne (Melbourne Melbourne (Melbourne

Pathology)Pathology)– Auckland (Diagnostic Medlab)Auckland (Diagnostic Medlab)

• 40,000 Patient samples a day40,000 Patient samples a day• Over 100,000 Tests dailyOver 100,000 Tests daily• Aging Population:Aging Population:

– Today Today 6:16:1– By 2031 By 2031 3:13:1

I.T. is Integral to Sonic OperationsI.T. is Integral to Sonic Operations

SONIC I.T. POLICYSONIC I.T. POLICY

• OWN AND CONTROL OWN AND CONTROL I.T. SYSTEMSI.T. SYSTEMS SOFTWARE SOFTWARE

DEVELOPMENTDEVELOPMENT INFRASTRUCTUREINFRASTRUCTURE SUPPORTSUPPORT

AutomationAutomation

General Workflow PrinciplesGeneral Workflow Principles

INPUTINPUT OUTPUTOUTPUT

$$ WORK $$$$ WORK $$

KPI’SKPI’S

InnovationInnovation

BenchmarkingBenchmarking

FeedbackFeedbackManagementManagement

The ‘Challenge’The ‘Challenge’

• Concentrate Resources Concentrate Resources on the ‘Strategic on the ‘Strategic Initiatives’Initiatives’

• Incorporate ‘Best Incorporate ‘Best Practice’ and Practice’ and standardisestandardise

• Enable continuous Enable continuous improvementimprovement

• Provide excellent Provide excellent customer servicecustomer service

• Reduce the ‘Per Reduce the ‘Per Patient’ cost of I.T. Patient’ cost of I.T.

Telecommunications

Financial Services

Health Care

Manufacturing

Utilities

Retail

IT Spending asPercentage ofRevenue

Mining 1.0

1.7

2.6

3.3

3.7

12.5

9.7

Choose The Right People & The Right TechnologyChoose The Right People & The Right Technology

8 LABORATORIES8 LABORATORIES

300%300%300%300%

CACHECACHE

DB2DB2

UNIFYUNIFY

BenchmarkingBenchmarking

• Compare I.T. CostsCompare I.T. Costs• Choose the Best Choose the Best

SystemSystem• StandardiseStandardise

• Why Cache?Why Cache?– High Performance Multidimensional High Performance Multidimensional

DatabaseDatabase– Outperformed Relational DatabasesOutperformed Relational Databases

• 5 Times Less processing Power• Ten Times Less Storage

Complete Flexibility with One Complete Flexibility with One TechnologyTechnology

OBJECTOBJECTARCHITECTUREARCHITECTURE

OBJECTOBJECTARCHITECTUREARCHITECTURE

““THIN CLIENT”THIN CLIENT”Web EnvironmentWeb Environment

““CSP”CSP”

““THIN CLIENT”THIN CLIENT”Web EnvironmentWeb Environment

““CSP”CSP”

““THICK CLIENT”THICK CLIENT”DevelopmentDevelopmentEnvironmentEnvironment

““THICK CLIENT”THICK CLIENT”DevelopmentDevelopmentEnvironmentEnvironment

CHUICHUINativeNative‘‘M’M’

CHUICHUINativeNative‘‘M’M’

SQLSQL

ODBCODBC

SQLSQL

ODBCODBC

MultidimensionalMultidimensionalDatabaseDatabase

MultidimensionalMultidimensionalDatabaseDatabase

SONIC I.T. MANAGEMENTSONIC I.T. MANAGEMENT

Tightly Coupled To Business Tightly Coupled To Business DevelopmentDevelopment

SITECSITEC

CEOCEO

CFO COO CSOCFO COO CSO

SITMSITM

HR & MarketingHR & Marketing

Development MethodologyDevelopment Methodology

BDU’sBDU’s

Business AnalystsBusiness AnalystsProgrammers AnalystsProgrammers Analysts

BDU’sBDU’s

Business AnalystsBusiness AnalystsProgrammers AnalystsProgrammers Analysts

SITMSITMSITMSITMPMGPMG

SITECSITECSITECSITEC

ProjectsProjects RFCRFC

GAINGAIN

$$ WORK $$$$ WORK $$

High Level Control – Law of High Level Control – Law of Diminishing ReturnsDiminishing Returns

Example of our Rapid Example of our Rapid DevelopmentDevelopment

• 2001 Radiology2001 Radiology• The Requirement:The Requirement:

– Web based RISWeb based RIS– Competitive priceCompetitive price– Competitive functionalityCompetitive functionality– Electronic Transmission Electronic Transmission

of Resultsof Results• From vision to From vision to

implementation in less than implementation in less than 12 months12 months

• Cache Server Pages (CSP) is Cache Server Pages (CSP) is the core technologythe core technology

IT Standardisation

1998 2000 2001 20021999

CAPITAL

BARRATTS

MELBOURNE

SNP

TASMANIA

CAP/BARR/

WAGGA

CLINPATH

SOUTHERN

CLINIPATH

DHM

Y2K

COOLUM

FIVE YEAR PLAN

20042003

RIS QXR

CASTLEREAGHSKGILLAWARAHIG

SAT

OutcomesOutcomes

• 30% less investment on technology 30% less investment on technology than the industry normthan the industry norm

• Very high Operational ResponsivenessVery high Operational Responsiveness• Our Technology Platform positions us Our Technology Platform positions us

for growthfor growth• Retaining the IP - Development of Retaining the IP - Development of

systems to support the core operations systems to support the core operations are all in-house are all in-house

• In Australia our IT operation - 53 people In Australia our IT operation - 53 people supporting a market share of 44%supporting a market share of 44%

Doing More With LessDoing More With Less

• Technology is part of our business Technology is part of our business culture and the business culture is part culture and the business culture is part of ITof IT

• Business Productivity Improvement is Business Productivity Improvement is founded on our IT Core Competence.founded on our IT Core Competence.

• Ownership ensures Retention of IPOwnership ensures Retention of IP• Removed the translation of the business Removed the translation of the business

requirements into IT through requirements into IT through involvement of the BDU’s involvement of the BDU’s

• High level executive controlHigh level executive control

COST ADVANTAGE

DIFFERENTIATION ADVANTAGE

W I D E N THE M O A T

PRODUCTIVITY AND DIFFERENTIATIONPRODUCTIVITY AND DIFFERENTIATION

The Non Traditional Approach The Non Traditional Approach to ITto IT

““It is our belief that unique Sonic operational It is our belief that unique Sonic operational models, including workflow, laboratory models, including workflow, laboratory design and computer software, may be used design and computer software, may be used to the company’s advantage in suitable to the company’s advantage in suitable offshore markets.”offshore markets.”

Dr Colin GoldschmidtDr Colin Goldschmidt

Managing DirectorManaging Director