Download - HCA Case Study
1© HCA, 2009
HCA IT Sourcing Strategy
NTC Virtual Trade MissionMay 7, 2008
Mary Silva DoctorFormer VP, IT&S Strategy & Planning
2© HCA, 2009
• Overview of HCA IT&S
• IT&S Sourcing History
• Current Sourcing Strategy – Flexible Sourcing
• Critical Success Factors
HCA IT&S Sourcing Case Study
3© HCA 2009
HCA IT&S By the NumbersEmployees – Corporate & Field 3,021
Regional Data Centers 4
Storage 736 terabytes
Servers 1,160
MEDITECH servers 146
Software applications 305
Enterprise-wide email boxes 98,162
Internet email received 37M/month
Active projects 195
Projects in Portfolio (incl. on hold) 271
IT Service Centers 14
Clinical interfaces to build 25
Clinical interfaces to install 461
HCA, 167
HCA
CHS
LifePoint
Capella
Total: 308
Hospitals Supported
Physician Practices
Ambulatory Surgery Ctrs
Imaging Ctrs
Total: 602
Other Facilities Supported
OtherOutpatient
Ranked 162 on Information Week’s Top 500
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HCA Background: Systems Context
General Ledger
Billing & A/RAccounts Payable
Materials Management
Payroll (Lawson)
Human Resources (Lawson)
Laboratory
Physician Portal (PatientKeeper)
Pharmacy
Physician Practice (eCW)
Critical Care
Radiology
Cli
nic
al
Sy
ste
ms
Fin
an
cia
l &
Ad
min
Sy
ste
ms
MEDITECH
• GE QS
• GE MUSE
• GE ImageCast
RIS
• AGFA
HeartSuite
• Perinatal – GE
• Perinatal –
Phillips
• GIM Pulmonary
• HPF
• RAD PACS
• CV PACS
• T-Systems
• Empiric
• Neodata
• Oncology
Warehouse Management(Infor)
5© HCA, 2009
For the hospital segment, IT spend is predicted to be about 4.4% of overall revenue
Source: Values are based on Everest research and multiple industry surveys and reports
Note: Survey taken in Q1 of 2008 of 1700 respondents. 10% of respondents were in the healthcare industry, 46% of those were from hospitals
6© HCA 2009
BackgroundHistorically, IT&S has provided IT services to non-HCA businesses. The strategy has been effective in offsetting costs through two streams of revenue - software as a service and professional services.
HCA IT&S is also a Sourcing Provider
Customers• Community Health (former Triad)• LifePoint • Capella • Signature • Additional non-affiliated/divested
facilities
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IT Outsourcers’ Market Share by Hospitals
Competition in IT outsourcing in hospitals is also dominated by Perot Systems which operates in 160 of 300 outsourced hospitals.
Perot SystemsHCA
Number of Outsourced North American Hospitals
Nu
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Source: KLAS “Extensive Outsourcing Study”, September 2008
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Strategic Sourcing
• Positioning to better meet and manage the delivery of IT products and services in the context of increased demand.
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IT&S Sourcing Past and Future
2000
2010
Today
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HCA IT&S Current Sourcing Strategy• Need to respond to the challenge of
providing new capabilities while tightly managing costs
• More focused, contingent approach• Look at specific functions/skills in
IT&S versus broad functions• Objectives may vary – cost,
scarce skills, technology transfer, time to market
• Frequent benchmark/comparison• Maintain flexibility• Balance demand and supply• Gain access to broader
R&D/innovation in IT
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IT Project Staffing Challenge (2008)
~1,200k hrs.
Resource GAP
Full Staffing
Embedded Base Management (40-40-20)
Incremental Staffing
Strategic Partner Sourcing
Capacity Strategies
~100 - 200k
Time to Effectiveness
~50k
800k hrs.
TBD
TBD
Leverage Existing Staff Introduce New Staff
12© HCA 2009
IT&S Sourcing Decision Framework
• Capacity• Strategic Importance• Risk• Scarce/New Skills/Technology• Commodity• Time to Market• Cost
• In-source• Staff Augmentation• Co-source*• Managed Service/ Outsourced*
* May be on- or off-shore
What Kind of Work/Project is It?
What Sourcing Options do We Have?
Work/Project
Sourcing Decision
13© HCA 2009
ProjectManagers
BusinessAnalysts
DevelopersApplicationArchitects
DBAsData
Modelers
HCA / IT&S
IBM
Wipro
Syntel
Staffing / Delivery Suppliers & Role Capabilities
Full Capability Unproven or Limited by Capability or Location
IT&S AD Sourcing Partners
14© HCA 2009
Critical Success Factors
• External advice/support/validation• Partnership perspective• Dedicated resources• Solid portfolio and resource
management process and information
15© HCA, 2009
Summary
• Flexible, Strategic Sourcing Seeks to Leverage the ‘Right’ Resources for Given Work
• Supports Employee Engagement while Providing Access to Best Resources Available
• Supports the inevitable Cycles in IT Investment