Successful Change

Survive and Thrive

Russ Branzell, FCHIME, CHCIO, FHIMSS

CEO and President, CHIME

CHIME Foundation

CHIME Education Foundation

July 1, 2015

We’ve come a long way!

How to Be a CEO for the Information Age

Harvard Management Review, Winter 2000, Volume 41 Number 2

“The implications for existing and aspiring CEOs are equally clear.

Information technology is now a survival issue…more and more frequently IT issues are now wrapped inside wider

questions of business strategy.”

The Black Hole of IT Value

“While [the system] has helped [us] boost patient safety and medication administration processes, [we have] put quality of care and improving safety ahead of ROI and time savings.”

- VP of Quality and Care Management

“I estimate that about half of our IT investment generates value . . . I just can’t figure out which half.”

- Healthcare CEO

“Some healthcare CEOs refer to IT as that black hole you pour money into… never seeing results.”

- Healthcare CEO

From “Good to Great” by Jim Collins

“…technology by itself is never a primary root cause of either

greatness or decline.”

Care Improvement Process

Status Quo – Fee for Service

Wellness Care

Quality Care

Managed Care

Value Care

“The job of the leader isn’t just to make decisions, it’s

to make sense.”

The Big MOO, The Group of 33, Quote by John Brown

Building Blocks of HIT 2.0

• Healthcare

Information Exchange

• Certified Electronic

Health Record

• Patient Portals

• Data Warehouse

• Business Intelligence

• Complete Data

Integration

• Data Analytics

• World-class IT Team

• Unified

Communications

• ACO System

• Population Health

System

• Document

Management

“Making IT work demands the same things that other parts of the business

do - inspired leadership, superb execution, motivated people, and the

thoughtful attention and high expectations of senior management.”

“Getting IT Right” Harvard Business Review, February 2004

Using a business case cycle that produces VALUE.

3. Baseline

Existing

Performance

4. Describe the

Capabilities

of the Solution

5. Negotiate the Targeted Improvements

7. Develop

the TCO

6. Convert

the Targeted

Improvements

to Financial

Results

8. Calculate the

Hard-Dollar ROI

2. Select

the Metrics

1. Organize Stakeholders and

Focus on Benefits

Business Value in Healthcare

Healthcare

Value ˭ Dollars Spent

Patient Outcomes

&

Revenue

Enhancement

Adapted from Value Measurement for Healthcare, Harvard Business School Executive Education

˭ IT/Informatics

Value

Value Realization Requires a Structured Approach

Current State – Start the journey

Execute Roadmap

Manage Change

Capture Value Realization Opportunities

Future State – Define the ideal

Change Readiness

Assessment

Envision the Ideal State

Innovate & Optimize Costs

with Disruptive

Technologies (Cloud,

Social Media, Big Data,

Mobility)

Identify Metrics and

Develop the Business

Case

Implement PMO &

Governance Model Measure Benefits

1

6

4

7

2

Develop Implementation

Roadmap

5

3

Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15

Program Management and Governance

1.0 Enterprise Services Transformation – Change Management1.1 Org Design

& Process/Role

Change Mgmt

1.2 Communic.

Planning

1.3 Business Case

Development

1.4 Readiness

Assessment

2.0 Rationalize/Standardize/Define

2.2 Knowledge Mgmt Processes &

Tools

2.5 Reporting Processes & Tools

2.1 On-Boarding

& PD/Accred.

Processes

6.0 Service Support &

Enhancement

3.0 Enabling Capabilities – Service Detailed Design/Build

4.0 Monitoring & Assurance – Service Detailed Design/Build

5.0 Business Area Service Deployment

Quarterly Formal

Communications Releases

Quarterly Formal

Communications Releases

Quarterly Formal

Communications Releases

Quarterly Formal

Communications Releases

Quarterly Formal Business

Case Updates

Quarterly Formal Business

Case Updates

Quarterly Formal Business

Case Updates

Quarterly Formal Business

Case Updates

2.6 Assurance Processes & Tools

2.3 Sourcing

Processes &

Tools

2.9 Demand Fcstg, Resource

Planning, and Scheduling Processes

& Tools

2.7 Financial Mgmt Processes &

Tools

2.10

Requirements

Gathering Tool

2.11 Test Planning & Execution Tool

2.4 Functional Capabilities Demand/

Supply Assessment

3.2 Knowledge Mgmt Processes &

Tools

3.3 Sourcing

Processes &

Tools3.5 Transition to Desired Functional

Capabilities Capacity

4.1 PRT

Enhancements

4.4 Assurance Processes & Tools

3.6 Demand Fcstg, Resource

Planning, and Scheduling Selection

3.8 Requirements

Gathering Tool 3.9 Test Planning & Execution Tool

4.2 PRT Replacement Selection

3.7 Demand Fcstg, Resource

Planning, and Scheduling Design &

Build

4.3 PRT Replacement Design/Build

Wave 1 (All)

5.1 On-Boarding

5.2 Personnel

Development &

Accreditation

5.3 Sourcing

Wave 2 (All)

5.4 Know. Mgmt

5.5 Funct. Capab.

5.6 Assurance

5.7 Governance

5.8 Rqmnts

Gathering Tool

Wave 3 (All)

5.9 Financial

Mgmt

5.10 Test Plan &

Execution Tool

Wave 4 (By Business Areal)

5.11 PRT Replacement

5.12 Demand Fcstg, Resource

Planning, Scheduling Tool / Demand

Mgmt

2.8 Governance

Processes

6.1 Wave 1

Support Begins

6.2 Wave 2

Support Begins

6.3 Wave 3

Support Begins

6.4 Wave 4

Support Begins

6.5 Enterprise Services

Continuous Improvement

4.5 Financial Mgmt Processes & Tools

3.4 Governance

Processes

Quick Wins

Month 3 6 9 12 15 18 21 24 27 30 33 36 39

Re-

Calibrate

Iterative Definition to

allow for Quick Wins

Delivery

Iterative Design to

allow for Quick Wins

Delivery

3.1 On-Boarding & Personnel Development/

Accreditation Processes

Transformation

William Bridges

“The three phases of transition”

Time

Acc

epta

nce

The phases are not separate stages with clear boundaries….

The eight-stage process of

creating major change

Employee Engagement Groups

28% 55% 17%

Engaged Not Engaged Actively Disengaged These employees are loyal and

psychologically committed to the

organization. They are more

productive and more likely to stay

with their company for at least a

year.

These employees may be

productive, but they are not

psychologically connected to their

company. They are more likely to

miss workdays and more likely to

leave.

These employees are physically

present but psychologically

absent. They are unhappy with

their work situation and insist on

sharing this unhappiness with

their colleagues.

-79.5

-45.6

-29.9

-18.1-8.7

0.08.7

18.1

29.1

44.1

78.7

-100

-80

-60

-40

-20

0

20

40

60

80

100

Engagement Percentile

Av

er

ag

e %

Ga

in/L

os

s i

n P

ro

fita

bil

ity

Engagement Drives Profitability

Copyright © 2007 Gallup, Inc. All rights reserved.

Why is ‘change’… and

change management’…

so important to us?

Medication Error Rates

2007-2012

VTE Incidence Per Year

Return on Investment

• Hard ROI: – $5,000,000 in HIM staff reductions and

efficiencies

– $1,900,000 in reduced forms cost

– $63,800,000 in Meaningful Use Stage 1 incentives

• 100% of eligible dollars

• Soft ROI: – $23,000,000 in Clinical Value and Cost

Avoidance

– $17,000,000 was recognized from decreased adverse drug events and incidence of VTE.

Estimated Cost Savings from

Preventable DVT and PE

$6,060,000 (404* preventable events x $15,000)

• Estimated System VTE/PE 2006 = 420**

• Estimated System VTE/PE 2010 = 218**

• Estimated cost per incidence $15,000***

Continued decrease 2011-2013

35 additional VTE/PE avoidance= $529,000 *Extended initial savings over years 2010-2011

**Estimates extrapolated from VTE reporting and CI DAM

*** Mid-range cost used from AHRQ inpatient DVT/PE estimates

Thank You