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Being John Glaser 7/21/09

July 20, 2009 News 10 Comments

American Airlines. Amazon.com. Federal Express. Bank of America. These organizations and others are often cited as examples of exceptional effectiveness in applying information technology (IT) to improve organizational performance and, at times, achieving a significant competitive advantage.

These organizations are more than one-hit wonders. They have been exceptional over very long periods of time. They seem to have one IT success after another.

What is it that these organizations have done to achieve such IT excellence? What makes them different?

Several researchers have pursued answers to these questions. The have identified a series of factors that lead to organizational IT excellence.

Leadership was critical
The leadership in these organizations was smart, honest, seasoned, committed, and valued the healthy exchange of ideas. They were individually excellent and a great team. This leadership understood the strategy, communicated the vision, was able to recruit and motivate a team, and had the staying power to see the organization’s strategies through several years of hard work.

Strong, sustained and clear themes provided the basis for IT strategy decisions
Organizations often develop themes or strategic imperatives such as “we must continuously improve the care we deliver” or “we must relentlessly focus on efficiency.” If there is sustained commitment to pursuing these themes, organizations become increasingly competent at addressing them. This competency extends to IT. In effect, organizations, year in and year out, get better and better at improving care and get better and better at applying IT to improve care.

The evaluation of IT opportunities was thoughtful and rigorous
IT initiatives that involve major commitments of resources and significant organizational change must be analyzed and studied thoroughly. However, these organizations also understood that a large element of vision, management instinct, and “feel” often guided the decision to initiate investment and continue investment. These organizations were careful to ensure that IT initiatives were strongly linked to key organizational strategies and plans.

Extracting value from IT required innovation in business practices
If an organization “merely” computerizes existing processes without rectifying (or at times eliminating) process problems, it may have merely made process problems occur faster. In addition, those processes are now more expensive since there is a computer system to support. All IT initiatives must be accompanied by efforts to re-engineer the processes that the system is designed to improve.

These organizations often focused on continuous incremental innovations rather than “big bang” initiatives
Organizations will often introduce very expensive application systems and process change “all at once.” Big bang implementations are very tricky and highly risky. It is exceptionally difficult to understand the ramifications of such change during the analysis and design stages that precede implementation. As a result, organizations risk significant operational degradation and non-trivial project overruns.

On the other hand, IT implementations (and related process changes) that are more incremental and iterative reduce the risk of organizational damage and permit the organization to learn before they make the next change. Incremental change helps the organization’s members to understand that change and performance improvement are never-ending aspects of organizational life rather than something to be endured every couple of years.

The strategic impact of IT investments came from the cumulative effect of sustained near term initiatives to innovate business practices
The incremental steps in aggregate led to a competitive advantage. Organizations often took five to seven years for major initiatives to fully mature and the results to be seen. Persistent improvements by a talented team, over the course of years and across many initiatives, resulted in significant strategic gains. Exceptional effectiveness is a marathon. It is a long race that is run and won one mile at a time.

Innovation was encouraged
These organizations were comfortable and competent at innovation. This innovation was not confined to IT. They knew that innovation had to be practical and goal directed. Innovation had to focus on a real business problem, crisis, or opportunity and the project needed budgets, political protection, and deliverables.

Well-architected technology was the great enabler
Information systems that are difficult to change, unreliable, overly costly, functionally weak, and impossible to integrate can severely hinder an organization’s strategies. The organizations studied had taken the time to develop approaches and policies needed to ensure that desired levels of integration and reliability, for example, were achieved. Their CIO had, and shared with the leadership team, a strategic understanding of information technology architecture. 
 

Achieving organizational excellence in IT requires much more than great information systems and a great IT staff (although these are important). Excellence requires talented people, great working relationships, organizational thoughtfulness, and dogged, year-in and year-out pursuit of performance improvements. These factors are probably not materially different from the factors that determine organizational excellence in general.

It is more important for an organization to focus on addressing these factors than it is to work on any specific IT application.

John Glaser is vice president and CIO at Partners HealthCare System. He describes himself as an "irregular regular contributor" to HIStalk.

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Currently there are "10 comments" on this Article:

  1. John is right on – particularly the references to business practices.
    So as we rush to install EMRs & CPOEs because the govt is giving us some bucks…keep in mind we won’t tbe able to get Obama the $200B savings the AHA promised him without alot of process re-engineering. The irony is that the savings is the re-engineering not the IT.

  2. This tells me that really if I were to replace Glaser, that nothing would be radically different. The airlines ?? seroiusly. Look at this ‘not for profit’ business that operates in for profit world. More importanlty, these companies sell passenger seats, books, plastic cards for swiping money, and shipping services. Not exactly patient care. This has a been a real problem in health care. It’s easy to see the rather simpler comparisons of IT as apple to apple. However, this is not the case. And the more we get these type of articles, the more we are stuck backwards in our logic and thought. Not that i care really, but the Partners structure and its ability to combat price enemies with insurance firms and others is almost , if not solely, independent of any other hospital out there. This is dissappointing

  3. Wonderful article – I have never seen it broken down into straight-forward attributes. I also believe that each of their respective industries value technology differently than did health care. It seems that health care is catching-up. With each of the companies mentioned, the organizations spend a more significant amount of their operating and capital budgets on technology. While this is no excuse for less-than-optimal performance and the attributes listed above can be applied without significant amounts of money, the commitment to continual investment in technology certainly doesn’t hurt.

    In fact, I would argue that it would be a large (not the largest) contributor to success. Being able to attract, train and retain talent, is critical and money certainly helps in this area as does leadership and workforce engagement. Being able to count on well-performing technology ‘infrastructure’ being viewed by leadership as a necessity as opposed to continually facing rejustification, also helps.

    I would love to read thoughts from those who were in these industries (except for Amazon) as they became more technologically advanced and the executive leaders realized technology was a critical enabler. Certainly these industries have some lessons that we can learn regarding resistive user adoption and what were the “ah-ha” moments and arguments that helped their executive leaders realize that technology investment requires continual “feeding” and replenishment.

    Thought provoking as always – thank-you

  4. At airline, shipping and banking companies, the data entry is done by the lower wage clerks. Only in healthcare do we expect the high wage earning “CEOs” (i.e., the physicians) to do the bulk of the manual data entry. You don’t see the CEOs of American Airlines, UPS and JPMorgan Chase spending significant portions of their days entering data into PCs and tablets.

  5. Jones has a good point.
    Healthcare delivery is more complex than flying planes. For example, how do you define a good airlne: A firm that gets you there, on time and at a competitive price. How do define good healthcare? Now that’s a debate that has raged for decades.

    But even so, that does not mean healthcare cannot benefit from some good work flow /process re-engineering. For example how many hospitals have a discharge time policy? And those that do – what percent of the patinets actually get discharged at that time (plus of minus 15 min of course). If the answer to either question is more than 20%, I’ll eat my hat.

  6. American Airlines. Amazon.com. Federal Express. Bank of America are all technology innovators in business. Two additional points to make about these companies is their strong belief in business continuity and business intelligence.

    Business Continuity is a key component to running a successful business. Many healthcare organization overlook the importance of having information available 24/7 no matter what the circumstances. We read about health systems having downtime costing the system millions of dollars. This does not happen at the above mentioned companies because their systems are always available through high availability solutions.

    Business Intelligence is another key component in running a successful business. Many health systems struggle to access real time data to make real time decisions. Many times there is one system used for running production and reporting. The above companies use real time data warehouses running BI tools to get the most out of their data

  7. Limiting myself to two issues here:

    1. Practically every organization, hospital or otherwise, claims (and most even believe) they fit your descriptions of “…smart, honest, seasoned, committed, and valued the healthy exchange of ideas”, and every other description you serve up. I’m not saying you’re fundamentally wrong, just that there must be a missing element since almost all execs fit themselves into these positive descriptors (although, in some cases, their employees would be choking in the background).

    2. Real and effective re-engineering, which I agree has to be considered before designing new systems, becomes pretty much nonexistent in many orgs, in part because of the current mode of buying one-size-fits-none software packages. You will not have the most efficient systems if you’re left with forcing processes and workflows to fit someone elses pre-packaged choice. It would be like trying to re-engineer a car, but you’ve been given all the prefabricated body, engine, and running gear parts you must use. You may end up with some parts shuffling, but are more likely to lose efficiencies than gain them.

  8. Good to see Glaser didn’t get the “kid glove” treatment.

    It’s what I love about HISTalk. No-holds-barred comments even for those at the pinnacle of the field. Nowhere else but on this site.

    And I admire those that chime in knowing full well what to expect. I respect that. I’d like to see more leaders go before the vocal and opinionated readers of HISTalk.

  9. I believe John has lost it. Citing Amazon and Bank of America IT organizations as the basis of his article and point of view is beyond pitiful, it’s absolutely ludicrous. While these IT organizations may appear bright and shiny on the outside, they are ugly and broken on the inside. Recent customer satisfaction surveys of both companies strongly indicate their IT support is sub-par and many of their applications are dysfunctional.







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