Healthcare Decision Analytics

This article was written by Rich Dormer.

For more than a decade, I have been working successfully with senior executives and key stakeholders at hospitals and healthcare systems within the United States in identifying areas to extract unnecessary costs within their organizations and then delivering upon these opportunities. During this period, the team and I at VIE Healthcare have delivered more than $600 million in realized savings and margin enhancements.

While working with a diverse group of clients with different objectives, personalities, and cultures, I have uncovered the universal process that is common to all of those who achieve superior results. I have named that process “Healthcare Decision Analytics,” or HDA. HDA is comprised of three equally important parts: The Data Design, The Stakeholder Alliance, and The Strategic Blueprint. The goal of this article is to put clarity around this very important, and common, universal decision-making process.

Getting to, and making the optimal decision, for a healthcare organization present unique challenges, including competing stakeholder priorities, time and resource management, capital cost barriers of new technologies, local and regional community influence, and incomplete or overwhelming amounts of data to digest and make sense of. And these are just a few of the obstacles that successful decision-makers must overcome. Making the wrong decision, not making a decision, or even delaying a decision can have a lasting negative effect on an organization.

Healthcare Decision Analytics (HDA) requires accurate, intelligent and presentable data. As referenced above, this is HDA’s first critical component, which I have named The Data Design. Carly Fiorina, the former Republican Presidential Candidate and former Chief Operating Officer at Hewlett-Packard once said, “The goal is to turn data into information, and information into insights.” This quote concisely expresses the overarching goal of The Data Design process which not only turns data into insights, but is built on the collection of the “right” data.

Identifying and obtaining the “right” data can be quite the challenge, but equally daunting is how one analyzes the data and turns it into useful, actionable information. The more complex a set of data, the more complex and variant the analysis, and by extension, the more likely to lead one down dead-end analysis paths before finding the right path, if it is found at all.

Once the data has been collected and analyzed, the final and equally important step in The Data Design is how that information is presented to demonstrate the derived benefits in a clear and concise way.

And though the derived conclusions and core recommendations will be the same, the presentation must be developed and geared to the target audience within the organization.

For example, one would need to develop and present the information differently to a CFO versus a spine physician versus a nurse manager versus a vendor representative. A flawed or misdirected presentation, which does recognize and respect the nature and culture of the specific target audience, could convert an otherwise solid set of recommendations into failure.

The second of three key components of HDA is The Stakeholder Alliance. Basically, The Stakeholder Alliance creates a shared vision of success through collaboration of the key team members. Typically the key team members will include stakeholders from the executive staff, involved department, and clinical or medical staffs as the case may be. Sometimes there may be a key influencer that is not an actual team member, but who has to be brought into the process in order to achieve success. The Stakeholder Alliance is a critical process of collaboration that has to be thoughtfully approached and navigated if one is to achieve success.

A Crew Team metaphor is perhaps the most effective way to explain the Stakeholder Alliance section of Healthcare Decision Analytics. If all of the crew members are rowing in unison, the vessel will move optimally. The importance of the team rowing in the same direction to make the right decision cannot be stressed enough. Good luck in getting the best in class orthopedic pricing if you don’t have the involvement and buy-in of the surgeons performing the orthopedic cases. Equally important is executive leadership support. Just like the Coxswain who guides the rowers to unified action and optimal results, the executive leader provides guidance and the authority to keep the initiative on course. Finally, just as the “shared vision” of the crew team is critical to their success, so too is shared vision a critical success factor for The Stakeholder Alliance.

The spirit of a successful crew team and Stakeholder Alliance are the same; where do we want to go, how quickly do need to move, and what is the defined goal that will make this initiative a success?  If any of these pieces are missing or flawed, then the chance for success is compromised, if not lost completely.

The last section of Healthcare Decision Analytics is the Strategic Blueprint, which is the engine that drives the decision-making process to superior results. Creating a clear decision process, understanding and balancing time with the availability of resources, and following fundamental negotiating principles will help leaders avoid making a poor, non-tactical decision. Gaining clarity of the decision process and urgency amongst all parties involved is critical to accomplishing and maximizing and realizing the opportunities. One client recently had a contract addendum held up for two months in legal review. This delay cost their organization over $200,000 which could have been avoided if their senior leadership had been notified earlier of the time sensitivity and the need for an expeditious legal review.

The amount of time to accomplish a goal and the availability of resources (data, people, and experience) are directly proportional to the amount of expertise and outside thinking and help that is needed. If an organization has limited time and/or people to work on a project and/or core competency in the specific type of initiative, then one needs to seriously consider outside, third-party expertise to accomplish their goals.

Negotiating correctly and without emotion is the final step in the Strategic Blueprint; try to avoid the using the “sharpen your pencil” strategy.

So, in conclusion, I hope I have conveyed the very important concept of Healthcare Decision Analytics (HDA) and its three essential building blocks, namely The Data Design, The Stakeholder Alliance, and The

Strategic Blueprint. Furthermore, I hope that I was able to provide some insights into the successful decision-making process that I have witnessed and used while working with healthcare senior executives and their organizations. While some decisions may not directly affect an organization’s bottom line, most do have a long-lasting positive or negative effect.

The goal of Healthcare Decision Analytics is for leaders to gain the clarity and process they need to consistently make superior decisions which will then provide margin enhancement, stability and sustainability for their organizations.