What’s the Big Idea? Innovation Changes Everything

Organizations that adopt a framework for new ways of thinking are better prepared to face the challenges of today's health care environment.

If any word strikes both excitement and fear in the hearts of health care leaders, it's innovation. Those that conquer the concept and introduce new and better ways to do things often witness exponential gains. Those that fail to innovate frequently find their organization floundering.

Brian Kalis

"There are endless opportunities for health care organizations to leverage big ideas and disruptive innovation," states Brian Kalis, managing director of Digital Health at Accenture.

Yet, the common denominator is that it's critical to focus on improving treatment, cutting costs and creating value.

Adds Peter O'Neill, executive director of Cleveland Clinic Innovations at Cleveland Clinic in Ohio: "Health care is changing dramatically. And anytime change takes place there's a need for innovation and disruptive solutions, whether they be tied to specific products, ways of analyzing data, ways of delivering treatment to patients. Those that don't innovate will fall behind."

Developing a framework based on innovation requires more than management edicts, blue-sky thinking and cutting-edge technology. At Cleveland Clinic, which has been rated one of the most innovative health care institutions in the world by Fast Company, Forbes, Strategy & Business and other publications, the concept starts at the top.

"We have a CEO and other senior-level executives that understand how important innovation is and the role it plays in defining an organization," O'Neill explains. “Financial metrics are only one piece of the puzzle. "It's all about creating value for patients, practitioners and the facility."

The CCI team is composed of about 50 people who spend time exploring ideas and developing inventions.

The diverse group generates about 260 inventions annually, and that results in about 40 licensing agreements. CCI currently holds more than 850 patents and has spun off 77 companies. These include everything from software applications for scheduling appointments and checking in to new surgical procedures for restoring brain function after a stroke .

These factors make a difference, O'Neill says.

• It's important to give people time to think.

• Leaders must seriously consider the ideas their people generate.

• Everyone must work in a collaborative way.

• The organization must provide resources that allow ideas and innovations to take shape.

O’Neill adds that it's essential to take a long-term view and consider failure an important factor in achieving success.

Peter O’Neill

"When people believe that their ideas might go somewhere, it encourages more people to embrace a framework of innovation," he says.

Another leading organization is Johns Hopkins Bayview Medical Center in Baltimore, Maryland. Charles Reuland, MHS, ScD, the chief executive vice president and chief operating officer, places a premium on an open framework of thinking and exploration.

"Innovation can come in many different areas," he says. "It can encompass new therapies, new IT systems, new research based on grants and much more. The core issue that leads to innovation is a basic understanding of what you are trying to achieve and what value it will provide."

A key element there is a bottom-up approach. "It's all about understanding what is going on the trenches and what needs to be done. If you can't be receptive to new and sometimes different ideas about medicine or processes, you wind up in a quagmire. Nothing advances or changes. People get frustrated and ideas don't go anywhere."

Teams also tap analytics to deliver deep insights — and work to match tools, such as analytics, to the specific requirements of physicians and researchers. Reuland says that this ultimately leads to a framework and culture that supports innovation, and winds up in the organization's DNA.

Reuland says that executive teams must stay aware of emerging and evolving technologies and allow teams to experiment with promising software, systems and connected devices — as well as procedures.

Charles Reuland

"When we enhance value, we strengthen our community and improve medicine," he says.

According to Accenture's 2016 Healthcare Innovation Research , 76 percent of health care leaders say their organization is "extremely" or "very dependent" upon innovation, yet only 26 percent are looking at innovation to disrupt the marketplace. Seventy-one percent indicated they tend to pursue product line extensions rather than new innovations.

The fundamental takeaway?

"Organizations are looking for innovation but focusing on renovation," Kalis says.

Yet, Accenture has found that an innovation-centric approach typically yields a revenue bump between 3 and 7 percent, Kalis says. He adds that one of the most effective ways to achieve innovation is a "two-engine approach." An organization can establish a separate venture capital fund or open innovation framework to pursue innovation outside its core offerings, while maintaining a focus on incremental innovation among existing product lines.

"All successful innovation requires speed, risk management, measurement, portfolio management and skills, but not all innovations are created equal," Kalis concludes. "Small innovation may be more comfortable, whereas big innovation involves risk, and it may push the organization beyond its comfort zone. Thus, approaching each key component differently allows organizations to achieve greater gains."

Samuel Greengard is a freelance business and technology journalist based in Oregon.