Healthcare Innovation: How The Big Guys Make Big Ideas Happen (and Why)

There aren’t many healthcare providers who are unaffected or unaware of challenges all around them. The parade includes reform requirements, the “soft economy” with rising costs and shrinking margins, shifting medical marketing goals and demographics…and the overarching stretch of resources to maintain and improve quality of patient care.

“Innovation is the ability to see change as an opportunity—not a threat”

From health systems and hospitals to group and individual provider practices, it often seems like the choice is either passive acceptance or assertive action. For those folks in the passive camp, please let us know how that works out. But for everyone else, the California HealthCare Foundation (CHF) has a blueprint for finding innovative answers.

Taking off from the perspective that the demands of health reform will increasingly challenge the nation’s healthcare delivery system, the CHF report says, “the answer must be found in creativity and a willingness among health care institutions to experiment with innovative ideas and approaches to delivering care. In fact, the viability of the health care system will depend on a consistent stimulus of innovations.”

This report has something for everyone. It’s titled, Going Big: How Major Providers Scale Up Their Best Ideas, but the creative concepts of four major provider organizations offer guided insight for everyone in the provider chain. [The CHF document is available online here, and it’s free.] “Going Big” focuses on three particular areas; technical advances, process improvements and business model innovations.

Moreover, you don’t have to be the Mayo Clinic (or Partners HealthCare, Kaiser Permanente or Ascension Health) to mine internal and external sources for useful ideas, adopt a process for innovation or to wring value from their innovation in your business. Mayo Clinic applies a simple selection criterion to weigh innovative ideas:

Mayo Clinic’s 8-Point Test

1. Does the project align with Mayo’s core values and strategic plans?
2. Does it add value to the Mayo brand?
3. Does it leverage core resources and capabilities?
4. Does it provide a competitive advantage?
5. Can Mayo mitigate the risks of failure?
6. Will it deliver good financial returns?
7. Will it deliver good educational returns?
8. Is it scalable?

"Creativity is thinking up new things. Innovation is doing new things."

The pursuit of innovation has become a strategic business initiative for medical practices, hospitals and health systems, on both the organizational level and the personal level. “Talent and good ideas are plentiful in healthcare, [but] ideas need to be shaped and distilled—and many winnowed out—to arrive at innovations that can succeed over time.”

The CHF research summarizes how the big guys make big ideas happen, offering five success ingredients:

Rules for Innovating

1. Create a dedicated innovation team or business unit.
2. Establish a formal framework to help your team select the best ideas to pursue.
3. Identify the method(s) of scaling that is most appropriate for your institution. (Do you scale within your organization, or turn the innovation into an independent business?)
4. Creativity is uniformly distributed. Leverage multiple sources for the best ideas to pursue.
5. Expect failure. Iterate and try again.

We especially appreciate the reality lesson of #5 on this list. They call it “the importance of iteration. Organizations that would innovate must have a capacity to learn from failures and to try again. This is the hallmark of all successful innovators within and outside of health care.”