2011 South African Data Centre Green Excellence Award in Technology Innovation Cybernest
© 2011 Frost & Sullivan 1 “We Accelerate Growth”
2012 North American Enterprise Imaging Informatics
Growth Leadership Award
2012
BEST PRACTICES RESEARCH
© 2011 Frost & Sullivan 1 “We Accelerate Growth”
Growth Leadership Award
Enterprise Imaging Informatics
North America, 2012
Frost & Sullivan’s Global Research Platform
Frost & Sullivan is in its 50th year in business with a global research organization of 1,800
analysts and consultants who monitor more than 300 industries and 250,000 companies.
The company’s research philosophy originates with the CEO’s 360 Degree Perspective™,
which serves as the foundation of its TEAM Research™ methodology. This unique approach
enables us to determine how best-in-class companies worldwide manage growth,
innovation and leadership. Based on the findings of this Best Practices research, Frost &
Sullivan is proud to present the 2012 North American Growth Leadership Award in
Enterprise Imaging Informatics to McKesson Provider Technologies.
Key Industry Challenges
The North American radiology PACS and RIS markets have reached such high levels of
market penetration and maturity, that the historical double-digit revenue growth rates
have given way to a much slower growth pattern. In this context of slow growth, the
financial stability and operational performance of PACS vendors have moved to the
forefront of vendor selection criteria in the mind of customers. In fact, the vendors that
have demonstrated unwavering reliability in their customer support and sustainability in
their business model are being favored by customers in the PACS replacement market.
During the last three years, healthcare IT enterprises and CIOs have been widely
absorbed by the HITECH legislation, dedicating most of their efforts and budgets to
evaluating and implementing EMR-related projects in order to best align their enterprise
with the first-stage requirements of Meaningful Use. During this period, much attention
has been driven away from radiology and imaging informatics purchasing decisions to
focus on more pressing needs. This prioritization scheme is one of the factors that is
contributing to further lengthening PACS replacement cycles. In this low-key environment
for imaging over the last few years, the only PACS vendors that were able to continually
strengthen their foothold in the market and tighten their ties with their existing customers
are those that were able to deliver effectively on workflow optimization, enterprise
communication and IT integration solutions.
Like their radiology counterparts, cardiology providers are being targeted by severe
reimbursement pressures particularly for cardiovascular imaging procedures. Similar to
radiology, historically sustained procedure volumes growth rates have declined to the low-
single-digit range, and have even reversed to negative growth rates for certain modalities.
This additional economic strain has made the business case for cardiovascular image and
information management systems (CIIMS) even more difficult to make for providers.
However at the same time, cardiology providers are in dire need for effective solutions
BEST PRACTICES RESEARCH
© 2011 Frost & Sullivan 2 “We Accelerate Growth”
that ensure best-of-breed functionality for each cardiovascular modality, enable
consolidation of growing amounts of patient data, allows integration of an increasingly
complex enterprise, and provides thorough reporting on more clinical and business
metrics. In such challenging market conditions, only select CIIMS vendors have succeeded
in maintaining their business organization upon a healthy growth path.
Impact of Growth Leadership Award on Key Stakeholders
The Growth Leadership Award is a prestigious recognition of McKesson Provider
Technologies’ accomplishments in the medical imaging informatics industry. An unbiased,
third-party recognition can provide a profound impact in enhancing the brand value and
accelerating McKesson Provider Technologies’ growth. As captured in Chart 1 below, by
researching, ranking, and recognizing those who deliver excellence and best practices in
their respective endeavors, Frost & Sullivan hopes to inspire, influence, and impact three
specific constituencies:
• Investors
Investors and shareholders always welcome unbiased and impartial third-party
recognition. Similarly, prospective investors and shareholders are drawn to
companies with a well-established reputation for excellence. Unbiased validation is
the best and most credible way to showcase an organization worthy of investment.
• Customers
Third-party industry recognition has been proven to be the most effective way to
assure customers that they are partnering with an organization that is leading in its
field.
• Employees
This Award represents the creativity and dedication of McKesson Provider
Technologies’ executive team and employees. Such public recognition can boost
morale and inspire your team to continue its best-in-class pursuit of a strong
competitive position for McKesson Provider Technologies.
BEST PRACTICES RESEARCH
© 2011 Frost & Sullivan 3 “We Accelerate Growth”
Chart 1: Best Practices Leverage for Growth Acceleration
Best Practice Award Analysis for McKesson Provider Technologies
The Frost & Sullivan Award for Growth Leadership is presented to the company that has
demonstrated excellence in capturing the highest annual compound growth rate for the
last 3 years.
McKesson Provider Technologies’ Performance in Medical Imaging Informatics
Based on the independent research findings from two recent Frost & Sullivan studies of
the North American radiology and cardiology informatics markets, McKesson Provider
Technologies is the vendor that has achieved the highest market share gains in the
medical imaging informatics market during the last three years.
Frost & Sullivan’s competitive benchmarking shows that in radiology informatics,
McKesson has continued to consolidate its position in the North American market,
narrowing down the gap with its only larger competitor and gaining more market share
points than any other vendor. McKesson captured 17.9 percent of total market revenues
including service in 2011, the second highest share in the North American market. In this
highly competitive space, this share represents a significant gain over the company’s
estimated share of 15.6 percent back in 2008, while the trend forward is also on the
increase. McKesson continues to succeed in the replacement market by winning new large
customers and thereby moving up-market. At the same time, McKesson is also
experiencing success in the mid- and the small-scale market, currently two very dynamic
customer segments.
BEST PRACTICES RESEARCH
© 2011 Frost & Sullivan 4 “We Accelerate Growth”
In cardiology informatics, McKesson has witnessed an unprecedented success story over
the last few years. The company has grown its share of the North American market rapidly
and constantly since its acquisition of Medcon Inc. in 2005. McKesson captured 14.1
percent of market revenues in 2011, making it the third largest vendor in the North
American market. In effect, McKesson has evolved from a minor market presence only a
few years ago, to become a top-three contender in the cardiovascular image and
information management systems (CIIMS) arena in the span of six years, surpassing in
the process many long-standing competitors in the field.
Key Performance Drivers for McKesson Provider Technologies
Factor 1: Maximizing Medical Imaging Customer Value
The growing number of facilities utilizing its radiology and cardiology informatics products
and services has validated an extremely robust value proposition for McKesson in the
North American imaging informatics marketplace. The brand name has become
synonymous with industry-leading reliability and performance of vendor service and
technology. McKesson’s flexibility and commitment as a true partner to its customers
allow it to meet varying customer needs by leveraging leading-edge technology from its
own portfolio as well as from its industry partners’. Its track record demonstrates that
McKesson’s foremost goal is to provide best-of-breed solutions that optimize workflow
productivity and generate immediate as well as long-term operational efficiencies at
customer facilities.
Frost & Sullivan’s competitive benchmarking shows that the company’s outstanding
operational performance makes it easier for McKesson than for many other PACS vendors
to deploy and support its IT solutions over the long-term. In addition, while many other
vendors had to constrain their research and development budgets during the phase of
market slowdown between 2008 and 2010, McKesson was able to pursue its continual
product development tracks during these challenging years. The recently launched PACS-
independent Enterprise Image Repository exemplifies McKesson’s alignment with the
needs of the marketplace. The company’s high financial stability also allow it to maintain
the highest degrees of price performance and customer service excellence, which explains
the fact that McKesson is the most often considered vendor in radiology and cardiology
imaging IT replacements.
Factor 2: Demonstrating Leadership in Enterprise Integration
Perhaps the most impactful success factor in McKesson’s imaging informatics
implementations is the tighter enterprise integration these deployments yield within
customer organizations. McKesson has demonstrated leadership in the delivery of
products and services that enhance communication between the various stakeholders
scattered across the medical imaging and healthcare enterprise. The vendor’s proactive
BEST PRACTICES RESEARCH
© 2011 Frost & Sullivan 5 “We Accelerate Growth”
involvement with its customer organizations manifestly leads to increased adoption of its
imaging informatics solutions by the physician referral base, as well as by enterprise
stakeholders acting in various IT, clinical and business roles.
The recent acquisition of PeerVue in February 2012 is a good illustration of McKesson’s
commitment to enterprise value generation within customer sites. According to Frost &
Sullivan’s research, this strategic acquisition provides McKesson a leading edge in clinical
workflow and emergency department communication around imaging. Indeed, the solution
has a proven track record of optimizing the use of diagnostic imaging in the emergency
department by improving workflow efficiency, communication, quality of care and patient
safety.
Factor 3: Aligning with the Future of Enterprise Imaging Informatics
A few years ago, McKesson started to build on a business strategy that consists of
promoting the adoption of add-on solutions and services by clinical and IT departments
within its large customer base, in a way that would increase key performance indicators
such as customer penetration, customer retention and customer satisfaction rates. In
doing so, McKesson has aligned its business operations well with the trends affecting
imaging providers’ technology adoption and financing models. This strategy has started to
pay-off for the company in the last two years, as McKesson is now driving more significant
recurring revenue streams from its customer base while securing long-term customer
retention and achieving industry-leading customer satisfaction rates.
In Frost & Sullivan’s opinion, with its recent successes in cardiology informatics
complementing its exemplary performance in radiology informatics, McKesson is ideally
positioned today to deliver effectively on the promise of integrated, enterprisewide
imaging informatics solutions. McKesson’s deep entrenchment in the North American
healthcare IT arena further strengthens the company’s ability to partner with customers
on comprehensive IT solutions, and to assist them proactively in their meaningful use
strategies within and around the medical imaging specialty.
Conclusion
McKesson has been highly successful during the last five years in achieving multi-faceted
and sustainable growth in all of the saturated radiology informatics market, the complex
cardiology informatics market and the fragmented enterprise imaging market. This
achievement further demarcates McKesson from the competition and consolidates its
position within the top-tier enterprise imaging informatics vendor group. Frost & Sullivan’s
analysis for the Enterprise Imaging Informatics Market clearly shows that McKesson is a
reliable PACS vendor whose solution enhances productivity and enterprise integration.
Based on these market share advances and the success factors underlying this growth,
McKesson is the well-deserving recipient of the 2012 North American Growth Leadership
award in Enterprise Imaging Informatics.
BEST PRACTICES RESEARCH
© 2011 Frost & Sullivan 6 “We Accelerate Growth”
The CEO 360 Degree PerspectiveTM
- Visionary Platform for Growth
Strategies
The CEO 360 Degree Perspective™ model provides a clear illustration of the complex
business universe in which CEOs and their management teams live today. It represents
the foundation of Frost & Sullivan's global research organization and provides the basis on
which companies can gain a visionary and strategic understanding of the market. The CEO
360 Degree Perspective™ is also a “must-have” requirement for the identification and
analysis of best-practice performance by industry leaders.
The CEO 360 Degree Perspective™ model enables our clients to gain a comprehensive,
action-oriented understanding of market evolution and its implications for their companies’
growth strategies. As illustrated in Chart 5 below, the following six-step process outlines
how our researchers and consultants embed the CEO 360 Degree Perspective™ into their
analyses and recommendations.
Chart 2: The CEO's 360 Degree Perspective™ Model
BEST PRACTICES RESEARCH
© 2011 Frost & Sullivan 7 “We Accelerate Growth”
Critical Importance of TEAM Research
Frost & Sullivan’s TEAM Research methodology represents the analytical rigor of our
research process. It offers a 360 degree view of industry challenges, trends, and issues by
integrating all seven of Frost & Sullivan's research methodologies. Our experience has
shown over the years that companies too often make important growth decisions based on
a narrow understanding of their environment, leading to errors of both omission and
commission. Frost & Sullivan contends that successful growth strategies are founded on a
thorough understanding of market, technical, economic, financial, customer, best
practices, and demographic analyses. In that vein, the letters T, E, A and M reflect our
core technical, economic, applied (financial and best practices) and market analyses. The
integration of these research disciplines into the TEAM Research methodology provides an
evaluation platform for benchmarking industry players and for creating high-potential
growth strategies for our clients.
Chart 3: Benchmarking Performance with TEAM Research
About Frost & Sullivan
Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth
and achieve best-in-class positions in growth, innovation and leadership. The company's
Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined
research and best-practice models to drive the generation, evaluation and implementation
of powerful growth strategies. Frost & Sullivan leverages 50 years of experience in
partnering with Global 1000 companies, emerging businesses and the investment
community from more than 40 offices on six continents. To join our Growth Partnership,
please visit http://www.frost.com.