The Front End and Back End of Innovation

Healthcare Innovation: Trends from the Trenches

Andrea J. Simon Ph.D. February 14, 2014

Our Presenter

Andrea Simon, Ph.D., President and CEO

Simon Associates Management Consultants (SAMC)

Dr. Simon (Andi) is a Corporate Anthropologist and Culture

Change specialist as well as an award-winning Branding

and Marketing consultant.

SAMC specializes in helping companies change.

Webinar Series

Healthcare Innovation: Trends From The Trenches

Dianne Auger

Senior Vice President, Marketing

St. Vincent’s Medical Center

President of the St. Vincent’s

Foundation

Linda MacCracken, MBA

Vice President, Advisory Services

Truven Health Analytics

Kriss Barlow RN, MBA

Principal, Barlow/McCarthy

Agenda For Today

Front End of Innovation: How can you “see, feel and

think” in new ways?

Back End of Innovation: How can you turn abundant

ideas into effective innovations?

How You can begin to develop a Culture of Innovation!

10 Steps to Help You Innovate.

Think About It…

"Ideas are like rabbits. You get a couple and learn

how to handle them, and pretty soon you have a

dozen." - John Steinbeck

The Idea Of “Innovation”

At recent workshops I held on

“Change Matters,” I was fascinated

by the answer to my question: “Is your

organization focused on innovation?”

Everyone said “Yes!”

But Doing “Innovation?”

But, when I asked: “What are

you actually doing that is

innovative?”

Their answers: “Not much!”

Not For Lack Of Spending

U.S. government spending on health care R&D,

which came to $53 billion in 2013, is topped

only by the government’s spending on defense

R&D.

Private-sector spending on health care R&D

also runs into the tens of billions of dollars.

Yet, Too Many Efforts Do Not Work

Despite this enormous investment and the magnitude

of the opportunity for innovators to both do good and

do well…

Too many efforts fail

Losing billions of investor dollars along the way.

Some Well-Known “Big” Examples

The disastrous outcome of the managed care

revolution.

The $40 billion lost by investors to biotech ventures.

The collapse of numerous businesses aimed at

bringing economies of scale to fragmented physician

practices.

Today, Let’s Think About This

How can you:

Turn the undesirable to desirable, leading to fresh innovative solutions.

Develop the skills to do this.

Build an affection for ideas -- “see, feel and think” in new ways.

And, a process to “do” things that help implement ideas into effective innovations.

Create a culture that embraces change and keeps it coming.

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Market Evolution: Adapt Or Die!

Change

Matters !!!

The Brain, Habits and Culture

Why We Hate Change

You See Things As You Are

“We don’t see things as they are. We see things as we

are.” ~Anais Nin

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Need New Eyes

“The real voyage of discovery consists not in seeking

new landscapes but in having new eyes.” ~Marcel Proust

You Don’t Know What You Don’t Know

What we know

What we know we don’t

know: like how to fly a plane

or speak Japanese

What we don’t know we

don’t know—

EVERYTHING ELSE

16

Brain Hates To Change

17

Change creates Pain

in the Brain

Power Of Habits

While we love to think that

we are full of “free will”

But, we are really products

of well-honed habits.

Comfort Of The Herd--Culture

Randomness To Fool The Mind

To create new solutions, innovate we have to Fool the Mind.

Have to look outside your current path and capture ideas from other places.

“See” in new ways.

20

You Have Great Ideas

Best ideas are with You!

And with your customers and partners.

How can you tap into them?

But, Scary, Fuzzy Goals Hold You Back 22

Trends In The Trenches: We See All Kinds And In

All Ways

Innovation Is Happening

Turning Reluctant Innovators..

It use to take physicians 13

years to adopt new evidence-

based medicine protocols.

Now it is down to 10 years.

Physician Engagement To Change

Summit Medical: Paving the way for accountability

Deciding to become a Medicare ACO, Summit Medical Group—a 218-physician group with approximately 140 primary care physicians—had a Real Challenge.

What did they do? Got the physicians engaged to change.

Organizations Re-Designed To Innovate

…at the Cleveland Clinic, they are teaching doctors, nurses and staff to “think of themselves and act like an innovator, to try and come up with new and better ways of doing their job, then to use the organization that (Chris) Coburn's created to make something from it.”

New Technology Is Transformative

New Entrants: Walgreens “Take Care” Clinics

Changing The ED Experience

Innovative New Solution: Sending EMS out to

people’s homes to do triage rather than just bringing

them back to the Emergency Department—such as

Christian Hospital in St. Louis has just launched.

Innovations At The Intersections

New Uses for Technology Solutions: Telemedicine

services in pediatricians' office to connect with the

specialists at the Academic Medical Center—such as the University of Michigan is doing.

Different Types Of Outreach

Addressing Problems In

New Ways: Doing extensive

high school student cardiac

screenings to eliminate the

risk of undetected heart

attacks on the sports field—

as Hurley Medical Center has

been aggressively promoting.

Little Steps That Lead To Big Wins

1. Front-line hospital staff as daily problem solvers

by Marcelo Zottolo

Want to drive performance? Stop telling your front-line staff what to do and engage them in daily problem solving.

One of the biggest wastes in healthcare, aside from the wasteful

spending, is the waste of not reaching to your front-line staff for daily

problem solving.

At Cape Coral Hospital, in southwest Florida, we have been experimenting with daily

improvement huddles in the emergency department. These are five- to 10-minute stand-up

meetings, twice a day, to review service, safety and quality performance. It also provides

staff-generated opportunities and ideas for improvement.

Read more > >

Business Model Innovations

BayCare Health System with 10

Hospitals on the West Coast of

Florida is changing its business

model to transform its mission

from fixing you when you are

broken or sick to population

health and keeping you well.

Mobile Medicine That Comes To You

www.mymobilemedicine.com

Or This Type Of Mobile Medicine

Then There Is Innovative Pediatricians

Coming Soon To Disrupt Even More

Smart Contact Lenses from Google with chips that

can read your tears and evaluate your blood sugar

for diabetes.

Feels Like Everyone Else Is Doing It

“Why Not Me?”

How do you really “see, feel and think in new

ways?”

And then how do you actually “do” innovation?

What To Do?

Grab hold and start building something quickly, or

else watch your brand wash away into

obsolescence.

Continuous Improvement?

Incremental Innovation?

Blockbuster Change?

What Do We Mean By Innovation?

Think About A Continuum Of Innovation

Create New

Market

Manage Existing

Market

Radical

Change

Minimal

Change Customer Experience,

Cost Savings Strategy

Low Risk, Many

Competitors

High Risk, High

Reward, Offensive

High Risk, Defensive

Strategy

Some Initial Observations To Consider

Innovation is not a lot of ideas sitting around

searching for some meaning.

It is critically important that it is tied into business

strategy, customer experiences, organizational

processes, structure, and capability.

It doesn’t do well by itself.

Execution Wins!

Innovation is when you turn ideas into action—and

preferably ones that add value in new ways.

It can be incremental or market changing.

But how do we know which ones will work?

Innovative Cultures

The big differentiator between vibrant innovative cultures and those that speak about innovation and hope it happens lies in these values and beliefs:

Risk tolerance

Idea sourcing

Collaboration

Small wins, win!

A No Failure attitude: success and learning experiences

Measure a lot to learn what works all along the way

Build A Culture Of Innovation

An organization that can execute well on a few

good “wins” and keep learning is more powerful

than one that has lots of great ideas with no way

to execute.

The Challenge

All too often a company has established and

branded itself as leaders in its industry.

But over time, the company has fallen into old habits

addressing client needs with the same solutions.

Frequently, we find the “factory” driving the

business strategy.

Away From Competitive Advantage

As times change, the old strategy of benchmarking

your system against others is no longer useful.

In-industry competition as systems consolidate

around you no longer works.

Time to look elsewhere for new ideas.

To Create -- Not Compete.

And…

Customers are finding new solutions that are simpler,

easier and faster—and often less costly.

Staff are ill-prepared to change and resist efforts

to transform what they are doing and how they are

doing it—that culture.

So, let’s begin to change…

Let’s Talk About The Front End Of

The Front End Of Innovation

What Problem Do You Really Want To Solve?

What Job Needs To Be Done – For Whom?

First, Define The Job To Be Done

What do you think you want to change?

To solve what problem?

What job is to be done?

Maybe You Want To Respond To…

Newly Insured?

Build an effective ACO and/or Medical Home?

Unmet Needs of Men?

Pressure to reduce readmissions and frequent users of your ED?

Changing demographics and lifestyles of the future users -- that Gen Y Generation?

Pick One

All of them are challenging the status quo in

healthcare systems today – whether you are selling

people pharmaceuticals or trying to engage them

with your PCP’s or Medical Homes.

Now, Let’s Go Through A Process

• Deconstruct today

• Build an idea bank

• Pull in the information

from across other

industries, markets, etc.

• Examine

• Explore

• Experiment

• Testable Prototypes

• Include Customers in

Creation Process

• Test, Test, Test and Learn

• Decisions

• Action

Goals Converge Emerge Diverge Ideas

Bundles

Intersections

53

Divergence Comes First

How can we take the

problem and think in new

ways about how to solve it?

Must deconstruct it.

We love Innovation

Games® for taking things

apart.

Divergence: Or Go Exploring

Must watch and listen

Research is clear: people

cannot tell you what they

are doing.

Be an amateur

anthropologist.

55

56

Divergence: Other Tools

Go Exploring: Like “Undercover Boss”

Spend a “Day in the Life of a Customer”

Have Lunch and Listen

Take a Camera

Divergence: Goal To Build An Idea Bank

A place to capture and

park ideas before you

know what to do with

them.

Who And What Are You Looking For?

Nonusers

Unmet needs and go-arounds

Emerging trends

Pain Points you can help resolve

Better use of resources

Better experiences

What Are Key Levers?

Faster: How can you make something faster?

Simpler: How can you make using you, choosing you, simpler and easier?

More Productive: How could you make them more productive?

More Fun: Maybe make the experience less complex, even fun!

Industry

Strategic group

Buyer group

Scope of product or service

offering

Functional-emotional orientation of

an industry

Time

Where Should You Look?

Not where you think!

Must look outside of

what you know

today.

Look across…

But Don’t Forget Employees

Engage employees across the organization.

Employees have an abundance of ideas but no

place to put them.

Use Modelling

Ideas come together at the

Intersections.

Often they need a picture

to allow the team to see it

together. It helps the brand

visualize the end result.

What About Execution?

With All Those Ideas What Happens Next?

How Do You Know Which Ideas Are Worth Pursuing?

How Do You Turn Them Into Effective “Innovations?”

Themes Emerge

• Deconstruct today

• Build an idea bank

• Pull in the information

from across other

industries, markets, etc.

• Examine

• Explore

• Experiment

• Testable Prototypes

• Include Customers in

Creation Process

• Test, Test, Test and Learn

• Decisions

• Action

Goals Converge Emerge Diverge Ideas

Bundles

Intersections

64

Searching For Small Wins

How do we convert the abundance of ideas into testable new solutions?

How radical do you want or need to be?

Are we going to do something that is just incrementally better than before? Which is fine!

Or something this is a “really big idea” that will “WOW” the market?

Remember The Continuum Of Innovation

Create New

Market

Manage Existing

Market

Radical

Change

Minimal

Change Customer Experience,

Cost Savings Strategy

Low Risk, Many

Competitors

High Risk, High

Reward, Offensive

High Risk, Defensive

Strategy

With Abundant Ideas…

See how ideas emerge in new ways.

Watch for ideas at the intersections.

Several Research-Based Models

First, Business Model Generation and Canvases

Alex Osterwalder along with co-author Yves Pigneur and 470 co-

creators, wrote a truly innovative bestseller on business model design

and innovation.

A Second: Blue Ocean Strategy®

Blue Ocean Strategy is a book published in 2005 and written by

W. Chan Kim and Renée Mauborgne, Professors at INSEAD and

Co-Directors of the INSEAD Blue Ocean Strategy Institute about

how to create demand and open new market space--innovate.

A Third: Discovery Driven Growth

Discovery-Driven Growth: A Breakthrough Process to Reduce Risk

and Seize Opportunity by Rita Gunther McGrath and

Ian C MacMillan.

They All Share Same Starting Point

Clarity of a Business Strategy

How to turn the undesirable to the most desirable?

(Maybe Bundle Pricing is ‘cool.’)

How to open new market space addressing unmet

needs? (What about Men?)

How about finding non-users and new users (those

newly insured, perhaps?)

Each Leads To…

Clear, simple story. A Strategy.

With specific steps on how you are going to achieve it.

Becomes a framework, that sets forth how you are going to innovatively add value to solve a problem, perhaps open new markets and grow within them.

Within That New Strategic Vision

What is it you are trying to do?

This must be clear at the beginning or ideas will

wander around in searching of a reason for being — a

mission.

If you do it really well what do you imagine will occur?

Visualization really matters!

Next, Backward Plan

The military uses it; great management consultants

use it; the brain loves it.

Use A Game: “Remember the Future”

Begin with the end in mind and then imagine each step that you need to complete backwards to get there.

Don’t start with today’s assumptions and march forward.

Leadership Engagement

I often begin here and repeat often.

Having a clear focus and specific vision and strategies that senior-level executives embrace is essential to success.

Senior leadership also needs to change its own thinking on the role of innovation in the overall success of the organization.

Change core values and beliefs.

Discovery Driven Growth Conventional

Corporate Culture

Discovery-Driven Culture

Success Makes your numbers; hit

projections

Learning as much as you can for the least

possible cost

Management Focus Day-to-day operations Innovation: Top of Agenda; Top of Mind

Timing Dictated by budget or

planning cycle

Dictated by key learning checkpoints

Revision Indicates a mistake Indicates a learning

Funding Allocated all at once or not

linked to milestones

Limited to amount needed to achieve next

milestone

Termination Decision Delayed, avoided or

reluctantly pursued

Occurs as part of the planning process;

disciplined disengagement

This Is Where The Ideas Really Turn To Testable

Models

Convergence And Your Goals

Themes Emerge

• Deconstruct today

• Build an idea bank

• Pull in the information

from across other

industries, markets, etc.

• Examine

• Explore

• Experiment

• Testable Prototypes

• Include Customers in

Creation Process

• Test, Test, Test and Learn

• Decisions

• Action

Goals Converge Emerge Diverge Ideas

Bundles

Intersections

79

Engage Partners

Include Customers

Ongoing Innovative Culture

Innovation is a process and you can put one into place.

Four of the most damaging words an employee can say:

“Aww, forget about it”

It leads to a culture where we never rest on what we

have always done but we search for new learnings and

constant choices.

Focus employees’ innovation priorities.

Change The Story

Story telling is very powerful. Brain loves stories to

organize the facts.

Innovation is all about changing the story.

Visualization Is Key

Brain has to see it to believe it—really!!

Try to create an amazing abundance of ideas in a

space in which people can express relationships

between concepts, features or other priorities by

manipulating objects on the visual field.

To Get To Your Goals

Recognize innovation as a

bucket with valuable leaks.

10 Steps To Remember

1. Begin with what you think you want to achieve—

fuzzy goals are good ones.

2. Take apart everything you do today. Divergence is

key.

3. Go explore visually, through games, through “deep

hanging out” and in different places.

10 Steps To Remember

4. Build an abundance of ideas—more you have

more likely you will have great ones.

5. Let them Emerge. At the Intersections.

6. Engage lots of people—employees, partners,

customers/patients.

10 Steps To Remember

7. Develop testable prototypes, models, visualization.

8. Test some more. Learn from each test.

9. Get ready to launch. But remain open to pivot and

redirect.

10. Make sure you have the metrics in place to know if

it is working or you might as well start all over.

Innovation Comes From Inside

“If an egg is

broken by outside force, life

ends. If broken by inside

force, life begins. Great

things always begin from

inside.” – Jim Kwik

Next Webinar March 14 At Noon EST.

Join our next webinar.

Featured Speaker: Margaret Davino, Attorney and Partner, Kaufman Borgeest &

Ryan, Chair Elect, New York State Bar Association Health Law Section.

“As the Affordable Care Act is implemented and healthcare expenditures continue

to rise, providers and payers need to explore how to best set themselves up to

succeed in an evolving marketplace. In this 5th webinar, Margaret Davino will

discuss how the relationships between hospitals, physicians and other providers are

changing and what structures are being used for providers and payers to work

together, including accountable care organizations (ACOs). Margaret will also

describe the different models of collaboration between hospitals and physicians,

how these affect reimbursement, and what to expect in the future.”

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Discussion And Questions

Share what you see happening in “the trenches.”

Take as many questions as we can now and we can

continue the discussion after the close of the webinar.

For More Conversation And Information

Andrea J. Simon PhD

Corporate Anthropologist

President, Simon Associates

Management Consultants

asimon@simonassociates.net

Office 914-245-1641

www.simonassociates.net

@simonandi

@andisamc