By Christopher Kunney, Chief of Strategy & Business Development, DSS, Inc.
Twitter: @DSSHealthIT
The dictionary defines the word utility as follows: “An enterprise concerned with the provision to the public of essentials, such as electricity, gas or water.”
It’s safe to say that for the majority of businesses primary utilities such as water, electricity and/or gas are essential in supporting the day-to-day operations of their enterprises. Limit access to any of these services and most organizations would cease to function effectively.
Over the past few decades, there has been a revolution in computing and communications, and all signs point to technological progress and use of information technology in the healthcare continuing to accelerate.
Much like utilities, today’s data driven environment that information systems (i.e., servers, networks, mobile devices, tablets, etc.) and the applications support the business ecosystem have become a vital part of how care systems deliver their products and services.
HIT Infrastructure: A New Reality
For most companies’ standard utilities – paying for electricity and water — are all the cost of doing business. They don’t think twice about allocating the funds necessary to ensure these services are always available for use. Conversely, many of the same organizations struggle to rationalize the ongoing cost needed to ensure its Internet, servers, WiFi, cell phones, network security and other important parts of their IT infrastructure remain scalable and uninterrupted.
Today’s care organizations must accept today’s reality that their IT infrastructure (the new utility) is critical for the dissemination of business intelligence (or informational currency), and is essential to remaining competitive.
We must also begin to adopt a more intelligent approach to how to leverage this new utility and the costs associated with maintaining it. This means not just budgeting for your monthly technology expenses, but also ensuring regular system upgrades, hardware refreshes, security testing, and more, becomes an essential part of the organization’s life cycle management strategy. This concept is no different than guaranteeing regular maintenance of a building’s plumbing and electrical systems.
Maximizing the Efficient Use of Resources
Investment in the care and feeding of a company’s technology investments should be balanced with an effective strategy for commoditizing its relative cost. When feasible, the goal should always be to redirect a care system’s resources in areas that bring greater impact to their bottom-line, and are clearly aligned with the organization’s core business.
Rather than spending limited capital on maintaining data centers facilities, purchasing servers, network security and highly specialized technical staff, care systems should consider migrating high-dollar IT infrastructure to cloud-based solutions and begin adopting a utility usage purchasing model (i.e., infrastructure-as-a-service). Like other types of on-demand computing such as grid computing, the utility model seeks to maximize the efficient use of resources while minimizing associated costs.
Approaching technology investments from this perspective allows care leadership to acquire computing power based on actual demand. It also creates opportunities for redirecting capital to other projects and revenue generating investments. Gone are the days of allocating large amounts of capital to IT infrastructure projects whose maximum utilization is rarely realized, and at best has a limited life expectancy of typically 3 to 5 years.
In today’s highly competitive business environment – compounded by redirecting resources for COVID-19 response — it makes sense for hospitals to begin viewing their technology usage like a utility to the business (similar to water and electricity consumption). They should also adopt best practices that will allow them to efficiently manage the anticipated usage.
Of course, there has been confusion and/or concern by many organizations over the utility model. Primarily because it will require the outsourcing of critical/sensitive areas of their IT operations to third party vendors who in turn, charge back based on capacity or processing demands. In addition, they are also left to the mercy of the vendor to provide them with access to their critical business data.
While this is one approach, it’s not the only one care systems are taking.
Private Utility Models
In fact, many hospitals are deploying their own internal private utility models that accomplish many of the same goals as traditional outsourcing without giving up the keys to their data kingdom. The bottom-line is that, whether you chose to leverage internal or external services, care systems adopting the utility model will be best positioned to adapt quickly to their evolving business environment.
Finally, the cloud is just one aspect of what I like to call the “Data Management Utility Model.” It’s important to recognize that choosing the right vendors is still very important to hospitals making the commitment to this model. There are a plethora of service options, vendors and delivery models to choose from, which makes this road one that organizations should tread carefully down. One size doesn’t fit all, and taking a conservative approach in its adoption is a wise strategy to say the least.
A successful adoption for the enterprise incorporates a practical service management strategy, with an effective data management and governance methodology in its implementation. Health data and infrastructure have become the next utility, which is not such a far-fetched concept these days.