Hail Mary passes in American football are named after a prayer for a reason. The chances of the quarterback connecting to a receiver over a long distance make this kind of pass look like an act of desperation when the clock is close to Game Over. Did prayers miraculously come true for Aaron Rodgers’ last-chance effort to win their Green Bay Packer’s second game against the Detroit Lions? No. The final pass was not entirely an act of desperation requiring heavenly intervention. Rather, practice made the play part of the Green Bay arsenal; and practice made perfect. There is a lesson in that for all of us as organizational leaders. Apparently Rodgers and his teammates regularly practice long passes, and did so at least three times the practice before the Lions game. Green Bay’s preparation for the final attempt to score also included…
Building, shifting, and destroying value
Economist Joseph Schumpeter called waves of industry change “creative destruction.” He argued disruption of the current industry structures and companies built a nation’s wealth. Most economists agree, viewing creative destruction as a necessary ingredient for economic growth. But Schumpeter was writing in 1942. Is creative destruction still a positive force in today’s world? Or are the benefits of creative destruction more nuanced and the costs far greater than Schumpeter argued? As I reflect on this question, I observe three types of disruptions to markets: new-to-market capabilities, reshaping of the industry value chain, and consolidation. While all three create winners and losers, the net benefits to society differ. New-to-market capabilities disruptions include examples like the steam engine, the telephone, the electric bulb, genetic profiling, and personal computers, creating industries that allow us to do things previously impossible. When an entrepreneur brings new-to-market capabilities to…
It’s all about the money, stupid.
The following post is authored by Bill Kraus, a senior executive in the insurance business who served as Chief of Staff for GOP Governor Lee Dreyfus in Wisconsin. The message is so important I am posting it in place of my blog this week. Former Governor Lee Dreyfus’s golden rule for politics: Those who have the gold make the rules. The Wisconsin Democracy Campaign recently published the list of the top 20 “rule makers” in Wisconsin over the last 4 1/2 years [www.wisdc.org]. In total this group contributed $128,691,113 during that period to advance their interests by promoting ideas and candidates or by criticizing opposing ideas and candidates. Many of the groups interests are obvious. The teachers union is on the list. It won’t be there long, however, since Act 10 shut down its revenue stream. The state’s largest business organization is also…
Disrupting the workplace
In 1989, the CEO of my global employer allowed me to work from home rather than demand I move halfway across the US to be near corporate headquarters. Two technologies made his decision possible: Overnight delivery and an early fax machine. I was the first distributed worker other than our sales and product service representatives. Flash forward to 2013. I worked for IBM where 45% of its global workforce (and growing) worked from home offices. Those of us already virtual referred to IBM as “I’m By Myself.” We used a shared on-line knowledge base so poorly structured that we often entered the IBM site pretending to be a customer—it was the fastest way to find the information that we needed to complete a pitch deck. Many a day, I thought I was working for a computer, not a company. Distributed work is an…
Healthcare data: The promise and peril
In this last of four blogs reporting from WTN’s Disruptive Healthcare Conference 2014, I focus on a realization I came to during the conference: Big Data and the Internet of Things have finally come-of-age in healthcare. Examples of how data, analytics and mobile platforms connected to cloud-based data centers are transforming healthcare were woven into many presentations. Here are some examples: Aurora Health Care, which spends $780 million on its supply chain annually, is using data comparing different surgeons’ supply usage to identify savings that do not hurt quality of care. It is also identifying frequent users of ERs who could be served less expensively in a primary care location. Specialists and primary care physicians are able to collaborate virtually or via e-referrals that, according to PDS CEO Jonathan Ravdin, are reducing the need for visits to specialists or wait times for appointments….
Will these three disruptive healthcare changes be enough?
In this third of a series of four blogs about WTN’s 2014 Disruptive Healthcare Conference (DHC), I’ll focus on three disruptive innovation waves reshaping healthcare. These innovations could lead to better care for less cost. But will they happen fast enough to allow us to channel wasteful healthcare spending into efforts that would make our economy more competitive globally? New reimbursement models and incentives Slowly but surely, payers are adopting new approaches for reimbursing providers. One is pay-for-performance (e.g., Medicare won’t reimburse hospitals for avoidable re-admissions). Another is making providers financially accountable for a population’s healthcare (e.g., Accountable Care Models, introduced in Obama’s far reaching reform). These new models create financial incentives to keep people healthy, surface health issues earlier, move care to less-expensive settings, and avoid unnecessary tests and procedures. In addition, Obama reforms preclude insurers from kicking out the chronically ill,…
Why does the US have so much waste in its healthcare system?
In an earlier blog about WTN Media’s Disruptive Health Care recent conference I argued we spend between $900 billion and $1.3 trillion on non-value-added healthcare, aka waste. Why? First, we pay hospitals and physicians to do procedures, not to keep people healthy. Jeff Grossman, CEO of the University of Wisconsin Medical Foundation and a dean at the UW School of Medicine and Public Health, pointed out that while there is talk of new models of care, providers still get paid largely on a fee-for-service basis; Aurora Health Care officials confirmed the same. Grossman added, “We are all focused on this efficiency thing right now, but I have to tell you that we make our money on waste … that is the name of the game. The focus on hospitals has to end before we can deliver healthcare. Delivery of healthcare (procedures) only accounts…
The opportunity cost of our healthcare system failures
The Disruptive Health Care 2014 Conference, hosted by WTN Media, exposed attendees to a range of observations about today’s healthcare system, its gaps and future trends. This blog the first of four related to the conference. “Why Does the US Have So Much Waste In Its Healthcare System?” “Healthcare Incentive and Landscape Changes: Trends Underway,” and “Healthcare Data: The Currently Weak Link” will follow. First, let’s look at the context for the conference speakers’ insistence that system disruptions are needed. I for one cringe when I look at comparative healthcare costs and outcomes across developed nations. According to data published by the Organization for Economic Cooperation and Development (OECD), which represents 34 democracies with market economies, in 2011, the US spent on average $8,508 per person on healthcare compared to an OECD average of $3,332. But, you might say, the USA is a…
Healthcare Industry Disruption
If you are in the healthcare industry, or are curious about where it is headed, be sure not to miss WTN’s June 24-25 upcoming conference focused on the industry’s disruption. Mike Klein was one of the early voices predicting dramatic change; once again he brings a stellar set of speakers to help participants anticipate the future. As a nation we pay more for healthcare than other nations yet achieve worse health outcomes. The three to six extra GDP percentage points we pay in healthcare costs are needed for infrastructure, education, federal R&D investments and our pocketbooks. We pay more because payers exert too little pressure on providers relative to other nations; and we’ve historically paid providers to do procedures versus improve health. In addition, many consumers are sheltered from cost and do not know the relative cost or quality of providers. Capitalism’s competitive…
Uber: A business model innovation that benefits and exploits
“Is the Uber disruption of local taxi and town-car markets a positive business model innovation for consumers?” a former colleague asked me. Uber, and its competitors Lyft and Sidecar, are disrupting the regulated taxi and limo-service markets by enabling ride-seekers to secure transit in privately owned cars using a mobile app. The entrepreneurs have used technology to both transform what has largely been a local market into a national/global market and dramatically improve customer service (e.g., automated billing, knowing potential drivers’ locations, cleaner cars, customer feedback on specific drivers, etc.). I am not in the least bit surprised about the emergence of Uber and its direct and indirect competitors (like Ridejoy, an on-line car pooling service). These disruptions demonstrate a number of consumer-friendly trends underway in our economy. Technology automates human tasks and makes markets more efficient and effective. Who needs friends–with-friends when…