Workday Podcast: Delivering Business Agility for the Future of Healthcare

Keith Lohkamp: As healthcare organizations continue to keep pace with change, CIOs are at the forefront of ensuring that their businesses increase flexibility, accelerate growth, and innovate faster. David Chou, a healthcare technology executive, shares why organizations must move beyond the traditional models of the past and towards an approach that enables adaptability. I'm Keith Lohkamp, senior director of healthcare industry strategy at Workday. Thanks for joining me today. Before we dive in, David, can you tell us a little bit about your background and current role?

David Chou: Sure. And thanks for having me, Keith. It's extremely exciting to be here. My background is I have been leading the healthcare technology space for the last 25 plus years with working for various types of organizations in the for-profit, non-profit, academic medical center, pediatric specialty hospital now focusing primarily on the value-based care space and the ambulatory space.  So, I would say I've seen the entire healthcare landscape. So happy to have this discussion today.

Lokhamp: So, you've seen a lot. And, you know, over the past few years, how has digitization accelerated in the healthcare industry? What has really changed?

Chou: I would say, just to think back a few years or probably, let's say, five or seven years ago where even getting to electronic medical record was a big push. That was the start of this accelerated digital movement of moving from paper to digital. And now we're seeing the second shift, which is, "How do we create new business models once we have all the data and all the information available digitally?" So, I would say this is now where we are now moving towards in the healthcare space and that we want to take the information, we want to create additional insights, we want to create predictive modeling, and we want to figure out how to practice medicine with the highest quality care, specifically at the lowest expense for every organization. So, I would say this is where we're starting to see the second wave happen from a digital health perspective. We're starting to see lots of other competing organizations that are coming in to gain market share that have traditionally not been healthcare. And I would say the traditional health systems are looking for ways to also-- to figure out how to utilize their technology stack as their competitive advantage.

Lohkamp: Is there anything specific that comes to mind in terms of how the industry has changed or particular trends that are driving this acceleration?

Chou: So, the move towards value-based care, which is a big shift in terms of how organizations are getting reimbursed, is coming. Historically, healthcare organizations are paid based upon fee-for-service, which is based on the number of patients that you see, and that's how you're getting paid. Now, as we are moving toward the future, it's going to be focused based upon the value of the care that you provide. So ideally, you want to see the least amount of patients, provide the best care, provide the best preventative care, and you would get a higher rate of reimbursement. So, that has shifted the model tremendously. It's also moving a lot of the care outside of the four walls of a facility. So, facility meaning the hospital or even at the clinic setting.  w-- everyone is focused on shifting care towards the home or towards a convenient location. And that's going to shift how we practice medicine. That's also going to shape in terms of the type of technology solutions that every organization is going to offer for the patient. I would say that's a major trend that is coming. Everyone's trying to figure out how to create that new business model of providing care. And it's not as easy as just offering simple technology solutions such as r-remote patient monitoring, telemedicine. We have to start thinking about some of the logistical components, right, some of the simple items such as, "How do you get medical supplies to the patient's home quickly?" That is going to be a challenge. And I-I'm not sure everyone has thought through those types of operational problems, but that is what's coming as we start shifting the model of care toward a patient's home or a different location outside the four walls of a hospital or a clinic setting.

Lohkamp: I hear you kind of talking about how the changes in how we deliver care and where we deliver care is creating a lot of challenges or opportunities for health systems. So how have you seen the role and responsibilities of the CIO evolve over time as they're, sort of, faced with these new challenges and the continuing evolution of healthcare delivery?

Chou: So, the CIO's role has changed dramatically. Even if I were just to date back 20-plus years ago, it started out as a role where you're just managing technology. You didn't have to stretch it. Just keeping technology moving and having solutions to implement it. Now the forward-thinking CIOs are more business savvy. They're focused more on outcomes. They're focused on can they create solutions that may help generate revenue or, at the same time, reduce expenses. And one of the big shifts toward that is moving towards the cloud. So, when I think about the cloud, there's a lot of misconception. Number one, cloud is not safe. The second misconception is that cloud is going to be cheaper. I would say, the first piece to that is cloud is definitely going to be a lot safer. Just imagine using, like, cloud from a provider-- like Workday or another big tech company's cloud. They built it to the scale that a-an-any healthcare organization cannot match. When I hear from security officers, compliance officers, that moving to cloud has security issues. I would say it's probably definitely the opposite. The second is moving towards the cloud is this cost-saving measure. It has nothing to do with cost. It's more to do with agility and the ability to scale up and scale down quickly. So, if you need to deploy a solution after 10,000 users, maybe we'll do so a lot faster in a cloud environment versus trying to build that same environment inside your data center. And I want to add a third piece of that which is moving t-to the cloud also allows you to have compute power that you probably would not be able to afford locally at your organization as well. So, definitely moving towards the cloud is top of mind for every forward-thinking CIO. And all the ones that are thinking more about the business opportunities have to start thinking cloud first versus trying to build and replicate the same environment internally.

Lohkamp: Well, that's definitely something we've seen at Workday as the ability to deliver applications on the cloud has really allowed CIOs to move away from just maintaining apps and maintaining databases. And hopefully, that's helping to enable the CIOs to really transform in their role. And, you know, you really mentioned that need for a-agility. Can you talk a little bit more about the need to have that adaptability, particularly as it's built into technology and processes?

Chou: So, I would say if you just looked back at the last few months in the healthcare sector, it's really inundated with news of heavily mergers and acquisitions.  there's market shares that's shifting. I am working with an organization that's in hyper acquisition mode, trying to buy various clinics or physician practices or, or a different business model that fits our need in terms of our expansion. And I would not be able to do that without agility, you know, bringing organizations on ASAP in terms of having that agility. It's going to be key. We just can't wait, you know, 6 to 12 months in order to bring in other organizations. So, I would say that's going to be the key as the trend for healthcare mergers and acquisition increases. We're starting to see these megamergers. So, the number of acquisitions may decrease. But what's different is that the size of these acquisitions is getting bigger and bigger. So, if you just think about the scale of these mergers, you definitely need to be agile. You definitely need to think about how you can integrate these large organizations in quickly. And the only way to do that is with an agile solution of, like, cloud environments. So, I would say that's definitely going to be key for forward business leaders that are thinking about growth. On the flip side, if you are not thinking about agility, you're not thinking about growth, then that may be, a different type of problem because you may not be on the acquiring side. You’re probably going to be getting acquired, which is probably not the place that most forward-thinking business leaders or organizations want to be in. So, agility is going to be crucial just to be able to scale upward. And at the same time, sometimes we want to have ag-agile solutions so that we could scale down. So let me use the same examples of [inaudible].  you know, the ability to spin up's extremely important, but we also want to scale down when the time is inappropriate of having these solutions.

Lohkamp: Well, going back to that evolving role of the CIO, can you talk a little bit more about how the CIO's becoming part of that strategic decision-making team and, and being really asked to execute on this, this strategy you mentioned or mergers and acquisitions? But love to hear your perspective on how the CIOs is, you know, playing a key role in that as well.

Chou: Yeah, just even reflecting on my career in the last few years, my role is not really about technology anymore. I would say the CIO role is really about connecting the dots for an organization just because we are in the great position where we see the movements from all across the operational department because of the solutions that we support. So, I'll give an example. I get to see exactly what happens when a patient arrives in, say, a facility all the way through the clinical operation model and then even on the backend towards when, a bill gets dropped and then even further whether we are getting paid appropriately. So, not every executive leader has that capability or even has that ability to see that entire movement of patient from a data, from a technology perspective. So, because the CIO sits in that seat, I really view the role as more of the thought connector. We're able to flag anomalies. We're able to bring together various departments to get them in sync operationally based on the technology that we support but also some of the [inaudible] that we may have learned throughout the experience. So, one of the things I always hear from the CEOs that I have worked for is that they're not using me to manage technology, but they're really using me to connect the dots to bridge informational gaps, operational gaps that-- based on my point of view. So, I would say that's the role of the CIO now. If you're able to do that and really understand the business operating model and the technology that supports that while bridging that gap, I think that is extremely valuable, and that's the key to success for the next generation CIO.

Lohkamp: That's a great perspective. The CIO really has that view across the entire enterprise and can be involved in every bit of technology, every bit of process. You also mentioned that view of the data and the truth. Can you talk a little bit about how the role of CIO's really critical to helping to pull together the data that the organization needs?

Chou: Definitely. So, I would say everyone agrees that we have more data than ever now. And understanding, number one, where the various data sources lie and then, number two, understand how you pull those together, that's extremely valuable. So, one of my roles is, even though I'm not a data scientist by trade, just having a good understanding of the various sources of truth in our disparate system. And then most importantly, we got to find and partner with a solid platform that has the capability of bringing all the aggregated data together. Because here's the number one problem that every healthcare organization wants to solve is, "What does this cost for us to take care of the patient? What is the actual expense related to it?" And I can guarantee you, it's a struggling challenge for a-almost every organization.  not that they don't know how much it costs. I think they have a good idea, but it's not down to a line item. Like when you go to a grocery store, this is how much you pay for your groceries all the way down to that line-item detail. And we struggle with that in healthcare because of the varied complexity with our billing because we bundle payments and charges together. Now we need to decouple that and get down to line item, which is where we could figure out how to extract additional un-unnecessary expenses. But we could also at the same time couple how much we spend from a healthcare perspective with a quality data so that we could ultimately provide the highest quality of care at the lowest cost. So it all starts down-- all starts with that data, understanding where the source of truth lies, and finding a solid platform that can aggregate all the various disparate information to create that insight. And I, I would say that's where organizations are looking for that holy grail [inaudible] in terms of what is that platform that we could use to provide that and ties in extremely well to population health management but, at the same time, just some of the simple [blocking?] and tackling of the financials in the healthcare organizations.

Lohkamp: Yeah, and I think that understanding that cost to deliver care ends up being such a foundational piece of every other activity. You know, it starts with understanding the cost to deliver care but, you know, that, that supports your decision making on whether to continue in a certain procedure area or impacts your planning-- your planning processes. Do you see the, you know, investment in cloud solutions for planning and analytics helping to really drive this forward and make it easier?

Chou: It's a must-have. I would say, going back to my earlier example of aggregating various data, you also need a lot of compute power to do that. So, you're not going to be able to scale and build that type of compute power inside your data center. Well, I guess you could, but it would be a very expensive endeavor. So, therefore, it's more cost-effective, number one, to utilize cloud providers that are building this out to scale multiple hundreds of clients throughout the world versus trying to build that. So, that cloud computing power is huge. And that's what is going to be needed in terms of that financial adaptability and be able to have the planning features. Just because what's going to happen is you are ingesting multiple, various data sources from everywhere and you're trying to create some insights utilizing artificial intelligence, machine learning, things that you just are not able to create yourself or have enough compute power to do so. So, I hope everyone's thinking about how they could utilize cloud computing or just to solve that simple problem.

Lohkamp: Yeah, you mentioned earlier that there's, there's too much data out there. And I think, initially, you know, years ago, it was trying to get all that data together. Now that we have all this data, there's too much to really be able to easily digest or act upon. Could you talk a little bit more about that, that role of AI and machine learning in terms of being able to better guide the enterprise?

Chou: Yeah, in terms of too much data, now we're trying to figure out how to not digest every piece of data, right? Just think about every wearable company out there that's in-involved with digital health things that remote patient monitoring tools that are getting deployed throughout every organization. So, there's constant monitoring of health data. It's probably not needed. You probably need more of the anomaly data. So, what do you do with the stream of data that's coming in from the wearable? Do you ingest them, or do you figure out how throw them out? Or do you utilize something like machine learning, artificial intelligence to ingest what's needed while throwing out what's not needed while creating the same insights? Because there's times when you want to have all the data to be able to prove that the patient is healthy or getting some clinical value out of it. But the flip side of that is the physician's not going to read all the streaming data all the time. That's going to really bog down their notes, and that's going to get to a higher rate of physician burnout, which you hear all the time. So, finding that right balance is extremely [inaudible] you have to utilize the latest technology such as machine learning and, and artificial intelligence to really combat that.  that's more on the clinical side in terms of monitoring. On the flip side, you know, being able to understand the financial aspect of it, the cost, as we discussed there, is going to be huge as well as expenditures are going everywhere to where you got to tie in insurance data, pharma data. We work closely with various group purchasing organizations. So, there's just a massive amount of data everywhere. And the same example of filtering out the clinical data also applies on the financial side.

Lohkamp: Yeah, I mean, definitely the similar type of challenges on the business side, and even on the HR side as healthcare providers deal with escalating turnover and the difficulty in recruiting and retaining new workers, being able to really get those insights into what's happening with their, their workforce. And these larger organizations are dealing with a lot of data. And so, machine learning can really help them pinpoint those trends and take actions sooner. So, yeah, it's definitely critical that we see that machine learning, AIs used now throughout our analytics. As you kind of look forward and you talk to IT leaders, there's got to be a lot of challenges they're facing in terms of trying to focus on innovating while also maintaining that, that business continuity as well. What advice would you give to IT leaders who might be struggling in that area?

Chou: That's a great question. That is definitely a hurdle right now for every executive that's leading technology, right? Just think about the number of disparate systems in every, I'll use the health system example, health systems have hundreds of applications that they have to support. It could range from 250 to 500. So just keeping those systems updated and maintained, it's already a full-time job if not more. And now they have to balance innovation, as you said. So, I think the approach that I have always taken is creating a group that really likes to focus on future thinking stuff, while you still have a lot of technology engineers that just loves to manage applications, making sure things are working appropriately. That's a skill set that's going to be required for any organization to be successful. So, figuring out the personalities of folks that really enjoy the business continuity and then while creating another group that really enjoys the out-of-the-box thinking, bringing out new solutions, things that have never been [inaudible] before. I think that's going to be huge. So, balancing the two within one team is re-really where the next generation of CIO needs to think about. Because if they don't take that approach, here's what will happen. The organization would say, "Okay, CIO. You're doing a great job of business continuity. We are going to position you and pigeon you in t-toward the business continuity." Then they go out and, and find another chief digital officer, chief innovation officer that comes in to do all the cool stuff. And that's where you start having the tension between the two executives, which is not where any organization would like to be at. And what also happens is the budget and spending authority typically stays with the business continuity group. So even though you go out and bring in these innovative leaders, they may not have the horsepower to introduce innovation. And you get into a different type of environment there as well where the tension also flares up. So, I would say the forward-thinking CIO must figure out how to balance that. They must figure out how to, within their own teams, create the innovation group, while also making sure that the business continuity stays intact. And that's my advice for IT leaders who are struggling to balance that. Because if not, [inaudible] again to that two senior execs. One's leading innovation, one's leading continuity, and, and it's just not a great place to be in.

Lohkamp: Are there any techniques or methods that you've seen to be particularly successful in terms of driving innovation within the IT department and helping to sport innovation within the health system at large?

Chou: I would say driving innovation internally, you got to also let go a lot.  I would say the personality for the CIO has to be more collaborative and really allowing everyone to be leaders of technology or superusers of technology, right? Historically, IT leaders probably provided limited access to users. But in the world that we live in today, everyone knows tech, everyone knows how to do stuff. I mean, people can code who are outside of IT. We must allow that freedom. We must allow that appetite for innovation to occur outside of IT. So, that's number one in terms of setting that culture and expectation. It is change. It is very uncomfortable for traditional IT to start giving up access. Like, I would say the forward-thinking CIO must create that environment to where everyone can get stability to innovate inside an organization. Everyone gets to be superusers of technology. So, I would say it has to start with that mentality and environment to create internal innovation. Otherwise, it becomes a build versus buy and a cocreate partnership with an ex-external entity. So, I would say I still like to have both. I still like to utilize external entities just because they could create solutions faster.  but at the same time, creating that internal innovation is still huge just for any organization because,  you got to have that-- you got to have something that comes out internally,  before, like, friction comes along where everyone thinks the external folks will a-all-- would be the only ones that gets to do the innovative and the cool looking projects while the internal group just focuses on keeping, keeping the lights on.

Lohkamp: Of course, one of the reasons that innovation is so important is how much is changing in healthcare from year to year. Putting on your vision of the future, what do you see is next, next for healthcare, and where should CIOs focus their investments to meet those future needs?

Chou: I'll just focus on three key areas. One is just your foundational environment of infrastructure and network. You know, make sure software-defined infrastructure has to be top of mind where you're utilizing software to drive networks, to deploy new networks and, at the same time, make sure you're thinking cloud first and mobile first in terms of all of your solution deployment that-that's going on the core technology side. I would say the business model side is what I touched upon earlier in terms of how you provide care outside the four walls of your organization, whether you're a hospital or an ambulatory care organization. So, can you create the business model of deploying a hospital at home environment? And that involves the entire makeshift of the clinical operation team because now you got to provide care at a patient's potential home. And just also think about the technology map, right, because now you need to extend your technology out to the patient's home where things as simple as [inaudible] may not be available. So, not having those controls is going to be difficult, but it's something that I would say forward-thinking CIOs must think on the future. And I would say the, the third piece is probably the type of solution I'm really [inaudible] still voice solution. I would say healthcare has not utilized voice as much versus other industries. But I think we're starting to see great solutions coming out to where hopefully, you know, a conversation that you and I have, if that's between a patient and a provider, that conversation can automatically get transcribed into some intelligence gets into the patient's notes, you know, some, some intelligent information can come out based upon the tone of the patient. You know, it could dictate whether they're not feeling at ease or something's bothering them. At the same time, it allows a physician to also put together the right diagnosis. So, that's going to be huge. And we're starting to see solutions like that on the market already. But I would say the adoption is still pretty low and not widespread yet. But of all technology that's going to be [inaudible] for the future just because it's going to combat a lot of the physician and clinician burnout that we're starting to hear about for the last few years.

Lohkamp: And do you think the changing patient expectations, or the consumerization of healthcare, is impacting how CIOs need to think about their technology investments and maybe taking more of a customer experience or consumer experience approach?

Chou: I hope so. I hope everyone's thinking about that and putting themselves in, sort of, the role of a patient slash customer, right? W-we all have a certain expectation of when we need to seek care just like the same expectation that we had when we want to utilize a retail space or even airline space, right? So, I would say I expect that to be a foundation where we are putting patients first as a customer.  if we're not, I think that definitely needs to be top of mind. But if you're looking at the various solutions that organizations are putting out there, whether it is something as simple as convening [of?] self-scheduling, convening of bill payments, right? These are simple things that we expect to have as a consumer.  but for some reason healthcare has not been at the forefront of this. But I would say it is starting to change as executives are demanding it, patients are demanding it. And with the fierce competition that we have ahead of us, organizations that do not think about these types of consumerism solutions, they may be left behind.

Lohkamp: And do you think CIOs are also starting to think about that consumer experience and bringing that to the employee experience as well? What have you seen happen in that area?

Chou: In the last year or so, employee retention is huge, right? How do you keep your employees engaged?  historically, it has been hard just because we have no insight about employees. We have no idea what their preferences are. We don't know what excites them. We don't know what challenges them. We don't have any data about their social activities that maybe  provide some insights. So, I would say every CHRO's thinking about employee experience the same way that we are thinking about patient slash customer experience because our employees are the biggest assets for every organization. And we need to start treating them, number one, and thinking about their wellbeing and thinking about how can we create a healthier work environment so that they want to stay.  because the cost of a, a replacement for a-any organization at every level is probably three X. So, would you pay three X amount of another employee coming in that may not do just as good a job if not worse? Or would you take some of that potential future cost savings, and make that right investment now to learn more about the employee base? So, I would say, yeah, it's definitely top of mind. I don't know whether organizations know what type of solutions can handle that. So, it would be interesting to hear further in the future in terms of what's provided. But yeah, that's definitely top of mind.

Lohkamp: So, before we wrap up, any last thoughts you'd want to share with our listeners?

Chou: For anyone that's overseeing the technology space, start focusing on the business problem that you want to solve and bring in the various solutions to the table. It's not all just about the technology but, as I stated earlier, how do you connect the various dots? Can you change the operating model? Can you provide some insights in terms of how an organization can be more efficient? I think that's what the next generation technology leader's going to be regardless of what they call it, right? Because that role may not be the CIO anymore. Maybe a chief digital officer. Who knows what it's going to be. But if you're able to sort of connect the dots as I call it, that's of extreme value. So, hopefully that's what folks who are listening are thinking about in terms of their own career path.

Lohkamp: Well, that's great advice to wrap up on. Thanks again for joining me today, David. It's been a pleasure chatting with you. And thanks to those who are listening. If you'd like to hear more, be sure to subscribe to the Workday podcast.