John Glaser


At a Glance

There are four primary ways that hospitals can develop a strong IT strategy:

  • Deriving IT initiatives from the hospital's strategic plan
  • Basing IT strategy on continuous improvement of core operational processes and information management needs
  • Examining the role of new technologies in health care
  • Basing IT strategy on the hospital's vision

Take a look at the best in healthcare IT and you'll find these key elements: a healthy organizational foundation, a sound link between organizational strategies and the IT plan, and strong project management skills.

Imagine you are at a senior management meeting at your hospital. A question is posed to the group: "Tell us about an IT project that was implemented on schedule and brought about all the benefits that the vendor promised." Imagine just how heavy the silence would be.

Now say that you're at the same senior management meeting and a different question is posed: "Tell us about an IT project that met with delay after delay, went over budget, met with resistance from users, and never brought the return you expected." Imagine just how boisterous the meeting would become as different managers all jostled to tell their stories.

For most healthcare organizations, IT investments are intended to improve organizational performance, reduce costs, and enhance patient care and service. However, achieving performance gains from IT initiatives is difficult. Some IT projects fail absolutely-the organization pulls the plug on the project before completion and banishes project managers to a distant outpost. Many more IT projects fail relatively-the costs were higher, the timetable was longer, and the value was less than envisioned.

No organization can ensure success across all IT projects. However, there are three areas that are major determinants of success or failure: a healthy organizational foundation, a sound link between the organization's strategies and the IT plan, and the IT department's ability to manage projects well.

Building a Healthy Foundation for IT Success

Several studies have examined the factors that enable some organizations to be continuously effective in applying IT to improve organizational performance. The attributes that these organizations share are:

Talented leadership. Exceptional performance requires leadership, and realizing performance gains from IT initiatives is no different. Leaders who are critical to an IT project's success will occupy a variety of roles, including senior executives such as CEOs, CFOs, and CIOs; IT department staff; and middle managers who will use the new technology or whose departments will be affected by the initiative. To ensure the project's success, these key leaders must understand and communicate the organization's vision for the project, be able to recruit and motivate team members, and have the staying power to see projects through potentially several years of work, disappointments, setbacks, and political problems along the way.

Effective relationships. In addition to strong individual players, the team itself must be strong. There are critical senior executive, IT executive, and project team roles that must be filled by highly competent individuals-and great chemistry must exist between the individuals in these roles.

Well-developed technical architecture and a high-performance infrastructure. It is difficult for an organization to embark upon new IT projects if the network is unstable, applications are sluggish, and business is interrupted by repeated virus attacks. Poorly integrated or difficult-to-change applications can thwart or bog down many plans for new capabilities. 

Strong IT organization and management. Excellence is difficult to achieve if the IT department's talent and skills are mediocre or if the organization has mind-numbing IT decision-making approaches. Competent and well-organized IT staff, in addition to well-designed IT governance and decision-making mechanisms, are critical contributors to a steady stream of successful projects.

These foundation elements are not IT-specific, per se. Clinical excellence, for example, would require a foundation of talented leadership, a great team, well-developed care processes, and strong clinical staff.

The Links Between Organizational Strategy and the IT Plan

To be successful, the IT plan must support and enable the hospital's goals and directions. If the link between the organization's strategic plan and the IT plan is weak, IT staff may be executing projects well, but they are likely to be working on the wrong projects for that organization.

There are four major ways to develop a strong IT strategy:

  • Deriving IT initiatives from organizational strategies
  • Basing IT strategy on continuous improvement of core operational processes and information management needs
  • Examining the role of new technologies in health care
  • Basing IT strategy on the organization's vision

The first approach derives the IT agenda directly from the organization's goals and plans. For example, suppose a hospital intends to become a low-cost provider of care. It may decide to achieve this goal through the implementation of disease management programs and the reengineering of inpatient care. The IT agenda would then be determined by answering questions such as, "What applications will we need to support our disease management strategy?"

The second approach centers on core processes and information needs. For all organizations, there are a small number of core operational processes and information management needs that are essential for the effective and efficient functioning of the organization. For a hospital, these processes include patient access to care, ordering medications and procedures, and managing the revenue cycle. The IT agenda is defined by answering questions such as, "How can IT help us improve a patient's ability to get an appointment?"

The third approach requires taking a look at emerging IT capabilities and considering new approaches to the organization's strategies or ways to significantly alter current approaches. In this vector, the organization examines new applications and technologies and tries to answer questions such as, "Do cell phones enable us to advance our strategies or improve our core processes in new ways?"
The fourth approach-basing IT strategy on the organization's vision-entails envisioning the organization as it would like to be. For example, a vision of a hospital with exceptional patient service might entail IT applications that enable patients to book their own appointments.

There are three key points to keep in mind when developing IT strategy.

IT planning is not a separate process. IT strategic planning should occur as an integral part of the organizational strategic planning process. During strategy development, managers should not separate out discussions about IT strategy development any more than they would run a separate finance planning process.

IT planning should be a continuous process. IT planning should reflect the continuous change in the healthcare environment and the organization's plans and strategies.

IT planning should involve shared decision-making and shared learning between IT and the organization. IT leaders should inform organizational leaders of the potential contributions (and limitations) of new technologies. In turn, organizational leaders should ensure that IT leaders understand the business plans, strategies, and constraints.

The resulting IT plan should address several areas:

  • Application systems that will be funded and implemented. The inventory of applications might include computerized physician order entry or outpatient scheduling applications.
  • Major investments in infrastructure (e.g., upgrades to the network or implementation of a new database management system).
  • Any changes needed in the IT department, its staffing, or the way in which the department functions. IT staff may need to acquire new skills. IT project management processes may need strengthening.
  • Potential changes in IT governance. For example, the project roles of IT staff and managers of departments that will use new application systems may need to be clarified.
  • Critical IT questions that can change from year to year, such as, "How do we address the HIPAA security provisions?" or "What steps should we take to increase physician involvement in IT activities?"

Developing IT strategy is a complex and difficult undertaking. There is no right way to develop an IT strategic plan, and there is no cookbook for success.

Managing IT Projects

Project management is a set of management disciplines and practices that, if executed well, will raise the likelihood that a project will deliver the desired results. Project management has several objectives:

  • Describing the scope and intended results of the project
  • Identifying accountability for the successful completion of the project and associated project tasks
  • Defining the processes for making project-related decisions
  • Identifying the project's tasks, task sequence, and interdependencies
  • Determining the resource and time requirements of the project
  • Ensuring appropriate communication with relevant stakeholders regarding project status and issues

There is no one way to manage projects. But all projects benefit greatly from having a well-defined approach to three areas: project roles, project committees, and project tools.

Three core roles must be filled to successfully manage an IT project: business sponsor, business owner, and project manager.

The business sponsor is the individual who holds overall accountability for the project.

The sponsor should represent the area of the organization that will be the major focus of the performance improvement that the project intends to deliver. For example, a project that involves implementing a new patient accounting system should have the CFO as the business sponsor.

Business owners generally have day-to-day responsibility for running a function or a department. An IT project may need the involvement of several business owners. The success of a new patient accounting system may depend upon processes that occur in registration and scheduling (hence, the director of outpatient clinics should be a business owner) as well as adequate physician documentation of the care provided (thus necessitating that a medical group administrator serve as a business owner).

The project manager does just that-manages the project. This is the person who provides the day-to-day direction setting, conflict resolution, and communication needed by the project team. The project manager can be an IT person or a person from the core business group.

In addition to these roles, most projects need two core committees to oversee and manage the project. A project steering committee provides overall guidance and management oversight of the project. The steering committee has the authority to resolve changes in scope that impact the budget, milestones, and deliverables. The project team itself should meet regularly and be responsible for managing the performance of the project activities, resolving day-to-day project issues, and allocating resources as necessary to complete the project.

The project roles and committees are supported by several core project tools. For example, the project charter is a document that describes the purpose, scope, objectives, costs, and schedule for the project. It also discusses the roles and responsibilities of the individuals and functions that need to contribute to the project. The project plan provides the details of tasks, phases, timelines, and resources needed, and is used by the project team during the day-to-day management of the project. The project status report documents and communicates the status of the project. The report typically covers recent accomplishments and decisions, work in progress, upcoming milestones, and issues that require resolution.

Taking a Pulse

How can you assess your organization's potential for IT success? One way is to take a close look at the three areas that can make or break an IT initiative: a healthy organizational IT foundation, a sound link between organizational strategies and the IT plan, and the IT department's ability to manage projects well.

For example, it is difficult to achieve IT-enabled excellence if the organization itself is unhealthy. Weak leadership, a fractious set of working relationships, shaky infrastructure and application performance, and an anemic IT group will doom an organization to mediocre IT project success-at best.

Most of the aspects of an organization's foundation are relatively straightforward to assess. One does not need an IT background to understand whether the relationships between the senior management team are healthy or ill. Poorly behaving infrastructure is usually self-evident; the organizational anger that results cannot be missed. One may not feel comfortable evaluating the technical skills of a CIO, but the assessment of a CIO's leadership and management skills is performed in the same way that one would evaluate the skills of the senior leadership team.

If senior leaders are uncomfortable assessing the organization's foundation, consultants can be very helpful. While assessment is often straightforward, resolving the problems identified through such an assessment can be difficult.

A number of variables work together to paint a picture of whether an IT project is well-managed. For example, the plan charter should be clear and explicit. Fuzzy objectives and vague understandings of resource needs indicate that the plan needs further discussion and development. Leadership of the departments and functions that will be affected by the IT plan, or that need to devote resources to the plan, also should have reviewed the charter and plan. In a well-managed project, any concerns that leaders have are addressed, and these leaders have publicly committed to performing the work needed.

Well-managed IT projects also have time lines that have been reviewed by multiple parties for reasonableness. These time lines take into consideration factors that will affect the plan, such as the need for staff to engage in the year-end close. In addition, projects that are well-managed have commitments for the appropriate resources, budget, and staffing, including assurances that staff may devote the amount of time needed to ensure the project's success.

Accountabilities for each phase of the IT project should be explicit. Well-managed IT projects have charters that comprehensively assess project risks and develop thoughtful approaches to addressing these risks. These charters should incorporate a reasonable amount of contingency for inevitable problems and current uncertainties. Discussion of project status should include candid dialogue about the problems encountered in implementing the IT initiative, as all projects encounter problems.

Additionally, the organizational noise surrounding the implementation should be appropriate in relation to the magnitude of the project. All projects generate noise, such as complaints about change or distress about delays. While difficult to assess, the noise level for the IT initiative must seem "reasonable." If the noise level is deafening, or if the volume can barely be detected, this may point to a problem in how the project is viewed by the organization.

All projects face unpleasant surprises, but in a well-managed IT initiative, project surprises should be few. A project in trouble will present a seemingly never-ending series of surprises.

Managing projects is difficult-and a lot of work. No approach can lead to 100 percent project success 100 percent of the time. Project management disciplines can, however, greatly improve the odds of success.

Support from Above

The actions and behaviors of management can have a significant impact on the effectiveness of IT investments. Clearly, management actions that strive to achieve links between organizational strategy and the IT plan and that ensure that projects are well-run are essential. However, there are actions and behaviors that cut across projects and IT undertakings.

Managers can perform a self-assessment of their role in contributing to the success or failure of IT initiatives by truthfully answering the following questions:

  • Do I communicate the importance of an IT project and work to ensure that the objectives and the initiative have been "bought into"?
  • Do I publicly demonstrate my commitment by "being there" and showing resolve during tough decisions?
  • Do I welcome the debate that surrounds projects, invite bad news, and refuse to hang those who make mistakes?
  • Do I ensure that we address complexity by breaking the project into manageable pieces and testing for evidence that the project might be put at risk by trying to do too much all at once?
  • Do I realize that there is much that I do not know about how to change the organization or the form of new processes? Am I prepared to change direction and listen and respond to those who are at the front line?
  • Do I try to limit the duration and depth of the short-term operational disruption, but accept that it will occur?

These questions help to determine whether the managers' behavior and actions are supporting the organization's IT plan and projects.

Meeting the Challenge

Achieving IT project success is hard, ongoing work. However, it does not involve magic or require that organizational leadership learn new techniques. Asking hard questions, holding people accountable, and effectively managing projects are attributes of good management, regardless of whether the topic is IT, finance, or patient care.

The challenge of achieving high levels of project success plagues all industries. This is not a problem peculiar to health care. The challenge has been with us for 40 years, ever since organizations began to spend money on big mainframes. The challenge is complex and persistent, and we shouldn't believe that we can fully solve it.

We should, however, believe that we can do a better job of dealing with it.

Imagine you are at a senior management meeting at your hospital. A question is posed to the group: "Tell us about an IT project that was implemented on schedule and brought about all the benefits that the vendor promised." Imagine just how heavy the silence would be.

Now say that you're at the same senior management meeting and a different question is posed: "Tell us about an IT project that met with delay after delay, went over budget, met with resistance from users, and never brought the return you expected." Imagine just how boisterous the meeting would become as different managers all jostled to tell their stories.

For most healthcare organizations, IT investments are intended to improve organizational performance, reduce costs, and enhance patient care and service. However, achieving performance gains from IT initiatives is difficult. Some IT projects fail absolutely-the organization pulls the plug on the project before completion and banishes project managers to a distant outpost. Many more IT projects fail relatively-the costs were higher, the timetable was longer, and the value was less than envisioned.

No organization can ensure success across all IT projects. However, there are three areas that are major determinants of success or failure: a healthy organizational foundation, a sound link between the organization's strategies and the IT plan, and the IT department's ability to manage projects well.


John Glaser, PhD, FHIMSS, is vice president and CIO, Partners HealthCare, Boston (jglaser@partners.org).


The Link to IT Success

One of the primary components of a healthy IT system is a strong link between organizational strategy and the IT plan. You can assess this link as the IT agenda is being formed, discussed, and presented by asking these questions:

  • Is it clear how the plan advances the organization's strategy? Is it clear how care will improve, costs will be reduced, or service will be improved?
  • Are the measures of current performance and expected improvement well-researched and realistic?
  • Are the members of the senior leadership team whose areas are the focus of the IT plan clearly supportive of the plan?
  • Is it clear who is accountable for the delivery of the desired gains in organizational performance?
  • Are the resource requirements well-understood and convincingly presented? Have these requirements been compared with those experienced by other organizations undertaking similar initiatives?
  • Are the necessary changes in operational processes and workflow understood? Have the investment risks been identified, and is there an approach to addressing these risks?
  • Do we have the right people assigned to the major projects, have we freed up their time, and are they well-organized?

Publication Date: Wednesday, February 01, 2006

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