73 years old and still creating Vision and Change in the Healthcare Communities he serves

Jim Hauenstein, MBA BA, Interim Executive Director

Jim’s career spans over 49 + years in the Manufacturing and Healthcare Information Systems/Technology Industries.  Jim’s career started in Manufacturing Information Technology, where he spent 18 years in Manufacturing.  Jim was given an opportunity to change his career in 1983 to Healthcare information Technology and for the last 31 years, Healthcare Information Technology has been his focus.   Jim believes his success over the years has been due to his focus of the merge between the human aspectwith the development of technology solutions for the organizations he has worked for.  In addition to building trusted relationships, Jim has always considers himself a visionary and over the last 31 years his focus has been creating a bridge between Care Providers throughout Healthcare.  He is focussed on marrying both the Financial and Clinical Applications with technology solutions that enhance the quality of patient care; designed around the Health Information Exchange.  The key to Jim’s success is building trusted relationship at all levels of the organization not just the C-suite.  Jim believes that today is the most exciting time to be in healthcare because real change is occurring and it is driven by enhancing the quality of care being delivered to the patient.  Quoting him: “Remember we all will be a patient someday and we will want quality care delivered to us and that means our latest patient record being shared with the care provider that is delivering the care.”

Jim’s latest undertaking was in 2012 – when Jim was asked by the Hospital Council of Northern and Central California to assemble the CIOs in the region to start a rural Health Information Organization (HIO).  Jim was elected chairperson of the SacValley MedShare Executive Work Group consisting of 20 stakeholders meeting every other week for 2 hours to create the plan for a sustainable rural HIE.  In October SacValley MedShare, with the assistance of the Hospital Council Foundation of Northern and Central Californian, he signed a contract with ICA to be their HIE vendor.  In January 2014 SacValley MedShare sent their Participation Agreement to the stakeholders; it was the first time that SacValley MedShare asked their stakeholders contribute money.  In February 2014 SacValley Med Share had their first Board of Directors meeting, demonstrated ICA Direct Secure Email to their stakeholders and it was approved.  SVMS went live with Direct Secure Email the following day.  In February 2014 Jim was selected interim Executive Director of SACVALLEY MEDSHARE HIO, which includes 5 counties in Northern California.

Role of Analytics in HR

HR Analytics blog summarizes the need for analytics in HR. “With data becoming widely available and more easily accessible, industries are quick to realize the value of insights that analytics can uncover. Analytics has helped police departments reduce crime, credit card companies detect fraud, companies reduce customer churn rates, and baseball teams win World Series. In Human Resources, with the automation of many HR transactions, from recruitment to retirement along with the need to perform strategically, analytics of the workforce is more important than ever. HR analytics is a lot more than head-counting-it’s about the total amount and the quality of talent, knowledge, and expertise to move your organization forward and stay ahead of competition. It’s about measuring the return on human capital investment and measuring the impact and how HR is driving performance, productivity, and profitability. In many different studies, HR seems to be lagging in this era of analytics and big data. But analytics of the workforce, a company’s most important asset, should be an opportunity for businesses, particularly for HR, to transform itself and align with the business strategy.”  

While some of the analytics may be common across all enterprises, in general, the analytics that are easy to develop and provide value will depend on 1) the maturity of the organization; 2) the size of the organization; and 3) the organization domain (the markets they serve).  There are other factors of course, but the aforesaid three categories provide the basis for a taxonomy of analytics for HR.

As an illustration, let us see why the maturity of the organization impacts the type of analytics that are relevant.  For entrepreneurial organizations that have a high velocity of growth the analytics will be quite different than a mature organization.  Entrepreneurial organizations may prefer the speed of hiring and rapid assimilation of the hired resource as key metrics, whereas a mature organization may be looking at employee growth and attrition rates as key metrics.  The size of the organization also impacts the type of analytics that are relevant.  Larger organizations may prefer multiple set of metrics and rely on statistical evaluation of historical data to provide trends, whereas smaller organizations may prefer simpler metrics and look at historical data as anecdotes to guide the human resources.  The organizational domain is also a significant factor in deciding which analytics are relevant.  In markets where resources required are scarce, then the HR analytics may need to include recruitment channels as part of their analytics, where as in very stable markets where resources are in plenty, then HR analytics may place a higher emphasis on fit to the enterprise culture.  Clearly, the metrics identified above apply to organizations of all sizes, in all domains, and in all stages of the enterprise evolution, however, the  relative importance of the metrics will be different.

The True Cost of IT

Costs are generally factored into decision making either in the form of financial metrics such as “Return On Investment” or “Time To Break Even”, or into analytic frameworks such as value per dollar expended. If you take a myopic view of costs, then it will simply be the “hard dollars” that are actually expended.  Generally, to account for total costs, many prefer to use life cycle costs.  These are also “hard dollars”, but they are added up over the life cycle of interest.

Of interest are the soft costs.  The soft costs are very rarely taken into account for many reasons:  1) They are difficult to quantify; 2) They are generally subjective and vary with the individuals making the estimates; and 3) They generally tend to tilt the decision in directions that do not appear to be popular.  Take for example, cloud computing.  It is clearly valuable to leverage the cloud technology as it generally entails minimal up-front costs and has built-in on-demand scalability, flexibility, and lower operating expenditures.  In itself, the cost savings may be very attractive. Organizations take for granted that cloud computing is cheaper than building an infrastructure.  But organizations fail to take into account soft costs.   If the organization is not careful, they may end up with multiple incompatible clouds. Disaster recovery, data warehouses all become concerns of enterprises about the resiliency of cloud computing, since data may be commingled and scattered around multiple servers and geographical areas.  It may be possible that the data for a specific point of time cannot be identified.  Cloud computing is still a viable and attractive solution, however, these additional costs tend to blur the cost advantages.  Staff morale and the loss of technical expertise are also other soft costs not taken into account. The message is simple – account for all costs in making a decision.

The Role of IT Analytics: Learning from Mark Twain

As I was starting to put my thoughts on the next blog on IT Analytics, I thought of Mark Twain. When asked to speak, he inquired as to how long he should speak. A bit bewildered, the requestor asked why it was relevant. Mark Twain quickly replied, “If you want me to give you a two-hour presentation, I am ready today. If you want only a five-minute speech, it will take me two weeks to prepare.” The same holds true for metrics, if a firm needs everything, it is easy do. But if the firm asks for just a few key metrics, then it is a bit harder. Please note that the growth of analytics is strongest in financial management and budgeting followed by operations and production, strategy and business development.  Sales and Marketing and Customer Services are target areas of growth.

The role of IT Analytics can be better understood by making the distinction between micro-analytics (individual Key Performance Indicators) and macro-analytics (combination of multiple metrics).  Individual functions such as sales, operations, finance create a set of domain metrics which are very specific and cover a few specific measurements. These analytics fall under micro-analytics. A Balanced Scorecard view provides macro analytics. Macro analytics is analogous to macroeconomics – dealing with the whole whereas microeconomics deals with a specific domain or area.

However, IT Analytics does require interpreting the data and data trends.  We should be very, very careful in creating analytics from facts/raw-data. It took us a long time to understand and refine the credit score, and to this date, the credit rating system has not reached maturity.  IT Analytics using the balanced scorecard approach seems to be sound, but it will take us a while to get analytics that are mature and have gained wide acceptance.   We started with Mark Twain, so let us end this discussion with him. He also quoted: “Get your facts first, then you can distort them as you please.”

Micro Analytics

In the first blog on Analytics Based IT Governance (ABIT 1), we discussed that ITIL offers over 100 KPIs for assessing the value of IT delivered. They classify the KPIs into several areas:

1. Service Portfolio Management
2. Financial Management
3. Service Level Management
4. Capacity Management
5. Availability Management
6. IT Service Continuity Management
7. IT Security Management
8. Supplier Management
9. Change Management
10. Project Management (Transition Planning and Support)
11. Release and Deployment Management
12. Service Validation and Testing
13. Service Asset and Configuration Management
14. Incident Management
15. Problem Management
16. Service Evaluation
17. Process Evaluation
18. Definition of CSI Initiatives

The secret sauce is not to choose all 100 or so micro-analytics, but pick the ones that are most applicable to the Enterprise.   Examples of KPIs include the following:

•  Number of Releases: Number of releases rolled out into the productive environment, grouped into major and minor releases.
•  Adherence to Project Budget: Actual versus planned consumption of financial and personnel resources.
•  Gaps in Disaster Preparation: Number of identified gaps in the preparation for disaster events (major threats without any defined counter measures).
• Number of Planned New Services: Percentage of new services, which are developed, being triggered by Service Portfolio Management.
• Duration of Service Interruptions: Average duration of service interruptions.

IT Alignment to Business: Over-spoken but Under-achieved

Enterprises seek more from technology than just simple efficient operations, They expect technology to provide value, and perhaps, a competitive edge. Aligning technology to business requires transparent IT planning and budgeting processes to ensure that all stakeholders contribute to the IT strategy.  The walk-talk ratio for “aligning IT to business” is not good – usually over discussed and under-achieved.  The reason why aligning IT is so difficult has to do with the old-school IT culture that still prevails.  Transparency is not regarded as critical to achieving alignment. Managing resources and budgets judiciously and prioritizing technology investments to ensure that the triaging process is best for the Enterprise and the customers they serve. Past history and performance metrics facilitate judicious resource allocation and project control, but innovation helps the Enterprise move forward.  This process helps nurture the IT organization to seek and deliver technology effectively.

I had a chance to briefly chat with Joel Golub, Deputy Commissioner and CIO for the Fire Department of the City of New York. Joel was previously a CIO for 28 years at NY Transit, he was also CIO in my neighborhood, San Bernardino County.  He was talking about how he is leveraging technology and implementing systems that can  save lives.  Alignment of IT to business is natural for Joel.  He has been a fireman for 42 years!

CIO Summit on IT Governance

Is the role of the CIO over as we know it? This was the topic of discussion at the First CIO Summit on IT Governance held at the Cerritos Sheraton on March 7th, 2014. With over 55 IT executives at the conference with three panels provided guidance on how the Mid Market, Fortune 500 and Service Providers leverage IT Governance to forge ahead.

John Dohm chaired the panel on IT Governance for Mid-Market companies with four leading CIOs on the panel: Jon Grunzweig, Vasu Kadambi, Keith Golden and Tak Fujji.  One of the key points John identified was that if the CIO is talking technology issues/decisions at the Executive level, there is something fundamentally wrong.

Becky Wanta chaired the panel on IT Governance at Fortune 500 companies with four IT Leaders on the panel: Jim Sutter, Joel Manfredo, Maria Fitzpatrick and Jim Thomas. Becky brought out the key point that CIOs must focus on innovation.

Dave Phillips chaired the panel on IT Governance with four cutting edge CEOs: Kevin Parikh, Ravi Chatwani, Jim Savitz and Jason Rosenfeld. Dave’s point was that CEOs of IT companies will bring a very unique perspective on IT Governance that will be beneficial to CIOs.

In summary, if CIOs are talking technology to the leadership team, they will not be able to retain their seat at the executive table.  In the past CIOs were brought in to be the bridge between technology and business. Now leadership looks to how CIOs can bring innovation and revenues to the Enterprise. The best way for a CIO to forge ahead is to ensure that IT Governance is nimble and simple, yet robust to provide sensible direction to run the business of IT that is aligned to the Enterprise.  A good Governance process will leverage tools to guide the stewardship of the IT department, leaving more time to focus on innovation.