Health Care as a Complex Adaptive System

Transcription

1 Knowledge and Skills for Enterprise Transformation. Health Care as a Complex Adaptive System Implications for Design and Management William B. Rouse Copyright 2007 Tennenbaum Institute. All rights reserved.

2 Knowledge and Skills for Enterprise Transformation. 2

3 Overview Complex Adaptive Systems Healthcare Stakeholders & Issues Disease Detection Networks of Networks Complexity Market Complexity Studying Complexity Design Implications Management Implications Summary Knowledge and Skills for Enterprise Transformation. 3

4 Complex Adaptive Systems They are nonlinear, dynamic and do not inherently reach fixed equilibrium points. The resulting system behaviors may appear to be random or chaotic. They are composed of independent agents whose behavior can be described as based on physical, psychological, or social rules, rather than being b completely dictated by the dynamics of the system. Agents' needs or desires, reflected in their rules, are not homogeneous and, therefore, their goals and behaviors are likely to conflict -- these conflicts or competitions tend to lead agents to adapt to each other's behaviors. Agents are intelligent, learn as they experiment and gain experience, and change behaviors accordingly. Thus, overall systems behavior inherently changes over time. Adaptation and learning tends to result in self-organizing and patterns of behavior that emerge rather than being designed into the system. The nature of such emergent behaviors may range from valuable innovations to unfortunate u accidents. There is no single point(s) of control systems behaviors are often unpredictable and uncontrollable, and no one is "in charge." Consequently, the behaviors of complex adaptive systems usually can be influenced more than they can be controlled. Knowledge and Skills for Enterprise Transformation. 4

5 Healthcare Stakeholders & Interests Example of Disease Detection Network of Networks Knowledge and Skills for Enterprise Transformation. 5

6 Stakeholders & Interests Stakeholder Risk Mgt. Prevention Detection Treatment Public e.g., Buy Insurance e.g., Stop Smoking e.g., Get Screened Delivery Sys Physicians Physicians & Hospitals Government Non-Profits Medicare, Medicaid, Congress NIH, CDC, DoD, et al. American Cancer Society, American Heart Association, et al. Academia Business Schools Basic Science Disciplines Technology & Medical Schools Medical Schools Business Employers, Insurance Companies, HMOs Guidant, Medtronic, et al. Lilly, Merck, Pfizer, et al. Knowledge and Skills for Enterprise Transformation. 6

7 Disease Detection Public Awareness Public Readiness Screening Available Costs Covered Screening Effective Public Communication Public Education Physician Education Consumer Advocacy Medical Research $ $ $ $ $ Public, Delivery System, Government, Non-Profits, Academia, Business Knowledge and Skills for Enterprise Transformation. 7

8 Networks of Networks Accreditation & Licensing American Board of Medical Specialties Accreditation Council for Graduate Medical Educ. Accreditation Council for Continuing Medical Educ. AOA Council on Postdoctoral Training Federation of State Medical Boards Joint Commission on Accreditation of Healthcare Org. Liaison Committee on Medical Education Professional Associations American Academy of Family Physicians American Medical Association American Osteopathic Association (AOA) Council of Medical Specialty Societies Etc. Examples of Other Stakeholders American Assoc of Retired Persons Leapfrog Purchasing Group National Business Group on Health Etc. Knowledge and Skills for Enterprise Transformation. 8

9 Complexity Market Complexity Studying Complexity Design Implications Management Implications Knowledge and Skills for Enterprise Transformation. 9

10 Market Complexity Retail Telecom Healthcare Complexity Model Network Model Calculating Complexity Complexity Surface Complexity Assessment Knowledge and Skills for Enterprise Transformation. 10

11 Retail Transportation & Logistics Apparel Beverages Electronics Food & Drugs Food Production Food Consumer Products Furniture Food Services Packaging Home Equipment Household General Merchandisers Consumers Toys Pharma Specialty Retail Knowledge and Skills for Enterprise Transformation. 11

12 Telecom Content Providers Government Service & Billing Network & Infrastructure Equipment Semiconductor & Other Electronics Computer Peripherals Telecomm Service Providers Consumers Computer Software Knowledge and Skills for Enterprise Transformation. 12

13 Google Yahoo! CNN Nortel Networks Cisco Siemens Openwave Alcatel-Lucent Amdocs Content Providers Service & Billing Provider Government FCC Semiconductor & Other Electronics Supplier Network & Infrastructure Equipment Supplier Computer Peripherals Supplier Telecomm Service Providers Consumers Enterprises & End-Users Qualcomm Texas Instruments Intel Palm Nokia Samsung Motorola Research in Motion Novatel Wireless HP Computer Software Supplier Microsoft Symbian Research in Motion Verizon Wireless T-Mobile AT&T Sprint-Nextel Knowledge and Skills for Enterprise Transformation. 13

14 Healthcare Government & Policy Makers Health Insurance Pharmacy R&D Laboratories Pharmaceuticals Health Wholesalers Medical Equipment Health Providers Consumers Other Equipment Knowledge and Skills for Enterprise Transformation. 14

15 Network Model t N ijkl N ijk N ij N i N i = No. of 1 st tier suppliers to i th product/service outlets N ij = No. of 2 nd tier suppliers to ij th Tier 1 supplier, e.g., OEM N ijk = No. of 3 rd tier suppliers to ijk th Tier 2 supplier N ijkl = No. of 4 th tier suppliers to ijkl th Tier 3 suppliers Knowledge and Skills for Enterprise Transformation. 15

16 Calculating Complexity T C = Σ pt m m = 1 { N i -p (n i t) log [p (n i t m )] + Σ i = 1 N ij -p (n j n i t)log [p (n j n i t m )] + Σ j = 1 N ijḵ p (n k n i n j t) log [p (n k n i n j t m )] + Σ k = 1 N ijkl -p (n l n i n j n k t) log [p (n l n i n j n k t m )] Σ l = 1 Knowledge and Skills for Enterprise Transformation. 16 }

17 Complexity Surface Market Complexity Complexity (Bits) Breadth Depth Knowledge and Skills for Enterprise Transformation. 17

18 Complexity Assessment Consumer Total 25 Complexity (Bits) Aerospace Automotive Retail Healthcare Telecom Knowledge and Skills for Enterprise Transformation. 18

19 Studying Complexity Health Advisor Back Story Clients Information Flow Architecture Research Questions Knowledge and Skills for Enterprise Transformation. 19

20 Health Advisor Knowledge and Skills for Enterprise Transformation. 20

21 Back Story Welcome to the Health Advisor business. Your firm helps clients successfully navigate the healthcare system. People pay you actually, they pay an annual fee -- for you to help them make the highest-value decisions regarding their health. You are not a doctor, but you have much data and information available to help your clients make the best choices. Your goal is to maximize their health state. Your score is the average health state of your clients divided by the costs of providing these outcomes. You also need to stay in business! As you are responsible for all of the costs associated with your clients health, you need to pay careful attention to the performance and costs of the providers you select for both test and treatments. If you spend more than a client s annual fee, the excess costs come out of your account. If you spend less than the fee, the excess payment goes into your account. Of course, you could save money by providing minimal treatment, but then your reputation will quickly fade and you would have few if any clients. Keep in mind that you are providing health advice, but not healthcare. You decide which doctors and other services to employ. For these providers, your clients are patients. For you, they are clients who expect value for their annual payment. Knowledge and Skills for Enterprise Transformation. 21

22 Knowledge and Skills for Enterprise Transformation. 22

23 Knowledge and Skills for Enterprise Transformation. 23

24 WORLD Economy, e.g., Recession Decreased Sales Politics, e.g., War Increased Acute Health Environment, e.g., Pollution Increased Chronic Health CONSUMER No. 1 Health State Provider Choice Benefits Provider Choice Information Provider Choice CONSUMER No. 2 Health State Provider Choice Benefits Provider Choice Information Provider Choice CONSUMER No. 3 Health State Provider Choice Benefits Provider Choice Information Provider Choice CONSUMER No. M Health State Provider Choice Benefits Provider Choice Information Provider Choice HEALTH Probability of Chronic Problems Probability of Acute Problems INFORMATION Provider Prices Provider Performance Symptoms Diagnosis Diagnosis Treatment Patient Health Record Wellness Programs Health BENEFITS Family Coverage, e.g., Employee % Medical Coverage, e.g., 80/20% Out-of-Pocket, e.g., Co-Pay Wellness Coverage CHOICES Coverage Yes/No Provider 1, 2, 3 or N PROVIDER No. 1 Patients Outcomes Patients Claims Claims Revenue PROVIDER No. 2 Patients Outcomes Patients Claims Claims Revenue PROVIDER No. 3 Patients Outcomes Patients Claims Claims Revenue PROVIDER No. N Patients Outcomes Patients Claims Claims Revenue INSURER EMPLOYER Benefits Revenue Sales Jobs Knowledge and Skills for Enterprise Transformation. Claims Costs Sales Benefits 24 Profits Rates Rates Benefits

25 OrgSim Architecture Facilitation, e.g., Training, Advising, Guiding User Interface, e.g., Large Screens, Voice, Gestures Organizational Story, e.g., Aging Population Characters, e.g., Patients, Doctors, Vendors World Model, e.g., Hospital, City, Economy Distributed Simulation Software Hardware, e.g., Computers, Networks Knowledge and Skills for Enterprise Transformation. 25

26 Research Questions Game Play What strategies do players employ to maximize value? What strategies do players employ to stay in business? How successful are these strategies? Information Services What information do players access to make decisions? How do the type and form of information affect decisions? How is value affected by information and decisions? Hedging Risks How do players hedge the downside risks of client costs? What types of insurance do players find attractive? How does insurance affect decisions? Education What do players learn from Health Advisor? Knowledge and Skills for Enterprise Transformation. 26

27 Design Implications Two Design Principles Designed Complexity Enterprise Agility Enterprise Architectures Agile Information Systems Knowledge and Skills for Enterprise Transformation. 27

28 Two Design Principles The nature and extent of B2C service value determines B2B service value, as well as the value of products and other value enablers. The magnitude of B2C complexity, relative to total market complexity, reflects market maturity Both B2C and B2B complexity are expressed in terms of information theory binary digits (bits), B2B complexity is often increased, in turn increasing total complexity, in order to reduce B2C complexity. B2C = Business to Consumer B2B = Business to Business Knowledge and Skills for Enterprise Transformation. 28

29 Designed Complexity The enterprise as a system includes all stakeholder organizations whether they are your partners, collaborators, channels, competitor, or regulators Increase complexity where you can best manage it, in order to decrease complexity to end users, i.e., patients and physicians You can manage design, development, manufacturing, sustainment You cannot manage economies, markets, competitors, end users Support managing complexity by providing means to monitor and influence system state, performance, and stakeholders see Managing Complexity Knowledge and Skills for Enterprise Transformation. 29

30 Enterprise Agility Optimization Within Design Assumptions Objective is to balance performance and costs Assure robust allocation of resources Adaptation Beyond Design Assumptions Objective is to balance opportunities and risks Assure ability to reallocate resources Tradeoffs Between Optimization vs. Adaptation Options for contingencies enhance agility Costs of options undermine optimality Architectures That Enable Ongoing Tradeoffs Knowledge and Skills for Enterprise Transformation. 30

31 Enterprise Architectures Strategic Processes Operational Processes Information Systems Information Technology Knowledge and Skills for Enterprise Transformation. 31

32 Agile Information Systems Tailor Information Sources Selected to Targeted Users Employ Representations Familiar to Targeted Users Provide Aiding to Enhance Information Seeking and Use Manage the Process that Information Is Intended to Support Glean Insights from the Flow of Information Sought and Used Epitomize Excellent Ease of Learning and Use Adapt All of the Above to Evolving Intentions of Targeted Users Knowledge and Skills for Enterprise Transformation. 32

33 Management Implications Value Philosophy Organizational Behaviors Managing Complexity Knowledge and Skills for Enterprise Transformation. 33

34 Value Philosophy Value focuses on organizational outputs (or outcomes), rather than inputs. Health states of patients vs. budgets of providers Value relates to benefits of outcomes, rather than outcomes themselves. Productivity improvements due to wellness Value implies relevant, usable, and useful outcomes. Stakeholders have to understand and appreciate Knowledge and Skills for Enterprise Transformation. 34

35 Organizational Behaviors Roles Methods Measurement Focus Relationships Network Design Traditional System Management Command & Control Activities Efficiency Contractual Hierarchy Organizational Design Complex Adaptive System Leadership Incentives & Inhibitions Outcomes Agility Personal Commitments Heterarchy Self Organization Knowledge and Skills for Enterprise Transformation. 35

36 Managing Complexity System State Current and projected value flows Current and projected problems System Performance Current and projected value, costs & value/cost Current and projected options for contingencies System Stakeholders Involvement of each stakeholder group Performance of each stakeholder group Information Systems Measurement, modeling & display of system state Agile What If? experimentation & adaptation Knowledge and Skills for Enterprise Transformation. 36

37 Summary Complex Adaptive Systems Healthcare Stakeholders & Issues Disease Detection Networks of Networks Complexity Market Complexity Studying Complexity Design Implications Management Implications Knowledge and Skills for Enterprise Transformation. 37

38 Knowledge and Skills for Enterprise Transformation. 38