Innovation from the outside in
My mission is to help clients look outside their industries to consider unexpected ways they can leverage analytics innovations.
Ryan Anker | July 23, 2015
Recently I received the unfortunate news that everyone in the consulting world has experienced before. A potential client had embarked on a strategic initiative to determine how to use data and analytics to improve their business, but the company ultimately decided to move forward with another firm. The feedback was that the firm specialized in their industry.
Another recent discussion comes to mind. Different executive. Different industry. Different question. Her question was, “What types of analytics have you done in other industries and how can this be leveraged for my business?”
This is not a question I am often asked, but it’s a great one that companies should be asking. Understanding the latest innovations and advancements from other industries is especially applicable in my area of expertise—information management and analytics—given that these initiatives all-too-often fall short of expectations or simply fail.
Our retail clients have done an exceptional job at creating very personalized, seamless experiences for their customers by leveraging analytics much more effectively than other industries. They have integrated their data across all of their sales channels. They have built predictive models to target individual customers. They have created complex algorithms to drive the digital customer experience. All of these analytics innovations have improved the customer experience and their profitability.
Consider what lessons we can learn from this, and whether these lessons can provide valuable insights for other industries, such as healthcare. For example, can integrating data across all retail channels translate to better information sharing in healthcare? Can personalizing the retail experience translate to improving the quality of patient care and safety? Finally, can improving the customer experience ultimately translate to improved health and profitability?
In Analytics in Healthcare and Life Sciences: Strategies, Implementation Methods, and Best Practices, authors Dwight McNeill and Thomas H. Davenport explain how healthcare can learn a lot from other industries. “Ideas can come from comfortable places and unfamiliar places.” The authors go on to say that the focus should be on the latter, not because the ideas are better, but because they are often ignored.
The book notes that while industries such as retail, banking, politics, and sports are somewhat mysterious to healthcare, ideas can be harvested and adapted to address some of the most intractable challenges in healthcare. The authors describe this as outside-in thinking and warn that ignoring this perspective can lead to blind spots. In retail, understanding the customer and responding in ways to earn their business is the pathway to growth. Many retail companies have successfully leveraged customer analytics to grow their business. The healthcare industry must adapt these same tools for their own industry.
Information management and analytics investments aimed at transforming the business often fail. McNeill uses the phrase “analytics sweet spot” to describe an industry strength. The concept comes from sports. In baseball, it is the place on the bat that produces the most powerful hit. “Each industry pushes the envelope in its use of specific analytics, not necessarily because it has more technical sophistication, but because the specific goals, purposes, pressures, and culture of that industry are unique and require better flowering of certain analytics tools. These are the sweet spots that we want to translate and adapt for healthcare.”
Examples of innovation from the outside in are not the norm, but they should be. Blockbuster didn’t come up with the Netflix model. A taxicab company didn’t come up with the Uber model. My mission is to help clients look outside their industries to consider unexpected ways they can leverage analytics innovations. In turn, I hope I get asked more often about the types of analytics that other industries are leveraging.