Healhcare Innovation Strategies – Understanding the difference between sustaining and disruptive
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Following on from my earlier article “Getting serious about making changes in health care?” I want to highlight the importance of understanding the difference between the two types of innovations – sustaining and disruptive.
To meet the complex challenges of First World countries’ health systems, both types of innovations are needed. Each type of innovation provides solutions to two common types of complex challenges which are:
- Improving quality, safety, timeliness, patient experience, efficiency and efficacy for people who can access existing health services.
- Opening access to health services in a timely manner for a growing number of people unable to access existing health services. Affordability is normally a major contributing factor.
Some innovative solutions provide answers to (1) while others provide answers to (2). Getting the right type of innovative solutions for the two different type of challenge is fundamental.
It is also important to note that any improvement or innovation agenda needs a portfolio that has the right mix of sustaining and disruptive innovations.
Types of innovation
Innovation involves making products, services or processes better. There are different ways to look at innovations. For the purpose of this article we will stick with how Professor Clayton Christensen classifies innovation.
Sustaining innovations
Sustaining innovations (sometimes referred to as sustaining and efficiency innovations) largely impacts on people who can access existing health services by improving the quality, safety, timeliness, patient experience, efficiency, and efficacy of health services. Exemplars of this type of innovation include well-known health system quality initiative like
the SURGICAL CHECKLIST and CHOOSING WISELY.
These initiatives aim to reduce variations, save lives, improve efficiency; reduce waste as well as cost. These in turn provides better care and experience for patients.
The significance of these innovations and improvements is made clear by Dr Atul Gawande in his 2017 interview with Malcolm Gladwell. He observes that lack of proper execution of existing treatments is responsible for over 30% of deaths of people over 75 that can be avoided. This observation is significant given that in most First World countries’ over 65s make up on average 15% of the total population and account for 40% to 50% of these countries’ total health expenditure.
The Economist March 2nd, 2017 article “A digital revolution in health care is speeding up” points out that in rich countries about one-fifth of spending on health care goes to waste, for example on wrong or unnecessary treatments.
Some health leaders argue that there is no more room for “savings” through reducing waste and improving efficiency. However, both Dr Gawande’s observation and the Economist article clearly indicate that there is still room for achieving these savings through sustaining innovation improvements.
Disruptive innovations
Disruptive Innovations and improvements open up access to health services in a timely manner for a significant number of people unable to access existing services by making them more affordable.
Disruptive innovation can do this by changing health service delivery that involves the use of new technologies supported by new business model that make services more accessible and more affordable. For clarity, service delivery, new technologies and business model are defined as:
- Service delivery involves who, where, when, what and how these services are delivered.
- New technologies are characterised by cheaper and faster computing power, ubiquitous use of smart phones and other portable devices, digitalisation of information and services making it easier to access, faster to scale and cheaper to develop technology enabled health services. Examples of new technologies includes physical (wearables sensors, robotics, 3D printing of prosthetic and organs), biological (tumbling costs of genome mapping and editing) and advanced digital technologies (AI, Big Data analytics, Cloud based services).
- Business model describes how a service organised its (1) key processes supported by (2) resources to provide a service that provides (3) value to the user in a (4) financially sustainable way.
It is important to invest time to understand the above four elements of a business model. Often in meetings and discussions the term business model is used without a good understanding of what it means.
Some examples of disruptive innovations in health care include:
- The CVS Pharmacy is an example of a disruptive innovation in the US pharmacy and primary care sector.
- 7 Cups provides free support to people experiencing emotional distress by connecting them with trained listeners.
- Mycare helps connect clients and provider in home care, disability support and aged care in New Zealand.
- GP at Hand powered by Babylon technology is a new NHS England funded primary care service being trial in a number of locations in England.
Final remarks
Sustaining innovations improve existing services that benefit people already accessing current services. Disruptive innovation opens up affordable access for significant numbers of people missing out on current health services. Both are needed and the challenge is to get the right mix. The two different types of innovations provide solution to two very different problems. That is why it is important to know their differences.
It is important to remember that disruptive innovations involve making changes to both service delivery and all four elements of its business model (value to the user, resources, key processes and sustainable financial formula).
There has always been and most likely always will be resistance to innovations. Some innovations survive while others don’t. Professor Calestous Juma in his 2016 book, provides examples of innovations (which we take for granted today) going back 600 years that met significant resistance and survived. He concludes that the underlying reason for this resistance is the disjuncture between rapid technological innovation and the slow pace of institutional adjustment due to a fear of loss. New innovations whether sustaining or disruptive will face the challenge of this disjuncture.
Think through the different innovations and improvements in your organisations. Is your organisation getting the right innovations for the right problem? I welcome your feedback and comments on this article.
Here are some useful books if you would like to go into greater details some of the material covers in this article.
- Seizing the White Space by Mark W. Johnson
- The Innovator’s Prescription by Clayton Christensen
- Innovations and its enemies by Calestous Juma
Likewise, here are some YouTube clips referred to in the article:
- Professor Clayton Christensen and John Hagel discussion on this important topic of disruptive innovation. (https://www.youtube.com/watch?v=lUmCvHwrPLM&t=1454s)
- Professor Clayton Christensen explaining the theory behind different types of innovation. (https://www.youtube.com/watch?v=p6vkDm50Bh8&t=1659s)
- Dr Atul Gawande’s interview with Malcolm Gladwell (https://www.youtube.com/watch?v=TKty2axfZxQ&t=1310s)
Chai 。仁材 Chuah 蔡
is the founder of Health System Transformation Limited. A New Zealand Company, he started after he finished up as the Director-General of Health
and Chief Executive of the New Zealand Ministry of Health on February 2018.
He is the first Asian to be appointed as Chief Executive in the New Zealand public service. His previous roles included the National Director
of the National Health Board, Chief Executive of a District Health Board, Chief Financial Officer, and Chief Operating Manager in public health institutions in New Zealand
His focus is currently writing, speaking, sharing, and advising on:
1. future of healthcare
2. leaders we need
3. better care for our seniors (elderly)
He currently also provides mentoring and coaching for up and coming leaders, especially in healthcare.
In his free time, he enjoys travelling with his wife, spending time with his adult children, and a brand new granddaughter. He also enjoys pottering around his garden and developing hs newfound hobby of drawing
