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CIOs: Work with the business to prioritize IT projects
We interviewed Vincent Vitali, chief information officer of La Rabida Childen's Hospital, a pediatric acute care facility in Chicago about how he prioritizes IT projects with input from the business.
The Enterprisers Project (TEP): Is it getting easier or harder to judge the value of an IT investment?
Vitali: Generally it is more difficult. One reason is infrastructure. Many hospitals and other organizations established their underlying network and servers many years ago but the technology has advanced rapidly. Virtualization and cloud computing have changed the cost structure of infrastructure. But because of an increasingly mobile workforce, the needs for voice, video and high-speed data over wireless networks have exploded, requiring new investment. Many hospitals are faced with complete overhauls of their underlying technologies that only yield incremental improvement in performance from the end user perspective. These investments do improve security, accessibility, reliability and recovery. However, those are hard to value — especially from the non-technical side.
TEP: How do you evaluate proposed technology projects?
Vitali: Virtually none of the projects we evaluate are IT projects. Every project needs to be driven by a business need and therefore by a business leader. We have created three “buckets”: strategic, regulatory, and “quick wins.”
- Strategic projects are enterprise-wide in scope, require cross-department or cross-discipline expertise, and are large-scale in cost and resources, and are carefully evaluated as to value.
- Regulatory projects are those mandated by government or other outside agencies (e.g., HIPAA, Meaningful Use). We assess business impact and cost as a group, and agree on a timeline.
- Quick wins are projects with relatively low resource needs and cost that provide rapid return or immediate benefit. We allocate a percentage of overall IT resource time each quarter for these type of projects.
TEP: Do you find that some worthwhile projects are tough to justify as investments, for instance because they reduce a risk that isn't well understood?
Vitali: We use a project filtering process that first requires the business owners to sell the project to their line management, who in turn then sponsor the project and bear responsibility for the schedule, budget, and benefits identified. We include tangible and intangible benefits and each has a separate scoring system.
Tangible benefits are quantified by increased revenue, reduced cost, improved resource utilization, etc. Intangible benefits are scored against core values such as market share, patient experience, physician bonding and others.
Risk can sometimes be included as a tangible or intangible benefit, depending on how quantifiable the costs associated with the risk are. For example, the risk of infection can be documented for a certain procedure, and steps can be defined to reduce that risk in a measurable way. The percentage reduction can then be translated into time and resource savings or reduced liability. This is obviously not a perfect science and it takes a good bit of effort to quantify such cases, but it at least provides comparable metrics vis-a-vis other projects when consistently applied.
TEP: Have you seen IT projects turn out to be bad investments? If so, what went wrong?
Vitali: I have been working in health care IT for about 25 years so I've seen my share of fiascos. Lots of things can go wrong in such a complex environment. I've heard for years people say, “You can get your money from an ATM in Russia but you can't get your health care data from your doctor/hospital.” Well, financial transactions are fairly limited and very simple compared with health care, and there is a much different regulatory environment. I do feel that we sometimes make things hard for ourselves in health care IT but it is a very complex ecosystem with numerous players, almost unlimited scenarios, and huge data needs.
Opportunities to fail include lack of organizational commitment or business buy-in (i.e., making it an IT project) , improper scoping of cost or resource need or time frame, poor project management and communication, software that simply doesn't work, and changes in the environment during implementation, such as mergers and acquisitions.
What I've learned is the value of discipline, having a formal process, over-communicating and sometimes saying "no" when you see signs of these issues.
Vincent Vitali is CIO of La Rabida Childen's Hospital, a pediatric acute care facility in Chicago.