Crowd Sourced, Connected and Streamed

November 12, 2018  |  Joel English

Healthcare

Finding Future Insight in Changing Customer Behaviors

Joel English, BVK Managing Director for Health Care and Mike Eaton Brand+Lever Senior Vice President

We often are invited to work with hospitals and doctors as they think about the future. The charge we are given is to help them find the answer to “what comes next” in care delivery.

Through the course of those conversations we have found that health system leaders frequently struggle with their future vision because they are looking in the wrong place for answers. Many teams search for insight in the rapid advances in clinical technology, personalized medicine and artificial intelligence that are reshaping the science behind detection, diagnosis and treatment of disease. And, they do a deep dive on the analytics and economics behind population health business models.

Those are important matters that must be understood. In the past, knowing the direction, rate and scale of these clinical advances and supply-side variables was highly predictive of the future of care delivery.

But today, to answer the question “what comes next”, we must first look closely at the demand side of the equation, and specifically at changing consumer behaviors. We must take our eyes off the question of “what we do” and focus instead on how people today think differently about consuming health services.

It’s the Questions, Not the Answers

Consider Hilton and Ford.

Hilton was founded in 1919 and has built a portfolio of successful hotels properties and brands. They spend millions every year thinking about the future of hospitality and have built a company with a $21 billion market capitalization based on their success building quality hotels and resorts.

Ford Motor Company was founded in 1903 and has decades of investment in and experience building some of the world’s best cars and light-duty trucks. Today Ford has a $36 billion market capitalization.

Yet, both Ford and Hilton have been surpassed in terms of market capitalization by relative newcomers which build neither cars nor hotels. Airbnb was founded in 2008 and has an estimated market cap of over $55 billion! Uber was founded in 2009. Its market capitalization is estimated to be about $70 billion.

How do Hilton and Ford, with their staggering investments in hotels and passenger vehicles, respectively, end up with lower capitalizations than Airbnb and Uber, which couldn’t rustle up a hotel and parking lot full of owned cars between them? The answer is in the question each company asked. Airbnb did not question how to build a better hotel. Instead, they focused on what people want to experience when they travel. Uber did not research futuristic cars. They thought about how people get where they are going.

Five Future Projections

The proper question when thinking about the future of health care is not how to build a better hospital or physician enterprise. Those are important tactical questions, but the far more strategic inquiry focuses on how people think about their health and to follow where they lead in terms of purchase behaviors. Applying that lens to health care generates what we believe are five intriguing possibilities.

1. Market Forces (Finally) Shutter Low-Performing Hospitals

Over the next decade the market is likely, finally, to do what health executives have long-delayed – culling the field of low-performing, high-cost hospitals. Critical factors underpinning this trend include:

The forward-looking questions that these trends raise for health care leaders include the following:

2. Consumer Demand Creates a New, More Efficient Primary Care Front Door

While we’ve been worrying about the primary care shortage, innovators motivated by mission and margin are closing the gap building a more efficient primary care front door. Innovations include:

The forward-looking questions that these trends raise for health care leaders include:

3. On-Demand Insurers and Providers Create Seamless, Guided Customer Experiences

Consumer-facing technology is reshaping countless industries, including airline travel, personal investing, ride-hailing, home mortgages, auto sales and insurance and personal loans. Companies like Travelocity, Schwab, Uber, Carvana and others have created seamless, guided applications that allow consumers to search, compare, shop and purchase goods and services from mobile devices.

Innovators like Bind and Oscar are bringing similar seamless guided experiences to health insurance, in co-branded partnerships with well-known provider systems that deliver simple navigation from getting coverage to getting care. Among developments of note:

Critical questions that these on-demand insurance options should generate for leaders include:

4. Housing and Health Care Converge for Healthy Active Seniors

The “built environment” is the man-made surroundings in which people live, including homes and neighborhoods, and community assets including parks and venues to interact socially. Research shows that these built dimensions greatly impact people’s physical and mental well-being. Knowing that, health systems are proactively seeking out broad opportunities to integrate housing and health care in purposeful designs to enhance individual wellbeing. Early indicators of this trend include:

Critical questions that this trend should raise for health system leaders include:

5. Empowered Consumers Crowd Source and Network to Create New Experiences

For most people, health care continues to be a lonely experience, shrouded in the rules of privacy and conducted behind closed exam room doors, in private hospital rooms and intimate 1:1 conversations.

Consumers are shattering that conventional model as they use the internet to crowd source information, join online communities to share experiences, and stream custom care plans. Key trends are:

Critical questions that this trend should raise for health system leaders include:


These five projections reflect what has already happened in multiple other industries that have been reshaped by consumer demands for control, choice and convenience, and a preference for seamless, guided self-service options.

Using the questions laid out in this article (or some variant thereof) will stimulate the critical strategic conversations leaders need to have and force some level of decision-making about future direction and the sequence and pace of change.

To succeed, those conversations will require peripheral strategic vision to see new competitors emerging from outside the industry segment. It will also require leaders to think not only in terms of symmetrical threats from other health systems, but asymmetrical challenges from organizations that have different competencies and assets.

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is a Managing Partner, BVK Health

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