the health technology leader’s agenda for the next decade

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August 9, 2021

HIMSS CIO Summit

The health technology leader’s agenda for the next decade

McKinsey & Company#HIMSS21 2

Karl KellnerSenior Partner & Leader of

healthcare technology and digital practice across providers, payors

and health services,McKinsey & Company

Venkat InumellaPartner & Leader of provider

technology, analytics and innovation practices,

McKinsey & Company

McKinsey & Company 2#HIMSS21


How much change have we seen over the past decade?

What change might the new decade bring?

How can we best prepare for this change?

Contents

3McKinsey & Company#HIMSS21

McKinsey & Company#HIMSS21 44McKinsey & Company#HIMSS21

Change over the past decade: the impact of tech

85%20%

Enterprises Industries

Smart phone penetration Data created annuallyZettabytes

Airbnb market capitalization ($)

259

85B

70Mvs.

2011 2021

2010

2020

2010 2020

Consumers

Source: Pew Research; IDC; Company financials


Enterprises IndustriesConsumers

Change over the past decade: in healthcare

>95%16% vs.

2010 2020

>150

2020

<12010

25%of US population

~4~3

2010 2020

Change in life expectancy at birth: ~0%

Health wearable adoptionUnits shipped, Millions

EHR adoption among hospitals%

US national health expenditure $ Trillion

Source: National Center for Health Statistics; KFF.org; CDC;


Traditional industries

What has driven these changes?

Tech advances

as catalysts for change(e.g., processing, cloud, AI, automation)

Shifting customer expectations

set through experience with digital natives

Enabling regulation

new laws, cost pressures, political factors

Competition & innovation

new & non-traditional competitors, business

model innovation


Tech advances have driven the most important shifts; the financial markets reflect this

Technology companies dominate the stock marketShare of total market cap, %

Source: S&P; Bloomberg; company financial reports

8/10of the largest corporations globally now are tech firms

20080

25

1610 1412

10

18 2020

5

15

20

30InformationTechnology

Health & Life Sciences

Real Estate

Energy

Materials





Contents



The next decade: a new industrial revolution is underway

Source: Maddison Project database ; OECD; UBS Asset Mgmt.

Global economic development has always been driven by technology-driven revolutions (GDP per capita, indexed to 1 in 1000 AD)

2nd industrialrevolution

1st industrialrevolution

Technological advancements

Efficient steam engine

Electricity, IC engine, telephone

Silicon chips, Internet

3rd industrialrevolution

195016501000 1700 1750 1800 1850 19001

2000

10

2050

100 World

4th industrial revolution accelerated 10x by technological advancements


The next decade: some technologies likely to drive 10x shifts

>50% Up to 80% 2030

>75%

>75%of today’s work activities could be automated by 2030

of global population will have 5G coverage by 2030 to enable pervasive IoT

Year by which Google expects to have a 1 million qubit Quantum Computer

of all digital service touch points (e.g. voice assistants) will have embedded AI

of enterprise generated data will be processed at edge

Automation1 Connectivity2 Computing4

Applied AI5

Edge infrastructure3

~30x >10% 45xreduction in the workforce required for software development and analytics

of global GDP could be associated with blockchain by 2030

reduction in cost to sequence the human genome in the last 10 years

Future of work6 Trust architectures7 Biotech8

Source: McKinsey research


The next decade in healthcare: the opportunity is massive

Source: Bureau of labor statistics (2017-18); McKinsey analysis

Ratio of support staff to core staff is US services industries

0.813%

3.6

87%

52%

Education 58% 1.1

Legal services

42%

48%

Securities and commodities

56% 1.944%

Healthcare delivery

Industry-agnosticIndustry-specific


Elements of a 2030 healthcare vision:The consumer view

Engaging with and through a patient’s family, community, and social networks

Enabling Life-Health integration

Intelligent orchestration, enabled by 3600 understanding of patients

Remote and continuous monitoring (e.g., after acute care episodes, for chronic conditions)

Higher acuity care in traditional settings (e.g., procedures, intensive care)

Financial assistance for high-value therapies

Homeand

self-care

Social care

Financial support

Data

Consumer

Daily lifeactivities

Traditionalcare


Elements of a 2030 healthcare vision: The health system view

Physical assets

Digital assets

Intelligent operations

Care management & decision support

Care providers Orchestration, concierge

Consumers

Pervasive AI

Business models

Workforce





Contents



Building blocks of a readiness plan

Talent Operating Model Value OrientationCore TechnologyScalable infrastructure

Fluid data

AI factory

Connectivity

Security

Translators

Engineering

Product

Design

AI

Multi-disciplinary teams

Agile, distributed

Digital fluency

Funding models

Partnerships

Care outcomes

Consumer experience

Staff experience

New business models

Growth & efficiency



What is on the CIO agenda today?

37

36

31

30

26

23

22

17

15

12

Transforming talent strategy

Changing IT’s delivery model

Redesigning tech org

Transforming cybersecurity practices

Modernizing infrastructure

Redesigning the IT operating model

Digitizing of end-user experience

Enhancing IT architecture

Transforming vendor management

Scaling data and analytics

Source: McKinsey global survey on IT and the business 2020

Focus of most transformations over next 2 – 3 years1

Over halfof the organizations that have made large scale and purposeful investments in technology transformations see positive impact



What else should be on the agenda?


No-regret moves Set a long term aspiration

Invest in the building blocks

Build digital talent and fluency

Mind the data

Learn to form productive partnerships

Big, bold bets Products, not projects

Automation in everything

AI factories, not AI pilots

Core business, not back office

Engineering, not IT support, culture


KarlKellnerSenior PartnerMcKinsey & Company

Venkat InumellaPartnerMcKinsey & Company

Get in touch by emailing [email protected] by scanning the QR code:

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The health technology leader’s agenda for the next decade

the health technology leader’s agenda for the next decade

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