Airlines are arguably more operationally complex, asset-intensive, and regulated than hospitals, yet the best performers are doing a better job by far than most hospitals at keeping costs low, and make a decent profit while delivering what their customers expect.
Southwest Airlines, for example, has figured out how to do well the two operational things that matter most: Keep more planes in the sky more often, and fill each of them up more, and more often, than anyone else. Similarly, winners in other complex, asset-intensive, service-based industries — Amazon, well-run airports, UPS, and FedEx — have figured out how to over-deliver on their promise while staying streamlined and affordable.
These examples are relevant to health care for two reasons:
First, hospital operations are in many ways like airline and airport operations and transportation services. There are many steps in the service operation (check-in, baggage, the security line, gates), high variability at each step (weather delays, congestion, mechanical issues), multiple connected segments in the user journey — and all these operations involve people, not just machines. In mathematical terms, hospital operations, like airlines and transportation, consist of hundreds of mini-processes, each of which is more stochastic and less deterministic than, say, the steps in assembling a car.
And second, hospitals today face the same cost and revenue pressure that retail, transportation, and airlines have faced for years. As Southwest, Amazon, FedEx, and UPS have demonstrated, to remain viable, industries that are asset-intensive and service-based must streamline operations and do more with less. Health care providers can’t keep spending their way out of trouble by investing in more and more infrastructure; instead, they must optimize their use of the assets currently in place.
To do this, providers need to consistently make excellent operational decisions, as these other industries have. Ultimately, they need to create an operational “air traffic control” for their hospitals — a centralized command-and-control capability that is predictive, learns continually, and uses optimization algorithms and artificial intelligence to deliver prescriptive recommendations throughout the system.
Dozens of health care organizations are now streamlining operations by using platforms from providers including LeanTaaS, Intelligent InSites, Qgenda, Optum, and IBM Watson Health. What these solutions have in common is the ability to mine and process large quantities of data to deliver recommendations to administrative and clinical end users.
Improving hospital operational efficiency through data science boils down to applying predictive analytics to improve planning and execution of key care-delivery processes, chief among them resource utilization (including infusion chairs, operating rooms, imaging equipment, and inpatient beds), staff schedules, and patient admittance and discharge. When this is done right, providers see an increase in patient access (accommodation of more patients, sooner) and revenue, lower cost, increased asset utilization, and an improved patient experience.
Sanjeev Agrawal is president and chief marketing officer of LeanTaaS iQueue. Sanjeev was Google's first head of product marketing. Since then, he has had leadership roles at three successful startups: CEO of Aloqa, a mobile push platform (acquired by Motorola); VP Product and Marketing at Tellme Networks (acquired by Microsoft); and as the founding CEO of Collegefeed (acquired by AfterCollege).
Sanjeev graduated Phi Beta Kappa with an EECS degree from MIT and also spent time at McKinsey & Company and Cisco Systems. Sanjeev is a Forbes contributor and also writes on his personal blog at
http://medium.com/@saagrawa. He is an avid squash player and has been named by Becker's Hospital Review as one of the top entrepreneurs innovating in Healthcare.