Wednesday, January 24, 2007

Lessons from little girls and school-teachers

I saw a pair of interesting stories about the EHR-vendor Misys Healthcare last week.

First was a story in NHINWatch about a $10 million grant program called the Center for Community Health Leadership. Launched 6 months ago by Misys, it just awarded its first grant ($3 million) to the community of New Haven, CT.

I think it's fantastic that a vendor has put money into an initiative like this, and particularly in a community-based approach, which is the only way to derive real and lasting value. A single-vendor approach poses some obvious adoption, technology, and business risks for a community, but where there's no other money available, this is a trade-off that's probably well worth the risk.

There's hopefully a coherent business strategy behind this for Misys as well. It reminds me of Apple's education program, which for 30 years has offered computers to schools at substantial discount. I don't know what the ROI on this program has been for Apple, but it's certainly built a tremendous amount of good will by searing their brand into millions of young, impressionable minds.

The Apple strategy also borrows an important lesson from, of all places, the Girl Scouts. Bury your product in a mission that's beyond reproach, like building girls' characters or educating our kids, and the little girls and teachers will become your salespeople. And they'll do it for free.

I can imagine a coherent, long-term strategy for Misys that involves coopting communities of physicians and medical students into becoming Misys salespeople by giving EHRs to communities and to medical schools. It's probably no coincidence that their first grant went to New Haven, home of one of the country's premier medical schools.

This type of corporate strategy won't work for all companies, however, because it requires a long-term view and a willingness to place high value on the softer aspects of ROI, like good will and diffuse, harder-to-measure returns.

Which brings me to the second article about Misys. The News & Observer reports that the CEO of Misys was fired last week for poor financial results. Put in the context of a yearly operating profit of $35 million, a $10 million grant program probably won't survive such pressure. This points out the risk to communities of going with a single vendor: Will New Haven see all of the $3 million? Will Misys be around to support them 5 years from now?

It also highlights the risk to EHR executives as well. I wonder if any EHR vendors have the intestinal fortitude, the deep pockets, and the patience to take the Apple approach.


Anonymous said...

It is a $10,000,000 "software" grant, which is quite a different thing than a $10,000,000 grant.....

Micky Tripathi said...

Yes, agree, excellent point. The financial hit of a $10M "software grant" would be the incremental cost of the software itself (almost zero) plus the opportunity cost of however many licenses they would have sold to the recipient communities without the grant. If they're including some services in the software grant, you would add in the cost of those services provided (implementation, training, development, support).

Anonymous said...

I read something that said people not using Mysis software will also be able to link in to the network because of the connectivity engine the hospital will be hosting. It's a Mysis product that claims to allow data to go between Mysis and non-Mysis systems. So it won't be a "company town" in quite the same way as described, though I'd imagine they'd like to see as many people using their software as possible.

Micky Tripathi said...

Interesting, and thanks for your comment. If New Haven is like the rest of the country, about 85% of their docs don't have an EHR and will presumably go Misys.

Unless there's an organized "RHIO" I can't imagine that any organization -- even the hospital -- could coordinate data exchange across disparate systems. And it's a stretch, I think, to think that an EHR vendor could offer an integration solution that other EHR vendors would be willing to work with.

But who knows -- I've been wrong before (many times).....