Got data? Of course you do. But it’s what you do with that data that matters.
Powerful new tools let organizations collect and analyze customer data in ways not possible a few years ago, but these tools are underused. Why? Most healthcare organizations are not data-driven. But that’s precisely what they must become—or risk getting left behind.
Organizations that figure out how to use data most effectively will be poised to outperform the competition, better meet the needs of their customers, and could help to improve the US health system. These data-fluent organizations will be able to accelerate the pace of innovation needed to address the industry-wide cost problem, while creating value for consumers. (For more on the types of data to collect, see the sidebar, “Gathering and analyzing data.”)
Stages of data: Where are you?
It’s useful to think about data fluency in stages. Knowing where you fall can help you better focus your efforts.
- Stage 1: You have some data you need, but key areas are missing. You need to begin the journey.
- Stage 2: You have the data you need. Unfortunately, you don’t know what to do with it outside of time-worn analytics that yield little insight. You have begun the journey.
- Stage 3: You have the data, and you can do the analytics to decode what it’s telling you. But, the resulting insights are not yet fully realized in terms of driving business performance. You’ve made a great start.
- Stage 4: You have the data and the analytic capabilities, and you use the data to inform your business decisions. You’re leading the way!
- Stage 5: You’ve flipped the process. Instead of gathering data and using it to inform business decisions, you know what you want to do, and your data-gathering and insights strategy emerges from those priorities. You’ve arrived.
Our experience suggests that most healthcare organizations are at stage 2 or 3. Only a small handful have reached stage 4 or 5.
Stakeholder insights that drive business outcomes
To collect and leverage customer insights that will move your organization forward, you must first define the business objectives and then determine how best to gain the right insights. As an example, let’s look at how two hypothetical payer organizations at different stages in their journey are using data and insights around networks.
We know employers and brokers are increasingly interested in new payment and delivery models.
Given this knowledge, a stage 3 payer asks its data-collection and analytics unit to research the issue. The unit recommends pursuing narrow networks. The organization follows the advice, but when uptake isn’t as high as expected, the leadership assumes that customers just aren’t interested in narrow-network products. In reality, the culprit may be poor design resulting from the company’s failure to understand how to use insights effectively—the next level of insight is missing. The company had enough information to pursue narrow networks but not enough understanding of the data to design a narrow network that met consumer needs.
In contrast, a stage 5 payer starts with the outcome. It wants to be innovative in delivering new high-efficiency network options to group customers; that’s a core part of the business strategy for how it’s going to compete. The organization conducts the same initial research the stage 3 payer did, but the data informs its strategy. The payer is able to derive the insights most likely to drive results and can implement tactics that reflect the insights. The business team reports how the initiatives are performing; the insights team then modifies its approach accordingly.
The insights team could, for example:
- Conduct broker interviews to understand the role networks play in recommending one payer over another and which attributes lead brokers to recommend products with narrow networks
- Analyze existing broker relationships to determine how they steer clients to different products (in this case, narrow networks)
- Consider claims data by customer type to understand which networks offer the least disruption and how consumers are likely to behave in different network configurations
- Do an employer-segmentation analysis to determine what industries, sizes, etc., are most interested in the new options, and then develop a comprehensive targeting strategy
Depending on the answers, the payer can make an informed decision about how to move forward. It could, for example:
- Embrace its interest in narrow networks and launch more new products and services to drive market share, even if the efficacy of narrow networks has not fully been proven
- Continue to focus on its current product and network designs until new delivery and payment models show impact
- Use employer interest in innovation to offer alternative products and services
A robust insights strategy driven by business outcomes has tremendous potential to differentiate and deliver greater value to customers. Regardless of where you are on the journey, now is the time to step back and ensure that your insights plan will help you achieve stage 5 insight leadership.