The Ghost of ERP Failures Past

Final, precise criteria for what healthcare CIOs have to do to obtain stimulus money won't be out until the end of this year. But if they hope to make Obama's deadlines, CIOs must push ahead with core systems such as electronic medical records (EMRs). As a result, healthcare IT operating budgets are up 4.7 percent this year compared with those of 2008, according to a survey of 200 IT executives by research firm Computer Economics. In comparison, across other industries, the numbers are flat. Healthcare hiring has jumped, too. While 46 percent of IT organizations overall have cut staff this year, 27 percent of healthcare organizations are adding technology positions.

The IT offerings in the e-health realm today are about where enterprise resource planning was in the early 1990s: many sellers, lofty promises and staggering amounts of money being spent. An EMR, which mainly digitizes patient records, is the centerpiece. But transforming a hospital to meet Obama's vision will require many more pieces to be integrated-tracking prescriptions electronically, computerizing physician orders, digitizing, storing and retrieving lab results and images. The complicated list goes on and on.

If done right, a healthcare organization can go nearly paperless, with real-time access to all patient information, generating treatment plans based on detailed analysis of aggregated data about what worked in the past and what didn't-all to produce better patient outcomes. The business mission, if you will, would morph from treating the sick to "spreading health," as Kaiser Permanente CIO Phil Fasano puts it. That's a vital strategic shift. (See " " ) In trying to achieve it, though, "a lot of people will try to do too much, too soon and fail," predicts Money Atwal, CIO and CFO of Hawaii's Hilo Medical Center. Atwal recalls with a shudder the way IT leaders rushed huge ERP systems into place when the technology was untried and lacked C-suite commitment.

Smart CIOs will recognize this period as a time to pivot from being someone who automates existing processes to someone who makes possible new business models, adds Mount Sinai's Contino. Success, he says, "isn't in the technology. It's the management."