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Delivering Digital

Healthcare CIO Interrupted

CIOs controlling increasingly smaller pieces of healthcare's technological pie

According to a survey conducted by Black Book Research, in healthcare organizations the IT budget center of gravity no longer exists with the CIO. According to the six-month rolling survey of 247 CIOs and 1,305 senior managers outside of IT, CIOs control just 8 percent of IT purchasing decisions.

That’s a stunning drop from those healthcare CIOs having control of 71 percent of IT budget just three years ago. The survey found that 88 percent of non-IT hospital leaders in Q4 2018 see the demand for their technology expertise radically intensifying.

“Traditionally, CIOs called the shots in IT purchasing after aligning with the department on its need, but digitalization is making a permanent change to the health systems IT purchase process,” said Doug Brown, managing partner at Black Book. “As healthcare organizations transform work processes through digitalization the department leaders involved must logically uphold the authority of those processes.”

CIOs control just 8% of IT purchasing decisions at healthcare organizations

The result is dramatic decentralization of IT decision-making. According to the survey, 45 percent of respondents expect more than a third of their IT budget to be outside of IT in 2019.

The numbers are dramatic enough to give healthcare CIO pause for concern: 29 percent of line-of-business leaders think of their CIOs as tactical — but not strategic enough to navigate the complex healthcare business systems to drive financial success. And 88 percent of CIO’s C-suite peers, CIOs are seen as developers and deployers of technology, and not as a source of innovation and transformation to deliver business value.

Conversely, 81 percent of CIOs identified themselves in a transformational CIO role.

“Lately, CIOs have been running IT more as a supply function — as order takers and implementation coordinators — than micromanaging IT costs,” said Brown. “As more and more healthcare providers are buying cloud-based services and turning to self-service models, IT decision making is spreading across the health system.”

Finally, the survey found that only 24 percent of hospital executives believe IT facilitates their entry into new markets and initiatives. That was 80 percent five years ago.

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