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The Business and Social Imperative for Digital Transformation in Health Sciences

 

As early as the 1900s when Nikola Tesla toyed with the idea of a “world wireless system”, academics, scientists and engineers began to envision the concept of a global communication platform.   In the 1960’s, MIT’s J.C.R. Licklider popularized the idea of an “Intergalactic Network” of computers that was followed by the development of “ARAPNET” or the Advanced Research Projects Agency Network, funded by the US Department of Defense[1], and would eventually lead to what we all know today as the Internet.

The primary motivation for the early Internet was the ability to have numerous computers communicate over a single electronic platform.    Most, if not all, believed that this capability would accelerate the communication of ideas and the advancement of science and technology but I don’t think anyone could have predicted the viral nature of the Internet becoming an essential tool that has transformed every aspect of today’s society.

As we fast forward to our current business climate, companies from all industries are realizing the potential of digital technologies to transform business models, create disruptions to marketplaces and enable competitive differentiators that create tremendous value for organizations.    This would include Health Sciences companies who look to leverage digital technologies to deliver insights and intelligence that automate and transform business models while freeing up employee resources to invest in creating exceptional experiences for their customers, physicians and patients.   The creation of the intelligent Health Sciences enterprise will provide tremendous commercial value to the entire healthcare ecosystem.

Yet, simply providing shareholder value may overlook a larger and more important social imperative.   The ability of public and private organizations to meet the increasing complexities of the modern healthcare systems is under attack.   The science around many of the new therapeutic innovations is remarkable but very complex while government spending on healthcare is increasing at an unsustainable rate for countries across the globe.

For example, Japan is home to the oldest citizenry with 27% of its population over 65 years of age.   By 2030, Japan will have almost a third, 32.2%, over the age of 65 while its percentage of individuals aged 15 to 64 has dropped by 4%.[2]     Japan has recognized this problem and is actively leveraging digital technologies to help care for the elderly population.

Japan is investing heavily in Smart Homes that have everything from digital assistants who can leverage voice commands to perform tasks or use those same voice capabilities to remind patients to take their medications, hydrate with fluids, take a walk or feed their pets.    Digital robots can perform a variety of tasks around the house while also providing emotional support through conversational interactions directly with the senior citizen.   Smart technologies can detect if the elderly person has fallen, can use motion detection to turn on lights or, if necessary, call 911 for emergency services.     Digital technologies reduce the physical and financial burden, simplify tasks and provide for a safer and healthier environment.   These technical enhancements can allow seniors to stay in their homes longer, aid them in the day to day tasks or simply provide additional support for the care of the elderly person.     Digital technologies will allow us to be more productive and cost effective at a time when the number of retirees continues to grow.

Additionally, chronic diseases like diabetes continue to grow across the globe.    The International Diabetes Foundation estimates that in 2017 there are approximately 425 million adults, ages 20-79, living with diabetes and that number is expected to grow to 629 million adults by 2045.    79% of adults living with diabetes are from low- and middle- income families and diabetes cost approximately $727 billion in 2017.[3]

As one of the leading chronic diseases, diabetes puts an emotional, physical and financial strain on families but also on the health systems that must pay for the life saving therapies.    Digital technologies are emerging as key components of the solution to this global health problem.

For example, intelligent Health Sciences enterprises are now able to transform the diabetic experience by allowing patients to assume more control of their health.   Wearable devices can provide real time readings of a patient’s glucose levels without having to take any blood samples.    The devices can wirelessly upload the glucose readings to an app on a patient’s cell phone that provides a historical view for the patient, physician and care circle.   Fitness trackers can monitor activity levels, track a patient’s food intake and provide reminders to improve their lifestyle choices that will not only improve the management of their diabetes but also help reduce the likelihood of additional health problems like cardiovascular disease, amputations or obesity.

Further, drug and device manufacturers are collaborating on newer, targeted reimbursement models that align therapeutic payments with patient outcomes.   For example, instead of selling a diabetic medication or an insulin pump, manufacturers are working with payers to align reimbursement models based on the AIC levels of their patients.    Effective management of AIC levels will likely include an engagement model that stresses diet, exercise and adherence to the therapeutic regimen that provides a more holistic view of the patient.     Digital technologies become the foundation for a more strategic approach to chronic disease that allows the patient and their care circle greater visibility and control of their lifestyle while also aligning reimbursement metrics directly with a patient’s health outcome.

As we approach digital transformation, Health Sciences organizations have the unique opportunity to leverage digital technologies to drive shareholder value through new business models, enable exceptional customer, physician and/or patient experiences and focus on a higher purpose of helping solve society’s most complex problems.    At SAP, our mission is to enable best run businesses that improve people’s lives.   This is not a marketing slogan but, instead, it is a calling that we believe is a better way to do business.

 

[1] Who Invented the Internet, Evan Andrews  https://www.history.com/news/who-invented-the-internet

[2] Countries with the Largest Aging Populations in the World, WorldAtlas.com https://www.worldatlas.com/articles/countries-with-the-largest-aging-population-in-the-world.html

[3] International Diabetes Foundation Facts and Figures  https://www.idf.org/aboutdiabetes/what-is-diabetes/facts-figures.html

 

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