Three years ago, about 30 people reported to Larry Egger, an assistant vice president for IT at HCA Inc. Not anymore. Egger is still a member of HCA's Information Technology & Services department, but he has moved his desk to a completely different department, one that monitors HCA's $3.2 billion annual supplies purchase of everything from bandages to heart monitoring equipment.
Egger now lives a dual life, working in one department but belonging to another. But he isn't complaining. He is one of five so-called alignment "solution leaders" appointed by CIO Noel Brown Williams in 1999 to help close the gap between business and IT at Nashville, Tenn.-based HCA. His mission: to help the nation's largest healthcare provider, with almost $18 billion in 2001 revenues, better use technology to cut costs throughout its almost 200 hospitals and 80 outpatient surgery centers in 23 states, England and Switzerland.
IT View: "Alignment is hard. It requires time and energy from both sides, and good listening and communication skills that in the past have not been strengths for many IT staffers."
"We were having trouble staying synced up with the business, making sure that the people in IT were always working on the highest business priorities," Williams says. So she appointed five people from IT to work side-by-side with business people to come up with new ways to support HCA's bottom line. The five were relieved of their previous responsibility of managing large technology staffs to focus on learning HCA's businesspatient billing, finance, employee services, clinical technology and supply chain operationsand recommend ways IT could help each unit reach its goals.
Biz View: "I think it was felt that a lot of decisions were made by IT without the proper input from those of us on the business side."
Is the team having an impact? So far, so good. Internal surveys show a jump in satisfaction among the business units, and executives point to big savings. Jim Fitzgerald, the senior vice president of Contracts and Operations Support, whose department is in the throes of a reorganization as part of an overall corporate consolidation along regional lines that was designed to cut costs and give the company greater bargaining power with insurance companies, says that IT's help in the reorganization has boosted his group's productivity by about 15 percent. Meanwhile, HCA has kept the lid on the cost of supplies; it's been hovering around 16 percent for several years. That's not bad, considering that Cap Gemini Ernst & Young estimates the typical cost of supplies in the industry at between 20 percent and 30 percent. Meanwhile, Merrill Lynch estimates that HCA's net margins will climb to 6.8 percent this year, from 5.9 percent in 2001.
Photos by David Johnson
This article was originally published on 07-01-2002