Streamlining IT at Carestream Health

By William Atkinson  |  Posted 05-24-2013

Streamlining IT at Carestream Health

By William Atkinson

Carestream Health came into existence when Onex Corporation purchased the Health Imaging Division of Kodak in 2007. At the time, the newly created Carestream found itself with an IT function responsible for its 150 worldwide locations and various global network service contracts to support these locations. The network was staffed by 300 IT people in 44 locations. Since Carestream's IT structure had been created to support the previously larger and more complex organization, it was not optimized for a company the size of Carestream. It became imperative for the Rochester, New York, company to transform its IT structure into to a lean, agile and cost-effective function.

To this end, Carestream CEO Kevin Hobert hired Bruce D. Leidal as CIO in August 2008, with the mandate to transform the IT function. Leidal had previous experience in IT with Texas Instruments, EDS, Federal-Mogul and General Motors, and as a management consultant with AT Kearney, in addition to being a member of the Society of Information Management and its Advanced Practices Council.

Over the next few years, Leidal focused on seven areas: IT strategy, relationship management, enterprise architecture, governance and the project management office, application development and support, global IT operations and infrastructure, and people management.

As Leidal sees it, the two most important and challenging areas were the first two: IT strategy and relationship management. "The biggest piece that was missing when I walked in was the lack of a portfolio management process," he says. "There was no frame for having a conversation with executive leadership."

Carestream has a number of different business units and functions, and although they share some common objectives, each unit has its own priorities. "There was no meaningful way to talk about common platforms, business priorities, and how IT could help the executive leadership with those priorities," Leidal says. "We needed to find a way to take different projects and initiatives and represent them on a level playing field, so that everyone could understand the work that everyone else wanted done."

IT funding is based on each project's strategic value, return on investment and on overall budget guidelines, determined by the executive management team. As IT got closer to its funding and human resources limit, the management team was able to focus on the proposed projects that were just above or below the cutoff line. "This allowed us to take all the rest of the 'noise' out of the system," says Leidal. "In other words, we didn't need to spend time discussing the top one or two, which were going to be funded for sure, or the ones at the bottom that would never receive funding."

To address the seven areas in general, Leidal focused on three overarching strategies. One involved creating an integrated vision, strategy, mission, roadmap, guiding principles, goals and execution for IT. These provided not only a holistic view of the transformation, but a step-by-step roadmap to get there. The second strategy was to implement strong and effective processes. As a result of implementing these processes, the company's IT processes are now viewed in Carestream as important components of IT's ability to deliver value. IT staff are viewed as process change experts, with the skills and capabilities to improve IT and help the business to innovate. The third strategy was hands-on leadership. Hobert gave Leidal the license to transform IT, providing him with authority and then stepping out of the way. Leidal then used his leadership skills to begin the transformation.

Streamlining IT at Carestream Health

Leidal selected these three strategies not only because they were appropriate for the situation, but because he had experience in all of them. "I learned the first one, IT strategy and implementation, at GM," he says. "I learned the second, strong processes, at AT Kearney, and I learned the third, management style and leadership, at EDS."

Efforts in these seven areas have been successful. "Executives in the various business units have told me that IT has been able to do some valuable things for them," Leidal says.

One valuable contribution has been to allow for business growth by extending IT's capabilities directly into customer organizations. "For example, we do cloud computing, where we take IT products that we developed for our marketplace, then put them in a data center environment with a cloud offering. We have also extended some of our capabilities, such as back office accounting and inventory replenishment, into a services area for our customers."

A second contribution resulted from spending a lot of time focused on creating business efficiencies. "When I joined, we had almost 700 core applications, 11 of which were financial," says Leidal. "You can imagine what it was like at the end of each month, trying to do consolidation, as well as people trying to manage the business as the months progressed, but flying blind until they reached the end of a month and only then seeing everything all rolled up. By that time, it was too late."

To address these weaknesses, IT worked with finance to implement a single global financial system, an advanced business planning and consolidation system, and other initiatives designed to emphasize the importance of using common processes and systems across the entire company.

"Third, we have placed a lot of emphasis on personal productivity," Leidal says. "Within the first two or three days I got here, I had already accumulated about a dozen user IDs and passwords that I needed in order to get to the various places I needed to be." To eliminate inefficiencies like this, IT installed a single sign-on platform. It also installed an external portal so that salespeople and other Carestream employees could gain access to some of the company's critical systems from anywhere, as long as they had Internet access. "We have also implemented mobile device management and backed it all up with 7x24 service desk," he says.

Having successfully addressed the majority of the important elements of the seven initial areas, Leidal is now focusing on further improvements. "We have two primary platforms that need to be completed," he says.

One is a global service platform. "We have a large field-service group in our organization, which is responsible for servicing our equipment installed in customer sites around the world," Leidal says. "By working on the service platform, we can make sure that we get the customer experience right and line ourselves up for what we want to be, as a company, for the future in terms of service and support."

A second platform is to further extend the company's internal capabilities to its customers, such as cloud computing and expansion of new services. "We are currently focused on some unified projects that can be customer facing," he says.