To spin or not to spin, that is the question
Success stories in digital transformation projects are likely to lead to a difficult decision for healthcare leaders: do we spin this out and build a new revenue stream and let the wider system benefit? Or do we keep it to ourselves? With the amount of investment and the number of projects underway, this dilemma will become much more common. For start-ups, could this be a worrying development?
Spin-outs have an immediate competitive advantage over start-ups – a customer. In a market desperate for proven solutions that can impact productivity, patient engagement and quality, the strategy can have enormous first-mover advantages.
To scale, it may be necessary to break free from that ‘customer’ and go through the process of being manipulated outside of a controlled environment to further prove the model.
Having the right business model is important, as we have seen in telehealth with so many groups struggling to reach profitability. Where technology seeks to solve a problem of access or quality, making sure it can make a profit or at least pay for itself is especially important.
But customers also need to be able to afford the services on offer. And a big market in terms of demand may be difficult to make a profit in, as the product becomes commoditised.
Healthcare has a sustainability problem. Rising costs, increasing demand and burnt out workforces risk sinking systems.
Technology is the big lifeboat everyone is piling in. As investors and health systems alike work hard on value creation and race to own the patient pathway, expect to see the creation of spin-outs become a more prominent page in the playbook.
HBI 2024, “New Models for the New Era”, June 10-12 in London features CEOs from all corners of the sector share their success stories in digital transformation. Hear directly about the impact made and lessons learned in scale and growth through case studies and data-driven presentations. You can find out more and book your tickets here.
We would welcome your thoughts on this story. Email your views to Lee Murray or call 0207 183 3779.
