health and life sciences - cgi...once again this year, transforming the patient and customer digital...

2018Client insights and CGI perspectives

on business and technology trends

HEALTH AND LIFE SCIENCES

An outlook on trends and priorities based on in-person conversations with business and

IT executives around the world


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INFORMING STRATEGY THROUGH CLIENT INSIGHTS

Each year, CGI leaders meet face-to-face with business and IT executives to hear their perspectives on the trends affecting their organizations and the implications for their business. Our experts incorporate the findings and insights from these conversations into our annual strategic planning process and share them with clients through CGI Client Global Insights reports.

In this report, CGI presents the insights and perspectives from our conversations with health and life sciences executives, where patient and customer expectations are driving organizations to advance their digital strategies and optimize operations.We thank the more than 1,400 commercial and government executives across the globe who participated in interviews this year, and we value the opportunity to help drive forward their future strategies and investments.


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Percentage of interviews by region

52% 39%52%

9%

48%

INTERVIEW INFORMATION

97 health and life sciences clients

Percentage of interviews by role

Europe

United Kingdom

North AmericaIT leaders

Business leaders


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CLIENT INSIGHTS

INDUSTRY TRENDSCitizen digital expectations and cybersecurity continue as top concernsOnce again this year, transforming the patient and customer digital experience tops the industry trends for health and life sciences executives we interviewed, with a stronger showing than last year (94% up from 87%).

Two notable strengthening trends are protecting data through cybersecurity and cyberprivacy, as well as interoperability standards, up 12% and 18% from 2017, respectively.

Healthcare reform remains important overall, but is much higher on the agenda in Europe (83% compared to North America at 70%), where regulations such as the General Data Protection Regulation (GDPR) are top of mind.


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CLIENT INSIGHTS

All responses North America Europe

1

Becoming digital organizations to meet customer/citizen expectations 94%

90%

90%98%

87%

2

Protecting data and equipment through cyberprivacy and cybersecurity

90%89%

78%

3

Pursuing interoperability and standards 81%

78%85%

63%

4

Health reform driving regulatory compliance 76%

70%83%

68%

5

Budget pressures due to aging populations 57%

52%62%

61%

2018 top trends 2017All responses


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CLIENT INSIGHTS

BUSINESS PRIORITIES

2018 top business priorities


1

Optimize today’s operations 90%

84%96%

74%

2

Protect the organization as cybersecurity risks mature 87%

88%85%

69%

3

Collaborate to deliver interoperability 85%

84%85%

85%

72%

4

Harness the power of data analytics 82%

80%

80%

5

Improve the patient experience 72%

66%79%

70%

Optimizing operations and protecting the organization rise in importanceGenerally, business and IT priorities for this sector are consistent with last year, and aligned with each other, particularly as cybersecurity rises in importance as a business priority. Optimizing operations is the new top business priority and, along with cybersecurity and collaboration/interoperability, surpass last year’s most frequent response of harnessing data analytics. Improving the patient experience rounds out the list, where Europe shows a stronger focus.

We asked both business and IT leaders to provide their perspective on these business priorities. While there is alignment around most priorities, IT leaders chose cybersecurity as their highest priority compared to their business counterparts who put optimizing operations at the top.

Business priorityBusiness leaders

IT leaders

Optimize today’s operations 91% 88%

Collaborate across the boundaries of our organization 85% 84%

Protect the organization as cyber risks mature 81% 92%

Harness the power of data and analytics 83% 82%

2017All responses


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CLIENT INSIGHTS

IT PRIORITIES

2018 top IT priorities


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Drive IT modernization and new IT delivery models 88%

78%98%

88%

1

Protect data and assets through cyberprivacy and cybersecurity 89%

84%94%

81%

3

Improve the patient experience and reduce costs by digitalizing and

automating healthcare 81%

70%94%

72%

4

Digitalize and automate business processes across and beyond

the value chain 75%

80%70%

N/A

5

Deliver clinical and business insight with

next-generation analytics 69%

64%74%

72%

Consistent with the business priority to protect the organization from cyber threats, cyberprivacy and cybersecurity become the top IT priority this year, surpassing last year’s top priority — IT modernization. Emerging technologies are gaining interest, with significantly stronger emphasis in Europe.

Cybersecurity and data privacyIn 2018, cybersecurity and regulation figure prominently among business and IT priorities, increasing in frequency across all industries. In health and life sciences, 70% of executives interviewed are focusing on employee training and awareness as the most common response in this area, followed by reevaluating the sharing of data across boundaries (65%) and identifying critical assets for management and control (61%).

2017All responses


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CLIENT INSIGHTS

DIGITAL MATURITYStrategies in development while emerging technologies gain momentumForty-five percent of health and life sciences executives we interviewed say they have a defined digital strategy in place, while 31% are starting to build such a strategy. For those leaders with a defined strategy, 12% have operationalized the strategy across the enterprise focused on the internal organization, while 59% are still building or launching one. Only 3% say they have operationalized a strategy that extends to their external ecosystem.

Stage of digital transformation strategy implementation

Don’t know OtherProducing results Operational Launching Building

Top challenges 2018 2017

1 Cultural change and change management 89% 77%

2 Change slowed by technology/legacy/agility constraints 80% 63%

3 Budget or funding challenges 72% 58%

4 Realizing business value from digital insights 61% 59%

For the entire enterprise, with a scope focused on the internal organization

12%11% 21% 38% 17%

For the entire enterprise extending to our external partners and suppliers

12%13% 41% 31%

3%

1%

Cultural change and change management remains the top barrier to digital transformation for this sector, but with much greater emphasis, and is again followed by technology constraints.

Interviewed executives provided more than one response.


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CLIENT INSIGHTS

A growing number of health and life sciences leaders we interviewed are evaluating emerging technologies such as the Internet of Things, natural language processing, artificial intelligence, machine learning and robotic process automation. However, few have completed implementations.

This year, 60% of health and life sciences executives interviewed say they jointly empower their CIO and lines of business to drive digital transformation. Forty-five percent say lines of business lead these efforts, while 40% say their CIO is primarily responsible.

CIO and lines of business jointly

empowered

Lines of business CIO

Team or role primarily responsible for driving transformation

60% 45% 40%

Stage of technology transformation

Interviewed executives provided more than one response.

30%

21%27% 12% 19%

Robotic process automation (RPA)

20%

34% 12% 5%

Internet of Things (IoT), natural language processing (NLP)

18%

38% 5% 7%

Artificial intelligence (AI) & machine learning

20% 30%

Investigating Transformation in progress Transformation achieved Not for us OtherProof of concept

1%

1%

DIGITAL MATURITY


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CLIENT INSIGHTS

New investment funding continuesOverall, health and life sciences executives interviewed see slightly lower budgets for operation and maintenance (O&M) this year at −0.3%, compared to 0.3% last year. For new application and infrastructure investments, they see 2.2% growth compared to 2.1% last year. In the life sciences sub-sector, 15% of executives estimate total new IT investment of $125 million or more in the next 3 years, compared with 14% of healthcare providers and payer executives estimating such investment levels.

Executives in this sector are focusing current innovation investments on integration and interoperability as well as cybersecurity and cyberprivacy. Over the next three years, cyber still ranks highly (and spikes in importance in North America), but innovation to improve the client and employee experience will see the most significant growth.

Planned investments in innovation

Now Within 3 yearsIntegration and interoperability

80% 81%

Cybersecurity and cyberprivacy

79% 80%

Legacy modernization and agile delivery

74% 73%

Improving the client and employee experience

73% 78%

INNOVATION SPENDING


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CLIENT INSIGHTS

BENCHMARKING IT SPENDING PATTERNS

The CGI Client Global Insights offer a wide range of benchmarking capabilities to support clients with their business planning. For example, in the area of IT spending, we asked health and life sciences executives to estimate their IT spend increase or decrease year-over-year. The average of their responses is a 2% increase, with 49% indicating that budgets are increasing, 25% citing flat budgets, and 22% citing decreasing budgets.*

Drawing on more than 1,400 interviews across 10 industries, the CGI Client Global Insights offer numerous benchmarks, including client priorities, investment plans, innovation activities, digital transformation, cybersecurity and data privacy practices, human capital and more. This data can be compared among peers and across industries and geographies. Through our client engagements, we draw upon these benchmarks to support the development of their strategies and publish CGI Perspectives to share the findings.

Overall IT spend increase or decrease year-over-year

> 6%

5-6%

3-4%

1-2%

Flat

-1-5%

-6-10%

> -10%

19%

16%

3%

11%

25%

11%

2%

9%

Data shown for answers providing a specific percentage only.% of

responses% of increase or decrease

*Percentages may not total 100 due to rounding.

Average 2%


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CLIENT INSIGHTS

Global average 6.1

Global average 5.7

Global average 5.9

Global average 6.3

Industry average 6.0




This year, business and IT executives interviewed ranked their satisfaction with their own IT organizations based on the 10 key attributes of a world-class IT organization, providing a comparative view of business and IT satisfaction both within and across industries. In the Perspectives section of this report, we share how this data helps health and life sciences clients measure and benchmark their progress toward building a world-class IT organization.

The following chart compares health and life sciences executives’ satisfaction with their IT departments to global averages. IT leaders in this sector tend to score satisfaction higher than their business counterparts. Compared with the global average, IT rankings in this sector lag behind in the area of introducing innovation.

Business leader satisfaction vs. IT leader satisfactionScores from 1 to 10, with 10 most satisfied

Providing cost-effective service

Consistently introducing innovations

Delivering on time and on budget

Providing services aligned with the line of business

Business leaders 5.7




IT leaders 6.3

IT leaders 5.1

IT leaders 5.8

IT leaders 6.0

CGI can provide clients with a discussion of all available benchmarking, including each client’s positioning, on topics such as digital maturity, IT budgets, IT satisfaction, innovation investments and more.

BENCHMARKING SATISFACTION WITH THE INTERNAL IT ORGANIZATION


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CGI PERSPECTIVESIn this section, we present CGI’s viewpoints on the insights health and life sciences executives provided this year.

INDUSTRY TRENDSShifting toward a secure, patient-centric and demand-driven modelRising healthcare costs, aging populations, shortages of care professionals, personalized medicine advances, and other evolutionary pressures continue to drive consumer-centric models across the health and life sciences industry. Once again this year, transforming the patient and customer digital experience tops the industry trends for executives we interviewed.

The dramatic rise of interoperability as an industry trend also reinforces the drive for a patient-centered approach to care, as it is a key enabler to achieving a holistic view of the patient. Better digital experiences mean better outcomes and greater adoption and treatment adherence by patients.

As electronic records integration advances the connected health ecosystem, the ability to capture more patient-centric data also will allow more actionable insights. Ever-growing amounts, types and flows of data, and the growing use of the Internet of Things (IoT) and mobile platforms, increase the urgency to secure sensitive information and protect patient privacy with “baked in” controls. This is reflected in the significant rise of the cybersecurity/cyberprivacy trend this year.

Digital-savvy citizens and consumers are conducting online research and engaging with a global community through connected devices. The richness of data in genomics, medical records, imaging, IoT, wearables, telehealth and connected homes are fueling the digital disruption of the status quo. This has opened the door to rebuild the health ecosystem differently by shifting business models from a focus on products and services, to solutions and outcomes.

We see the transformation from a supply-driven industry where institutions dictate services, to one that is demand-driven and focused on citizen and consumer preferences and needs, as the key opportunity for this industry in the coming years.


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CGI PERSPECTIVES

BUSINESS AND IT PRIORITIES

Optimizing operations while increasing agility, protecting data and assetsContinuing cost pressures and consolidation are driving health and life sciences executives to focus on optimizing operations as the top business priority.

Harnessing the power of data and analytics and collaborating within the health ecosystem across pharmacies, patient programs and medical records also continue as key business priorities. Organizations have a powerful opportunity to generate an interactive digital experience for customers, patients and employees by using real-time data for deeper insights. Customer engagement solutions built on analytics and digital technology will enable even greater engagement, and ultimately move patients/customers further along the desired journey.

Business and IT leaders are prioritizing their focus to protect the organization from cyber risk as a foundation to implement digital strategies. We also see an increased push in Europe to adopt emerging technologies as government agencies and GDPR are addressing regulatory and privacy concerns faster than in North America.

This year’s IT priorities also emphasize modernization, new delivery models, cybersecurity and interoperability. Interoperability becomes increasingly important as the ecosystem aims to deliver an end-to-end experience for patients and customers across multiple suppliers.


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CGI PERSPECTIVES

DIGITAL MATURITY

Transformation strategies disrupt conventional business modelsHealth and life sciences organizations are committed to digital transformation to enhance the consumer and workforce experience while incorporating interoperability, privacy and security into everything they do.

Industry executives we interviewed are increasing investment in digital strategies while navigating a highly regulated industry. They recognize that transformation requires thinking holistically and aligning on a coordinated approach. Incorporating “digital” into the DNA of the organization — across business, technology and organizational dimensions — must be systematic. It requires reimagining business models, empowering digital leaders and breaking down silos to integrate complex health data across and beyond the digital health ecosystem. Interoperability plays a key role in the digital roadmap, along with privacy and security.

As industry executives move their digital strategies from experimentation to scale, significant culture and talent challenges persist as top inhibitors. This challenge rises in significance for executives we interviewed this year.

Organizations need to be flatter, leaner and more focused to rapidly seize on digital disruption opportunities. This means creating new roles that blend business and IT functions to execute on digital strategies in the new technological world. Of note, 60% of the health and life sciences executives we interviewed say they are jointly empowering the CIO and lines of business to drive digital transformation. And, while just a few include ecosystem partners in their digital strategy today, this is an emerging trend that we expect to strengthen.


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CGI PERSPECTIVES

Balancing investment across transformation and protectionWhile budgets for new investment show only a slight increase this year, executives from health providers, payers and life sciences firms we interviewed see higher growth rates next year, and even more significant investment gains three years out.

Despite information consolidation, much data remains outside core systems for this sector, so investing in integration and interoperability capabilities is critical to unifying data.

The pace of innovation continues to be tempered by compliance and security requirements, which consume significant budget and reduce funds available for digital transformation initiatives. Data breaches continue to make headlines, pointing to the need for continuous investment in managing and protecting data. With integration and interoperability also driving IT spend, investments for emerging technologies require proving the business case.

As patients, members, citizens and customers expect more from their user experiences every day, health and life sciences organizations are increasing investment in delivering digital services and customer/patient-centric experiences.

INNOVATION SPENDING


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CGI PERSPECTIVES

PROGRESS TOWARD WORLD-CLASS IT

Today’s enterprises need world-class IT to compete in an increasingly digital world When there are gaps between business and IT executive expectations, advancing the transformation agenda is challenging at best. To become a top-performing enterprise, there should be continuous interaction between the business and IT sides of the organization that focuses year-over-year improvement efforts on key attributes of successful IT operations.

In comparing how health and life sciences business and IT leaders assess their satisfaction with internal IT services, notable gaps are in the areas of innovation and service effectiveness. There’s also a gap when comparing this sector to the global average for providing services aligned to the line of business.

The focus of health and life science executives is to free up their business leaders to advance patient care, therapies and experiences, and improve health globally. Business leaders are not satisfied with IT innovation levels and are looking to drive digital transformation initiatives with new organizational models. As organizations become increasingly digital in their operations, the lines between business and IT are eroding. Digital strategies increasingly are defined as a business imperative, and IT leaders must shift to execute on those strategies.

CGI asked 1,400 global leaders about their satisfaction with the 10 attributes that define a world-class IT organization, providing a benchmark among industry peers and a foundation for continuous improvement. The resulting insights identify ways clients can bridge the gaps and align satisfaction.

ABOUT CGIFounded in 1976, CGI is among the largest IT and business consulting services firms in the world. Operating in hundreds of locations across the globe, CGI delivers an end-to-end portfolio of capabilities, from IT and business consulting to systems integration, outsourcing services and intellectual property solutions.

For health and life sciences organizations, we help clients transform their businesses by optimizing efficiencies and improving the quality of patient and customer experiences. We drive the digitally connected health ecosystem through IT modernization and secure access to digital information and services.

CGI works with clients through a local relationship model complemented by a global delivery network to help clients digitally transform their organizations and accelerate results.

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© 2018 CGI Group Inc. All rights reserved.This document may not be reprinted, reproduced, copied or used in whole or in part by any means without the prior written consent of CGI.

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