Why effective transformation starts at the heart of healthcare

By Philips ∙ Jul 01, 2021 ∙ 8 min read

Hospital operations

Optimization services

Even before the global pandemic, the days of business as usual in healthcare were over. Around the world, every health system had been struggling with rising costs, aging populations, chronic health challenges, legacy technology and overloaded staff. The pandemic also revealed gaps in the transformational change process that was underway such as the tendency to expect technology and AI to act as a complete solution rather than an enabler and the assumption that healthcare complexity necessitates complex solutions.

This white paper focuses on:

  • Healthcare transformation, healthcare complexity
  • Hospital operations transformation
  • Change management process in hospital operations
  • Operational Intelligence examples

Two male doctors talking in hospital corridor

Healthcare transformation, healthcare complexity and the impact of the pandemic

“The crisis has been a final wake-up call,” says Dawn Bruce,  Philips Services and Solutions Delivery Leader, Canada. It’s time for leaders to prepare strategically and structurally for the new reality that will follow, she says. Employing a change management process in hospital operations and developing a new operating model can quickly build the specific capabilities modern healthcare needs and put in place a roadmap for effective transformation.

Focusing on hospital operations for innovation

As the healthcare sector undergoes rapid change, intensified and accelerated by the COVID-19 pandemic, it is increasingly turning to operations to increase its overall efficiencies. According to Eugene Litvak, PhD, of the Institute for Healthcare Optimization at the Boston University Health Policy Institute, “Operating systems have a huge impact on work climate, staffing, financial results, etc., and yet we are trying to change our healthcare delivery system without changing its core operations.”


Litvak goes on to say, “The cost of healthcare delivery is inflated because we do not appropriately apply operations management methodologies.” It’s a compelling observation. Reports indicate that a fifth of healthcare spending gets wasted with administrative complexity accounting for the most – up to $265.5 billion annually – in the United States.1


Fortunately, quality improvement theory links high-quality care with financial performance and waste reduction.2 The opportunity, as we see it, is to employ operational management principles and develop a methodology that speaks directly to the nature of healthcare operations.

Female physician looking at medical record on tablet

What is operational intelligence? 

Operational intelligence is an integrated, service-based healthcare growth model with a focus on behavioral change  to connect silos and build relationships to optimize planning, alignment and outcomes. This approach to working together offers cumulative gains, unlocking hard value but also the softer, more people-powered value that is harder to achieve and quantify but delivers significant benefits.

Operational intelligence principles


  • Business isn’t a dirty word: A hospital, with operations as its control center, should run like the best businesses.
  • Partner with purpose: Healthcare partners need to share a common purpose and have their values aligned. Partners each bring valuable knowledge, expertise and  assets to the table that should be acknowledged and utilized to elevate the common purpose.
  • Pre-defined plans don’t work: Strategic partners need to work collaboratively with healthcare leaders to solve problems and plan based on the realities of what’s currently in place.
  • One partnership team: Forget the sales mindset and adopt the service thinking, growth mindset.

People + process + technology = operational intelligence 


Partner skills merge with operations team skills for continual, cumulative improvement.



Operational intelligence demands that processes are finetuned and cocreated together to solve root causes such as waste.



Operational intelligence makes medical technology connected and interoperable.

Why operational intelligence works

“An operationally intelligent governance model enables both partners to be less transactional and more solution focused,” says Dawn Bruce, Philips Services and Solutions Delivery Leader, Canada.


Operational intelligence harnesses quantifiable change and performance but also focuses on the intangibles that make a big difference such as soft skills, cultivating collaboration and enabling positive behaviors and innovative ways of working. Four examples of how operational intelligence can transform ways of working within a strategic partnership for significant healthcare gains are: 

Innovating the procurement mindset

According to Bruce, an operationally intelligent approach can help procurement focus “not only on the price of a particular product or service, but also on the overall value the solution could create.”


Reappraising governance

Bruce believes that a modern, innovative governance model is central to the formation of any good relationship and is integral to realizing change management.


Integrating clinical, IT and operations

While operational teams may have exposure to responsible business and disruptive innovation practices, clinical and IT teams tend to be siloed – a problem that should be addressed.


Building resilience for the long term  

Embracing an operational intelligence approach that prioritizes people and encourages a growth mindset is key to healthcare transformation.

“An operationally intelligent governance model enables both partners to be less transactional and more solution focused.“

Dawn Bruce
Philips Services and Solutions Delivery Leader, Canada

How to get started with operational intelligence 

Step 1: Start in operations, the control center of any hospital.

Step 2: Adopt a holistic, integrated approach fusing people, process and technology.

Step 3: A focus on people should start by innovating the customer experience and embracing collaborative leadership and management styles.

Step 4: Adopt highly effective business processes including Lean, Agile as well as systems thinking and design thinking.

Step 5: Embrace technology and drive interoperability but learn from business that achieving this is a cultural, rather than a technical, shift.

Step 6: Bring it all together iteratively with partnership and a continuous feedback loop.

Examples of operational intelligence 

Here are some ways Philips has partnered with healthcare teams to apply and embed innovative operational management and improvement strategies using the Philips Operational Intelligence approach.


Adopting an Operational Intelligence approach to create a new model for optimized ultrasound usage in Munich, Germany


In the case of München Klinik, Ultrasound Demand Analysis, led by Philips Managed Technology Services in partnership with the hospital, mapped 24 devices with a savings potential of €851,000, with costs savings from Day 1.


Examining the strategic role of education and training

Mackenzie Health Canada standardized and optimized education services to support staff training for diagnostic imaging. Mackenzie Health had over 30 third-party technology suppliers, and this challenge was exacerbated by a change in hospital sites. A 12-week recurring training cycle was created per department, and staff participated every week.


The same training strategy used for diagnostic imaging was implemented for ultrasound and, in part, patient monitoring. The integrated program has standardized education, removing inconsistencies or variations between vendors and assimilating training content and delivery.


Mastering complexity through connection


The partnership between Philips and München Klinik focuses on a “needs-based” model of care, designed to address rising costs and reshape the clinic for its future health needs. At one location, a project is underway to redesign workflows to support patients and staff. At another, they're building the radiology department. And an installation of the Philips Intellispace Portal 11 platform has streamlined radiology processes across the health system, allowing faster diagnoses.

White paper

Operational Intelligence - Why effective transformation starts at the heart of healthcare 

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[1] 2019 JAMA study on Healthcare waste, Modern Healthcare, September 2019.
[2] Source: deming.org W Edwards Deming, The New Economics for Industry, Government, Education - 2nd Edition: For Industry, Government, Education (The MIT Press).

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