Unleashing Disruptive Innovation in Healthcare

How Disruptive Innovation Can Finally Revolutionize Healthcare

A Plan for Incumbents and Startups to Build a Future of Better Health and Lower Costs

By: Clayton Christensen, Andrew Waldeck and Rebecca Fogg
May 2017

The discussion around reforming healthcare tends to focus on progress the industry makes against prescribed numbers—lowering the rate of the uninsured, boosting productivity, and improving metrics around new payment models. While these high-level measurements are important for tracking performance, they distract from the understanding of the true causal mechanism of how industries become more affordable and accessible.

Download Part I of our healthcare report series  

Regulatory changes have aimed at shifting costs and risks around the system yet have largely missed the true nature of the problem—the fundamental disconnect between what patients need in order to maximize their health and what they actually get as consumers: more services and treatments that generate revenue. Due to this disconnect, even the shift from fee-for-service to value-based care, while helpful, has not yielded the expected benefit.

While it’s taken longer than expected, we can now point to promising healthcare innovations in the marketplace. In Part I, we set the context, focusing on why disruption has not taken hold in the delivery practices of hospitals and physicians groups. In Part II, we zero in on how disruptive healthcare technology has begun to improve health while lowering costs for significant populations.

Health For Hire

Unleashing Patient Potential to Reduce Disease Costs

By: Clayton Christensen, Andrew Waldeck and Rebecca Fogg
October 2017

Spiraling healthcare costs have been of grave concern to prominent segments of industry, government, and the public for at least 50 years. And while the cross-sector battle rages on over the appropriate strategy for addressing them, there is one fact upon which clear-eyed industry analysts agree: There can be no solution to the healthcare crisis that does not address America’s unchecked epidemic of chronic disease, which afflicts more than half our citizens and consumes 86% of the exorbitant $3.2 trillion spent each year on care.

Download Part II of our healthcare report series  

But our traditional healthcare delivery system, designed to excel at episodic acute care, has not made a dent in the problem. To prevent and reduce the cost of managing chronic disease, the system must learn to facilitate change in individual behavior, which has the greatest impact on health of any contributing factor, including healthcare. The Theory of Jobs to Be Done is a powerful tool toward this goal of true healthcare innovation.

Jobs Theory explains that everything people consciously choose to do (including doing nothing), they do to make progress according to their own priorities, in a particular set of circumstances. We call this progress a “job,” and it motivates individuals to search for solutions. Based on this insight, the theory asserts that the way to unleash patients’ potential to better manage their health is not to try to get them to prioritize health goals over the jobs they’re already striving to do. Instead, it’s to understand those jobs, and help patients accomplish them in ways that enhance their health, rather than detract from it.

For instance, a person striving to feel less lonely might “hire” a cat, a walking group, more hours on Instagram, or smoke breaks with colleagues to do that job. Each of these solutions has health consequences, ranging from positive to negative. Jobs Theory provides a framework for creating solutions for patients’ jobs that also have positive consequences for healthcare innovation.

WATCH INNOSIGHT’S ANDY WALDECK ON CHANGING THE BASIS OF COMPETITION IN HEALTHCARE

About the Authors

Clayton Christensen is the Kim B. Clark professor of Business Administration at the Harvard Business school and co-founder of Innosight.

Andy Waldeck is a senior partner at the growth strategy consulting firm Innosight, where he leads the firm’s healthcare practice.

Rebecca Fogg is the senior research fellow in healthcare at the Clayton Christensen Institute, a nonprofit, nonpartisan think tank dedicated to improving the world through disruptive innovation.