Digital Transformation Is Changing the Role of CIOs in Healthcare

Samara Rosenfeld
NOVEMBER 27, 2018


With the increasing demand for technology and cloud-based software in the medical industry, chief information officer (CIO) roles in healthcare have been changing rapidly over the past few years, according to a survey from Black Book Research.

There has been a dramatic shift over the last few years that has put line of business (LOB) management teams in power over IT purchase decision making and influence. Not long ago, those responsibilities fell mostly on CIOs.

According to the survey, 88 percent of non-IT hospital leaders see the demand for their technology expertise radically intensifying, and the role of CIOs is decreasing with the shift toward decentralized tech management to department heads and LOB executives.

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In 2015, CIOs held the balance of power over IT purchasing decisions, controlling 71 percent. In 2018, that figure fell to just 8 percent.

“Traditionally, CIOs called the shots in IT purchasing after aligning with the department on its need, but digitalization is making a permanent change to the health systems IT purchase process,” Black Book managing partner Doug Brown said in a statement.

With the increase in digitalization in healthcare organizations, department leaders must uphold the authority.

Forty-five percent of respondents expect more than a third of all dollars spent on IT to originate from outside the IT department. As digital ecosystems in health are increasing, strategic decisions are being made by others than the CIO.

“Some say the CIO title and role might just end up losing the ‘C’ over the next few years,” Brown said. “In 2018, only 21 percent of CIOs felt they were meaningfully involved in the creation of market-facing innovations and strategic departmental software selections.”

Eighty-eight percent of colleagues in the C-suite see CIOs as people who leverage technology, not deliver it. Nearly 30 percent of CEOs think their CIO is tactical but not strategic enough to navigate the complex healthcare business systems to drive financial success.

“Lately, CIOs have been running IT more as a supply function — as order takers and implementation coordinators — than managing IT costs,” Brown said.

The traditional role of a CIO is declining, according to 84 percent of hospitals surveyed.

“Among the health system CIO hires in 2018, hospital CEOs and board members surveyed are looking for more consultative-type executives who can orchestrate integrations, strategies, business goals, digitalization opportunities, evaluate innovations and consult to LOB managers,” the survey said.

CIOs in hospitals are now shifting into more of an information management role, and in 2018, 39 percent of CIOs reported having board-level communications on technology strategies, compared to 64 percent in 2017.

IT investments are being directed toward business initiatives, which 55 percent of C-suite respondents say LOB leaders will lead in 2019.

CIOs face many challenges in 2019, including tackling problematic technologies such as artificial intelligence, cybersecurity, the Internet of Things and interoperability. A quarter of healthcare CIOs have little to no expertise managing the demand for these new skills.

According to the survey, the most highly sought skills in 2019’s new healthcare CIO include: innovation as a critical element of success (83 percent), connectivity to engage as a leader in the flow of all organizational information (81 percent) and communication leaders in an era of medical and financial data driven cultures (77 percent).

While the survey says that CIOs are not going anywhere as long as the demand for technology in healthcare operating systems persists, CIOs’ roles will continue to dramatically change toward information management.

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