One-on-One with Catholic Health Initiatives SVP and CIO Michael O'Rourke, Part II

June 24, 2011
Catholic Health Initiatives is a nonprofit organization headquartered in Denver. The faith-based system operates in 20 states and includes 77

Catholic Health Initiatives is a nonprofit organization headquartered in Denver. The faith-based system operates in 20 states and includes 77 hospitals, 40 long-term care, assisted- and residential-living facilities, and two community health services organizations. With approximately 70,000 employees and annual revenues of $8.2 billion, CHI ranks as the nation’s second-largest Catholic healthcare system. Last month, O’Rourke was promoted to full-time CIO after an 18-month interim stint, during which he helped restructure the entire IT organization. Recently, HCI Associate Editor Kate Gamble spoke with O’Rourke about what it takes to transform 40 autonomous operations into a single enterprise, as well as his vision for the organization.

Part I

KG: So by pushing forward with plans and being upfront, you were able to gain the respect of the staff as well as the senior leaders.

MO: I would say it was identifying the outcomes and the journey we were on, and being clear. One of the key successes, and I think this is important in any work you do, especially transformation, is to have really extraordinarily clear communications and to manage expectations; to define expectations and then to manage them with your audience. When I came into the organization, the one thing I was emphatic about was that I said I need communications people — Mike Romano and Peg O’Keefe — to help me with this. Because I can do all the right things and it can be interpreted all the wrong ways. I would say the communication was done extraordinarily well, and I think that without it, there would be a lot of misunderstandings and misgivings. It was so clear what our objectives were and how we were going to do it, and information was sent out in advance. If someone asked me what I was paying for this or how much consultants cost, it was all transparent. You could put it right there on the table. And I think that put people back a bit and made them say, well, this is not Attila the Hun. This is really just good, sound business.

But it was a shocker for myself and others, I think, in the end, that we did achieve this degree of acceptance. There was credibility there.

You mentioned that governance was one of the key components of CHI’s restructuring. How was it set up?

MO: The way that the governance structure works is we have representatives from our MBO as well as our corporate office. Most are senior executives, but there are people from clinical and other different areas who sit as a group now that really represents different constituents and stakeholders throughout the organization. We still have smaller steering committees in the MBOs that do work locally, so that we can pull that work together and bring it up to this national governance group, which is very important. This way, we still have alignment. But the national group is actually responsible for looking across the organization as we bring all this information forward. An example would be, as we go into a budget year, we’re looking at all the different types of requests for IT for different things. It’s part of this governance that we look to in working with IT to make recommendations and say, ‘We can’t do 15 different of these various different things. We’re going to do three, and they’re all going to be with the same vendor.” So they are now empowered to help us move that standardization model forward.

And we feed into that governance model through this whole EPMO (enterprise project management organization), which puts all this structure and rigor to what project requests are, how much they are, what are the benefits, when will we see the benefits, are others doing the same thing, and can we leverage some of the applications we are already have in the organization. So there is a very large funnel that happens through the EPMO into that governance structure, which basically provides the information for making good decisions.

I would imagine that with such a large organization, it has to be structured so there are regional CIOs to help manage and funnel the requests and other IT issues.

MO: Right, and that’s a good point. One of the first things I did when I came in, relative to the organizational structure, was to create regional CIOs. These are people who came from the organization who had IT leadership experience in various different markets. We created eight regional areas; each of those areas has a collection of MBOs that make up that region, and there’s a regional CIO. That regional CIO is sort of the account executive for IT, providing service and delivery to that region. But what it also helped us to do was align our service delivery. We have to break that down into regions and smaller pieces of the MBOs, and that’s exactly how we do it. Those MBOs report to their regional CIO, and they do some filtering and validation before it even goes to the national steering committee.

We have regions out there that help us to gather that information. It also works the other way. As our organization and national structure standardizes things, the regional CIOs are there to move those agendas down; to standardize those things in a region, and also to move them into the MBO process. So there’s a two-way flow there — they’re sort of the control tower, if you will.

What about the process of combining 30-40 different IT operations into a single enterprise? What did that entail, and what is the status?

MO: If you think about your typical IT organization, whether it’s an MBO or an enterprise, it has a very similar look and feel. You have people who work on projects, people who support desktops, people who work on the helpdesk, people who do network services, and people who do application support, and that’s typical across any organization, either inside or outside of healthcare. So the first thing we did, in terms of the organizational structure, was to send the RCIOs to start gathering information. Then we created these various different functions. For example, we have an applications group made up of applications specialists, analysts, and people who implement applications and support them from across the organization. They’re virtual in the sense of the structure. So if you think about it, when I first came in and we started looking at how many applications people do we have — how many network supports, how many desktops — we started to get these numbers, and they’re spread out across 20 different states.

The structure for what we call One IT, which is an enterprise IT group, was to take all those similar functions that do application support, and align those back to a national function. We didn’t take people and move them and say, ‘now you all come to Denver.’ We said, ‘you’re now part of a bigger group.’ We’ll use as an example our clinical support group, Cerner, which is a big vendor we have here. So all the folks who are supporting the vendor out in the field now report up through and align back to this VP of applications, and they all work across all hospitals to support Cerner, not just within their MBOs. So if you just take that and you look at technology services and you look at desktop and helpdesk, we did that across all those functional groups, so now they look — even though it’s virtual — like one, single aligned organization.

Very interesting. Did this process take place in the time you served as interim CIO, during that 18 months or so?

MO: That took place over about a year and a half, and I can tell you that the process is still underway. We have all of the functional groups aligned, but we’re still in the process of building teams; how they work virtually, which is very different than when you work in a single environment where you get your directions and your orders in that environment. We have people who basically are project managers in Seattle who are supporting hospitals and projects in Maryland. This is very different for people. So we have the alignment done; what we’re doing now is sort of training and continuing to optimize how people work in this environment. If you think about it, it’s a significant change if you’re used to having your supervisor and boss and everybody in this environment, and now you have some folks on the ground that work with you. But you’re getting your work, your direction, and your performance evaluation from someone that is fairly remote and who you only see maybe two or three times a year.

That has taken the better part of the 18 months to do, and we’re still optimizing and truing it up. In that process, there were lots of changes we had to make, and we had to go through and evaluate everyone’s skill set at the time. So if you were going to be a project manager, we had a set of skills that we had created a profile for (based on project managers in the organization) that was then matched against it to determine if you really did have those skills. Because in the smaller MBOs, you might be called a project manager, but really you’re not — you’re more like a jack of all trades.

So we had to make sure. We went through a lot of skills and comparisons, and in some cases, people really weren’t project managers. So there were actually some changes; some people left the organization in the process.

So it really was a transformation in every sense.

MO: It was. And I’ll tell you, it was a transformation for everyone because human resources was involved, as were our mission services and communications departments. So what many people thought was an IT thing really became an organization-wide transformation.

As far as the IT transformation, you mentioned Cerner before. Is CHI a Cerner shop?

MO: Not necessarily. One of the things we’ve done is looked at our mix of hospitals; we have very large hospitals, some of them almost 1,000 beds, like in Des Moines, and we have critical access hospitals, which are like 15 beds, in the Minnesota and North Dakota area. So when you look at that and say that you need to be effective and affordable and have consistent outcomes, if you try to take a Cerner system and install it in all of these 15-bed hospitals, it’s not very affordable.

In terms of our clinical strategy, we have two avenues: our larger, more complex, competitive environments like Des Moines are Cerner shops. We have five large MBOs — and MBOs can be multiple hospitals in an area — that are Cerner. And then the majority of our other hospitals are smaller community hospitals down to the very small, critical access hospitals. For those, we use Meditech. It provides the same solution that’s much more affordable.

That will remain our strategy, I think, for the long-term; to provide the right solution for the right cost and the right outcome.

It makes total sense. You have to do what’s best from a standpoint of resource utilization.

MO: Right. And what you don’t want, as you can imagine, is 50 clinical solutions. You do what you feel is appropriate. As things move on, President Obama’s stimulus package may change some of the way we approach this. But for right now, I think that’s a pretty good plan for us.

That brings up another big issue, which is the state of the economy. How is the economic situation impacting your plans, or how will it impact your plans in the near future?

Part III coming soon

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