Legacy applications are blocking new healthcare business models

05 May

Legacy applications are blocking new healthcare business models

IDC Jonas Knudsen

 

 

 

 

 

Jonas Knudsen
Research Director, Health Insights
Read full bio  @JonasHKnudsen

In healthcare, legacy is a growing problem. Not only when looking at obsolete digital applications but also on infrastructure. When IT fails to deliver due to legacy and the lack of agility, the business model and clinical processes becomes legacy as well. 

The range and type of new business models and initiatives are then defined by the lack of IT agility and not by the business. It’s a dangerous course and CIOs should prioritise the effort and focus on how to modernise and manage IT as a transition and continue to offer digital and agile healthcare solutions. Legacy application management is a discipline in which healthcare organisations gain insights into their IT infrastructure and the value it delivers, thereby creating the basis for developing a modernisation transition strategy. Only when you know where you are can you plan where to be.

 Healthcare CIOs are beset with tight budgets, escalating workloads, and the clarion call to help their healthcare enterprises innovate new digital products and services. Meanwhile, they are obliged to maintain a vast amount of legacy systems built over decades and rapidly becoming obsolete because of 3rd Platform technologies.

As line-of-business (LOB) executives, clinical leadership, and local department’s clinical professionals assert their growing budget authority to bypass IT and acq uire new systems independent of IT, healthcare CIOs know that these new systems may be critical to the business; nonetheless, they often end up in the shadows with no IT support.

When LOBs can choose applications on their own, it might increase local innovation and agility. But at the same time an increasing amount of shadow IT will increase security risks, and it might decrease availability of the infrastructure because it is not scaled for such applications. The role for hospitals’ CIOs will then be to identify relevant applications, include them in the formal architecture, and scale them to fit the entire organization. Shadow IT will also become obsolete and eventually turn into legacy. If that is not managed, the healthcare organizations will suffer.

The question becomes especially acute in large healthcare organizations (such as university hospitals) that have accumulated hundreds — if not thousands — of legacy systems. CIOs do have to deal with ageing legacy systems that need to be upgraded, or decommissioned. Adding to the problem is the fact that the challenge with legacy systems is not just getting an overview and finding the funding to develop, upgrade, or change a legacy application architecture. Hospital CIOs are also tasked with maintaining business alignment and IT support of the ever-changing clinical environment, processes, and business models defined in a modern healthcare organization. That makes legacy application management a crucial capability for the modern CIO.

For CIOs implementing legacy application management, it is important to consider the following:

  • Create an architecture vision and develop architecture principles. Get executive management approval.
  • Conduct an application portfolio assessment.
  • Develop an application modernization strategy and transitional road map for its execution.
  • Align investments and the split between operation and capital expenditures with the transition strategy.
  • Establish application management services and get them operational with the support of digital tools

Legacy applications are crucial for healthcare organisations since they support key functionalities and often have been in operation for several years or even decades. They are often integrated into other core clinical, administrative, or financial applications/platforms by a patchwork of technologies and methodologies, making them complex, expensive to operate, and difficult to change. But software and data as well as infrastructure, processes, and business models become obsolete with ageing and the rise of new techniques. With a high degree of software and data legacy, the business value will decrease, and IT will struggle to operate and maintain systems that can deliver valuable business capabilities.

More insights on this topic are available in a new IDC PlanScape, IDC PlanScape: Legacy Application Management in Healthcare, that presents the key challenges of modern healthcare organisations and the main goals of legacy management that can address these barriers. It also presents a view on the major stakeholders of a legacy management project and a four-phased approach to its execution. Visit IDC for more information regarding this research.

Write a Reply or Comment

// ]]>