Your AI Driven Digital Transformation

Part 1

Even in the world’s best operating theatres, patient outcomes depend on more than the surgeon or their equipment.

Currently in hospitals around Australia, when and even whether you see a surgeon isn’t due to a medical expert but a booking clerk. To understand how this works, the following diagram outlines the current process in most hospitals:

After a hospital receives and approves your Request for Admission, to book you into an operating theatre, a booking clerk will often begin by recording your potential booking date in a notepad or Excel sheet. Only after reviewing hundreds of other patients will the clerk finally secure you a spot in the hospital software booking tool, once they are confident the proposed time is the best outcome available – that they can find.

This intractable game played by booking clerks is a gigantic puzzle placing thousands of patients with varying operation lengths and medical needs into a limited number of booking slots. Simultaneously the clerk needs to pay attention to the severity of the condition, the maximum permitted length of time until the guaranteed operation, other pre-operative complications and much more. It is a difficult problem with a range of constraints and variables making it very difficult for even the best booking clerk to optimise. 

It is also one of the greatest success stories of AI driven digital transformation.

Improving patient outcomes does not require complex change management, more human resources or redesigning the extant booking processes – just let AI take care of the ordering and optimisation of which surgery slots are given to which patients. This relieves experienced medical and clerical staff of the laborious and complex allocation process and leaves them free to focus on the quality control functions of reviewing, amending and approving an already optimised schedule.  

This type of improvement is a welcome one, as patient waitlists across Australian hospitals remain a source of patient dissatisfaction and are only set to get worse with an aging population.

So what can be achieved with such a seemingly straight forward upgrade to a booking process?  In the current health care system, even a 1-2% improvement would be revolutionary.

What this AI driven digital transformation shows is that we can reduce our waitlist faster than ever, with the same number of resources. It is the gigantic puzzle of allocating people to surgical slots that is causing people to miss lifesaving surgery and it is a task perfectly suited to AI – and it exists in all industries.

In this set of articles, we’ll discover how to achieve this type of transformation in any organisation. This first article sets the scene and the second article will reveal how to create the value.

But before we discuss AI driven digital transformations, what is a digital transformation in the first place? And what change does AI make to it?

Digital Transformations

Digital transformations are about using digital technologies to create new or modify existing business operations, e.g. the day-to-day processes to provide a service, customer experience or a transaction.

When people speak about it, a digital transformation is often used in the sense of replacing one simple digital technology such as Excel with a large scale, holistic software system (often cloud based), especially in an enterprise with thousands or tens of thousands of employees.

The first digital transformation to typically occur in an enterprise is the implementation of a back office tool to manage finances (general ledger managing the cash going in and out, receivables, invoices, etc.), management accounting (budgeting, costing, etc.), procurement and more.

These capabilities are often rolled up into what is called an Enterprise Resource Planning (ERP) tool. Other major digital transformations, which often happen separately to ERPs but can be a part of it, are implementations of CRM tools which go beyond just the storing of customer data and create triggers and actions based on the characteristics of the customers’ behaviours – a first step on the journey to AI.

And the AI part?

Artificial Intelligence in industry typically refers to a set of mathematical techniques that allow one to make predictions or prescribe what actions to take. In the modern sense it often involves lots of data and applying analytical techniques to this data to answer questions like:

• How many sales can I expect tomorrow?
• Where should I best locate my products to meet this demand?
• How can I route my vehicles to make sure those products are in those locations in time?

AI and digital transformations should go hand in hand because whatever the digital transformation looks like, it always leads to one thing – lots of data. So what can we do with this data to create value via AI?

Data – A Curse or a Boon?

Let’s shift gears for a moment and assume you now have begun your digital transformation and the data is flowing. You look at your data sets and a sinking feeling sets in.

After carefully gathering requirements, making sure you used the right mix of cloud technologies and then digitising the processes with the right tools, you realise your next big challenge:

The data from each system sits in its own silo.

As the complexity of this task sweeps over you, your boss bursts through your door, breaking your train of thought, and barks at you:

You’ve got all this data, now what? How do you start creating value? And I’d like to know by the end of today.

It dawns on you that this is the whole promise of the digital transformation that you bought into – a holistic view of your operations. Given what your boss has now demanded of you, how can you create value quickly?

Do we need to combine all this data now?

Is a large, expensive data warehouse the first step to the answer?

By choosing the right analytics battle, as we saw with our health client that the solution to the previous questions can be quite simple and deliver enormous benefits but many stumbling stones lie ahead of you – the first of them being your migration to the cloud.

Creating a Lack of Value

The trend to migrate to the cloud is currently one of the biggest tech trends of the last three years. With over 85% of enterprises now having a multi-cloud strategy, there seems to be no stopping its inexorable steamrolling of anyone expressing a different opinion.

However, as cloud migrations are creating a crowded sky, more than one in three cloud migrations are failing – even when we try and measure it against any metrics of your liking such as:

• Reducing costs;
• Improved staff productivity; or
• Increased revenue

At the same time, around forty percent of global information workers are circumventing IT policies to try and maintain their productivity. The icing on the computational cake is that the productivity of employees is experiencing a gradual decline due to the complexity of current IT strategies and policies. So as you add your new layer of “cloud efficiency” on top of the existing IT systems, you recognise there is a risk that things may not turn out as planned.

So where is this taking your digital transformation agenda?

A 2017 Dynatrace study revealed that:

IT complexity and performance challenges are killing digital transformation initiatives, and causing organizations significant digital performance problems as often as once every five days.

The digital transformation to the cloud may be harder than people anticipate but what about the analytics/BI part of the transformation? Surely once you’ve sorted out the digital transformation challenges, the rest flows from there, right?

Not always.

A Logicalis survey recently showed that typically 60% of CIOs rate their organization as 3 / 5 or less when it comes to deriving value from BI and analytics work.

In fact, those who have derived value are few and far between and many would like to do something about that: less than 20% of CIOs say their organisations are using AI. Like your company, they’ve probably built the data warehouse in the cloud but they are still yet to derive insights and take actions from it.

What is going wrong?

With 66% of CIOs wanting to see AI adopted in their organization in the next 3 years, it is not a lack of will. Digital transformations have been praised as the next industrial revolution that is supposed to lead to untold benefits and chart busting efficiency gains. So where are they?

In the next part we will find the surprisingly simple way to achieve the promised gains without reinventing your business. By focusing on an AI driven digital transformation, you will increase the chances of success of your digital transformation and quickly show some early wins.