Besides incredible market valuation and growth, what do Uber, Airbnb and Snapchat have in common? According to author Salim Ismail, these firms represent a new type of company—an “Exponential Organization.” At first glance, the Exponential Organization may seem like a new generation of internet hype, but it is difficult to dismiss the tremendous impact these types of firms are having in the real world. It turns out that even the sometimes slow-moving world of healthcare is being impacted by this new wave of exponential transformation.
So what are the characteristics of Exponential Organizations (ExOs), and what are some examples of Exponential Growth in healthcare? After identifying and studying more than 60 of these fast growing firms, Ismail discovered several key drivers. First and foremost, exponential organizations are marked by a Massive Transformative Purpose (MTP). A well-crafted MTP not only provides external customer focus and motivation for employees but also helps a community and tribe of customers spontaneously rally around the purpose.
“Organizing the world’s information” is the well-known MTP of Google. TED talks are focused on “Ideas worth spreading.” BMW builds the “Ultimate Driving Machine.” Healthcare companies have a range of MTPs from broad to specific. Novartis’s MTP is to “Care and Cure.” Pfizer is focused on “Working together for a healthier world.” At the therapeutic level, BMS Oncology is more specific: “committed to discovering, developing and delivering innovative medicines for the treatment of cancer.” Likewise, Acadia Pharma is “passionate about improving the lives of patients with central nervous system (CNS) disorders.”
However, clarity of purpose alone does not translate into exponential growth. There are five key elements that allow companies to SCALE.
Staff on Demand
According to Ismail, “leveraging personnel outside the base organization is key to creating and running a successful ExO.” In a fast moving business environment, having staff on demand allows for speed, flexibility and—most importantly—the infusion of fresh ideas. Over the next few years, as more than 3 billion new people come online, they will bring with them a tremendous amount of skills and insights. For healthcare companies, this influx of online talent represents a tremendous opportunity, not only to source valuable and scarce talent on a global scale, but also to reach new customers in a much more personalized and tailored fashion.
Community & Crowd
Building a customer community is a long-term investment that requires consistent nurturing and skill. Interacting with patient communities is nothing new for healthcare companies. However, with the rise of social platforms, the reach and interaction of these communities is now substantially greater. Furthermore, companies are reaching out directly to their constituents and tapping the wisdom of the crowd to help solve difficult challenges.
One of the more surprising examples of this type of collaboration can be found at Dominos. Working in collaboration with auto manufacturer Local Motors, along with dozens of customers and employees, Dominos designed and built a customized pizza delivery car. They launched the Ultimate Delivery Vehicle Challenge on Local Motors’ Open IO innovation platform in June of 2013, and received 385 entries from several countries. Ultimately, more than 150 designers collaborated on the project over 5 stages, with nearly 20 live chats, and thousands of comments. Over $50,000 was awarded to more than 60 participants in the 5 stages. Over 70 concepts made it into production.
While the output may not be as visually dramatic as a pizza delivery car, the GSK Innovation portal takes a similar approach, soliciting the input of “outsiders” for a wide range of healthcare challenges.
Medstartr is a dedicated platform for healthcare crowd-sourcing and is “crowdfunding the healthcare revolution.” For example, Together is an app funded on Medstartr that is focused on linking cancer survivors, helping them with transitions of care by linking them with caregivers and multiple providers on a HIPAA-compliant platform. Together was built collaboratively by over 50 co-designers that included survivors, caregivers and providers.
Google’s PageRank algorithm is in many ways the most famous algorithm among exponential companies, but according to Ismail, “the world is pretty much run on algorithms” as companies in almost every industry embrace algorithms to help with decision-making and sifting through mountains of data. In healthcare, providers such as the Cleveland Clinic are embracing IBM Watson to bring this type of algorithm-driven machine intelligence to bear on complex cases.
Leasing equipment and facilities is not a new concept, but the launch of Amazon Web Services was a key inflection point for exponential organizations, allowing them to outsource their IT costs on a variable basis, and giving the flexibility to stay focused on their key business drivers—rather than building and maintaining server farms. In healthcare, pharma companies have long relied on CROs to handle the heavy lifting of recruiting and managing clinical trials. However, as this trend continues, some smaller firms are exploring outsourcing the entire span of commercial operations, freeing the core management team to focus on overall product development and community building.
The final driver of ExOs is user engagement, driven by games and incentives that help keep customers engaged and satisfied. This type of user incentive has started to make powerful inroads in terms of patient compliance. For example, earlier this year the FDA approved a Kinect-based physical therapy system developed by an Israeli startup company, Biogaming. According to CEO Dudi Klein:
“Adherence to traditional physiotherapy approaches is painfully low, and boring routines often demotivate patients and fail to improve patient health as intended. We’re taking the proven physiotherapy routines, real-time biofeedback, and personal encouragement of sessions in the hospital or clinic and bringing it home.”
Online platform DietBet.com uses similar gaming principles, such as challenges, nominal monetary prizes and social interaction, to motivate participants to lose weight. More than half of those who participated in a recent study of the online game’s effectiveness were young adults, and almost 40 percent of them reached their 10 percent weight loss goal.
Exponential Organizations are now found in almost every industry—driven by a Massive Transformative Purpose, and built to SCALE with staffing on-demand employment structures, powerful communities, advanced algorithms, leveraged assets, and high levels of engagement powered by the latest breakthroughs in gaming theory. By embracing these same principles, healthcare organizations of all types are on the cusp of exponential growth. If you aren’t experiencing this type of growth in your organization, the time to get started is now. As Ismail points out: “If you aren’t disrupting your business or industry, someone else is.”
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