Council Post: How Can The Healthcare Industry Solve Innovation Inertia?

Co-Founder & CEO of corporate venture-builder FoundersLane, a serial entrepreneur building business up to IPOs and author of ”Fightback”.

While the Covid-19 pandemic might be dominating the headlines, I believe it is also laying bare a much more deeply rooted problem: Our healthcare systems are at breaking point. If we don’t fundamentally change our ways, there could soon come a time where those in need won’t be able to get the care they require. 

From my perspective, corporations play a large role in all of this. Through my experience co-founding a corporate venture builder that specializes in healthcare, I’ve found that many companies have outdated business models that focus on making short-term gains. Instead, I believe we urgently need meaningful, long-lasting and impactful innovations in the healthcare sector if we want to turn the tide and ensure that both current and future generations can lead healthy lives.

The Keys To Successful Innovation

The resourcefulness we’ve seen from individuals, private and public organizations during the ongoing pandemic has been inspirational. That being said, it is clear to me that in moments where humanity is faced with existential threats, we can’t rely on current innovation methods, particularly in highly complex sectors such as climate or health. I believe many of our current models either don’t result in the long-term benefits we need to successfully address these challenges head-on, or they are too slow to get off the ground.

Innovation in a complex field such as healthcare is not always a matter of introducing new drugs, treatments or technologies. Technology often forms part of a new initiative, but its role might be as an enabler, rather than as the star of the show. I believe we already have the technologies to handle emergencies and improve one’s health; from my perspective, many companies are sitting on underused assets that could be leveraged to help people lead healthier lives. Addressing global healthcare challenges hinges on unlocking those assets.

To do this, we need a structured approach to innovation that brings together the scale, resources, networks and expert industry knowledge of corporations with the entrepreneurial drive, disruptive mindset, technological expertise and creativity of successful entrepreneurs.

One such innovation methodology that might help is corporate venture building. Being the CEO of a corporate venture builder, I know that this investment type is specifically designed to spark innovation in complex, highly regulated and scientific sectors. CVB allows organizations to transform their business models in a sustainable, impactful and profitable way by using a corporation’s existing assets and capabilities.

Nevertheless, pursuing CVB investment is not the sole answer. Securing economies of scale is often challenging in healthcare due to varying regulations and care delivery systems. The healthcare industry is massively regulated, so expect long times to market, a need for a truly diverse team of experts and a willingness to lean into the discomfort of being challenged in your established ways of working.

Whatever you build, you’ll likely be outnumbered by startups working in the same space. Excellent health ventures excel at both: being medically sound and economically viable. Resist the temptation of taking charming business models at face value, and get industry experts, including healthcare providers, at the goal face to provide their most sincere feedback.

There are also a variety of tools, such as internal transformation, mergers and acquisitions, corporate venture capital, incubators and accelerators to consider. It helps to have a broad portfolio of tools, but often I find that companies are biased toward certain models. The most important thing is to establish a culture that embraces disruption and failure.

By engaging entrepreneurs who can dare to speak freely and give a clear perspective that is grounded in deep experience, you will tap into a new mindset needed to make an established company more successful.

Healthtech Innovation Done Right

A key challenge for healthcare systems across the globe — and one of the World Health Organization’s 13 biggest threats to global health — is the lack of access to treatments. Roughly one-third of the global population is lacking access to common healthcare services such as diagnostic tools, basic medical treatment and vaccines, the WHO reported.

There are many examples of how organizations have created new innovations to positively impact and support our struggling healthcare systems. One such example I’ve observed is of a company in China that deployed AI-powered self-service kiosks in public spaces. Customers sit in a booth equipped with a range of smart medical examination devices and respond to questions about their symptoms. The AI booth then delivers a diagnosis or a recommendation for further investigation.

From my perspective, these little kiosks prove that healthtech innovation done right has the power to create new digital business models based on existing assets that are both effective and can provide support to the struggling healthcare systems.

Time To Act

There are lots of other innovative businesses out there that are already trying to fix our healthcare systems, but we still need many more of them — and we need them fast. Our healthcare systems aren’t a problem for the next generation to solve. If we fail to rebuild and reinvigorate the healthcare sector now, most of us will experience the immediate repercussions and resulting hardship as we age.

Contrary to popular belief, I believe our healthcare systems only really influence a portion of our health. Combined, a person’s diet, education, income, social life and exercise regime have a large impact on how healthy we all are. These are the areas most in need of innovation right now, particularly given the percentage of the global population over 65 is set to increase substantially by 2030. Clearly, even companies that don’t operate directly in the healthcare sector (yet) can make a meaningful contribution. But the time to innovate is now.

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