Chapter 3
Inspiration
Let's think back to the idea of Pine's transformation economy, in which experiences change us in some way. Healthcare, we know, is just beginning to extend into the experience economy, much less venture into the transformation economy, but it's the personalized, transformative experiences that are what's needed in healthcare. The industry may be just getting on board, but many others are much further along; in fact, they've thrived in both the experience and transformation economy. Banking, for example, is creating uniquely personal products and services that are transforming the way individuals approach their fiscal health. If banks can figure out how to motivate individuals to care about their fiscal health, surely there can be things done to motivate us to care about our physical health. What inspiration might be drawn from these other industries?
The design thinking process consists of three overlapping spaces: inspiration, ideation, and implementation. After conducting research in the discovery stage, and then identifying our criteria, the inspiration stage lets us think about the problems and opportunities we've found and search for solutions (Figure 3.1).
Figure 3.1 The Inspiration Stage is the Next Step in Design Thinking
So naturally, I decided to look at other industries to find out how they've solved similar challenges—be it personalization, creating choice for consumers, increasing motivation, or improving coordination. I wanted to see what connections could be made to our healthcare system and what ideas could be translated to healthcare.
Learning from Banking
I mentioned the banking industry a couple of times now because it's one that's become increasingly personalized over the last decade. The banking and financial services industry looked a lot like healthcare 15 years ago. It was in general a reactive industry that certainly didn't focus on individual experiences and proactively assisting you to improve your fiscal health. But now, everything from personalized recommendations for savings to comprehensive views of your finances, to widespread mobile banking are all commonplace. Brett King, author of Bank 2.0, says, “The future of banking is about connections with your customers, engaging them when and where they need banking to solve a problem or provide a service. Banks won't be able to influence people with clever ad campaigns, better rates, or talk of branch networks. The only differentiation will be how you anticipate their needs and serve them in their day-to-day life, wherever they may be.”1 And this transformation is well on its way today.
Over half of U.S. adults with smartphones already use mobile banking,2 and applications like Personal Capital and Mint, which provide customers the ability to manage their assets and investments and get advice on financial growth, are becoming the norm for managing finances. Banks are moving from segmenting and offering banner ads and mailers to offering a custom experience that leverages what the bank knows about that customer from across previous interactions and individual relationships. At the same time, however, while customers have embraced these new digital channels, they are also expecting higher value from face-to-face interactions at their bank branch. So the human factor is still very relevant, if not more important, and customers want to feel like their bank truly knows them, whether it's through a mobile or web experience or an in-person interaction.
A couple of scenarios from an Intuit report3 helped me understand these concepts a little further. Let's look at Olivia's and Nathan's stories.
Olivia is in her Realtor's office, checking her financial portfolio on her smartphone. She's considering purchasing a new home and wants to know how her bank can assist her. She opens a banking app to contact and work with her personal banking specialist. A few minutes later, the specialist responds with an approved, customized financing package based on mortgage market data, an analysis of Olivia's income and expenses, and a risk-adjusted assessment of her banking history and investment portfolio. The bank also provides a property appraisal and suggests an opening offer. Olivia makes an offer based on her banker's input and closes the deal.
Nathan, chief executive officer of a manufacturing company, turns to a local bank for a financing package to help his firm expand. He worries that the bank will reject his application because his company, which focuses on product design and partners, has few tangible assets. As part of its risk assessment, the bank analyzed Nathan's social reputation and customer satisfaction, and included a sophisticated review of his intellectual property. Based on that, the bank concludes that Nathan is an excellent risk and offers terms better than he had expected.
Can you relate in some ways to Olivia and Nathan? You've likely experienced similar changes in your banking and financial services over the last few years; and if you haven't, get ready for it. These types of stories are becoming more and more prevalent as the industry ventures into the transformation economy, and will quickly become the norm.
Learning from Retail
The other industry that probably comes to mind when we think about personalized experiences is retail. We've all noticed customization while shopping, specifically online, for virtually any product—be it clothing, books, or household goods. Shoppers are becoming increasingly empowered and retailers are having to create unique experiences based on their preferences in order to succeed in the experience economy. I think this statement by Marti Tedesco, a digital marketer, sums it up pretty well:
The shopper drives the business now and retailers have to respond appropriately or the shopper will go elsewhere. Customers can easily bounce to another vendor—price and availability are 100 percent transparent on the web. This free movement leaves retailers with one primary way to differentiate themselves: through the customer experience.4
Retailers are using a plethora of techniques, both online and in stores, to create a pleasant and unique customer experience and establish loyalty among shoppers. Kohl's, for instance, recently tested real-time personalized offers in stores where shoppers can opt in for offers via their smartphones. If a shopper lingers in the shoe department, for example, they'll receive a coupon based on the shoes they looked at online but never bought.5 The experience is therefore becoming seamless as the various channels are integrated. And what's more is that the in-store experience becomes much more valuable to the shoppers because of the integration of their online activity. This is similar to what I mentioned earlier regarding banking; customers, though they are utilizing multiple channels now, are expecting (and receiving) higher value from their experience in person. Digitization and tech haven't replaced the human element but, rather, have increased its significance.
Think about some of the promotions and offers you've received lately. Have you gotten any that have been spot-on for what you've been needing or wanting? I've been taken aback several times when I've received a suggestion or an offer from a retailer that I felt was an act of mindreading.
Many retailers, like Target, have switched from sending shoppers blanket email promotions to sending unique offers based on individual shopper purchases, going as far as to predict what you might buy on your next visit to the store. And like banking, mobile shopping is also becoming easier and more customized. Companies like Shop Spring and Trunk are creating new experiences for shoppers that include personalized fashion experts, one-click-to-buy features, and customized fashion feeds. There's no doubt that this industry is taking personalization and customer experience to a new level.
As I was reading back through these last few pages on the banking and retail industries, it was never clearer that what we need to create in healthcare are the very same things that these industries have established. Take a moment to glance back at the last couple of pages and notice some of the words that appear: personalization, individual experiences, transparency, consumer connection, trust, loyalty, anticipating needs, engagement, and others. Sounds a lot like what we're missing in healthcare, right? Both banking and retail have tackled many of the same challenges we experience in healthcare and that's why they're good sources for inspiration.
Learning from Healthcare
But don't get me wrong. Although the healthcare industry is not as mature in today's experience economy, there are certainly sweeping changes happening in the industry that can serve as great sources for inspiration. For example, organizations like Privia Health—a physician practice management and population health technology company—are focusing on keeping people healthy, preventing disease, and improving care coordination in between office visits. They're creating a network of doctors dedicated to increasing people's engagement in their own health and well-being. Further, they're focusing on integrating health and wellness into people's daily lives. In other words, they're making healthcare more about the total experience that I talked about earlier, by creating patient-engagement before-and-after services, not just at the point-of-care. Similarly, Turntable Health, which describes itself as a “wellness ecosystem focused on everything that keeps you healthy,” is changing the healthcare landscape completely. Its focus on team-based care, technology, and continuous service for its members is doing wonders for the patient experience. More important, the company is reinstating the human element of healthcare, building new models of care based on empathy and empowerment. It is empowering both doctors and patients—doctors to do what they became doctors to do, and patients to take more control of their health with the support and resources they need.
But How Do They Do It?
You may be thinking, this all sounds great so far—banks, retailers, and healthcare organizations all creating better experiences for their clients, shoppers, and patients. The words sound nice, but how exactly are they making these bold changes?
The answer is simple. They're using data. More specifically, they're using big data analytics that generate new insights to make better decisions. They're using new types of data and new types of analysis to do novel things like predict, forecast, and optimize.
Let's start with some examples from the banking world. Over 70 percent of banking executives worldwide say customer-centricity is very important to them. They see it not only as key to understanding customer profitability, but also as the doorway to providing customers with a consistent and personalized experience.6 Achieving customer centricity requires a deep understanding of customer needs and thoughts, and while demographics and current product ownership are at the core of customer insight, more insights are needed to get to this deep level of understanding. That's why behavioral and attitudinal insights are gaining importance in banking as channel selection and product use become more differentiated.7
Banks are moving from a traditional product focus to a unique customer focus through customer experience management (CEM), which is all about delivering personalized, contextual interactions that will assist customers with their daily financial needs. In addition, if done correctly, customer analytics in the context of CEM enables the real-time delivery of product or service offerings at the right time. By combining various data points such as past buying behavior, demographics, sentiment analysis from social media, along with CEM databases, banks are able to create specific micro—customer segments that help them to make more accurate decisions about their customers. These micro-segments capture new insights on customers that aren't obvious, for example, trends and patterns in the way customers respond to offers, and how factors like age and location affect buying behavior. Institutions can then use these segments for cross-selling and upselling, improving customer engagement, customer loyalty, and ultimately increasing sales and profitability while improving the customer experience.8
A great example of big data analytics in banking is the Royal Bank of Scotland (RBS), one of the largest banks in the world. RBS has developed an entire division dedicated to “personology,” which Andrew McMullan, RBS director of analytics and decision making, says is all about using data to help the bank understand each of its customers. Using big data and analytics, the bank is re-creating personal relationships with customers that they believe disappeared some 40 years ago. Christian Neilissan, their head of data analytics, says of that time: “We knew our customers individually, we knew their families, we knew where they were in life, we knew what they were doing next.”
In the 1980s, most banks lost focus on their customers and became more interested in creating products to meet sales targets. In the case of RBS, Neilissan said, “We had to get hundreds of thousands of credit card mailers out of the door. That was all that mattered…. The tactic may have boosted profits, but it left most customers with a feeling that RBS did not understand or care about their needs.”9
That's why they're creating the personology team to analyze customer data and better meet their customers' needs. They've brought together multiple IT systems into a single data warehouse, and have invested in open-source big data technology, like Cloudera and Hadoop. The bank is using structured and unstructured data, and a variety of analytics methods, like decision trees, predictive analytics, and machine learning, to do things like identify customers who could save money by consolidating their loans, provide the best offers for each customer, and leverage mobile apps and online banking to spot patterns and tailor recommendations according to the customer's location and what they click on. Banks are also using data analytics to predict future behavior of customers, such as whether a customer is likely to make payments on time or the potential risk of losses or fraud.
Similarly, retailers are taking a parallel approach with data and analytics to enhance the shopping experience. They're combining product and customer data to get a 360-degree view of their customers. Adding social media data to the mix to understand an individual's network, rather than just simply their own transactions, is helping to uncover trends and potential new opportunities with their customers. And even more, they're combining this with their customers' mobile activity to learn their behaviors. All of this allows retailers to send product recommendations and special offers directly to the customer's preferred device, taking into account all the information available.
Birchbox is one retailer that's really getting data analytics right. Birchbox is a beauty product subscription service that sends monthly boxes with different types of samples, with an opportunity to buy the ones that subscribers like. Online subscribers enter personal data like skin tone, hair color, and style preferences to determine what they receive each month, giving the company rich data to work with. This data also helps drive product recommendations in their brick-and-mortar store. In the store, customers have the ability to see samples up close before deciding to put them into their box. There are iPads throughout the store and a big touchscreen “Product Matchmaker” to make data-driven personalized recommendations.10
Birchbox also uses big data, like behavioral and survey data, when they launch a new service or offering, and to continuously improve their offerings. Deena Bahri, the VP of marketing, says that “from the beginning, data has been an essential part of Birchbox's growth and strategy…we use it to make important company decisions, and use it to guide us toward creating the best possible new products for our customers.”11 Birchbox is a highly personal brand all around, and being able to provide targeted products each month and suggestions in-store makes each shopper feel special. Plus, these micro-purchases can easily lead to loyalty that lasts a lifetime,12 making it a win-win for Birchbox and its customers.
Both the retail and banking industries are great sources of inspiration in their data and analytics strategy. It's their use of these tools that's helping them and other industries to be successful in the experience and transformation economies. And while healthcare is beginning to make the shift to data-driven decision making, there lies ahead of us abundant, untapped opportunity to use data to impact the patient experience.