Posted by The Bowdoin Group on November 27th, 2018
Convergence in healthcare is accelerating, and Digital Health companies are at the center of it all.
Companies are finding it increasingly difficult to find talent that understand the various stakeholders that are part of the healthcare ecosystem. Historically, these stakeholders (payers, employers, providers, pharma, and more) operated in their respective areas, serving their constituents without stepping into each other’s domains. These days, those lines are blurring. Each entity can no longer live in a bubble and deliver just one service. The market is demanding change and the stakeholders are now working together to deliver a better, more integrated, value-based service.
The Drivers of Convergence
The following developments are catalyzing convergence and are rapidly changing the future of disparate entities in healthcare:
- Rising costs: Costs have been rising at an unsustainable pace to accommodate for expensive drugs, administrative fees, and increased wages, forcing organizations to hone in on quality over quantity.
- Insights and outcomes instead of data collection: The last decade saw most stakeholders moving away from archaic approaches to collecting information towards more sophisticated platforms. Now that most healthcare entities have greater access to critical data, they’re using it to inform and improve the patient experience.
- Increased focus on patient care: Patient care is being emphasized by all parties involved in healthcare. For example, hospitals must now report patient satisfaction information to the federal government and private insurers because it plays a contributing role in setting pay levels. In addition, patients are smarter than ever before. They do their own research for the benefit of their health and their care experience, and they make smarter, more informed decisions.
Trends in Digital Health Leadership
Not only is convergence setting the pace of change and innovation in healthcare, it’s also greatly affecting the talent market. Here are the trends we’ve experienced hiring executive and strategic roles at Digital Health and Life Sciences companies:
- Industry growth is outpacing the talent supply: The Digital Health industry is still emerging, but it’s growing fast: in 2017, analysts predicted a chart-topping 28% average compound annual growth rate from 2018-2024. As a result, there’s a high demand for executives who have led Digital Health companies, especially because they’re low in supply. Before they shift to the next company, many Digital Health executives are committed to making an impact at their current company and, in many cases, not enough time has passed for that to occur.
- Knowledge of the broader healthcare ecosystem is highly desirable: Healthcare technology companies sit at the center of the convergence that is taking place in healthcare, so the leaders of Digital Health companies must understand how the broader healthcare ecosystem works and how to operate successfully within it. It’s become far more important to understand how the healthcare industry is connected than to have expertise in all of the areas — great leaders can flex in specific areas they don’t know as well.
- Leadership is filling in expertise gaps with strategic hires: It’s become almost impossible to understand all aspects of healthcare intimately, so Digital Health companies are pulling in partners, board members, consultants, or advisors to give them guidance that requires subject matter expertise, and they’re filling in knowledge gaps with strategic hires at the VP and director levels.
Nearly every company we’ve worked with in the Digital Health space has experienced these trends firsthand. Working with a partner who specializes in hiring for these industries has become more critical than ever before. At the same time that we are pushing companies to think more creatively about their next leader as it relates to the intricacies and nuances of healthcare, we are testing candidates to ensure they are up to the task. Rapid convergence is challenging for the Digital Health and Life Sciences industries, but having the right leaders to navigate through it can pay dividends. We’ll help you find them.
This topic—how convergence in healthcare is affecting the Digital Health ecosystem—is incredibly relevant in today’s market. We plan to gather various perspectives from companies that have experienced this and how they’re facing this challenge head on.
For more in-depth information on the Digital Health market, read our Digital Health Sales Compensation Report that explores compensation highlights and regional differences for sales executive leadership and teams across the U.S.