Why the €135M Healthcare Platform Project Went to Epic/NNIT
The Danish authorities have announced that they have chosen Epic/NNIT for the delivery and implementation of the new healthcare platform project. The project, which is estimated to require a €135M investment, will provide fully integrated IT functionality for the 40.000 healthcare workers in Zealand and should lead to improved healthcare services for the 2,5 million population in the area.
Why did this order go to Epic/NNIT?
We did the analysis of the five vendors who were invited to bid for projects on February 15, 2013. The ranking then predicted Cambio as the leader with Systematic/IBM and Epic/NNIT coming next.
In our analysis on March 20th 2013 we illustrated how minor changes in the ratings would bring Epic/NNIT in the leading position.
Now that the decision has been made we believe that the final ranking was:
The reasons for the ranking were those stipulated in our analysis on January 4th 2013.
The Danish healthcare authorities want a system that covers as much clinical functionality as possible and delivered through a system already in operation elsewhere in the world.
Revising our score system from the February 15, 2013 analysis we can now make the following reassessment:
The rating hasn’t changed since our first assessment.
Since Systematic entered this market much later than Epic and Cerner, they obviously have fewer references and none which are comparable to the RH/RS project.
Epic and Cerner have numerous references including some which are comparable to RH/RS.
We have changed the importance to 0% as we do not believe this parameter had any impact on the final decision.
EMRAM EUR 6/7 Rating
This rating is unchanged. Systematic have no references in this category, while Epic and Cerner have numerous. The criteria has only played a minor role in the final decision.
Fit for purpose – clinical processes
We have increased the importance of this criteria to 50% of the final decision. During the last five months the three vendors have demonstrated their systems to a large group of clinicians. Through questionnaires the clinicians have rated the systems and their ability to deliver “out of the box” functionality. We are convinced that the result of this feedback has been the most decisive for the final decision.
We assess that both Epic and Cerner have rich functionality even in the areas stated as “options” in the Request for Proposal from RH/RS, while Systematic being new and with basically only a single reference still has a long way to go.
Fit for purpose – external integration
With more functionality in the core system, the requirement for external integration diminishes. However, we have also learned that integration to external systems is something that both the healthcare industry and the IT systems vendors take extremely seriously. Thus, much have been done to mitigate the risk associated with external integration. This was highlighted in Epic’s response to us prior to the February 15, 2013 post.
We still believe that Systematic has a slight advantage by already being present in the Danish market; however Cerner and Epic are not as disadvantaged as we originally assessed.
Software Scalability – Current Installations
The criterion and the rating is unchanged.
We have no indicators on this criterion.
We are convinced that the price/performance relationship has played a vital role in the final decision. While the price component of the equation is tangible and measurable, performance is a more composite variable. We have changed this criterion to price only as performance is assessed through the other criteria.
It is very likely that Systematic came in with the lowest bid. They have less functionality than the other vendors and they have much more to win (or lose) through this project. We have maintained the highest score for Systematic on this criterion.
Although the price is always an issue we believe that the decision makers at RH/RS looked at total system cost compared with total system value. The value being the benefits released in the institutions for the staff and for the patients who will be affected by the system during and after implementation.
Thus, we guess the price of the system (to the vendor) only plays a minor role in the final decision.
The combination of Epic and NNIT is in our opinion the strongest possible in the Danish market. NNIT is a recognized brand with a long track record in the Danish healthcare sector (although outside the EMR domain). Epic is one of the world leaders in EMR systems for the healthcare industry. Even on a global scale we have learned that the RH/RS project is big – very big. If NNIT and Epic cannot muster the implementation resources required for getting the system implemented, then it is hard to see an alternative.
We haven’t given any of the vendors a 5 since this is the toughest part of any project of this scale, but we do consider Epic/NNIT the least risky option.
Product Strategy and Influence
We have accessed that this is no longer (if it ever was ) an issue for the RH/RS decision makers. By engaging with the market leader, RH/RS are now passengers on a train going in the right direction at a steady speed. RH/RS deliberately wanted to avoid becoming a very big customer in very small shop.
Giving a €135M order to an American software company (ignoring that NNIT is a Danish company) definitely stirred some of the more nationalistic voices in the industry. Why didn’t we (whoever “we” are?) give this order to Systematic, boosting the Danish IT industry at the same time and improving our (whoever “our” is relating to?) opportunities for export?
We must thank the RH/RS decision makers and the political system for ensuring that this subject apparently never reached the agenda.
If all nations applied this type of protectionism (which they have a strong tendency to do!), the Danish industry would suffer dramatically. Denmark is representing less than 0,4% of global demand for IT systems and services. 99,6% of the market is outside Denmark. Denmark has a clear interest spearheading the promotion of free trade and open, competitive and fair public tenders. We have much more too lose on a global scale than what we could ever win on a local scale.
We have reduced this criterion to 0% as we genuinely believe that it never played a role in the final decision.
We admit that the personal agendas of all the people who participated in this project are impossible to read or measure. However, we do find that most of the participants will benefit most from choosing Epic. They are the market leader in this industry and open up user meetings, conferences and job opportunities all over the globe.
We have actually received inquiries from people in the healthcare industry who wanted our prediction on the outcome as they considered applying for jobs with RH/RS in case Epic was awarded the project.
Adding it all up
The final result of our analysis, which admittedly is based on pure speculation and “common sense”, lands Epic/NNIT as a clear winner, with Cerner/CGI as a close runner up and IBM/Systematic as the least attractive alternative.
Seen through these glasses RH/RS made the right decision.
The question is if IBM/Systematic should have seen the writing on the wall much sooner. Could they have saved their powder for “fighting new fights in other places on different days”?
Hindsight is a very precise science, but looking back is a way of improving your visibility looking forward.
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