IT companies need to better understand the healthcare industry before they can change it, former Apple CEO tells CES audience.
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Former Apple and PepsiCo CEO John Sculley, now an investor in several healthcare companies, believes in the power of consumer-facing IT to transform parts of healthcare. But this cannot happen unless technology developers understand this complex industry and the vendors engage the people who actually pay for health services, he said.
"The thing that is missing is getting the people with the domain expertise aligned with the people with technological know-how to turn ideas into branded services," Sculley said Thursday in Las Vegas at the Digital Healthcare Summit adjunct to 2012 International CES.
"You have to have domain expertise" in addition to technical smarts, Sculley continued. He specifically mentioned Google Health as a product that failed because the people behind it didn't understand what the healthcare industry or consumers really wanted. "This is not a typical Silicon Valley problem," Sculley said of healthcare.
He suggested that developers have put too much emphasis on technological flash than on usability. "You never compromise on the user experience," Sculley offered.
Sculley remains bullish on the potential for technology companies to address what ails the fragmented, pricey, and error-prone healthcare industry, which tends to focus more on episodic, sick care than on prevention, wellness, and control of chronic diseases. "My thought is that we will be pleasantly surprised that we will find multiple ways to get chronic-care patients involved in their own care, but I can't say when that will happen," Sculley said.
He also advised would-be healthcare fixers not to get discouraged by ideas that never catch on. "In high tech, there's a very thin line between success and failure," Scully said, adding that American culture tends to allow for second and third chances.
"Failure doesn't mean you're finished. It means you have to pick yourself up and start again," Scully told the gathering.
Microsoft became the behemoth corporation it is today, according to Scully, by being the first to "shrink-wrap" software for the masses, ushering in the PC revolution. He feels like the healthcare industry is poised for a similar breakthrough. "This feels to me a lot like what the early '80s felt like in the personal computer industry."
To that end, he noted that he is now serving as mentor to leaders in some of the healthcare companies he has financial stakes in, including Audax Health, a start-up "social Web company" founded by a 22-year-old who had to endure seven knee surgeries in a 20-month period after a sports injury. Audax, which hosts specialized communities that bring in social and condition-specific networks as well as elements of online gaming to help people find answers to health questions, seeks to become the "Facebook of health services," Sculley said.
That's a lofty goal but Sculley said it might be possible because the company offers more than just the "cool" factor that has doomed other enterprises that target healthy people, providing an outlet for those who are frustrated trying to navigate the intricacies of American healthcare. "If you want to build a billion-dollar company, you have got to solve the multibillion-dollar problems," Sculley said.
Social networking has changed the dynamics of online gaming, he noted. He was surprised to learn that the most active type of Zynga user is closer to a 40-year-old woman than to a teenage boy. That 40-year-old woman might just be struggling to manage care for her children and her aging parents, according to Sculley.
He also believes Audax Health has a chance because it is not just a direct-to-consumer company, but one marketing its services to insurance companies and self-insured major corporations looking to trim their healthcare expenditures. "You always go where the money is," Sculley advised.
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