Beyond IT and productivity : effects of digitized information flows in health care

155 Pages·2.169 MB·English

by  by Pontus Fryk.

Linköping Studies in Science and Technology
Thesis No. 1328
LiU-TEK-LIC-2007:37

Beyond IT and Productivity
- Effects of Digitized Information Flows in Health Care

By

Pontus Fryk

Submitted to Linköping University in partial fulfillment of the requirements for the
degree of Licentiate of Economics

Linköping 2007
Department of Management and Engineering
Linköping University, SE-581 83 Linköping
© Pontus Fryk, 2007

“Beyond IT and Productivity – Effects of Digitized Information Flows in Health Care”
Linköping Studies in Science and Technology, Thesis No. 1328

ISBN: 978-91-85831-08-1
ISSN: 0280-7971
LIU-TEK-LIC-2007:37

Printed by: LiU-Tryck, Linköping

Distributed by:
Linköping University
Department of Management and Engineering
SE-581 83 Linköping, Sweden
Tel: [phone], fax: [phone]
Beyond IT and Productivity
- Effects of Digitized Information Flows in Health Care

By

Pontus Fryk

ABSTRACT

This thesis examines how investments in IT, and the digitization of information flows, have
affected health care productivity. Through empirical investigations of health care processes –
along with discussions based on notions derived from theories related to e.g. economics, the
Productivity Paradox, General Purpose Technologies, and medical informatics – effects from
digitization are detected and analyzed.

An important point of departure is the so called Productivity Paradox, which raises the question
why previous comprehensive investments in IT seemingly have not generated the anticipated
productivity growth. Researchers have debated this dilemma for many years now but no
sufficient explanations have been put forth. This is so due to a prior focus on snapshot
descriptions, founded on macroeconomic statistics and aggregated data, which has resulted in
ambiguous conclusions about IT and economic development. Thus, in order to really describe
the effects from digitization, the process investigations mainly are carried out at the organization
or department level, and from a qualitative and historical perspective.

Furthermore, in the current research, it is believed that too narrow definitions of IT and
productivity have contributed to the overlooking of benefits from digitization. Therefore the
term IT is extended to include technology for collecting, storing, processing, retrieving, and
communicating data, text, images and speech. Moreover, this definition includes both
administrative and embedded IT. Also, the traditional definitions of productivity are questioned,
and the concept is given a broader meaning in order to capture all possible benefits and/or
disadvantages from IT investments.

The results and analysis presented in this thesis show that productivity within health care has
increased immensely thanks to investments in IT. In general, the treatment processes have been
speeded up, health care quality has improved, and the cost effectiveness has been significantly
enhanced. In other words, by introducing new thoughts regarding the Productivity Paradox,
more effects from digitization are detected and analyzed. However, there are some problems
connected to the implementation, adoption and diffusion of IT within health care, and they are
also given proper attention throughout the current work.

This work has been supported by the foundations of Jan Wallander, Tom Hedelius, and Tore Browaldh

Linköping 2007
Department of Management and Engineering
Linköping University, SE-581 83 Linköping

SAMMANFATTNING

Denna avhandling undersöker hur investeringar i IT, och digitaliseringen av
informationsflöden, har påverkat produktiviteten inom sjukvården. Genom empiriska
undersökningar av avgränsade sjukvårdsprocesser – samt diskussioner baserade på idéer
och teorier relaterade till ekonomi, ”produktivitetsparadoxen”, så kallade General Purpose
Technologies (GPTs), och medicinsk informatik – detekteras och analyseras effekter av
digitaliseringen.

Produktivitetsparadoxen – vilken ställer frågan varför tidigare omfattande investeringar i
IT till synes inte har genererat de förväntade produktivitetsökningarna – är en viktig
utgångspunkt i föreliggande studie. Forskare har dryftat detta dilemma i många år men
hittills har inga fullständigt tillfredsställande förklaringar lagts fram. Detta beror till stor
del på att tidigare forskning huvudsakligen har inriktat sig på makroekonomisk statistik
och aggregerade data, vilket har resulterat i otydliga eller ofullständiga slutsatser angående
IT och ekonomisk tillväxt. För att verkligen beskriva effekterna av digitaliseringen är
denna forskning istället baserad på undersökningar på mikronivå (organisations- eller
avdelningsnivå) ur ett historiskt och kvalitativt perspektiv.

En annan viktig tanke som genomsyrar denna avhandling är att för snäva definitioner av
IT och produktivitet har bidragit till förbiseende av många nyttor till följd av digitalisering.
Därför utvidgas termen IT här till att inkludera teknologi för att samla, lagra, bearbeta,
återfå och kommunicera data, text, bilder och tal. Dessutom omfattar denna definition
både administrativ och inbäddad IT. Vidare ifrågasätts de traditionella definitionerna av
produktivitet, och begreppet ges en bredare betydelse för att fånga upp alla möjliga nyttor
och/eller nackdelar som kan härledas till IT investeringar.

Resultaten och analysen som presenteras i denna studie visar att produktiviteten inom
sjukvården har ökat enormt tack vare IT-investeringar. Generellt sett så har
sjukvårdsprocesserna snabbats upp avsevärt, sjukvårdskvaliteten har förbättrats, och
kostnadseffektiviteten har ökat. Med andra ord, genom att introducera nya tankar gällande
produktivitetsparadoxen, har fler effekter kunnat detekteras och analyseras. Det finns
emellertid också många problem förknippade med implementering, användande och
spridning av IT, vilka ges tillbörlig uppmärksamhet i denna undersökning.

I förlängningen bidrar analysen av digitaliseringseffekterna till en ökad förståelse för hur
”IT-fieringen” av modern sjukvård påverkar dess produktivitet i form av exempelvis
bättre (och även helt nya) behandlingsmetoder, förkortad konvalescens och snabbare
patientflöden. Vidare ges förslag på hur implementeringsförfaranden kan skötas smidigare
än tidigare, vilka problem relaterade till digitalisering som bör beaktas och lösas, samt
vilka möjliga framtida nyttor som skulle kunna realiseras och hur.

Detta torde vara av intresse för yrkesverksamma inom sjukvården, patienter, politiker som
skall besluta om sjukvård, och även samhället i stort. Det övergripande målet med
avhandlingen är således att underlätta utvecklingen mot en alltmer digitaliserad – och
förhoppningsvis därav förbättrad – sjukvård genom att fördjupa förståelsen för relationen
mellan IT och produktivitet.

Preface

The division of Economic Information Systems engages in research and education in the
borderland between management and IT. More specifically, the subject area relates to the
transmission of information from, between and to people. Of special interest is the role of
strategies and information systems when people work together in different kinds of
organizations (companies, public authorities and associations), but also when they interact
with customers and citizens. Our research is concentrated in the following areas:

* IT and productivity

* Strategic use of IT, with a focus on organization for the use of IT

* Strategy and management control

* Financial accounting, auditing and economic crime

Most doctoral candidates in the division of Economic Information Systems are enrolled in
either the Swedish Research School of Management and Information Technology (MIT) or
the Research Programme for Auditors and Consultants (RAC). MIT is a joint endeavour
involving some ten colleges and universities. Within the structure of this network, a doctoral
programme is offered with a focus on issues arising in the borderland between management
and IT. The RAC is a graduate education programme focused on accounting and auditing,
with an emphasis on the processing of information. It combines internships at auditing firms
with graduate courses and work toward a licentiate degree.

This thesis, Beyond IT and Productivity: Effects of Digitized Information Flows in Health
Care, is presented by Pontus Fryk for the degree of Licentiate of Economics – in the subject
area of Economic Information systems – at the Department of Management and Engineering,
Linköping University. Fryk is currently enrolled in the MIT Research School and holds a
Master of Science in Engineering.

Linköping, August 2007

Fredrik Nilsson
Professor
Economic Information System

FOREWORD

The current research is conducted within the ITOP Research Program (Impact of IT On
Productivity). The program uses the so called Productivity Paradox as a major starting-
point. This term is derived from the notion that there is no clear connection between IT
investments and productivity growth. In other words, until recently, studies based on
aggregate data have failed to prove that digitization contributes to economic growth.
Today, however, positive effects of IT investments on productivity have been reported,
but the overall value of IT is still under debate.

Previous research has focused largely on IT capital spending and not how the technology
is actually used. The ITOP program, in contrast, has adopted a micro-level approach
based on empirical investigations of generic processes in order to study both
administrative and embedded IT. The research strives to detect effects from digitization
by looking at limited processes before and after the introduction of IT. In addition to
effects on productivity as traditionally measured, numerous other benefits of IT, some of
them not even measurable, are identified.

This research would not have been possible without the great financial support from the
foundations of Jan Wallander, Tom Hedelius, and Tore Browaldh, which is deeply
appreciated.