Why healthcare needs to be more like champagne

Many of my friends opt for a glass of red wine a day for their health. After coming across the surprising story of Veuve Clicquot, I’ll be savoring the bubbly stuff from now on

The surprising story of Veuve Clicquot

• In 1805, a woman named Barbe-Nicole, newly widowed by Francois Clicquot, raises funding from family to expand a tiny, unprofitable wine business
• She FAILS. For years…and years
• By closely following external market forces, Barbe-Nicole knows Russians are early enthusiasts, and they haven’t had access to the product due to the Napoleon war. She finds a way to deliver her product 2 weeks ahead of competitors, earning consumer preference amongst products and massive market (and company) growth
• Faced with demand that outpaces her ability to produce, Barbe-Nicole invents a solution to the biggest bottleneck in the champagne production process. It simultaneously increases quality, improves consumer experience, reduces cost and increases speed and scale of production
• Loyalty of her workers keeps her innovation a secret for decades

What healthcare can learn

• It will take more time and creativity than we think...and we need to set audacious goals, not incremental ones. Many, many, many healthcare services, products, technologies and protocols that are an improvement on the current standard of care have yet to become standard of care let alone be available to the majority of Americans (and beyond). That said, adoption of healthcare innovation is accelerating. Now is the time.
• Know your market. The complexity and fragmentation of healthcare demand, decision making and payment (doctor – payor [reinsurer-insurer-employer] – government – consumer) makes identifying the customer, being consumer-centered, and finding profitable, rapidly scalable business models difficult. But hey… if Barbe-Nicole can navigate a war and deliver champagne 2,600km (over 1,600 miles) to a Russian Tsar as a young single parent, then we in healthcare can find our paths to market too.
• Expect innovations to reduce cost and human effort AND increase quality and consumer experience. Many in healthcare traditionally expected reimbursement to increase every year, or assumed that cutting costs means worsening care. Having started my career in the technology industry, I’ve seen more often than not cost reduction and quality increases go hand in hand. The Dartmouth Atlas, amongst many other sources, demonstrate that in healthcare, quality and cost are not very correlated. And standards such as the QALY (quality-adjusted-life-year) have existed for many years to bring cost into the equation. Putting healthcare on consumers' terms, leveraging analytics and technology, is a key enabler.
• It will take servant leadership. Growing a business at scale requires many, many individuals to bring their best and work well together. Today’s healthcare climate of cost reduction and threats to the livelihood of many established industry segments and businesses encourages internal politics to ferment, and clouds visibility in serving the healthcare consumer. It’s way more fun to work together. And what better to sip after a hard day’s work than Veuve Clicquot?

Thanks to HBR Ideacast 431: Myths About Entrepreneurship, October 23, 2014, where I originally learned about Veuve Clicquot.