Innovation in healthcare: an investigation into the relationship with organizational performance

Since the advent of the Internet in the 1990s, technology has revolutionized organizations and management in all sectors of the economy (Wang & Xu, 2023). In the healthcare sector, the response to this change can be observed with the occurrence of eHealth and digital health. E-health is defined by the World Health Organization as "the use of information and communication technologies (ICTs) for the benefit of human health", while digital health is an "umbrella term that encompasses e-health, as well as emerging areas such as the use of advanced computer science in big data, genomics and artificial intelligence" (WHO, 2021). Moreover, in recent years, the healthcare sector has undergone a significant transformation that has generated rapid growth due to increasing technological innovation, rising demand for healthcare and an ageing population (Ker et al., 2018; Ahmadi et al., 2015; Chong & Chan, 2012; Curry & Sinclair, 2002). All these conditions have made healthcare management an increasingly prominent and relevant issue in the managerial, economic-political and legislative spheres (Hegde, 2008; Sherer et al., 2016; Xu et al., 2021). In this context, in particular, the adoption of innovative managerial tools and new technologies, have contributed to transform the sector in managerial and organizational terms, in improving the healthcare and management processes, enhancing their resource management and performance, and in supporting the patient in his or her care pathway, improving quality of care. The aim of this thesis is to analyze the contribution of innovation within the healthcare context and the possible impacts that the adoption of these tools may determine on the management and the performance of healthcare organizations. It must be emphasized that the term "innovation" is a very broad umbrella concept that embraces different aspects (Tidd & Bessant, 2020), however, in this thesis, we focus on the contribution that technology (both medical technologies and information technologies) provides to the performance and management of healthcare organizations and systems. Starting from these premises, it is necessary to place the object of this thesis in context by explicating the characteristics of the public healthcare sector. The healthcare sector represents an interconnected system of actors, institutions and resources aimed at providing healthcare services to promote the health and well-being of the population (Murray et al., 1991; Paoli et al., 2019). Its relevance is as broad as its influence, reflecting the growing awareness of the importance of health as a foundation for sustainable development and social progress (WHO, SDG 3). Over the years, the healthcare sector's contribution to the global economy has been significant. In fact, global healthcare expenditure has constantly increased, prompted by factors such as ageing population, the rise in patient comorbidities and the growing demand for quality health services. Data reported by the WHO (Global Health Expenditure Database, 2022) shows that the healthcare sector has become one of the largest and most dynamic industry in the world, with investments often exceeding those of sectors traditionally considered to be driving the economy. In fact, today, about 10 % of global GDP is spent on health (WHO, 2023). Most of the spending is financed from public resources, through governments' funding from taxation on citizens and contributions from compulsory social insurance with the purpose of guaranteeing that services are accessible to everybody (OECD, 2020). At the same time, however, data developed by the WHO (2023) show how health expenditure is heterogeneous, reflecting significant inequalities in access to care and health resources between different states around the world. This disparity underlines the need for a global and collaborative approach to address common challenges, promoting health as a global public good. In this complex economic environment, the effective and efficient management of resources in the healthcare sector has become crucial. Management strategies driven by quality, equity and financial sustainability are now essential to ensure that resources are allocated effectively, enabling the healthcare sector to address the desired performance (Vainieri et al., 2020). The same concept of performance of healthcare systems and organization has evolved over the last years. One of the first authors to propose a performance assessment framework in health care was Donabedian, according to whom the quality of care and thus the performance of a health care organization can be framed into three levels: structure, process, and outcome (Donabedian, 1966). Structure measures refer to the resources of the health care organization, e.g., beds, devices, and personnel; process measures relate to the activities performed during the delivery of care, assessing the adherence with best clinical practices, appropriateness of procedures, and efficiency; while outcome measures reflect the health results achieved through service delivery e.g., reduced mortality, reduced hospitalizations (Donabedian, 1966). A different representation of this model is proposed by Lega (2020) who combines Donabedian's scheme with an instrumental view of performance. In particular, the instrumental view of performance identifies strategic resources, intermediate results and final results (Bianchi, 2016). Therefore, in Lega's conceptual scheme we have the "inputs", defined by Donabedian as "structure" and by Bianchi as "strategic resources"; the processes defined by Donabedian represent the "transformation" phase; the intermediate results defined by Bianchi are the "outputs"; while the "outcomes" represent the final results. This extended approach reflects the growing awareness of the importance of evaluating not only the structure and process of health care, but also the long-term outcomes that directly impact patients' health and well-being (Lega, 2020). The contribution of innovation in healthcare can be framed in two distinct domains (Tortorella et al., 2020): i) the contribution of clinical/medical innovation and technology in the delivery of care, and thus in the processes; ii) the contribution of innovation and information technology to support performance management in healthcare organizations and systems. For what concern the first domain, in order for healthcare organizations to achieve better health performance and efficiency in the provision of their services, the advancement of digital and health technologies has assumed a key role over the years, enabling the implementation of innovative solutions and the adoption of tools to support the healthcare service (Chaudhry et al., 2006; Goldstein et al., 2002; WHO, 2021). Health technologies include all the practical applications of knowledge that are used to promote health and prevent, diagnose and treat disease (WHO, 2023), i.e. healthcare equipment, medical devices, drugs, diagnostic systems, medical and surgical procedures, care pathways and the structural, organizational and managerial arrangements in which healthcare is delivered. While digital technologies include tools and services that make use of ICT (information and communication technologies) to improve the provision of care and the well-being of people (Mumtaz et al., 2023), including wearable technology, telehealth and telemedicine, mobile health, health information and personalized medicine (FDA, 2022). The advancement of digital technologies has also had important effects on the information systems of healthcare organizations (Bates et al., 2001; Chaudry et al., 2006). Indeed, the evolution from paper-based records to electronic systems with the introduction of electronic medical records, digital patient registration and e-prescribing systems have greatly improved the accessibility, accuracy and efficiency of health information management (Baumann et al., 2018; Wager et al., 2021). Furthermore, the implementation of emerging technologies such as artificial intelligence and machine learning is another step forward in healthcare information systems innovation (Devenport & Kalakota, 2019). These technologies are capable of analyzing complex data faster and more efficiently than human capabilities, opening new perspectives for diagnosis, personalized treatment and epidemic management (Guo et al., 2020; Schwalbe & Wahl, 2020; Secinaro et al., 2021). With the support of technology, information systems are able to collect huge amounts of data (Noorbakhsh-Sabet et al., 2019). Advanced analysis of this data can reveal significant patterns, trends and correlations, providing healthcare professionals with powerful tools for early diagnosis, personalization of treatments and disease prevention (Devenport & Kalakota, 2019; Klump et al., 2021). For what concern the second domain – i.e. the contribution of information technology to support performance management in healthcare organizations and systems – it is important to understand how innovation, and in particular technology, may contribute to the management of the healthcare sector. This, since the 1980s’ has been characterized, in Western countries by the implementation of the wave of reforms called “New Public Management” (NPM), developed in response to the failures of the bureaucratic model (O'Flynn, 2007; Osborne, 2010; Bryson et al., 2014). Indeed, through the NPM paradigm, private sector managerial practices and values have been adopted by public administrations in several Western countries, expanding the sphere of responsibility of public managers and introducing a new figure of the public manager (Hood, 1991; O'Flynn, 2007; Guy & Pierre, 2008). The adoption of these principles has, moreover, changed organizational structures and mechanisms, through the diffusion of business management functions and techniques and the introduction of performance measurement and management practices (Noto et al., 2019). NPM theories have, therefore, initiated the process of "managerialism" of the public sector organizations, paying attention to aspects previously underestimated such as financial measures and a control over the volume of services provided (Hood, 1991; Brignall & Modell 2000). This managerialism process led to a gradual transformation by the main industrialized states, such as England, Australia, New Zealand (later followed by the other states, such as Italy), in the management of public administrations through the adoption of managerial and economic approaches brought by the NPM (Farris & Marchetti, 2017), providing, thus, a new idea of public service provision (Hood, 1991). The main changes certainly concerned the decentralization of decision-making power, first concentrated at the central level, then moved to lower levels, a greater orientation towards the citizen, as the final user of the PA, designing services taking into account their expectations and needs through an involvement in the public sphere, but also the emphasis on results-based management, introducing performance measurements aimed at assessing the efficiency, effectiveness and quality of public services (Christensen and Lægreid, 2011; Waheduzzaman, 2019). In particular, the last aspect represents the methodological approach of Performance Management (PM), a discipline of management control, introduced in the public sector with the NPM reforms (Otley, 1999; Ferreira & Otley, 2009). PM is defined by Otley (1999) as the use of performance measurement information to improve organizational culture, systems and processes through: the setting of predefined objectives, the appropriate and preventative allocation of resources, the timely provision of information to managers to consolidate or modify existing policies in order to align with set objectives, and the sharing of results achieved. In other words, PM consists of measuring an organization's performance within given objectives in order to make decisions on how to improve or modify the actions to be carried out so as to achieve ever higher performance (Ferreira & Otley, 2009). In order to ensure that these new management techniques were applied correctly and due to the complexity of healthcare systems, several performance management systems (PMSs) were developed, which are able, through the use of quantitative and qualitative performance indicators, to provide an overall assessment of healthcare organizations (WHO, 2012; EU, 2017; Paoli et al., 2019). The first PMSs, designed to overcome the limitations of the bureaucratic organizational model, were mainly focused on measuring and promoting productivity (e.g., volumes of services produced) and economic efficiency (Nuti et al., 2018). This phase is called budgetary control (Arnaboldi et al., 2015). According to Head and Alford (2015), these PMSs focused primarily, if not exclusively, on monitoring and input allocation choices such as, for example, volume of services delivered, financial measures, and organizational accountability assessment. As a result, health care organizations, in order to achieve the desired performance results, were orienting their activities toward maximizing the services delivered with the available resources with the goal of increasing the financial margin (Noto et al., 2021). This, however, in the health sector, is not considered a desired outcome, as more health services offered do not always correspond to positive outcomes for the target population. To overcome these limitations and a number of unintended consequences (Smith, 1995), a second phase of PM in the health sector, which began in the 2000s, followed the budget control phase. A key element of this second phase is the integration of multidimensional measures of quality of care within health care organizations' PM systems with the goal of making them more comprehensive (Nuti et al., 2018; Vainieri et al., 2020). Recently, healthcare organizations are paying attention to the introduction of inter-organizational performance measures (Nuti et al., 2018). This is because there has been a recognition that in order for the PMS to be able to properly measure the activity carried out within health care organizations, it is necessary to have measures that take into account what is happening within different units working together (Vainieri et al., 2020). A step forward in performance measurement systems has occurred through the adoption of the concept of performance that encompass the perspective of population medicine (Gray, 2017). This made it possible to overcome the problem of sub-optimization of PMSs capable of focusing on improving one aspect of health care without considering the consequences generated on the other components of the health care system (Vainieri et al., 2020). In fact, if we consider the structure of multi-level health systems, it becomes clear that in order to achieve better care outcomes, collaboration between different professionals and entities (entities) is necessary. Inevitably, therefore, the integration of measures that are able to consider the performance achieved by different entities (hospitals, private care providers, outpatient clinics, etc.) by aligning goals and adopting tools capable of fostering an exchange of information and implementing joint actions is required of the new PMSs (Vainieri et al., 2020). Therefore, the introduction of PMSs has provided significant management, organizational and accounting innovations aimed at increasing the rationality of decision-making processes and, thus, at achieving significant improvements in the level of operational and allocative efficiency, as well as in the effectiveness of the activities through which healthcare organizations pursue their objectives (Curristine et al., 2007; Lewis, 2015). Innovation in information systems has also revolutionized the way performance data are collected, managed and used in the healthcare sector (Mathew & Pillai, 2015; Krause, 2015). Through continuous and systematic monitoring, new performance measurement systems allow for real-time, accurate and timely data dashboards capable of providing reports and statistics to decision-makers (e.g. managers, physicians, practitioners, etc.) that are useful to guide and improve decision-making processes (Lehoux et al., 2018 Adler-Milstein et al., 2019; Alfian et al., 2018). In contexts characterize d by high complexity, such as healthcare, the timeliness of data allows for an immediate assessment of the effectiveness of medical practices, identifying areas for improvement and supporting informed decisions; it can also prevent complications from arising, as well as improve the quality of care. Data updated in real time, therefore, enables a rapid response to possible problems that may arise within healthcare organizations, enabling them to adapt to changing conditions. Recently, another area where innovation has revolutionized the collection of performance data concerns the patient perspective measured in terms of experience (PREMs or Patient Reported Experience Measures) and outcome (PROMs or Patient Reported Outcone Measures) (De Rosis et al., 2020). The introduction of these indicators is related to the parameters of multidimensionality and shared design of performance measurement systems in healthcare, which require on the one hand to consider the centrality of the patient and on the other hand to involve all stakeholders in the implementation of performance systems and, in particular, patients as the most important stakeholders of the healthcare system (Carman et al., 2013). The possibility of actively involving patients through digital tools, such as mobile applications or online portals, enables a more active and conscious participation in monitoring their health (Greaves et al., 2013). This direct involvement can improve the collection of data on patient experience, perceived outcomes and quality of life (Coulter, 2006; De Rosis et al., 2020). Innovative information systems are capable of integrating data from different sources such as administrative, accounting and patient data, and their interoperability allows for a comprehensive and integrated view of healthcare performance, incorporating the different indicators into dashboards that can be consulted in real time by professionals (De Rosis et al., 2020). Thanks to technological support, these new systems allow for real-time feedback, enabling healthcare professionals to act promptly on patients' needs and concerns, making corrections with a view to continuous improvement. Several studies point to how readiness to collect data enables healthcare organizations to adapt their practices and make improvements that can be immediately perceived by patients (Larsen et al., 2011; Wright et al., 2017). This contributes to improving the overall patient experience and perception of the quality of care received. Therefore, the use of these performance indicators from patients, with technology to support the systems for collecting this information, represents a major innovation in healthcare. Measuring patients' satisfaction, experience and perceived outcomes enables healthcare organizations to adapt their practices and policies in a way that is more oriented to the needs and expectations of care users (Larsen et al., 2011; Wright et al., 2017; De Rosis et al., 2020). This information is, therefore, able to guide the decision- making process of healthcare professionals and managers by meeting the needs of patients. In accordance with the above, this thesis wants to explore the role of innovation and technology in terms of medical technologies and information technologies, are spreading within the healthcare context and the possible impacts that the adoption of these tools may generate on the performance and management of healthcare organizations. The aim of dissertation is threefold: • To provide a comprehensive analysis of the existing literature on technology and innovation in healthcare and management literature and to synthesize and integrate the results obtained by proposing a matrix that identifies four emerging thematic areas according to the dimensions relating to the level of analysis (individual-organizational) and methodological approach (inductive-deductive), providing clarity on the positioning of scholarly contributions for future research. • To examine how technology adoption, in terms of active implantable medical devices, can affect the performance of healthcare organizations, suggesting that policymakers create incentives to encourage healthcare organizations to invest in innovative technologies and to use monitoring of expenditure on new devices as a valid parameter to evaluate the extent of technology adoption in clinical practices. • To investigate the role that different types of performance information have within the decision-making processes of health hybrid professionals and, in particular, whether physicians are more likely to use user-based performance information, rather than traditional performance measures, when making a choice.