Cloud could usher in $11B in savings

Could reduce IT costs by 9 percent over three years
By Tom Sullivan
10:01 AM
cloud computing
While 90 percent of healthcare CIOs view IT innovation as critical to success, the more surprising statistic is that fewer than one-fourth consider their existing infrastructure capable of supporting such technological advancement. 
 
That’s according to a report from MeriTalk, published Monday, examining the potential of IT-as-a-service within the healthcare realm by surveying 109 CHIME members.
 
The ITaaS model can be used to lower operational costs, shift from capital to operational expenditure, boost service levels and streamline application deployment, David Dimond, healthcare solutions chief strategist at EMC, which sponsored the report, explained in a statement.
 
 
And 47 percent of respondents said their existing IT portfolio has the potential to be delivered ITaaS-style, be that via private, hybrid, or public clouds.
 
Embracing the model could reduce IT costs by 9 percent, the report found, or $11 billion in savings across three years.
 
“As IT departments transform their operations to run IT as a service, their role will also transform, from exclusive providers of IT services to brokers of IT services,” Dimond said. “An ITaaS framework enables providers to support the pace of change and organizational transformation to meet accountable care goals.”
 
The migration toward a services approach has already begun, MeriTalk noted in the report, with respondents indicating 15 percent of their current IT portfolio is presently delivered as a service, and 87 percent are deploying virtualization technologies, while 73 percent said they are streamlining operations and 48 percent are centralizing IT management.
 
“Healthcare reform is forcing new efficiencies,” said Steve O’Keeffe, founder of MeriTalk. “ITaaS results to date show enormous potential. This is a crucial step if we want to revitalize our U.S. healthcare system.”
 
Naturally, ITaaS and cloud computing bring new challenges. MeriTalk determined that 52 percent of respondents are having trouble finding and hiring skilled workers, and only 30 percent are using a structured process to measure IT return on investment.