Strategic, political, and cultural aspects of IT implementation: improving the efficacy of an IT system in a large hospital.

Healthcare spending will exceed $4 trillion by 2017, a trend that is leading executives to implement information technology (IT) systems to contain these rising costs. Studies show that numerous factors determine the outcome and net benefits of IT in healthcare. However, what happens when a newly implemented IT system results in negative outcomes? We explore this question by examining a newly implemented IT system in a large hospital that was yielding none of the benefits for which its designers had hoped. Using an expanded set of analytic lenses, our in-depth study found that political issues were a major stumbling block to the implementation of this IT system, as the interests of IT managers were different from those of the system's users. In addition, cultural values among these stakeholders were not aligned. The new IT system carried very different meanings for these two key groups. These political and cultural issues, which reflect a broader set of factors than is commonly applied in IT or in management, led to specific recommendations designed to improve the system's viability and benefits. In a follow-up analysis we found that these alternative lenses helped increase the intended usage of the IT system by 16 percent in the first year, yielding a 20 percent improvement in performance. By better understanding the cultural and political significance of IT implementation, managers may thus improve the effectiveness of new information technologies for containing costs in hospitals.