Nearly 70% of digital health pilots converted to a paying customer, according to our 2017 survey of entrepreneurs. While conversion is a significant milestone for the startup, this also marks the beginning of a lengthy, challenging undertaking for enterprise leaders on the other side of the negotiation table.
One of the biggest challenges enterprises face in adopting innovation isn’t a failed pilot—it’s a successful one. With the need to scale, the real work begins: aligning stakeholders, finding the budget for full deployment, integrating new solutions into current workflows, and shifting hearts and minds in favor of organizational change.
Rock Health partners with select mission-aligned payer, provider, biopharma, medical device, technology, and other enterprise organizations in support of their digital health initiatives. Rock Health provides them with the knowledge, access, and platform to effectively connect, partner, and invest across the digital health ecosystem. Twice a year, we convene these healthcare enterprise leaders for a day-long retreat to discuss emerging trends, dive into Rock Health’s latest research, hear from startups tackling pressing healthcare issues, and exchange ideas with other industry leaders.
At our latest retreat, representatives from our corporate partner organizations—including Blue Shield of California, CVS Health, Accenture, Novo Nordisk, and Sutter Health—came together for conversations focused on advancing beyond the startup pilot phase. Joined by founders from our portfolio, the group candidly shared their respective experiences—and shared why the transition from pilot to scale is difficult for enterprise and startup alike.
The enterprise perspective
The enterprise partners shared their experiences and best practices to reduce obstacles on the path from pilot to scale.
- Ensure innovations concretely address business needs. Enterprise innovation teams shared the importance of deeply understanding business unit priorities so they can identify appropriate, external solutions. They spoke about collaborating with the business units while conducting diligence on a startup to validate the real-world utility of the product.
- Secure alignment from multiple stakeholders before selecting who to pilot with. Gaining buy-in from operational teams is critical to ensure successful pilots can be incorporated into day-to-day processes. Founders and partners cited the importance of also aligning teams that support business operations, including legal and IT. For example, one enterprise leader mentioned that the concerns posed by their legal team about data usage during a startup negotiation helped the enterprise better understand attributes of solutions that could work at scale.
- Build a pilot playbook. Create a playbook that maps out the steps to test and incorporate new innovations: the key stakeholders to engage, the resources and support to secure, and the transition milestones to achieve, such as shifting ownership from the innovation team to the business team. Consider the current decision-making process and ensure the playbook aligns with existing systems (rather than reinventing the wheel).
- Provide resources for operationalizing pilots. Even small pilots can be big lifts to integrate into everyday operations. Provide business units with additional resources (e.g., staff, budget) and training to support the integration.
The startup perspective
Two of our seasoned digital health startup CEOs discussed how they would approach enterprise sales based on their lived experiences.
- Reframe pilots as phased implementations. Startups with records of successful implementations, partnerships, or a strong body of evidence for outcomes may not need to enter into “test and learn” pilots. Repositioning pilots as phased contracts with specific milestones for scaling can help align expectations with enterprise partners while still ensuring both parties are satisfied before expanding the relationship.
- Find the right champion. Startup founders discussed the difficulties of navigating enterprise partners’ organizational structure, processes, and politics. It’s critically important to find a champion who has the knowledge and authority to drive the project forward. One startup CEO recounted her experience working with a champion who helped her navigate the enterprise partner organization by laying out a clear plan to secure stakeholder buy-in. At the 2018 Digital Health CEO Summit, founders shared how they supported enterprise champions by providing performance metrics and success stories—empowering the champions to easily share these with leadership, generating goodwill for the champion and startup.
- Partner with enterprises that are willing to invest resources in the initial phase. The startup founders observed that partners with the intention for full deployment were willing to invest financial and staffing resources into the pilot. This is critical for the startup’s sustainability since pilots often require product iterations and heavy consulting support from the startup.
- Don’t say yes to every enterprise customer. Pilots can help startups build a body of evidence for their solution. Early on, it can be beneficial for startups to prioritize outcome measurement rather than rapid scaling. However, once the startup has validation, the timeline to move to enterprise-wide deployment becomes more important. Both founders spoke of times when they should have passed on enterprise clients because the timelines were not aligned to the startup’s stage or maturity.
Bringing technology solutions to scale should be a repeatable process. Rock Health is conducting research this year on building an enterprise playbook for scaling innovation. If you would like to share your challenges and success in these areas, please reach out to firstname.lastname@example.org.