 Live from Las Vegas, Nevada, it's theCUBE. Covering Knowledge 15, brought to you by ServiceNow. Okay, welcome back everyone. We are here live in Las Vegas for ServiceNow, Knowledge 15, hashtag no15. This is theCUBE, our flagship program. We go out to the events and extract the sounds and noise. We've got two great guests here, practitioners and IT, talking, breaking down all the trends. We have Jay Yella, VP of IT and Matthew Chambers, CIO of Baylor Scott, White Health. Welcome to theCUBE. Thanks. Thanks for having us. One of the things I love about ServiceNow, like a lot of the startups that grew out of the web, web 2.0 generation are now public companies and have to file all their earnings and get all that stuff done. But they actually got to scale their business. So ServiceNow is doing that, Frank Slubin was on earlier. And so they're talking about all the things that need to get done in tech. So I got to ask you guys, kind of check their story with you. Is the transformation underway to digital? Is it in progress? Is this service-oriented architecture and web services? That was 10 years, over 10 years ago, in process? Yeah, I'll take a first shot at what's happening in healthcare specifically. And I think Jay's far more qualified to talk about what we're doing around our service management functions. Healthcare is transforming to a digital architecture unlike any other industry vertical in the world right now. With some of the government mandates and incentives around meaningful use of electronic health records in our plans in the United States to reduce the cost of care from, now it's roughly 19% of the GDP, digitization of health records and a meaningful exchange of health records to provide a more holistic form of care throughout healthcare is the way that we're going to do that. So we've seen a massive influx of technology into healthcare over the past couple of years. And now I think what we're seeing is, okay, we've got all this new technology. We've got these practitioners and these care providers that are using it. How do we serve them when something goes wrong? And so that's Jay's unenviable task of how do you keep roughly 4,000 doctors happy 24-7? Yeah, I think of it as we used to deliver technology. I used to bring somebody a thing, right? And make them happy. Here's your laptop. Here's your desktop. Here's your new whatever. We're really trying to change the paradigm and start thinking of these things as services and delivering services. And it's both a cultural shift from both our employees as IT employees but also our employees, our customers, the employees that we're servicing, whether it's a doctor who's used to just seeing the IT guy that delivers something to understanding that we're not here just to deliver a thing. We're here to make sure that his service is provided uninterrupted. So I got to ask the question, because that's healthcare. Is the technology an aspirin or a vitamin or a vaccine? And how would you, and which technologies would you, because I think it needs a lot, right? It depends on who you ask. Someone called a plague, you know? So healthcare has been largely unchanged in the way that we deliver it. Now, there's been huge advances in terms of technology adopted for patient care, direct patient care, you know? Implants and vaccines and things of that nature. But the process of documenting your care, I'm sure, you know, we're probably roughly the same age. When you went into a doctor's office up until the past couple of years ago, they had racks and stacks and racks of paper files. One of the last businesses, and so people don't really love change as much as we'd like for them to sometime. So let's take a step back. So healthcare was in need of some disruption and it still does, and you guys are looking at this. Some of us think so. Some of us think so. Yeah, it's right for it. You're a HIPAA. Right. Some say it was protecting privacy, but yet not letting data be used in a way. And so I asked the question to aspirin, what is the pain, and where's the opportunity to apply technology in healthcare? What do you guys see? What's your view on that for a minute? Using information and being a CIO, how do you look at that? Do you look at it that way, or is it more of, okay, critical path here, investment areas here? We've absolutely changed the way that we look at the adoption of technology in healthcare, excuse me. The role of the CIO in healthcare delivery has become far more strategic over the past couple of years because what you're seeing, the main cost increases that we've seen is duplication of care, not efficient care, not effective care. And the way that we're combating that now is a more holistic, full scale, full cycle method of care. So let's say, heaven forbid, you were in a traumatic accident here in Las Vegas, you'd be admitted into an ED. Once you were stabilized, you might be admitted into a med surge here at a hospital here. Once you go back to your hometown, you might go see your primary care doctor, you're a physical therapist for months on end. In the past, there was no way to get that data back and forth. Now, what we're trying to do is make that far more holistic. So from the time you were admitted into the ED to the time you're stabilized, to the time you go back and see your primary care doctor, they know what meds you're on, which is very, very important for patient safety. They know what tests you've run. Allergies, that sort of thing. The other thing that we're seeing too is that as a Gen Xer, I'm going to drive five more miles to a more advanced clinic than clinic A that I just passed up. He's not really a Gen Xer, he's a baby boomer. He's just trying to pass this up on. Because the further away clinic, I can get my labs two days after I take my test on my iPad versus the first clinic that's still maybe on paper. But it's the consumerization of healthcare, where as a patient, I care about those things more than I used to. Yeah, and we were talking before you came on, you had a pebble on the top of the eye watch. Wearables will certainly play a factor into healthcare that day. The data on these things is going to be huge. It's going to be immensely valuable. The internet of things is people too, people of things. Right. I read a book, Thing One, Thing Two to My Kids Years ago. So we know it's out there. But so I got to ask them about service management. What's unique about healthcare? What specifically is the innovations on the service management side? Because when they almost think about the emergency room, all these notifications going off, there's so many alarms and what's more important. I mean, obviously they know, hey, flatline, he's dying. So when something breaks in healthcare, it's always a P1. It's always a priority one. That's probably the single biggest challenge that we face. The second thing I'll say that we face a lot of is that our customers are very highly educated, very highly compensated. And what they want, regardless of standards and standardization and some of the other trends we see in healthcare, they think they're immune to it. So we often times, we struggle with that, right? Because we- Here's an iPad, make it work. Yeah, right. Or, yeah. Exactly. I want my MacBook to work in a Microsoft shop or whatever, right? So we struggle with how to make them happy, but also to try to stay on the right side of safety and compliance and everything else. How about outside of IT? What is this stuff? Because you mentioned the business side of it. You're getting more involved in the strategic piece. That's really outside IT. That's more of kind of business outcomes in this case, healthcare outcomes. Well, for instance, here at this conference, we've brought several people from outside of IT to come explore the possibilities of using the cloud outside of traditional, where you would think you'd use the cloud, whether it's HR, it's a supply chain or other hospitality type things. They're all functions that, at the end of the day, those functions aren't unique to IT. They're still delivering a service. That's the thing, service management is not that different if it's IT or payroll or accounting or what have you, and healthcare is probably one of the last industries that didn't go through that whole disruption of shared services and globalization over the past couple of years. There's reason some things will never be globalized in our lifetimes perhaps. But Jay's right, it's not that dissimilar to here's our HR help desk, here's our IT service desk, here's our payroll service desk, and what economies of scale can we drive now that you're seeing consolidation in healthcare? So everything as a service really speaks to that microservices trend, I mean Silicon Valley, it's all they talk about is microservices gets down to the granularity of the app level, not necessarily the silo or the monolithic original purpose. You guys seen that same thing, and what examples could you give around those innovations? Well, I'll tell you that I think one of the aspirations that I know that I have for Baylor, Scott, and White Health would be eventually to get to the point where our service delivery is agnostic to the type of service we're trying to deliver. So if you need your light bulb changed, or if you need a new laptop, or whatever you need, we ought to be able to handle that centrally, and take advantage of some of those economies of scale that Matt was just talking about. I don't know if that's certainly not probably not a 12 month journey, I don't know if it's a five year journey, but that's the aspiration. So anything that we can chip away at along the journey, that's what I'm after right now. The vision that we were talking about this last night at dinner is our executives and our board ask us, what's going to be the Uber of healthcare? Uber's been such a huge disruption. Everybody gets that as a disruptive business. And the technology is a small piece of it, right? It's the business model. And so they say, well, what's going to be the Uber of business or the Uber of healthcare? We're defining that right now for kind of the digital consumer experience, but also internally our employees, the one button of I need something. Like Jay said, the trash can needs emptying, the server needs rebooting, my paycheck is gone, whatever it is. And we want to make that so much easier because what's critical to understand is those folks that call us, sometimes it is a life or death situation. They need to get back to work. Yeah, and again, the internet of things he's mentioned, Lightbulb, it's not about the services have to apply. So service management isn't just an IT function per se. I mean, a lightbulb to do surgery is pretty important if you need to redo that. But I got to ask the question about investment versus operating expense. You look at healthcare and education, some will say the most archaic verticals, needing the most help right now and the opportunity when government to a throw in their government education, so what happened to government? They're actually moving really, really fast. So what's happening is interesting is the slowest to move or actually have the biggest lever with the new technology versus say the pure enterprise. So with that being said, what percentage of new investments coming? It used to be like, oh, operating budget was pretty much what was going on. Can you comment on that dynamic of percentage of operating budget versus new investment? Yeah, we're trying to leverage that late mover advantage as you talked about, right? I mean, if you look at electricity around the globe, United States had a first, we're 110, everywhere else you go 220. Sometimes there's a late mover advantage and you're right. We're finding that now with an operating model, a hosted model, a cloud model, we find much more predictability, obviously in our cost versus a capital refresh. What we've also found that we really enjoy is there's several things that we move to the cloud and I'm going to do a product endorsement here, but some of the things that we see is when a vendor has a new technology or new functionality for us to get that, it's our time, our labor, our capital investment to get the latest release, to get a new hardware. With a hosted cloud model, as long as we're ready to go, we can train the team and do the testing to minimize the impact, we get it. And that's a huge, huge satisfier. And it's an opportunity to create that. So I want to ask you guys to kind of, buzz word bingo kind of round here, lightning round. Hold on, let me get my score down. We used to have a different term for that, I think. You can do a shot every time we buzz word. So I want you to comment on the following phrases. API economy, fully asynchronous, always connected. What does that mean to your business and how you go out? Because really those are the mega trends that everyone's kind of a buzz word talking about. API economy, meaning services. What is your take on those three areas? I'll take a shot. And how would you explain that to the person who's actually a normal out there? Yeah, so I'll take a shot at it and then I'll let Jay correct me. But what I'd say is, the whole asynchronous service management function, we've seen that for years. As we talked about earlier, as I mentioned earlier, if you've got a healthcare provider that has an issue, they're not going to sit and wait for you to resolve an issue. I've spoken to doctors about this, if this PC is down and I need to order medication for this patient, I'm going to go find another PC that's up. So most of our service management is asynchronous. So we've got to get used to that as kind of a steady state. We want to resolve things real time, but there's a percentage of those things that we never will. So those are asynchronous. You can't cash an answer that's needed in healthcare now. I mean, that's basically what it comes down to. The old ways to be copious. Sometimes you can, but we don't always do a good job of capturing the knowledge and making it available. But I'll add one more thing to what Matt was saying, is that specific to our industry, a lot of what we're being forced and asked to support is outside of our environment, our normal environment, charting from home. How do I make dictation work from home? That's, you know, from an asian because of support or an asian because of support. Is it through the public cloud? Yeah, I'm like, what the hell? I mean, I get to imagine that. When somebody solves that one, let us know, right? So what about things like flash storage, all flash arrays from EMC? These companies are rolling out faster, faster. We hear trends like unlimited compute is in our future. The challenge is, you know, have me explain to my CFO that this thing that we implemented two years ago is now, you know, it's out of date. It's not fully depreciated. I'm not going to unplug all the spin and disc that I've got my data center just because there's something that's sexy or better, faster, you know. So I think over time, what we are doing is we are adopting, obviously, flashes as we can. We think it's a better option. There's trade-offs too. I mean, the media, if it's a lot of volume, a lot of transaction, you can wear and tear. Right. You know, so that- But for our growth, our spikes, we have spikes in healthcare, you know. We don't see the computing spikes like you do in retail industry around the holiday season, right? But what we do see is when we've got development projects, we don't want to build out that development capability. So we're staying in the stuff to the cloud now. We're looking at one of the big trends that you hear in healthcare now is called a V&A or a vendor neutral archive. If you think about the stuff that consumes the most disc space, it's all these images. So you go in for an X-ray, you go back six weeks, you get another X-ray, now we get 3D imaging. This thing just burns disc in an incredible rate. So now we're looking at the cloud for a more commoditized, you know, vendor agnostic way to store that. So it's something that we're adopting pretty rapidly. You mentioned strategic before. I want to come back to that. I want to ask you about, again, the role of the CIO, one of the topics of our talk here within an organization. How does an organization, if they had to do a self-assessment, be self-aware, how do I know whether I'm strategic or not on the business side of it? Because, you know, Dave Vellante, who's not here, we always talk about this. You're either spending money or investing money. So just because you're spending doesn't mean you're investing. So that's the kind of the balance. So how do I look at myself in the mirror and decide if I'm good or not? Or I'm doing the right things or going down the right road. So, you know, my point of view is, if you're not bringing thought leadership to your team, if you don't have a seat at the table, which I know is one of the most overused cliches for CIOs, but I found it to be true. I'm fortunate in my organization is that I do sit at the leadership table, you know, our CEO, COO, CFO. And the thing that's more important is not just, you know, being able to be there for the conversation, but it's really influencing the conversation because now what we've got is, like we talked about, you know, the root for healthcare, the patient-digital experience, people want it to be just as easy to go see their physician as it is to get a taxi or to get a restaurant reservation. And who's the strategist who's driving that? Right now it's the CIO. And so that's an incredibly exciting time to talk about, here's how we want to drive our consumer engagement channel. So I don't know if you can add anything. The only thing I'm going to add is, you know, when you talk about am I good or am I bad, depending on whether I'm investing or spending, is, you know, you've got to layer on the fact that we're in an environment of declining reimbursements. You know, so it's all about doing more with less. So advice for CIOs out there, what would you say to them in terms of going forward, doing the transformation? What's some of the things that you can see? You know, the first thing I'd say is you've got to cover your table stakes. Since, you know, since we're in Vegas, I'll use that term. You can't have a seat at the table and talk about strategic transformation if your systems are not, if you're not managing issues, if you don't do a good job of covering your table stakes. So you have to be very transparent about that as well. You know, I've got a five column IS scorecard that I showed my boss, my CEO, and he says we want to be one of the top three healthcare systems of the United States. And I say, well, I want to be the best IT shop in the United States, bar none. And if I'm all green on these five areas, that's when I can look in the eye and say I'm the best. We're not yet. But so I think it's a balance of doing those things that you got to do. So spending money, right? Keeping the lights on. And then coming to them with thought leadership. And you do really need to engage building relationships. And a lot of this stuff is the cliches you've heard time and time again. But the CIOs do need to have the relationship to be able to go to, you know, the leader in marketing and the leader in finance and say, hey, this is some technology. Would you see some benefit in this? There's build out involved. I mean, it's like construction project. So you got to kind of take a holistic approach and saying, hey, you know, we're going to essentially transform our business. So you got to think of it like a long term, you know, going to put the foundation in some foundational table stakes. So that's what you say. I mean, it's not like a, you know, department over there doing this thing. You've got to do the easy things. The easy things well, right? Before you can gain credibility and say that you want to go spend, you know, a hundred million dollars on a major capital project. But yet, you know, the stuff that you've got in the data center right now is running, you've got to get in. Otherwise, no one's going to listen to you. All right, guys, really appreciate Jay and Matthew from the trenches. They're in their practice. They're the ones implementing the technology, making it happen in a great disruption environment where the innovation is needed and it's happening, healthcare. This is theCUBE bringing you all the significant noise here in Las Vegas. We'll be right back with our next guest after this short break.