I've read articles on how its a brilliant move, or how its a crazy move. HP had success in the PC field with a particular market strategy. They did not go for building the most expensive machine. The owned the basic market--they built solid computers for a good price. To do so, they had to make a profit on VOLUME--building things in bulk, getting discounts on components and turning razor thin margins into a profit.
They did have some entrance into higher end markets with the Envy line which was always somewhat limited and not the focus of their business. For the most part, they build computers at a good price for everybody and moved volume to stay in business.
They have opted that it is the post-pc world and with the advent of the Ipad they have to get out of the PC market. They want to move into software instead. Part of the crisis is likely that their own tablet, the WebOS based Touchpad was a failure upon launch. The fact that they wanted to build a lower end tablet with the prior principles of their pc business is significant. Can you make a low cost tablet and have it take on the Ipad? Probably not.
Apple does not work on volume. They have a market strategy of vertical integration, with control of the hardware and software. They might have some lower cost options but most people are willing to pay the apple tax /premium. And by doing so, they design some truly innovative and beautiful pieces of technology. But its not cheap. They further make market with control of the software on the ipad/iOS platform and well as media through iTunes.
I was recently struck by the notion of this business model. Most primary care medical practices function on volume. The reasons are multi-factorial but a lot of it is based on poor reimbursement of most primary care services. As such, whether you are private practice, solo practice, or hospital based, you usually have to see a lot of patients a day to make money--or sadly in some times just to break even.
Does that mean that most medical groups aspire to be HP? Making (or not making) things work by volume? By not leveraging technology? Having patients come in for every problem. Not using email. Not using the web to schedule visits. Forcing patients to call the office to talk to a 3rd party, who then has to talk to the doctor/provider to answer the question. Or, my personal favorite, a nurse calling to talk to the medical assistant who is never at their station because they are generally rooming patients, their primary job function. Is that phone call very efficient? Should the MA have a cell phone or perhaps get a text message instead? Or sending a message in the EMR and clogging up the doctor mailbox with even more messages.
Practice management is a tricky field. Apple has shown volume, at least in their success, is not how they do things. Will a group in medicine find a niche that follows the same business philosophy?
In some respects this is already true. We see doctors not taking insurance--having patients pay directly. They see less patients per day. They have easier ways of talking to the doctor. They generally have better access. Many are not happy about this, saying its not ethical to refuse insurance, medicare or medicaid.
Innovation is medicine is often considered a dirty word. And its difficult. But as we have less and less primary care doctors available, the system will need a change or further worsen the critical shortage in providers.
Would you rather see your doctor in a serene Apple store like environment or more like Burger King?
