There's an old Latin expression, Rerum novarum cupidus, that means "People are always greedy for new things." While some take the aphorism to be an expression of the endless need people have for material things, others put a more entrepreneurial twist to the saying.
In his seminal book Innovation and Entrepreneurship, management expert Peter Drucker cites the ability to spot opportunity and pursue it as the core competence of entrepreneurs, be they in small business, the corporate world or working for non-profits. The same applies to physicians working in private practice, a company trying to get an idea to market, a non-profit with a social mission, or the growing ranks of doctors working for hospitals or hospital chains.
Entrepreneurs innovate in the pursuit of opportunity. Physician entrepreneurs use the process of creating user/patient defined value to create drugs, devices, diagnostics, vaccines, digital health products, new care delivery mechanisms and business process improvement systems. Drucker suggests seven sources of opportunity, all the result of change either within an organization or business or in the external environment. The sources are as applicable to today’s turbulent healthcare environment as they are to electronics, retail, the steel industry or the Boy Scouts. The seven sources of opportunity are:
- The unexpected success, failure or outside event.
- The gap between what is and what should be.
- A process or system that is broken and in need of repair.
- Changes in the structure of an industry or market.
- Demographic shifts.
- A change in societal perception, mood or meaning.
- New knowledge or technology.
While most physician entrepreneurs focus on the new -- new technology as the basis for a business or commercialization opportunity -- Drucker argues that the low-hanging fruit is at the beginning of the list, not the end of it. Recognizing “happy accidents” or unexpected success or failure is leadership’s responsibility and part of the skill set of entrepreneurial leaders.
Take the example of a medical device company that developed a non-stick bipolar cautery designed for plastic surgeons. After years of product development, careful market analysis and testing, the company rolled out the product and waited for the orders to come. And wait they did. Sales were flat and revenues were anemic. However, at a medical show, a neurosurgeon asked the CEO why the instruments where not being marketed to neurosurgeons, since they had a particular need for bipolar cautery during brain surgery with minimal disruption caused by cautery cleaning or malfunction.
Recognizing the unexpected failure as an opportunity, the CEO changed course and directed the sales force to the new market. Sure enough, the orders began to roll in, so much so that the company expanded their product line and was eventually sold to big device for several millions of dollars.
U.S. healthcare is undergoing one of the largest reorganizations in its history. Change is everywhere and enormous opportunities exist for physician entrepreneurial leaders who see it for what they are – opportunities, not problems. Maybe Gordon Gecko was right after all.