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What would you add to the job description for the next Cerner CEO? They may not be asking, but let's go ahead and give them anyway.

FTA

Cerner Corporation on Wednesday announced that it will begin the process of looking for a new chief executive officer, more than three years since current CEO Brent Shafer succeeded the health IT giant's late founder Neal Patterson.

As for Cerner's ongoing electronic health record projects with the U.S. Departments of Defense and Veterans Affairs, Schafer said he was optimistic about both.

The DoD is moving "full speed ahead" on its MHS GENESIS deployments, he noted.

As for the VA – which recently launched a strategic review of its EHR modernization program – Shafer said VA Secretary Denis McDonough has made clear he is "committed to Cerner and this program. We believe this review is analogous to the steps taken by the DoD during their initial go-live.

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I believe that Cerner needs to change its culture and focus on the core business. Sure, there will be growth in new areas, but the core has to be strong to enable that growth. What are your thoughts?

Transcript

This transcription is provided by artificial intelligence. We believe in technology but understand that even the most intelligent robots can sometimes get speech recognition wrong.

  Today in Health it, this story is Cerner is looking for a new CEO and I wanted to offer a little help in writing the job description. My name is Bill Russell. I'm a former CIO for a 16 hospital system and creator of this week in Health IT a channel dedicated to keeping Health IT staff current and Engage.

No sponsor for today. If you're interested, send me a note at partner at this week in health it.com. I wanted to take a second and let you know about our summer schedule, which kicks off on June 1st. This channel will stay the same, except I may take a week off here and there for some family time. I'll let you know when that is coming up this week in Health It.

The other show we do will drop down to two episodes a week, Newsday on Monday, and influence on Friday. I'm hoping to give my staff a break over the summer and give you a chance to catch up on some of the episodes you may have missed. All right. To today's story, this, well, you can find this story anywhere.

I, I picked it up from healthcare IT news. Cerner to search for new CEO as it announced its Q1 earnings report. Brent Schaeffer and company's board also said they've reached a joint decision to start looking for a new chief Executive Officer Cerner Corporation on Wednesday announced that it will begin the process of looking for a new CEO.

More than three years since current CEO Brent Schaeffer succeeded the health it giant's late founder Neil Patterson. Lemme give you some of the quotes here. Cerner is on the right trajectory with increased financial guidance based on actions. We are taking to improve performance at Schaeffer in a press statement.

With the support of the entire organization, we have simplified the business while implementing a new operating model. To make Cerner more efficient and effective, we have strengthened our senior leadership team, including recent edition of Mark er Keg, E-R-C-E-G as our CFO. And I believe we now have the right team assemble to drive our company forward.

Schaeffer will remain with Cerner until his successor is hired and then will serve as a strategic advisor with the company. As for Cerner's ongoing electronic health record projects with the US Department of Defense and Veterans Affairs, Schaeffer said he was optimistic about both. The DOD is moving full speed ahead on its Genesis deployments.

He noted at the end of February, they went live at the Naval Medical Center in San Diego, which is . The largest and most complex go live. To date, DOD officials said this was their smoothest go live. Since the program began in late April, DOD went live with Wave Carson across 12 states, two time zones, and more than doubled the number of DOD commands now live as with the va, which recently launched a strategic review of its EHR modernization program.

Schaeffer said the VA's secretary, Dennis McDonough, has made clear that he is committed to Cerner and this program. We believe this review is analogous to the steps taken by the DOD during their initial go live during this review, we expect the impact on our results will be largely mitigated since the work on the ground continues.

As you would expect, Cerner was founded in 1979 by Patterson, along with a couple other people. And he was their CEO for 40 years until his death of cancer in 2017. And then they selected Schaeffer and Schaeffer had committed to spending three to five years at Cerner when he was chosen by the board as the second CEO, which has to be one of the toughest acts in business, quite frankly, following the founding CEO.

Since then, he's helped to reshape the company. He hired a new CFO, hired a new CTO and so forth. That's about all from the, from the story. Let me give you my so what on this? It is nearly impossible task to follow the founder of a company. So this is not a huge surprise, but let's step back for a moment and consider what Cerner should look for in its next CEO.

Clearly, two of the things that Schaeffer focused in on were operational excellence within the organization. So he's driving a, a better profit margin and those kind of things because he probably streamlines some . Aspects of the internal Cerner operations. I, I'm not privy to any information here. It's just common sense that that's what he is talking about in the analyst conversation, and that's what he did over those three years.

He also focused on an improved technology stack. We've talked about this in the past. He brought in A CTO. They have made a rapid adoption of AWS and are heading in that direction. Which again, are bold moves, smart moves, uh, better technology, technology transformation, operational excellence. You would expect that in A CEO.

That's gonna be on everybody's list for the next CEO. But let me talk about a couple of other things. One is, uh, culture. There is a difference between Epic and Cerner. When people talk about Epic, they talk about Judy. Epic is personified in Judy. Judy is epic. It is a person. It is to be defended. It is to be cared for.

It is to be loved. Cerner is a corporation. It acts like a corporation. It sounds like a corporation. There is no warmth that is given to Cerner. They do the same things. They do the same exact activities, and Cerner gets blasted and Epic gets defended. Why is that? Well, Judy has cultivated that, and Judy deserves that, by the way, because I've talked to many CIOs who have gone through implementations with Epic, and they would tell me stories of receiving emails from Judy, Judy being on the calls, going through the implementation, Judy making things happen on their behalf.

I've talked to many, many CIOs who will go to bad for Judy. Really appreciate what she did in bringing all the resources that Epic has to bear on their implementation. Cerner doesn't have that same reputation. They really do have a corporate personification as they go to market. Uh, I remember the day one of my EHR vendors brought out their new CEO and I.

I knew the moment I met him that he was a suit, a handpicked suit, a person who knows how to work the system. I, I really wasn't impressed. He barely understood my business as a healthcare delivery organization and that really didn't seem to matter. It was a nice lunch. He was a nice person. There was no personal connection.

And at the end of the day, he was brought in to do a task for that organization and he was gonna make them more efficient, more profitable. This is one of the challenges with the public company, to be honest with you, is that there is a certain set of guidelines that has to be followed, but with that being said, Cerner can't afford this.

Cerner has to find somebody that's personable. Cerner has to find somebody that can go out and talk to their clients, that can connect with their clients on a personal level and do it on an ongoing basis. There has to be a connection. They have to know the CEO by name. The CEO has to understand. Uh, amongst their largest clients, what is going on in those clients and how to bring the resources of Cerner to bear on those client challenges.

So I would say there's, there's a culture challenge. There's a person you're looking for needs to personify a culture and needs to develop a customer centric culture within Cerner. The next thing I would talk about is the growth mindset. It's interesting, I, we hear all these things outta Cerner of growth in pharma and life sciences, insurance and, and you know, perhaps that all makes sense and, and Sure, go ahead, grow, get into, uh, other segments of the business, but have a strong plan for growth in the core, first and foremost.

Always strengthen the core, grow healthcare delivery, grow the healthcare delivery, market share. How do you do that? One is you. You deliver the tools that your clients are looking for. In order to do that, you have to have a very strong relationship with those clients. Be gathering feedback. You're almost co-developing the next generation of tools, better modules, better tools, better interactions with the new technologies that are coming to bear in the market.

The second thing I would say is solve your client problems. Know your client's problems. Emerging competitors are everywhere. How are they going to fend them off? Tech debt is a huge and growing issue within healthcare, antiquated delivery models. You know, we still do sick care and we need to do well care, and healthcare systems are trying to figure out how to make that transition.

Does your tool enable that or does your tool rely on them staying rooted in the old models? If it does require them to stay rooted in the old models, then you are going to be relegated to the old model delivery organization. I would say it's great that you are doing really cool things around technology that you're adopting AWS, that you're giving people access to AI tools and, and more data capabilities and those kind of things, even better disaster recovery and and whatnot.

And that is a good foundation to have and continue to grow that. But start to think about the application of those tools. Problems that your clients are having. So my addition to the conversation around who the next CEO of Cerner should be. Clearly operational excellence and better technology and technology transformation are gonna be on the top of the list.

But I would say culture, culture, culture, culture. A person that is personable and can interact and start mixing it up with your clients and create a culture that takes that to the next level where everybody in the organization is engaging the clients, looking for new ways to make the client successful, and then from a growth mindset, sure, continue what you're doing in pharma, life, sciences, insurance, other categories.

And that, that probably makes sense, but focus on the core, grow the healthcare delivery market share. If I were interviewing the next CEO of Cerner, I would be looking for, do they understand the healthcare delivery business? What are their plans for helping healthcare organizations, specifically healthcare delivery organizations to make that move out of sick care into WellCare and get out of the tech debt, address the emerging competition.

To do those kinds of things that help them to be successful as a emerging new way of delivering care to the communities that we live in. That's all for today. If you know of someone that might benefit from our channel, please forward them a note. They can subscribe on our website this week, health.com, or wherever you listen to podcasts.

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