Quote Of The Year

Quote Of The Year - Paul Shetler - "Its not Your Health Record it's a Government Record Of Your Health Information"

Tuesday, August 29, 2006

iSoft – A Problem for More than the NHS!

In November 2005, I had the opportunity to review, in some considerable detail, the Hospital Information System which was being offered to an international client as a solution to provide advanced computer services for a three hundred bed tertiary private hospital.

It was clear at that time that the iSoft Lorenzo software suite was little more than ‘foilware’. The system was a concocted blend of old and new components, was obviously un-integrated and lacked any common utility in its user interface.

Needless to say I recommended that no further engagement be had with iSoft and that alternative providers of the necessary HIS software be considered.

The following headlines from the London Financial Times over the last week say it all!

Isoft receives bid approaches
Isoft, the beleaguered software supplier to the £6.2bn National Health Service IT project in the UK, has received several informal approaches from both private equity firms and trade rivals.

Isoft refinances after posting £343.8m loss
Isoft, the troubled healthcare software company being investigated by the FSA for issuing potentially misleading statements, has reported a full year pre-tax loss of £343.8m.

Isoft duo present a catalogue of horrors
For the two men charged with delivering one of the most eagerly awaited earnings statements of the year, Isoft's John Weston and Gavin James appeared remarkably fresh...

Questions linger over plan to build electronic patient record
Ministers and officials yesterday breathed a collective sigh of relief that iSoft, one of the principal suppliers to the National Health Service's £12bn computer..

There is one crucial lesson to be learnt from this. That is that buying software futures is a fool’s game, especially with complex systems like a HIS. If you can’t see, touch and feel the software operating live in at least 2-3 reference sites, exactly as you need it to operate, then to make any purchase is folly!

In the Australian today Karen Dearne makes the point there are potential Australian implications.

Health group's fall may hit here
Karen Dearne
August 29, 2006

TROUBLED health software developer iSoft's shock loss of almost £400 million last year has destabilised Britain's £10 billion ($24.9 billion) Connecting for Health IT program and may hit local projects, including Victoria's $323 million HealthSmart.

While iSoft clutched a straw offered by its British bankers, the company faces investigations by financial regulators, problems with current implementations and questions over the long-promised Lorenzo web-based product.

The debacle has grabbed front-page attention in Britain, with reports that iSoft's three founders have become millionaires while the company's market value has plummeted from more than £1 billion at its peak to just £97 million.

Reports say the late Roger Dickens (iSoft chairman until late 2003), sold shares worth about £10 million; former chief executive Patrick Cryne received about £40 million; and Stephen Graham, currently suspended, about £30 million.

Former chief executive Tim Whiston resigned in June, reportedly with a golden handshake. The release of iSoft's results ended months of speculation over alleged accounting irregularities that saw its share price fall 90 per cent to just 40p last week.”

It looks to me that iSoft’s failure is inevitable, given the comments made a week or so ago in the audit of their progress in delivery of Lorenzo that they “lacked a credible plan” for its delivery any time in the next few years.

Additionally, there is no point holding obsolete software in escrow. All that does is provide a false sense of security that something can be done when iSoft fails. All that can be done with the escrowed software is maybe fix the occasional critical ‘bug’ while buying time to identify new software to replace the now doomed iSoft system.

Those in NSW and Victoria who have purchased iSoft software on the basis of future promises have clearly let their respective health systems down very badly and should consider their ongoing roles in their present positions. This is a huge mess both here and in the UK. Those in both the UK and Australia affected by this have my sympathy, but they should have known better.


1 comment:

peter said...

I appreciate your clear sighted analysis of the problem. iSoft is a scandal, one of many, not only in IT for Health but IT for anything. You were, of course, correct not to recomend a purchase of a 'product' that was so obviously not a product. There are ways of assessing whether a software contractor is likely to be able to deliver without reference sites, but of course, it is always more risky. There is a chronic lack of engagement by the 'business' in all things IT. It's like when people laugh at the fact that they are terrible at maths. It isn't very funny, if your job involves IT you should know something about it. It isn't as hard as people think, but it does take a concentrated engineering approach.

The money that has been wasted on this debacle is a disgrace but it is by no means unique. I would draw your attention to the Child Suppor Agency (in the UK) who are having yet another go at building a system that could be put in place easily with a small, dedicated and TALENTED team. It's so often the same old tired suspects, the EDS, the Fujitsu's etc. whose names crop up again and again. A merry go around of failure, incompetence and greed, that government rewards.