Learn from Amazon’s $100 Million Mistake

The COVID-19 pandemic fundamentally changed our approach to business. We believe a radical diversity of experiences must exist to tackle “wicked problems,” particularly in healthcare. To start 2021, we are revising our fundamental writings with this updated context. 

Even before the COVID-19 pandemic, we knew that healthcare was a “wicked problem.” Attempts to bring innovation to healthcare costs uncovered an ill-defined problem space, with confusing inputs from various actors, all leading to judgment-based solutions that often exacerbated the underlying challenge.

Enter Haven, with the backing of JPMorgan, Berkshire Hathaway, and Amazon, sought to improve healthcare delivery at lower costs. Instead, it will end its operations next month.

But What Went Wrong?

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Haven’s three main struggles were:

  • The lack of transparency in healthcare costs and data,
  • Unclear goals and varying interests of the stakeholders, and
  • Unexpected competition.

As design thinkers, we begin with curiosity to tackle wicked problems, identifying the "right problem"  to solve.

Ask the right question

Understand the Question before Solving the “Problem.”

Like trying to tame a lion, we do not approach wicked problems head-on. Rather, we take an empathy-based approach and "observe to understand," which uncovers possible solutions, yet we resist the urge to solve the problem right away.

As design thinkers, we would begin by asking, “why,” healthcare costs are opaque. Haven dove headlong into its mandate to reduce costs. They solved the “problem,” without first understanding the question.

Segment to Address Challenges.

Creating a breakthrough solution to “disrupt” the healthcare industry is an outcome. Everyone involved in Haven wanted the best outcome; yet, the solution starts with describing the problem, which requires understanding the problem and its stakeholders. 

Practicing empathy, we see that beyond the billions of dollars healthcare companies spend on lobbying and legal fights, they invested decades in-service to higher premiums and higher costs. Haven’s lack of empathy for the existing players’ motives contributed to their failure. 

“Listen to be Heard.”

A successful application of design thinking requires listening with empathy, not listening for data points to reinforce our existing opinions. A new venture of Haven’s caliber brings together the brightest minds, large sums of money, and high expectations. The fallacy is the combination of resources means the challenge must be solved internally.

Instead, I assume someone else has tried to tackle this challenge in the past. Before constructing my solution, I open my aperture and embrace academic papers, competitive analysis, and first-person audio/video sources. Where are people talking trying to be heard? Often what I find creates unexpected connections that lead me to deeper insights.

Let’s Talk.

If you lead a team, a division, or an entire organization facing corporate or societal challenges that require a breakthrough solution, we look forward to sharing our thoughts with you.

Sources

  1. Churchman, C. West. (1967, December). Wicked Problems. Management Science.
  2. Sebastian Herrera and Kimberly Chin. “Amazon, Berkshire Hathaway, JPMorgan End Health-Care Venture Haven.” The Wall Street Journal