Reference no: EM13828128

Discuss technology diffusion, S-Curves and innovation decision process. I will use the healthcare industry as an example. Our healthcare system is ever evolving - new technologies, insurance models, and information systems are shaping the system on a daily basis. Despites these changes and the huge healthcare expenditures (16 of GDP in America compared to 8 in United Kingdom), Americans are comparatively not any healthier than citizens in most other developed nations (Merson, Black, & Mills, 2012). The disconnect between investments in technology and health outcomes is a concern of us all. It makes as question technology diffusion within the healthcare system: are investments in health system being spent efficiently? Are consumers really resistant to changes that benefit their health? Or are there issues with technology diffusion as a practice.

Diffusion is the process by which an innovation is spread through a population. Ironically, people and institutions, generally, do not like change. Change is viewed as painful, difficult and times creating uncertainties. Because of this, and for the healthcare industry, huge amounts of resources are devoted either to promoting innovations (for example, selling the latest drug, imaging system, medical device etc.) or to preventing innovations from disrupting the status quo. Although many successful healthcare innovations are aimed at making people healthier, at relatively smaller increases in costs, IT usage in healthcare has always lagged other industries - ERH are a good example. Adoption of ERH was slow. Literature on technology diffusion states that successful implementation is influenced by the compatibility and complexity of the innovation, organizational context, and the characteristics of the implementation strategy (Cain M, & Mittman, 2002; Rogers, 1995). People respond to these factors differently resulting in an S-shaped curve illustration of the adoption process.

The S-curve model shows that any innovation is first adopted by a few people/organizations and as more use it, and confidence is built around the technology, other will begin to use it. Because of the inherent uncertainty to new innovations, the decision to adopt an innovation takes time. However, "once the diffusion reaches a level of critical mass, it proceeds rapidly. Eventually a point is reached where the population is less likely to adopt the innovation, and spread slows down. The S-curve implies a hierarchy of adopters, starting with innovators, early adopters, early majority, late majority and laggards (Rogers, 1995). In other words the S-curve explains the innovation-decision process: the process through which an individual/organization passes through from when they gain knowledge of an innovation, to forming an attitude, to the decision to accept or reject the innovation, to implementation, up to the confirmation of the decision.

Thus it is important for innovators to understand the factors that influence this decision process and design information and adoption messages that reduce the level of uncertainty about the innovation.