Chances are, if you are reading this blog, you have heard some flavor of the “build vs. buy” question in the context of data warehousing. For example, here are two conflicting ways that I’ve personally heard this question posed: “Do we need to buy [a data warehouse], or can we build it?” “Are there any vendors we can buy this from, or will we have to build this?” As you can imagine, both approaches resonate differently with different people, cultures, and strategies, and the same basic questions sound very different depending on who is asking it.

1. © 2014 Health Catalyst
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© 2014 Health Catalyst
www.healthcatalyst.comProprietary and Confidential
Build vs. Buy a Healthcare Enterprise Data
Warehouse: Which is Best for You?
By Mike Doyle

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The Build or Buy Question
When considering a Data
Warehouse solution, one of the
first questions posed is:
Should we build it or buy it?
Both approaches resonate
differently with different people.
The CIO may see vendors as
potential partners in success. They
may see their internal resources
unable to deliver.
Where others see their Business
Intelligence operations a core
competency.
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Why Healthcare Data Warehouses
Were Built, Not Bought?
Consider the evolution of the
Electronic Medical Record
(EMR). With few commercial
vendor options early adapters
had to build their own.
Then a handful of companies
driven by the EMR adoption
model from HIMSS gave
vendors and customers a vision
for product development and
acquisition.
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Why Healthcare Data Warehouses
Were Built, Not Bought?
Health systems without the staff,
budget, or experience to build a
centralized EDW themselves were
left with two main options:
• “Data analyst heroism” – where a few
savvy analysts used whatever
reporting or analysis tools available.
Their value was often unrealized
because they spent too much time
extracting instead of analyzing data.
• Implemented best-of-breed analytics
solutions to help address specific,
siloed, reporting and analytic needs
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The Case for Building a Healthcare
Data Warehouse
For some organizations,
the “Build vs. Buy” question
can become a heated,
political battle.
When internal staff are
asked to compare versus
external offerings, it can
become unhealthy for the
entire process.
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Pros of Building Your Own EDW
• The possibility of “Perfect Fit.” Custom
software tailored to the organization
• Potentially lower initial cost
• Pride of Ownership – Viewed by other
systems nationwide as now possessing a
vital knowledge asset, they are justifiably
proud of their accomplishments, vision,
and forethought.
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Cons of Building Your Own EDW
• Staffing to meet project scope
• Shortage of EDW experience
• Learning curve
• IT agility insufficient to meet the
needs of analytics and reporting
• IT teams accustomed to
autonomy may struggle to adapt
to new vocabularies, standards
and cost containment
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The Case for Buying a Healthcare
Data Warehouse
For many organizations without a deep bench of
software developers, the possibility of rapidly
implementing a robust analytic resource is now a reality.
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Pros of Buying an EDW
• Experienced EDW vendor can deliver
quickly – as little as 90 days.
• Top vendors bring real-world experience
• Extensive IT resources
• Validated industry successes
• Lower total cost of ownership
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Cons of Buying an EDW
• Knowledge transfer – handing
off the EDW to the organization
• Always tradeoffs between the
perfect solution and what the
EDW vendor delivers
• Vendor may fail to engage in-
house IT resources when they
will ultimately be responsible for
the future success.
• Knowing what questions to ask
new vendor to minimize risk.
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The 3rd Option: The Case for Buying AND
Building a Healthcare Data Warehouse
To climb the rungs of the Healthcare
Analytics Adoption Model, IT
resources are looking for help from
experienced commercial partners:
1. Mature Healthcare Analytics market with
viable partners have emerged
2. Several commercial options for Healthcare
analytic vendors
3. Organizations with effective IT talent can
partner with an experienced supplier for an
accelerated outcome.
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Pros of Buying AND Building an EDW
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• Rapid implementation time
• A tailored fit
• Lower overall project risk
• Engaging your IT employees early
• Vendor contractually obligated to
deliver agreed statement of work
• Opportunity to innovate with a vendor
that empowers your internal team

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Cons of Buying AND Building an EDW
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• Some of the same “cons” as both
building and buying, but these tend
to cancel each other out
• This approach is best suited to a
data-driven culture that values
analytics as a business differentiator
• Slightly higher total cost of
ownership than the purely “buy”
option, usually offset by higher ROI

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Selecting Your EDW Approach
• Develop strong criteria for
evaluating a clinical analytics
vendor
• Consider internal resources
when evaluating cost impacts
• A hybrid strategy – build and
buy – brings the best of both
worlds. Partnering with world-
class suppliers coupled with
internal engagement will help
minimize long term risk.
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Other Clinical Quality Improvement Resources
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More by Mike Doyle
Data Warehousing in Healthcare: Is It Necessary?
Do I really need a healthcare enterprise data warehouse?
Mike Doyle joined Health Catalyst in May of 2013 as a Vice President. He
has been connected with the Health Catalyst senior leadership team since
2006. Prior to Health Catalyst, Mike led the Enterprise Data Warehouse
(EDW) program at Allina Health as Director of Healthcare Intelligence. He
helped Allina grow its EDW program from a nascent clinical improvement
initiative to an enterprise-wide strategic asset, in heavy demand by
thousands of users across all of Allina’s 11 hospitals and 100+ clinics. Prior to his work
with Allina, Mike was employed on the Northwestern Medicine campus in Chicago,
beginning as a Systems Administrator at the Medical School and eventually leading the
Analytics and Systems Integration team at Northwestern Medical Faculty Foundation. In
addition to his experience building strong technology teams, Mike has experience in
technical roles such as database administrator, web programmer, data architect, and
business intelligence developer. Mike holds a Master of Music degree from Northwestern
University and a Bachelor of Fine Arts degree from Carnegie Mellon University.