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Fuqua Faculty Conversations

Ronnie Chatterji on Rising to the Challenge: Bending the Cost Curve in Health Care And Education

March 12, 2014

Pre-Reading Video

Live Session Recording

Ronnie Chatterji

In our April Fuqua Faculty Conversation as Ronnie Chatterji, Associate Professor of Strategy, presented:

Rising to the Challenge: Bending the Cost Curve in Health Care And Education

The U.S. health care and education sectors face big challenges, including simultaneous pressures to lower costs AND raise outcomes like test scores and mortality rates. But how?

Disruptive innovation is often suggested as the answer. Technology has radically reshaped entire industries and led to increases in productivity. Many big companies, startups, universities, governments and foundations are looking at ways to disrupt education and healthcare in the same manner.

Professor Chatterji proposes that this will be a lot harder than we think. He views education and health care very differently than other industries due to the role of government, the importance of the teacher/health care provider in delivering services, and the ways in which technology can be implemented. Professor Chatterji’s talk will provide an overview of this perspective and identify the models/companies/policies that he thinks can fix our health care and education systems.

View Professor Chatterji’s Bio


  1. Alexandre Beduschi

    Ronnie, I couldn’t watch your class today and am waiting for the class video to be posted, so sorry if I asking the same questions already answered or shown, but I have a couple of comments/question to make based on the pre-reading.
    1. Education: all the suggestions are based on 1 simple concept – web based and computer. I don’t know in the US, but in my country government would probably have to give hundreds of millions of computers to attend that. Although we have the money, government certainly don’t have the drive for it. How can we, the society, empower that and change without help from government?
    2. Healthcare: we spent a lot of money on healthcare, not wisely, of course. Using devices is a great deal, but, still, we couldn’t fix the underpaid salary to doctors. How to implement that if doctors are not well trained anymore and underpaid? How the society can interfere on that?

  2. Dear Prof. Chatterji:
    I watched your pre-course video with interest. I agree with almost everything you have to say except for one point. By the way, this difference I have with you is the same that I have with so many other educators and thought leaders. What is it I differ from you?
    Through out your video you refer to “technology”, but what you really mean is Digital Technology (DT).. This misperception or misrepresentation of DT as the sole and total of everything called Technology is a very common mistake.
    The evolution in DT is a two edged sword. It can help you to foster and develop new solutions unheard of, leading to drones, robots and computers and smart phones and call centers, BPOs, that can do almost anything human being can do with fewer human beings or none at all. It can also lead to cutting costs in every known human activity, displacing 1000s if not millions of people from the middle class to the low wage population. These two disruptions are the largest mostly in developed nations leading to a hollowing out of the middle. This has been an evolving crisis for the past four decades.
    Every solution for education, health care, employment, economic recovery, …. have to take into account the above fundamental disruption, which we call as the Binary Economy.
    How do we cope with this? First we have to admit that “Technology” is lot more DT. Indeed 19th and 20th century successes came from relentless deployment of Technology in its true sense (i.e.) Knowledge and understanding of the Physical Phenomena (Science), their exploitation (engineering) and their judicial abstraction of value (Management).
    Hence Technology = Science X Engineering X Management, Hence Technology is not mere DT in isolation.
    True application of Technology requires a view of the big picture – System Thinking – that simultaneously integrates the Science, Engineering and Management of the almost limitless physical phenomena of nature.
    Try and explain that to any college professor and encourage him to work across the three silos of the School of Science, Engineering and Management — you will have few or no takers. With this fundamental flaw built into the educators thought process – their silo mind set and inability to look at any problem as a system – we perpetuate it at all levels of education. The DT helps to further isolate and develop task oriented students who are ready to take orders rather than think through and solve problems and deliver solutions of value to any one. This siloed education is reflected in our poor educational outcomes and test scores – the statistics you cite very well.
    This ability to constantly look at the big picture – which we call as System Thinking – and the emphasis on delivering a constant stream of new solutions – which we call as Transformational Skills – are the missing pieces in all our education for the 21st century. The same need – ST and TS – and a lack of it, also hurts our health care system, economic policies, investment strategies, national priorities ,politics, ……
    This relentless focus on ST and TS and education for it is a crying need. Leaders like yourself can help in this urgently needed cause. If I can be of any help please let me know. It will be my pleasure to hear from you.

  3. Excellent session! Efficient and effective format for stimulating interest and promoting lifelong learning in the Duke Community!

    Thank you!


  4. Thank you, Ronnie, for addressing my question on public pensions. I agree and have first hand experience in dealing with state policy makers and the competing interest groups, particularly the teachers unions. The answer from one side is “more revenue”, ie, tax increases on the higher income groups and corporations. In Oregon, that marginal rate is already 9.9% on personal income.

    I prefer to focus on appropriate funding of education, but also focus on outcomes — the get better at what we do with what we have. This does not carry much water with the current economic, budget situations states have currently. The pie is not growing fast enough to make up for the real cuts over the last six years. Thus, the political dynamic leads to a very static debate. The left wants more revenue, the right insists on revenue neutrality, at best.

    It is quite the puzzle to deal with our education system and all the competing interests — much more so than per-recession years.

    Again, thank you for your comments!


  5. I love the idea of test and learn with respect to technology in the classrooms. However, I’m curious what the measurement technique and criteria would be in determining effectiveness. How would you control for the potential confounding variables? You mentioned quality and engagement of the teacher as one of these variables – the more engaged the teacher, the more effective the technology.

    Brad Newcomer
    Daytime MBA 2003

  6. If these types of technologies are just being invented and implemented now, what have other countries been doing over the past decades to get better outcomes in healthcare and education?

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