Innovation has become synonymous with survival in the current healthcare environment. Hospitals, however, tend to be conservative, hierarchical, conforming and risk-averse. And they don’t reward innovative physicians.

To innovate, there’s always a risk. For physicians or healthcare professionals to assume the necessary risks of innovation, they must have some confidence that their hospital will reward success and tolerate failure. I don’t see that very often in our healthcare ecosystem. A climate of trust is so much better than a climate of punishment. The carrot is so much better than the stick.

Innovation, for hospitals, means economic survival. Market pressure from the administration, patients and the rest of the healthcare value chain induces hospitals to (a) try to be perceived as better than their competitors and (b) to reduce health-care costs through efficiencies. Today’s best hospitals are the ones that have been very active at innovation, and this trend will continue in the future, as innovation will be the most important differentiator among hospitals. Excellence will no longer be enough.

So, yes, innovation provides competitive advantage, and failure to innovate will be very dangerous in the XXIst century. What’s the first step? What’s the single most important thing to foster innovation at a hospital? Develop a climate of trust.