Stanford Hospital, located in Palo Alto, California, uses advanced technologies to improve the experience of both patients and caregivers. Brian Kalis, managing director for digital health and innovation for Accenture PLC’s health business believes the hospital’s technologies “could lead to improvements in labor productivity

. . . that would be beneficial given the rising demand for highly skilled labor.”

a. Explain why increases in output per worker (productivity)

in health care and other service industries are more difficult to achieve than increases in output per worker in manufacturing industries.

b. Why would the use of new technologies, such as those introduced in Stanford’s new hospital, “lead to improvements in labor productivity . . . that would be beneficial given the rising demand for highly skilled labor”?