Based on Chapter 10, are there drawbacks inherent in Lean Six Sigma? Explain.
Based on Chapter 16, describe methods to reduce employees’ resistance to change during an operations improvement project.
Chapter 16
Holding the Gains
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Holding the Gains
• Types of projects to select
• Backlogs
• Revenue less than expense
• Poor outcomes
• Engage support departments
• Tools
• HR planning
• Managerial accounting
• Feedback and control
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Human Resources Planning
Project
identified
Decrease
staffing?
No
Plan for
maintaining staff
Yes
Vacant
position?
Yes
Eliminate vacant
position
No
FTEs
needed
in other
department?
No
Retrain and pool
or redeploy
Yes
Lay off
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Holding the Gains
Managerial Accounting
• Understand the source of revenue
• Per member per month (PMPM)
• Diagnosis-related group (DRG) (case mix adjusted)
• Unit of service—relative value unit (RVU)
• Retail
• Determine costs
• Fixed
• Variable
• Overhead—allocation methodology
• Conduct cost-volume-profit analysis (CVP)
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CVP—Examples
Backlogged
Financial Loss
Base
PI Project
Base
PI Project
Test volume
1,000
1,500
1,000
1,050
Revenue/test
150
150
150
150
Total revenue
150,000
225,000
150,000
157,500
38
38
38
38
Fixed costs
85,000
85,000
120,000
80,000
Overhead
20,000
20,000
20,000
20,000
143,000
162,000
178,000
139,900
7,000
63,000
(28,000)
17,600
Costs
Variable cost/unit
Total cost
Profit
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Holding the Gains—Control
Birthing Center Patient Satisfaction
90
80
Facilities
Clinical Quality
70
High Touch
60
Ju
ne
M
ay
Ap
ril
Au
gu
Se
st
pt
em
be
r
Oc
to
b
No er
ve
m
b
De er
ce
m
be
r
Ja
nu
ar
y
Fe
br
ua
ry
M
ar
ch
50
Ju
ly
Percentage Satisfied or Be tter
100
Run Chart for Birthing
Center Patient Satisfaction
Month
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Tools to Use – General Algorithm
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Levels of Operational Excellence
• Level 1
• There are no organized operations monitoring or improvement
efforts at this level.
• Quality efforts are aimed at compliance and the submission of
data to regulatory agencies.
• Level 2
• Organization has begun to use operations data for decision
making.
• There are pockets of process improvement activities in which
process mapping and PDCA or rapid prototyping is used.
• Evidence-based medicine (EBM) guidelines are used in some
clinical activities.
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Levels of Operational Excellence
• Level 3
•
•
•
Senior management has identified operations improvement efforts as a priority.
Organization conducts operations improvement experiments, uses a disciplined
project management methodology, and maintains a comprehensive balanced
scorecard.
Some P4P bonuses are received, and the organization obtains above-average
scores on publicly reported quality measures.
• Level 4
•
•
•
Organization engages in multiple process improvement efforts, using a
combination of project management, Six Sigma, Lean, and simulation tools.
A significant number of employees have been trained in the advanced use of
these tools, and these individuals lead process improvement projects.
EBM guidelines are used comprehensively, and all P4P bonuses are achieved.
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Levels of Operational Excellence
• Level 5
•
•
•
•
•
•
Operational excellence is the primary strategic objective of the
organization.
Operations improvement efforts are underway in all departments,
led by departmental staff who have been trained in advanced tools.
The organization uses real-time simulation to control patient flow
and operations.
Modern digital health applications are used extensively.
The organization develops and publishes new EBM guidelines and
best practices for administrative operations.
The organization scores in the top 5 percent of any national ranking
of quality and operational excellence.
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The Future
Ambulatory,
home &
telehealth
model
Demand
prediction
system:
Volume—clinical
conditions
Predicted
resource needs:
• Facilities
• Staff
• Supplies
Emergency and
inpatient care
model
Staff scheduling
system
Supply chain
system
Real-time control
Real-time data
Optimized clinical
operations
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End of Chapter 16
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Chapter 10
Lean Healthcare
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The Lean Enterprise
• Definition of Lean
• Types of waste
• Kaizen
• Value stream mapping
• Tools
• Takt time, throughput time, five Ss, spaghetti diagrams, kaizen
events, standardized work, jidoka, andon, kanban, SMED, flow
and pull, heijunka, advanced access
• Lean Sigma
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What Is Lean?
Goal
Customer Focus
• Takt, Heijunka
• Involvement, lean design, A3 thinking
Lean
• Flow
• Heijunka
• Takt time
• Pull system
• Kanban
• Visual order (5S)
• Robust Process
• Involvement
Jidoka
Involvement:
• Standardized work
• 5S
• TPM
• Kaizen circles
• Suggestions
• Safety activities
Standardized work
Kanban, A3 thinking
Standardization
Standardized work, 5S,
jidoka
Stability
• Poka-yoke
• Visual order (5S)
• Problem solving
• Abnormality
control
• Separate human
and machine work
• Involvement
Visual order (5S)
TPM, heijunka, kanban
Dennis, Pascal, “Lean Production Simplified”,
2nd ed., 2007, Productivity Press, New York
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Types of Waste (Muda)
• Defects
• Overproduction
• Waiting
• Nonutilized talent
• Transportation
• Inventory
• Motion
• Extra processing
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Lean Dashboard
• Overall Equipment Effectiveness
• OEE = Quality × Performance × Availability
• Takt Time and Cycle Time
• Takt Time = (Available worktime/day)/(Customer demand/day)
• Throughput time
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The Lean Toolkit
• Value stream mapping
• Takt time
• Throughput time
• Five Ss
• Spaghetti diagram
• Jidoka
• Andon
• Standardized work
• Kanban
• Single-minute exchange
of die (SMED)
• Flow
• Pull
• Heijunka
• Kaizen blitz or event
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Value Stream Mapping
• Shows process flow from a systems perspective
• Includes information, material, and patient flows
• Value-added steps
• “Does the patient care about the activity?”
• “Does the activity transform the end product in some way?”
• “Is the activity done right the first time?”
• Non-value-added steps
• Necessary
• Unnecessary
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Value Stream Mapping
Diagram created with eVSM
software from GumshoeKI, Inc.,
a Microsoft Visio add-on.
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Takt Time
• The speed with which customers must be served to
satisfy demand for the service.
Takt time =
Available work time /day
Customer demand/day
• Cycle time is the time to accomplish a task in the
system.
• System cycle time is equal to the longest task cycle time
in the system—the rate at which customers or products
exit the system, or “drip time.”
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Throughput Time
• Time for an item to complete the entire process, which
includes:
• Waiting time
• Transport time
• Actual processing time
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Riverview Clinic
Cycle, Throughput, and Takt Time
Patient check-in
3 minutes
Move to examining room
2 minutes
Wait 15
minutes
Nurse does
preliminary exam
5 minutes
Physician exam
and consultation
20 minutes
Wait 15
minutes
Visit complete
Wait 10
minutes
Diagram created with eVSM software from
GumshoeKI, Inc., a Microsoft Visio add-on.
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Riverview Clinic
Cycle, Throughput, and Takt Time
• Patient check-in cycle time = 3 minutes
• System cycle time = cycle time for longest task = physician exam and
consultation = 20 minutes
• Throughput time = 3 + 15 + 2 + 15 + 5 + 10 + 20 = 70 minutes
Takt time = 8 physicians 5 hours/day
100 patients/day
= 0.4 physician hours/patient
= 24 physician minutes/patient.
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Riverview Clinic
Value-Added Time
• Valued-added tasks:
• Nurse preliminary exam
• Physician exam and consultation
• Non-value-added steps, necessary:
• Patient check-in
• Value-added time = 5 minutes (nurse preliminary exam) + 20 minutes (physician
exam and consultation) = 25 minutes
• Percentage value-added time = 25 minutes/70 minutes = 36 percent
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Five Ss
• Seiri (sort)—Separate necessary from unnecessary
items, including tools, parts, materials, and paperwork,
and remove the unnecessary items.
• Seiton (set in order)—Arrange the necessary items
neatly, providing visual cues to where items should be
placed.
• Seiso (shine)—Clean the work area.
• Seiketsu (standardize)—Standardize the first three Ss so
that cleanliness is maintained.
• Shitsuke (sustain)—Ensure that the first four Ss continue
to be performed on a regular basis.
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Spaghetti Diagram
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Standardized Work
• Written documentation of the way in which each step
in a process should be performed
• Not a rigid system of compliance, but a means of
communicating and codifying current best practices
• Care paths
• An optimal sequencing and timing of interventions to
minimize delays and resource usage while maximizing
quality of care
• Massachusetts General Hospital CABG surgery example
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Jidoka and Andon
• Jidoka is the ability to stop the process
in the event of a problem.
• Prevents defects from passing from one
step in the system to the next
• Enables swift detection and correction of
errors
• Andon is a visual or audible
signaling device used to indicate
there is a problem in the process.
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Kanban
Empty
Kanban
Empty
Kanban
Full
Kanban
Task 1
Workstation
1
Full
Kanban
Task 2
Workstation
2
Customer
Order
Microsoft Visio® screen shots reprinted with permission from Microsoft Corporation.
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Kanban
Signal
patients
Signal
echo
patients
Microsoft Visio® screen shots reprinted with permission from Microsoft Corporation.
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CT
Single-Minute Exchange of Die (SMED)
• Used to reduce changeover or setup time,
which is the time needed between the
completion of one procedure and
the start of the next procedure
• Steps
• Separate internal activities from external activities
• Convert internal setup activities to external
activities
• Streamline all setup activities
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Flow and Pull
• Continuous or single piece flow—move items (jobs, patients,
products) through the steps of the process one at a time
without interruptions or waiting.
• Pull or just-in-time (JIT)—products or services are not
produced until the downstream customer demands them.
• Heijunka—“make flat and level”; eliminate variation in volume
and variety of “production”
• Level patient demand
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Advanced Access
• Patients are unable to obtain timely
primary care appointments.
• Advanced access scheduling reduces the
time between scheduling an appointment
for care and the actual appointment.
• The goal is swift, even patient flow
through the system.
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Advanced Access: Advantages
• Decreases no-show rates
• Improves patient satisfaction
• Improves staff satisfaction
• Increases revenue
• Higher patient volumes
• Increased staff and clinician productivity
• Reduces administrative costs
• Fewer patients reschedule
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Advanced Access: Implementation
• Advanced access challenges established practices and
beliefs.
• Balance supply and demand
• Obtain accurate estimates of supply and demand.
• Reduce or eliminate backlog.
• Minimize the variety of appointment types.
• May need to:
• Adjust demand profiles.
• Increase availability of bottleneck resources.
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Kaizen Blitz or Event
• Determine and define the objectives
• Determine the current state of the process
• Determine the requirements of the process
Act
Plan
Check
Do
• Create a plan for implementation
• Implement the improvements
• Check the effectiveness of the improvements
• Document and standardize the improved process
• Report the results on the event on an A3 reporting form
• Continue the cycle
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Lean Sigma
• Lean and Six Sigma are focused on
continuous improvement of the system.
Six Sigma
Lean
• Eliminate waste • Eliminate defects
• Achieve flow and • Reduce variation
in processes
pull
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6
Step 1: Eliminate Waste
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Step 2: Identify Problems
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Step 3: Remove Variation
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End of Chapter 10
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