Lean Healthcare Exchange

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Visuals are such an important part of Lean Healthcare, and everyday life for that matter, that it is not surprising that most people focus on the Daily Management Board component of their Daily Management System. After all, it’s a visible part of the system, right?.  This notion can be a bit misleading and can cause employees to miss the true power of the system, akin to ignoring the submerged portion of an iceberg.  A true, disciplined Daily Management System should be the nucleus of a sustaining, engaging Lean transformation process. It’s not about the boards!

Here’s a high-level framework. In addition to the “tip of the iceberg,” is your Daily Management System composed of these pieces?

Daily – It is absolutely crucial that everyone in the organization meet daily for 15 to 30 minutes to discuss how they did against yesterday’s goals, what they need to accomplish today to satisfy customer demand, and what problems they need to solve to meet their goals.  While work and outcomes occur in minutes and hours (and sometimes seconds), we in healthcare are conditioned to look at monthly and quarterly metrics.  By then, it is too late to adjust processes to positively impact those metrics.  Both outcome and process metrics must be reviewed and acted upon by management daily.

Management – Managers organize and lead teams to achieve the organization’s goals in support of its mission.  A brief huddle at the beginning of each day with the manager’s team sets the tone for the day by keeping everyone focused on the team’s objectives and giving them frequent feedback on their performance.  The longer it takes to provide feedback, the less valuable it is.

System – A system is an organized set of processes which delivers value to customers.  It is interesting that the customers of the Daily Management System are the managers and team members.  The ultimate beneficiaries, however, are the patients.  The processes in a Daily Management System include updating the boards each day before the meeting, the meeting itself, and completing the action items that come out of each meeting.

The Daily Management Boards are a powerful visual tool to make the Daily Management System efficient.  The boards are not the system.  They allow each team and individual to see how they are doing at a glance, which allows them more time to use their teamwork and problem-solving skills.  I believe that healthy Daily Management Systems are the single most important ingredient to sustaining a Lean culture in your healthcare organization. 

Has your hospital implemented a Daily Management System?  Share with other readers in the comment section below:  What has made it effective (or ineffective)?

Today’s Blog was written by Dwayne Keller, Executive Vice President of Operations at Medical Reimbursements of America (MRA). 

Dwayne is leading the implementation of Lean in MRA’s revenue cycle operations. Prior to MRA, as COO of Healthcare Performance Partners (HPP), he coached hospital executives and all levels of leadership in the implementation of Lean Healthcare, resulting in significantly improved outcomes.  Dwayne served as a general manager over two manufacturing plants at Alcoa and was also responsible for driving business results through Lean implementation in five Alcoa business units as an executive Lean coach. 

Dwayne holds Master’s and Bachelor’s degrees in Mechanical Engineering from Bucknell University and a MBA from Clemson University.

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After meeting with the Executive Team of a large hospital system recently, I was reminded of how difficult it is for leaders to find time to create Lean Healthcare momentum.  Momentum is defined as force or speed of movement.  So, what should Lean Healthcare leaders be trying to move and what is their role?  I believe that they are the “force” that moves people (the organization) from the inertia of the Current State to the new world of the Target State.  The Current State is firefighting and chaos.  The Target State is stability and calmness.

There is no magic bullet for Lean Healthcare leaders to get the proverbial ball rolling and keep it rolling.  However, there are numerous guidelines that will make the daily task feel much less intimidating or overwhelming:

• Start small – bite off a small problem that you can fit into your schedule.
• Don’t aim for perfection – “don’t let best get in the way of better.”
• Observe your staff’s work for 30 uninterrupted minutes per week – you will be amazed at what you see.
• Just start drawing – A3s don’t have to be pretty.
• Free up minutes of time for Lean vs. looking for hours – change your standard meeting time from 60 to 30 minutes by focusing them on decision-making and problem-solving (believe me, it is liberating).

You don’t need to have a big bang to get the improvements started.  As long as you are moving your processes toward Ideal, you are Eliminating Waste and Improving Outcomes.

There really are more hours in the day.  Actually, there are more Value-Added hours in the day.  Waste consumes our precious time and keeps us from doing the fun stuff – improving.  Make the decision today to become relentless about Eliminating Waste in your day so you can be a “Lean Force” to be reckoned with.

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In trying to teach the essence of Kaizen, one of my esteemed Lean coaches would frequently remind me to “not let best get in the way of better.”  How simple.  How practical.  I have used this phrase hundreds of times in Lean Healthcare since learning it.  Even more powerful, is that it is now a common phrase used at every level of my company. 

Kaizen loosely translates into “continuous incremental improvement.”  This is not an easy philosophy to understand or follow—especially in Lean Healthcare.  We all want the biggest return on our limited resources’ time.  We need big savings quickly.  However, Lean, being the paradoxical system that it is, turns this thinking on its head.

Experimentation is a practical necessity in Lean.  Even more important is that people must experiment daily so they can learn which ideas truly eliminate waste.  Rapid experimentation and implementation leads to big savings faster than the big bang approach, as it is easier to eat an elephant one bite at a time.

Consider this: There is no perfect solution, only the pursuit of perfection.  The good news is that Lean has a definition of perfection or the Ideal State: Defect-free, One-by-One, On Demand, Immediate Response, No Waste, and Safe.

So the next time you are holding out for the best solution, “don’t let best get in the way of better.”

This week’s blog was written by Dwayne Keller, Executive Vice President of Operations at Medical Reimbursements of America (MRA).  Dwayne is leading the implementation of Lean in MRA’s revenue cycle operations. Prior to MRA, as COO of Healthcare Performance Partners (HPP), he coached hospital executives and all levels of leadership in the implementation of Lean Healthcare, resulting in significantly improved outcomes.

Dwayne also served as a General Manager over two manufacturing plants at Alcoa in which fifty percent of the floor space was freed up using Lean principles and tools. He was also responsible for driving business results through Lean implementation in five Alcoa business units as an Executive Lean Coach.

Dwayne holds Master’s and Bachelor’s degrees in Mechanical Engineering from Bucknell University and a MBA from Clemson University.

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Meetings are a necessary evil.  Really.  There is no other way to rapidly and effectively make decisions.  As a matter of fact, that is my rule of thumb.  When I evaluate whether a meeting is effective, or whether I am going to attend one, I look to see if there is clearly defined decision to be made.  I use this rule of thumb to cancel or redirect the agenda for meetings.

Hypothesis:  IF meetings were used to only make decisions, THEN thousands of hours of employees time could be saved and used for activities that Add Value to the Customer.

In many cases meetings are used in place of following PDCA: Plan Do Check Act.  I call these “get-togethers.” There is not a clear meeting purpose (problem) or agenda communicated before the meeting.  Not all of the right people are invited that are needed to make decisions.  People show up without data or facts based on Observation. They show up late and end late.  Actually you should finish 5 minutes early in order to have time to get to the next task on your calendar.  The Scientific Method is not followed when problem-solving. There is not any action items assigned nor is there any follow up.  The Waste is abundant when PDCA is not employed in meetings.

Our time is too precious and our resources are too thin to not critically evaluate the value of every meeting we call or attend. Meetings can be a huge source of Waste without discipline.  I encourage you to Observe every meeting you are in over the next week and evaluate whether at least one decision was made in each one.  I think you will be both surprised and excited about the amount of time that can be freed up for your organization and you!

This week’s article was written by guest author, Dwayne Keller. Dwayne is the Executive VP of Operations and Process Improvement for Medical Reimbursements of America. He has over 25 years of leadership experience in the implementation of Lean Healthcare in various hospital systems and healthcare settings, He coaches at all levels of Healthcare organizations, from CEO to front line staff to deliver improved outcomes via Lean. His deep understanding of Lean as a holistic process improvement “system,” and leadership guidance in connecting Lean implementation to each organization’s specific business case needs in a visual way, sets him apart in the industry. Dwayne has also been a speaker and lecturer at various Lean Enterprise conferences as well as a presenter at the Shingo Prize Conference. Dwayne received an MBA from Clemson University and hold both a Master’s and Bachelor’s degree in Mechanical Engineering from Bucknell University.

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As Lean continues to take hold in Healthcare operations, more Healthcare Executives are requiring that Lean Flow be designed into their new facilities.  On the surface, this seems logical.  Streamlining patient, equipment, supplies, medication, nutrition, labs and work flows is hard to argue.  But how do Lean concepts really apply to the physical design of new facilities?  And how do we help clinicians and architects see that more and bigger are not always better, and can cause additional Waste?

I developed the following list of Facilities Design Implications as examples of how Lean Healthcare can help eliminate the 8 Wastes.  Applying Lean thinking to the Design, Construction and Operations of a new facility can save time, money and frustration not only to the new facility, but to the Design and Construction process as well.  Is it hard?  Yes.  Does it require vision and investment to apply Lean on the front end of a new facilities project?  Yes.  Are the short and long term (30 years or more) benefits worth it? Absolutely!

This week’s article was written by Dwayne Keller. Dwayne, MBA, MSME, holds the position of Vice President of Healthcare Performance Partners, LLC (HPP).  He coaches at all levels of Healthcare organizations, from CEO to front line staff to deliver improved outcomes via Lean. Dwayne holds Master’s and Bachelor’s degrees in Mechanical Engineering from Bucknell University and a MBA from Clemson University.

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There are many ways to explain what Lean Healthcare is, leading to different definitions.  In the spirit of Lean principles, I submit the following brief description and definition of Lean Healthcare and invite your feedback.

Originally developed by Toyota after WWII as the Toyota Production System, Lean has become recognized as the premier process improvement system in the world.  It has gained traction in Healthcare due to significant improvements in safety, quality, lead time, and financials through the application of Lean principles and tools.  Lean engages all levels of the organization in the elimination of Waste in all processes.  The 8 Wastes in Healthcare are (please note the DOWNTIME acronym):

• Defects
• Overproduction
• Waiting
• Not Clear (Confusion)
• Transportation
• Inventory
• Motion
• Excess Processing

Definition:  Lean Healthcare is a structured way of continuously exposing and solving problems to Eliminate Waste in Systems that deliver Value to Customers (Patients).

As more leaders in an organization begin leading its implementation, Lean becomes their operating model.  Since Lean principles and tools apply anywhere there is flow (of products, people, or information), it can be applied to any process: operations, clinical, business office, and support services.

More recently, Lean Healthcare has been successfully applied to new facilities design, resulting in better space utilization, lower design and construction costs, and more efficient operations.

This week’s article was written by Dwayne Keller. Dwayne, MBA, MSME, holds the position of Vice President of Healthcare Performance Partners, LLC (HPP).  He coaches at all levels of Healthcare organizations, from CEO to front line staff to deliver improved outcomes via Lean. Dwayne holds Master’s and Bachelor’s degrees in Mechanical Engineering from Bucknell University and a MBA from Clemson University.

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In order to implement Lean Healthcare, you must make sustainable change.  We all get that logic.  So, what does the change agent need to focus on in every kaizen activity to ensure that real change is happening?

There are three critical areas that must be addressed simultaneously to make real sustainable change: learning, people engagement, and process change. If you leave any of these out, your gains will be short lived.

Learning

Lean Healthcare is learned-by-doing, but the kaizen facilitator must creatively test that the new concepts and terminology are really sinking in with the kaizen team members.  Team members must be able to articulate the 8 Wastes and Rules-in-Use, for example.  Otherwise, the team and leadership may not be able to tell the difference from any other process improvement activity. Furthermore, they will not achieve the full benefits of what Lean has to offer.  A good test of sustainable change is to listen for changes in language.

People Engagement

All of the people not on the kaizen team but affected by the changes must be deliberately engaged in the change process.  This must occur before, during, and after any improvement activities or events.  They too must learn the new concepts and be given an opportunity to weigh in on the recommended changes.  Remember, these folks are already a little upset at having to cover for the people on the kaizen team.  Forcing new requirements on them without seriously engaging their hearts and minds is not really giving the improvement ideas a chance.

Process Change

This one is the most obvious.  Visible changes to the work process and environment like 5S, a new chart rack, or a new layout are required to facilitate patient and work flows with less waste.  These are often times the easiest to implement in the short term, but are quickly lost without the Learning and People Engagement.

Once again, tradeoff thinking won’t work here.  Learning, People Engagement, and Process Change must occur simultaneously with intent to have sustainable change toward Ideal.  If you leave one out, you will be wondering: “Did we really change anything?”

Dwayne Keller holds the position of Vice President of Healthcare Performance Partners (HPP). Dwayne has overseen the introduction and implementation of Lean Healthcare in various hospital and clinical systems throughout the USA. He coaches at all levels of Healthcare organizations, from CEO to front line staff to deliver improved outcomes via Lean. His deep understanding of Lean as a holistic process improvement “system,” and leadership guidance in connecting Lean implementation to each organization’s specific business case needs in a visual way, sets him apart in the industry. Dwayne has also been a speaker and lecturer at various Lean Enterprise conferences as well as a presenter at the Shingo Prize Conference. Dwayne began his career with DuPont as an Engineer and as an Industrial Engineer & Production Manager at Michelin Tire Corporation, he introduced Just-In-Time and Teamwork into two of their largest manufacturing operations. After earning his MBA, he spent three years in Michelin’s Marketing Department helping to transform it into a customer-focused research and data-driven organization. Dwayne joined Alcoa’s AFL Telecommunications Division as Plant Manager and later Director of Operations and drove implementation of the “Alcoa Business System” (ABS), which is its Lean Enterprise system, to meet business goals. Dwayne holds Master’s and Bachelor’s degrees in Mechanical Engineering from Bucknell University and a MBA from Clemson University.

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When and how to “cash the check” from Lean Healthcare process improvements is not always obvious.  Rightly so, CFOs will say: “If I can’t see the financial savings in the P&L, then they don’t count.” 

Lean is not a social program.  It’s a process improvement system that improves all aspects of the business case simultaneously when Waste is eliminated.  In healthcare, business case (outcome) metrics can be categorized into: Satisfaction, Quality, Time, and Financial.  Time includes patient access to services, the time to complete those services, and employee time to deliver them.

When Waste is eliminated, time is “freed up” for staff and leadership.  For example, staff doesn’t have to search for supplies or perform rework due to a recurring defect. Leadership doesn’t have to deal with a recurring problem.  But time is usually not freed up in 1 full-time equivalent (FTE) increments. And while continual productivity improvement is a business requirement, you cannot lay people off because of gains due to Lean.  If you do, no one will sign up for the next improvement activity.  So, what should leaders do to “cash the check” in a Lean Healthcare environment without it being perceived as another cost reduction program?

Make Productivity Visible

Productivity is a measure of cost, not production.  It measures how much input is required to deliver a certain amount of output (output/input).  When looking at labor productivity, possible productivity calculations are patients/labor-hour and service-units/FTE. Once the appropriate productivity metric for a given Value Stream process is determined, track it daily and post it in a visible location for all staff to see.  Discuss it at least weekly.  Let people know that productivity must be continually improved and that eliminating Waste is the only way to achieve it without overburdening staff.  This creates an opportunity for dialogue allowing leadership to communicate the business reality while letting staff know that we are not going to continue adding work or reducing FTEs without improving processes to free up a proportionate amount of time.

Track all Time Saved and Dollarize its Potential

If we think of freed up time from Lean as being stored in a “time bank”, it may help us to see its value to the customer and organization.  This time passes through three phases.  First, it is identified (phase 1) during Lean improvement activities like kaizen events as time that will be freed up once tested solutions are fully implemented (phase 2).   It is at this point that leadership must decide how to monetize (phase 3) the time savings.  The freed up time can either be invested, cashed, or both.  For example, freed up nursing time can be “invested” in more direct patient care (time with the patients) in order to improve other outcomes like satisfaction, infection rates or fall rates.  Or it can be “cashed” by actions such as increasing volume with existing staff (revenue increase), reducing overtime (cost reduction), not filling a planned position (cost avoidance), or reducing budgeted FTEs.  If you reduce budgeted FTEs, staff must feel confident that a proportionate amount of Waste has been eliminated and that no one will lose their jobs as a result.  Attrition and internal transfer are examples of ways to achieve your commitment to no one losing their jobs due to Lean.  In Lean thinking, it is important that leadership track and dollarize the time savings in all three phases in order to see its value.  In many cases it will be difficult to quantify the exact impact to the P&L, but if we don’t quantify freed up people’s time, we cannot see its potential or actual financial value to the organization. 

Reducing wait time and defects for patients frees them up to do the things they want to be doing, which increases their satisfaction with healthcare services.  Eliminating Waste for staff frees up time to improve productivity without overburdening them.  When it comes down to it, “It’s About Time.”

Dwayne Keller holds the position of Vice President of Healthcare Performance Partners (HPP). Dwayne has overseen the introduction and implementation of Lean Healthcare in various hospital and clinical systems throughout the USA. He coaches at all levels of Healthcare organizations, from CEO to front line staff to deliver improved outcomes via Lean. His deep understanding of Lean as a holistic process improvement “system,” and leadership guidance in connecting Lean implementation to each organization’s specific business case needs in a visual way, sets him apart in the industry. Dwayne has also been a speaker and lecturer at various Lean Enterprise conferences as well as a presenter at the Shingo Prize Conference. Dwayne began his career with DuPont as an Engineer and as an Industrial Engineer & Production Manager at Michelin Tire Corporation, he introduced Just-In-Time and Teamwork into two of their largest manufacturing operations. After earning his MBA, he spent three years in Michelin’s Marketing Department helping to transform it into a customer-focused research and data-driven organization. Dwayne joined Alcoa’s AFL Telecommunications Division as Plant Manager and later Director of Operations and drove implementation of the “Alcoa Business System” (ABS), which is its Lean Enterprise system, to meet business goals. Dwayne holds Master’s and Bachelor’s degrees in Mechanical Engineering from Bucknell University and a MBA from Clemson University.

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That’s right.  The gold standard of manufacturing is not exempt from the worst economic downturn since the Great Depression.  In November, Toyota’s sales dropped 34%.  GM’s sales were down 41%.  People aren’t buying cars or much of anything right now.  The value of the yen has risen 25% since summer, which makes autos significantly more expensive overseas (or the losses even bigger).

But let’s take a look at the rest of the story.  It is Toyota’s first financial loss in 70 Years.  In 2007, Toyota posted $28 billion in operating profit.  They have $18.5 billion in cash with relatively little debt.  Have they lain off any employees?  No.  Have they cut back production and delayed new plant openings?  Of course.  So what are the employees doing?  Training, maintenance, cleaning, problem-solving, and doing jobs that had been outsourced.  Even in downturns, Toyota continues to invest in its people, plant and equipment.

Will Toyota abandon Lean?  Absolutely not.  Why would anyone abandon an improvement system that saved the company after WWII and has given them a significant competitive advantage since the 50’s? It is what makes Toyota the gold standard. 

So what does this have to do with Healthcare?  Everything.  Whether you have begun a Lean Healthcare Journey or are considering starting, you are at a critical juncture.  2009 may very well be the most difficult year in 70 years in Healthcare.  Your decisions about Lean in your organization may not only determine your level of success throughout the recession, but in some cases your very survival.  With most of the significant improvement in outcomes coming with little or no cost, is there a better time to invest in Lean?

This week’s blog was written by Dwayne Keller, Vice President of Healthcare Performance Partners (HPP). Dwayne has overseen the introduction and implementation of Lean Healthcare in various hospital and clinical systems throughout the USA. He coaches at all levels of Healthcare organizations, from CEO to front line staff to deliver improved outcomes via Lean. Dwayne began his career with DuPont as an Engineer and as an Industrial Engineer & Production Manager at Michelin Tire Corporation, he introduced Just-In-Time and Teamwork into two of their largest manufacturing operations. After earning his MBA, he spent three years in Michelin’s Marketing Department helping to transform it into a customer-focused research and data-driven organization. Dwayne joined Alcoa’s AFL Telecommunications Division as Plant Manager and later Director of Operations and drove implementation of the “Alcoa Business System” (ABS), which is its Lean Enterprise system, to meet business goals. Dwayne holds Master’s and Bachelor’s degrees in Mechanical Engineering from Bucknell University and a MBA from Clemson University.

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30 years from now, what will people working in your aging hospital be asking

No leader would ever intentionally institutionalize Waste.  Unfortunately, it is happening every day as new Healthcare facilities are being designed and built.  As our population ages, new construction and expansion of existing Healthcare facilities is increasing at a rapid pace.

“It looks nice, but look at all the walking we have to do every day!”

So, why would Waste be “designed” and “built” into a new facility, and literally be institutionalized into the bricks and mortar for 30 plus years to come?  The answer is that Healthcare leaders who must make the design decisions don’t realize that they are designing Waste into the new facility.  Even if they have been exposed to Lean Healthcare or started a Lean Transformation at their facility, when choosing between options put in front of them by the architects, the “Leanest” option is not always obvious.

“Grandad always said, ‘Measure twice, cut once.’”

When clinicians are asked what they want in the new facility, most respond that they want “more.”  They want more space, more inventories and equipment, more computers in larger nursing stations…  This makes perfect sense if they will transfer the current batch and queue, broken processes they are working in today to the new facility. While adding more of these things helps to cover up the broken processes, they also increase the 8 Wastes.  For example, larger spaces increase travel distances (Motion); and large, centralized nursing stations create batching (Over-production) and interruptions (Confusion).

“Did they save money on storage areas so we could have this nice team room for group problem-solving and optimizing our internal processes?”

What’s needed is a framework based on Lean to bounce these decisions against and a coach with many years of experience applying Lean principles and tools.  But this will only work if the entire Sr. Leadership Team is bought into this new “common set of lenses.”   Without these common lenses, each leader on the team is left to view the design options through traditional lenses, and to do their best in bringing their staff’s wishes into the new design.  This inevitably leads to tradeoff thinking, as the leaders cannot find common ground, and therefore push their own agendas.

“How did they keep everyone focused on what was best for the patient and improving the total value stream before Lean Healthcare came along?  Didn’t Grandma call it Silo Thinking?”

Even if the leadership has made a commitment to make Lean the way they will do business in the future (which is required to operate in new Lean facility), this requires a bit of a “leap of faith,” so to speak.  Without years of experience in Lean, it is hard to SEE how much Waste will actually be eliminated with “Standardized Work” in “Standardized Facilities.” This is where the Lean coach comes in.

“Grandad kept us rolling on the floor with stories about how much they had to walk in the old building.  The formalin room was all the way on the opposite side of the department from pathology!  And all the plugs were down behind the head of the beds!”

At HPP, we call this process “Lean-led Design.” So, will staff working in your new facility for many years to come remember your team as the one who institutionalized Waste in it, or will they remember you as leaders who put a stake in the ground and said: “The Waste stops here.”

What questions will be asked about your new building?

This week’s blog was written by Dwayne Keller, Vice President of Healthcare Performance Partners (HPP). Dwayne has overseen the introduction and implementation of Lean Healthcare in various hospital and clinical systems throughout the USA. He coaches at all levels of Healthcare organizations, from CEO to front line staff to deliver improved outcomes via Lean. His deep understanding of Lean as a holistic process improvement “system,” and leadership guidance in connecting Lean implementation to each organization’s specific business case needs in a visual way, sets him apart in the industry. Dwayne has also been a speaker and lecturer at various Lean Enterprise conferences as well as a presenter at the Shingo Prize Conference. Dwayne began his career with DuPont as an Engineer and as an Industrial Engineer & Production Manager at Michelin Tire Corporation, he introduced Just-In-Time and Teamwork into two of their largest manufacturing operations. After earning his MBA, he spent three years in Michelin’s Marketing Department helping to transform it into a customer-focused research and data-driven organization. Dwayne joined Alcoa’s AFL Telecommunications Division as Plant Manager and later Director of Operations and drove implementation of the “Alcoa Business System” (ABS), which is its Lean Enterprise system, to meet business goals. Dwayne holds Master’s and Bachelor’s degrees in Mechanical Engineering from Bucknell University and a MBA from Clemson University.

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