Lean Healthcare by Operational Excellence Consulting

© Operational Excellence Consulting. All rights reserved. 2
Learning Objectives
By the end of the program, you would be able
to:
• Understand the principles and key concepts of Lean
• Acquire knowledge on the key Lean methods and tools
and their applications to eliminate waste and create
more value for customers/patients
• Identify ways to develop “Kaizen eyes” to look for
improvement opportunities
• Describe the various Lean roles
Copyrights of all the pictures used in this presentation are held by their respective owners

Outline
1. Introduction to Lean Thinking
2. Key Concepts & Principles of Lean
3. Common Lean Methods & Tools
4. Ways to develop “Kaizen Eyes”
5. Lean Roles
6. Sustaining a Lean Culture
NOTE: This is a PARTIAL PREVIEW. To
download the complete presentation, please visit:
http://www.oeconsulting.com.sg

Healthcare Imperatives
• Rising cost of healthcare
• Deaths due to medical errors
• Ageing population
• Shortage of doctors and nurses
• Complicated processes and systems
• High percentage of caregiver time spent doing
paperwork
• Customer/patient satisfaction
• Employee satisfaction

How Can Lean Help?
• Lean can increase
healthcare value delivery by:
 Improving healthcare quality
 Decreasing healthcare costs
• It is one piece of a puzzle to
solve the challenges facing
the healthcare industry

Lean has been adopted in many different
environments since its creation
Toyota
Automotive
Industrial products
High fashion
Medical
devices
Consumer
products
Aerospace
Shipbuilding
Pharma
Food
production
Pulp
and paper
Chemicals
Airlines
Railways
Naval operations &
maintenance
Healthcare
Insurance
Banking
Retail Store
Upstream E&P
High Tech
Consulting
Law Firms
Hospitality
ITO/BPO
Services
Process
industries
Manufacturing
Time
Complexity

Results of Lean Implementation at Virginia
Mason Medical Center
Source: Virginia Mason Medical Center
Category
2004 Results
(after 2 years of
Lean)
Metric Change from 2002
Inventory $1,350,000 Dollars Down 53%
Productivity 158 FTEs
36% redeployed to
other open positions
Floor Space 22,324 Sq. Ft. Down 41%
Lead Time 23,082 Hours Down 65%
People Distance Traveled 267,793 Feet Down 44%
Product Distance Traveled 272,262 Feet Down 72%
Setup Time 7,744 Hours Down 82%

What is Lean?
• Value streams or processes
• Focused on improving process performance
• Clear view of end state
• Wide range of Lean methods and tools
are available
• Learn-by-doing approach
• Culture of continuous improvement
• Lean is a management philosophy based
on the Toyota Production System (TPS)
• Eliminate everything that does not add value
(waste) in the customer’s/patient’s eyes
Objective
Focus and
scope
Approach
and tools

Lean Principles
1. Specify value – from the standpoint of the end
customer (the patient)
2. Identify the value stream – all process steps across
departmental boundaries (the value stream),
eliminating steps that do not create value
3. Make value flow continuously – eliminate causes of
delay, such as batches and quality problems
4. Let customers pull value – avoid pushing work onto
the next process or department; let work and supplies
be pulled as needed
5. Pursue perfection – through continuous improvement

What Lean IS NOT
• Laying off employees by the bus load
• Only applies to manufacturing companies
• A cost reduction program
• Delivering less or working harder
• Just a set of “tools” like 5S, kaizen events, etc.
• Automation or implementing an IT system
• Another “extracurricular activities”

Lean Facilitates a Culture Change
Work Systems
& Processes
Behavior
Attitude
Culture
The way we act
The way we think
Waste elimination

Lean Management Framework
(a.k.a. Toyota Production System)
Source: Adapted from Toyota Production System
Stability
Heijunka Standardized Work Kaizen
Just-In-Time
• Continuous flow
• Takt time
• Pull system
• Flexible workforce
Jidoka
• Separate man &
machine work
• Abnormality
Identification
• Poka yoke
Goals:
highest quality,
lowest cost, shortest lead times
Involvement
Stability
Standardization
Just-In-Time
Jidoka
Involvement
1
2
3
4
5
1
2
3 4
5
Focuses on
Quantity and
“Flow”
Focuses on
Quality and
Prevention

Benefits of Lean Healthcare
• Lean Healthcare cuts out wasted time and
resources
• Increases the process efficiency of admitting
and treating patients
• Improve direct patient care processes
• Allows more patients to be treated
• Allows hospitals to leverage existing assets and
generate higher margins

Value
• Value Added
 It is an activity
 It is requested by or important to the patient (i.e.
something the patient is willing to pay for)
 It changes the thing being processed
 It is done right the first time (i.e. without any rework or
waste)

© Operational Excellence Consulting. All rights reserved.
“There is nothing so
useless as doing
efficiently that
which should not be
done at all.”
Peter Drucker

Eight Types of Healthcare Waste
Over-production
Producing more, sooner, or
faster than required
Inventory
Storing excess drugs/supplies,
including unnecessary
equipment and resources
Transportation
Unnecessary movement
of patients, specimens
and supplies
Defects
Errors or corrections due
to work not being done
correctly
Over-processing
Putting more work into
a process than required
Motion
Extra physical/mental
motion that does not add
value
Intellect
Not using employees full
intellectual contribution
Waiting
Waiting for another
person, process or
equipment
Waste

Types of Waste
• “Just in case” blood tubes drawn
from patients but not used
• Patients seen by MD faster than can
be treated by chemo causing delays
• Creating reports that no one needs
or making extra copies
• Purchasing drugs and supplies
before they are needed
• Providing more information than the
customer needs
Over-Production

Types of Waste
• Patients waiting due to schedule
exceeding capacity
• Specimens waiting in batches for
testing in the lab
• Waiting for patients, beds, equipment,
operating rooms, information, etc.
• Seeking clarifications (due to unclear
communications)
• Equipment/System downtime
• Out-of-stock drugs and supplies
Waiting

Examples of Value-Added Activities in
Healthcare
• Admission
• Discharge
• Providing treatment (e.g.
emergency, outpatient,
surgical, medical,
therapy, etc.)
• Nursing care process
• Medication process
• Staff scheduling to match
patient loads
• All patient scheduling
processes, such as
inpatient and outpatient
• Ancillary testing, such as
lab and x-ray
• Core process
improvement
Source: Robert Chalice, “Improving Healthcare Using Toyota Lean Production Methods: 46 Steps for Improvement”

“We must always
keep in mind that
the greatest waste
is the waste we
don’t see.”
Shigeo Shingo,
a Japanese industrial engineer and expert on the
Toyota Production System

Lean Thinking Philosophy
Identify and eliminate all activities that are waste.
Focus on optimal flow throughout the process.
Focus on creating value for customers/patients.
Current
State
Future
State
Identify
Waste “True North”
Value Added Time = Lead Time
Full of Waste,
Variation, and
Rigidity
Eliminate
Waste

What is 5S?
Principles General Description
1S Sort
Remove what is not needed and keep
what is needed
2S Set in Order
Arrange essential items in order for
easy access
3S Shine
Keep things clean and tidy; no trash or
dirt in the workplace
4S Standardize
Establish standards and guidelines to
maintain a clean workplace
5S Sustain
Make 5S a habit and teach others to
adhere to established standards

Laboratory – Before & After 5S
A laboratory work area before and after conducting 5S Sort and
Set In Order. Clutter and unused items have been removed
leaving only what is needed.
Before After

2S : Set In Order - Examples
Drugs are organized for easy retrieval
A neatly arranged Cardiac tableA neat table setup for blood donations
Form submission boxes for walk-in blood
donors and those by appointment

Everyday Visual Management

Daily Management Meetings
Agenda
• Yesterday’s issues
• Lessons learned
• Manpower status
• Update from top management
• Lean activities
• Today’s target and actions

• Creates an end-to-end view of the system
• Demonstrates interaction between material/work and information flow
• Provides a common visual language for understanding a complex system
Supplier/
Customer Management
Control
Customer
Work & Information Flow
Information flow
Value stream mapping provides an overview
of the end-to-end administrative process

Heijunka – Lean Levers Can Be Applied to
Reduce Waste
Segmenting complexity
Redistribute activities
Flexible manpower systems
Reduce incoming work
Reduce NVA work
Standardize operations
Form separate channels for complicated tasks so that simple
ones are not held up
Align activities with appropriate skill set and group
Balance processing capacity with the ongoing demand by
moving people to where the work activity is
Eliminate tasks from a person by reducing the actual work
activity arising
Eliminate work that does not directly add value to the end
customer
Establish best practices to execute a task
1
2
4
5
6
7
Pool resources Utilize existing skills and resources to reach economies of
scale
3

Quick Setup
• Quick setup or SMED (Single Minute Exchange of Dies)
are used to reduce the setup or changeover time for
operating rooms, MRI machines or ICUs
The pitstop concept of quick changeovers can be
applied to operating rooms to reduce setup time

Examples of Andon
Andon cord at patient’s bed
Andon system for customer service
Andon cord placed at the toilets to facilitate
patients to call for help if needed
Andon for monitoring of patients’ vital signs

PDCA Five–step problem solving process
Define the
Problem
Analyze the
Root Causes
Define
Solutions
Implement
Solutions
Check &
Evaluate
Results

Example of 5 Whys
Why? Because…
1 Why is Tom injured? …he had a fall
2 Why did he fall? …the floor was wet
3 Why was the floor wet? …there was a leaking valve
4 Why was the valve leaking? …there was a seal failure
5 Why did the seal fail? …it was not maintained
1 3 4 52
A continuum of causes

A Simple Lean Implementation Roadmap
Create
Awareness
Build
Capability
Operations
Management
&
Improvement
Lean Thinking
Training
Lean
Leadership
Training
Build Lean
Activity Board
Kaizen #1:
5S
Kaizen #2:
Waste
Elimination
Value Stream
Mapping for Key
Processes
Train-the-
Trainer
Training
Information Sessions
for Whole Organization
Senior
Management
Awareness
Kaizen #3:
Standardization
Month 1
Lean Methods &
Tools Training
Month 3Month 2
Daily Management Meeting
Lean Update in
Monthly
Newsletter &
Intranet

Sustaining a Lean Culture
• Management commitment
• Alignment to vision and mission
• Availability of resources
• Address “what is in it for me”
• Success measures and KPIs
• Management review
• Rewards and recognition

About
Operational Excellence
Consulting

About Operational Excellence
Consulting
• Operational Excellence Consulting is a management
training and consulting firm that takes a human-centered
approach to helping organizations in the public and private
sectors to work smarter and grow faster.
• The firm’s mission is to create business value for
organizations through innovative operational excellence
management training and consulting solutions.
• OEC takes a unique “beyond the tools” approach to enable
clients develop internal capabilities and cultural
transformation to achieve sustainable world-class excellence
and competitive advantage. For more information, please visit
www.oeconsulting.com.sg

END OF PREVIEW
To download this presentation,
please visit:
www.oeconsulting.com.sg

Lean Healthcare by Operational Excellence Consulting

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