Management Engineering/
Process Improvement (ME/PI)
“Provide Value”
What is a Management Engineer or Process
Improvement (ME/PI) Professional?
Process Improvement (PI) professionals address
the design, installation, and improvement of
integrated systems of people, material, facilities,
information, equipment and energy.
They bring a wide variety of work experience and
educational backgrounds to the job.
Education
• BS, Industrial Engineering, Management Engineering
or Operations Research
• MBA, MHA, MSIE, MS Operations Research or Health
Systems
• PhD, MBA, MHA, BSBA Business Management or initial
clinical background such as RN, RHIA, RHIT
• PhD, MHA, Allied Health Professionals with
Business/Engineering minors
• Six-Sigma, Lean, CPHIMS, CPHQ, and other
certifications
Key Practice Skills
Analytical - a solid knowledge and experience with:
– quantitative statistical techniques and tools
– process improvement programs (Lean, 6-Sigma, ….)
– demand and supply forecasting
– workload and schedule optimization
– engineering economics, financial analysis and
decision support
– queuing theory
– workflow analysis
– simulation modeling
– the quality process
Key Practice Skills (continued)
The ability to:
– collaborative with people in complex organizations
– manage the design and implementation of processes
and systems
– promote ideas and influence change in a organization
– teach others the quality management problem solving
tools
– teach and deploy business improvement methods and
tools
Key Practice Skills (continued)
Profound knowledge of:
– JCAHO and other licensing standards
– clinical protocols and clinical outcomes
– hospital organization structure and interrelationships
ME/PI Philosophy
To provide value by:
• Advancing a win-win culture
• Promoting customer centric environment
• Improving the system of production, service, and
planning – Constantly!
• Educating and transferring skills to departments to assist
them to realize their full potential
• Breaking down barriers between departments and
becoming a catalyst for lasting improvements
• Promoting continuous quality improvement
ME/PI Profession
Current State
Current State
• Responsibilities and accountabilities are not
universally defined
– Sometimes we’re “Jacks of all trades”
– Reporting structure depends on the institution
• Lack of direction
– Skill set, education and training has not been
standardized leading a broad arrays of professionals
– No set continual education or certification
– Prevalence of soft skills in the profession
Current State (cont.)
• Career path is sometimes limited
– In industry people with our skills are frequently
brought into senior management
• Seen as “cost” versus “revenue” departments
– Savings multipliers not touted
– Project benefits not advertised
ME/PI Concept
Customer
IT Engagement
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Operational audits
Outcome measurements
Service quality audit and evaluations
Process identification, documentation and evaluation
Streamline or “tweak” existing processes
Design off current processes
Enhance value added activities
Modify existing systems
Conduct staff skill audits
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Performance Improvement
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ME/PI Concept
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Identifying process and outcome measures
Performing quantitative and qualitative analysis
Aligning measures to meet organizational goals
Designing “Scorecards”
Evaluating system capacity
Establishing performance targets
Initiate DMAIC projects
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Performance Improvement (cont.)
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Analyze, Improve, Control)
(Define, Measure,
Root cause analysis
FMECA
DOE
Kanban
SPC/SQC
Performance
Benchmarking
• Poka-Yoka
• Etc.
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• Department Functional Tree
Structure
• Process mapping and
analysis
• Value stream mapping
• Simulation (Modeling)
• 5 Ss
• Kaizen
• Lean
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Performance Improvement Tools
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– Develop opportunity matrices based on
current department performance
– Utilizing Action OI Reports for operational
benchmarking
– Attending and facilitating departmental
and interdepartmental meetings
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• Internal and External Benchmarking
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Performance Improvement Tools (Cont.)
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Paid FTEs/Adjusted Occupied Bed
Paid Hours/Discharge
Management FTEs/Total FTEs
Department Paid Hours/Unit of Service Volume
Square Feet/Adjusted Discharge
Over Time as a % Percentage of Paid FTEs
Agency, Temp, Contract FTEs as a % of Total Paid FTEs
Adjusted Admission/Active Physician
Percent Occupancy
Surgery Suite Utilization
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• Operational Benchmark Indicators
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Performance Improvement Tools (Cont.)
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Salary & Benefits as a % of Net Revenue
Labor Expense/Adjusted Discharge
Non-Labor Expense (Supply, Drug, etc.)/ Adjusted Discharge
Days in Accounts Receivable
Bad Debt Percentage
Revenue Per Adjusted Discharge
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• Financial Benchmarks Indicators
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Performance Improvement Tools (Cont.)
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 Case Mix Adjusted Average Length of Stay
 Mortality
 Tests per case per physician
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• Clinical Benchmarks Indicators
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Performance Improvement Tools (Cont.)
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ME/PI Concept
Patient Treatment Concept
Process
Input
Happy Customer
Staff Hours
Supplies
Equipment
Voice of
Process
Voice of Customer
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• Service utilization evaluation
• Supply standardization audit
• Departmental staffing pattern audit and
evaluation
• Supply chain Management evaluation
• Service utilization benchmarking
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Resource Management Function
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Clinical Process outcome analysis
Clinical Process Benchmarking
Productivity Analysis
In-Quality Staffing
Physician Profiling
Cost Per Case
Supply Chain Management (SCM)
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Resource Management Activities
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• Measuring workload, identifying patterns and
trends
• Identifying labor utilization, by type and cost
impact
• Matching staffing to demand “In-Quality
Staffing”
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Productivity Measurement and Analysis
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“In Quality” Staffing:
Which customer(s) win?
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ME/PI Concept
30
In Quality plus Process Improvement
Time in Minutes
25
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USL
15
LSL
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Number of Transports
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• Reduce cost through reduction of unnecessary
variation of utilization
• Sharing information with providers (Value Added)
• Select cost effective physicians
• Improve patient outcomes
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Physician Practice Profiling
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ME/PI Concept
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Strategic Planning and strategic analysis
Needs Assessment
Assess current and emerging technology
Feasibility Study
Project Management
Cost and Benefit Analysis
Selection Criteria
Request for Proposal and/or Information
Selection of System
Vendor viability analysis
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To ensure the success of IT ME/PI provides following
support services;
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IT Engagement Function
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ME/PI Concept
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Process mapping (“As Is” and “Should Be”)
Gap analysis
System performance analysis
System reporting capability analysis
Project planning
Project management
Team and meeting facilitation
ROI calculation
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IT Engagement Tools
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ME/PI Profession
Ideal Future State
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• Well defined roles and responsibilities within
Healthcare
• Operational guru
• Starting point for all healthcare operational leaders
• Training ground for healthcare COO, Department
Directors and other healthcare operational leaders
• Defined skill set for the entering to the profession
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Future State
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• Structured on the job training and licensure for
promotion
• At least 50% to 70% of ME staff to be trained
engineers
• Well developed on the job training program
• Defined minimum performance criteria related to
cost savings, revenue enhancement, and quality
improvement (i.e. Minimum contribution factor to
bottom line should be 3 to 5 times of ME
department cost)
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Questions
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ME/PI Concept