Lean Sigma Healthcare
A New Model for CAH and Small Hospital
Quality and Performance Transformation
© SigmaMed Solutions 2011
all rights reserved
SigmaMed, the People
 Jamie Martin, President & CEO
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Six Sigma Black Belt from GE
20 years in Healthcare IT, EMR, Surgical Sales
6 years Applying LSH to HIT Workflow in CAHs & Clinics
Instructor in CEU/CME rated courses
Commercial Pilot with over 1,000 hrs in Light Aircraft
 Wray Paul, VP Professional Services
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MSEE and BSChemE, PMP
Master BB, 35+ years of LSS PI
Rural Hospital Director
EMR/PACS implementation Consulting
Design, development of PACS/EMR (5+ years on the
“Dark Side”)
 Contract Healthcare Black Belts, including Nurses, PCMH
and Quality Directors, and EMR Implementation Experts
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SigmaMed, the Company
 Focus on Small and Rural Healthcare Facilities
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Generalized PI and QI in all departments
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EMR Deployment and Meaningful Use Process Redesign
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Lean PCMH and ACO - Lean Core Process Redesign
 Contracted Lean Six Sigma Provider for:
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Colorado Rural Health Center
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CORHIO and CO-REC
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Contracted work for Wyoming PCA
 Teach CE and CME rated Courses on LSH for:
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Colorado AHEC
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CU College of Nursing HIT Leadership Program
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HRSA
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Hospital and Practice Management Groups
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Key (Unconventional) Ideas
 Lean Sigma Healthcare is not an additional project
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Rather, it’s a way to optimally complete projects you are doing
anyway, while simultaneously building internal capacity
 You don’t need to master all of Lean Six Sigma to
be successful… learn a few tools and get going
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We teach a version called Lean Sigma Healthcare, which is a
subset of LSS specific to healthcare
 LSH doesn’t require huge commitment of time or
money
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The most effective transformations begin with results
LSH teaches proper project management
LSH done right can be revenue positive in a very short timeframe
 Change Leadership and Project Management are as
important as LSH tools/technique…we teach all
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Why Lean Sigma Healthcare in Rural HC?
 By Most Estimates, 40-70% of healthcare spending
is Pure Waste!
 External Demands for PCMH, MU, JC, and payor
models are making our care provision processes
much more complex
 HIT Isn’t Mature Enough to Help with
Complexity…and in fact make it worse!
 Resource Constraints in Rural Areas Limit our
Options….can’t just throw money or people at problems
 If we don’t take a proactive approach to designing care
processes things will only get worse as HIT is layered
on…
 Safety-Quality-Cost-Patient & Staff Satisfaction
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The Lean Sigma Healthcare Equation
Start with a Healthcare Specific Subset of Lean Six
Sigma…
 Lean (Toyota Production System) adapted for a
Complex service industry…eliminate waste, improve flow
 Six Sigma (Motorola and GE) adapted for a Defectprone service industry…focus on perfecting process
Work on the Right Project(s), Scoped Properly
With the Right Team
add… Change Leadership
plus… Process-focused Project Management
= LSH…A Simpler Methodology for Healthcare
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Errors Reduced on Outpatient Services
• Substantial Reduction of A/R
• Eliminated 1+ FTE in Billing Department
Yuma District Hospital and Clinics, 2012
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Cheyenne Health and Wellness Center
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Increased Patient Visits past point of Break Even in 3 months
Greatly Improved Staff and Patient Satisfaction
Developed Internal Capacity to Continue Leading LSH
Redesigned Care Delivery Processes to Meet PCMH Level 1 & 2
© SigmaMed Solutions 2011
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CAH and FQHC Results with LSH
 Decreased insurance defects at clinic admission by 100x
(50% defects to 0.5% defects) - Rio Grande Hospital, Del Norte
 Increased customer satisfaction on test results notification
from 60% to 80%+ (red to green trending up,)
 Increased patient visits 47% yr/yr in 3 months and Intake
appts. 83% within 5 months at WY FQHC
 Reduced rework required on outpatient procedure orders
from 20% to less than 0.6%
 Reduced patient waiting time for ortho surgery from 14
weeks to 31 hours (first call to surgery)—Theda Care,
Wisconsin1
1 From
“Lean Hospitals” Mark Graban, 2008
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So Why Doesn’t Everybody Use LSS?
Benefits
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Cost
Satisfaction
Quality
Safety
Perceived Barriers
 Investment cost
 Too many other
“big changes”
 Not enough staff
resources
 What are some
others?
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Models for LSS – the Big Bang…
 Big Idea
 Big Implementation
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Hire consultants
Train everyone
Start lots of projects
 Big bet…
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Leadership has too many
projects to provide needed
attention
$$ makes everyone
impatient
Hard to show results fast
enough to justify $$
Fire consultants
 Not Realistic for CAHs
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Models for LSH – Organic Growth
 Big Idea
 Small Implementation
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Start with one project
Train one team
Leadership support for that
one project
Grow your capabilities
 Small Bet…
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One Project = Low Risk
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Something you have to do
anyway
$$ often under the radar
Grow excitement from
results
Plan LSH growth from there
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Successful Change Begins with Results
 Activity Focus -- many organizations cite the number of
trained LSS resources, the number of projects, etc. as
evidence of success of program
 Results Focus -- the only really meaningful measure of PI
success is tangible results, bottom line impact
 Without tangible financial benefits, organizations lose
patience and pull back before effort has gained steam
 By starting small, visibly, and meaningfully word of
project success may permeate an organization and create
the internal pull necessary to spread throughout
 Change is greeted with open arms when it is proven to
generate positive benefits and is not seen as another
“flavor of the month” change program
 This generates “internal pull” vs. shoving an unwanted
program down an organization’s “throat”
This is from Schaffer & Thomson’s 1992 Classic, “Successful Change Programs
Begin with Results,” in the Jan-Feb Harvard Business Review
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Keys to LSH Transformation Success
Successful LSS Implementations
 Committed Leadership
 Use of Top Talent
 Supporting Infrastructure
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Formal Project Selection Process
Formal Project Review Process
Dedicated Resources
Financial System Integration
Not So Successful LSS Implementation
 Supportive Leadership
 Use of Whoever was Available
 No Supporting Infrastructure
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No formal project selection, review process, not integratged
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SMS Virtual LSH Project Model
1. Train and Mentor Execs in Requirements for Leading a
Successful LSH Transformation
2. Assist in Picking the Right Project, the Right Team, Scoping
Correctly, and Keeping on Track
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First project can be key to a successful LSH launch
3. Just-in-Time LSH training for Teams – “Learn & Use”
immediately increases retention
4. Intensive 1-on-1 Mentoring of Team Leaders in LSH
methodology and Project Leadership
5. Virtual Project Facilitation by SMS BB’s to advise teams
and make mid-course corrections
6. Always-available, “Asynchronous” Online LSH Training for
Teams and YB Certification Program for Team Leaders
7. Ongoing mentoring in LSH roll-out to maintain momentum
and assist in overcoming obstacles (that always appear!)
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LSH Thoughtware
 It’s the Process that’s broken not the People…
design perfect processes and people perform perfectly
(almost!)
 The only people that can fix a process are those
that work in it every day (not managers)
 Data is your ally….opinions are (nearly) always wrong
(otherwise the problem would have been fixed!)
 You Must Plan Change in as much detail as you plan
for new implementation
 Follow the DMAIC framework for all improvement
projects, great and small, to stay on track
 Work can (and must) be done OTIFNE!
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The Change Effectiveness Formula
E f (Q*A)
(E) Change Effectiveness
The Effectiveness of any change initiative is a
function of the Quality of the technical solution
“times” its Acceptance by the culture.
Courtesy of Destra Consulting, LLC
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What do the Numbers Say?
 With Effective OCM, Change Investment ROI =143%
That’s a gain of 43% with Effective OCM
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Characteristics of Successful OCM
 Senior and Middle Managers and Frontline Employees all were
involved
 Reasons for the project were understood and accepted
throughout the organization
 Everyone’s Responsibilities were clear
 With Poor OCM, Change Investment ROI = 65%
That’s a loss of 35% without OCM
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Reasons for the Failures
 Lack of commitment and follow through by senior executives
 Defective project management skills among middle managers;
 Lack of training and confusion among frontline employees
(Source: McKinsey & Co)
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Kotter’s Change Model
Kotter found that 2/3 of all Transformation efforts fail.
However, Successful Change Follows a Pattern
• Create Shared Sense of Urgency
• Remove Obstacles to the New Vision
• Systematically Plan and Create Short-term Wins
• Develop a Powerful Guiding Coalition
• Create a Vision
• Over-Communicate The Vision by a Factor of Ten – Yes 10X!
• Don’t Declare Victory Too Soon!
• Anchor the Changes in Organizational Culture
When these 8 factors are addressed, change efforts are highly
likely to succeed!
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19
Human Elements of Change
Groundbreaking Thinking in “Switch…”,
2010, by Dan and Chip Heath
 When you ask people to change you are Tinkering
with Behaviors that have Become Automatic
 “Self control is Needed to Override Behaviors that
have Become Habits
 However, People’s Self-control is Finite and they
can Only Handle so much Change
 People Aren’t Closed to Change, Just Exhausted by
the Effort Required for Head to Over-ride Habits!
From “Switch…”, 2010, by Dan and Chip Heath
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“How to Make A ‘Switch’
 Direct the Rider – Rational
 Follow the Bright Spots – clone what’s working
 Script the Critical Moves – specific behaviors
 Point to the Destination – vision, big picture
 Motivate the Elephant – Emotional
 Find the Feeling – make people feel something
 Shrink the Change – make it manageable
 Grow Your People – cultivate sense of identity
 Shape the Path – Process
 Tweak the Environment – change situation
 Build Habits – habits are “free”
 Rally the Herd – behavior is contagious, help it
spread
From “Switch…”, 2010, by Dan and Chip Heath
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Essential Ideas for Change
 Developing a Change Plan is just as Important as Using
Tools/Methodologies like Lean Six Sigma
 An Early Win on a Visible Project is Necessary to Build the
Hope and Belief Necessary for Change
 Leading Change is About Engineering Hope and Working with
Teams to Build a Path
 Your Change Plan must Appeal to Peoples’ Heads (logic)
and Hearts (emotions) for Change to Last
People are Generally Not Unwilling to Change, Rather,
They are Exhausted by the Extra Effort!
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Value and the Voice of the Customer
 You are in Business to Deliver Value – good care – for
Patients
 Steps in Your Process not Delivering Value Create Waste
 Your Survival Depends upon Making Customers
(Patients) Happy every chance you get
 View Your Processes from the Patient’s Perspective
 We mistake our view of the process for the customer’s
 The customer doesn’t care about our process
 GE Concept of “Wing-on-Wing”
 Projects need to have a clear connection to customer
needs expressed by the customer
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These are called CTQ’s – Critical to Quality – or CTs
An good project improves top Customer CTQ’s (as determined by
a VOC, ie patient surveys, focus groups)
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Needed - A Process View
 People do a “bad job” because they are
working in a “bad Process”
 What is wrong with HC Processes?
 They were generally never “designed”, they just
happened. When they didn’t work, they got “patched”
 There is usually not a standard process—people just
modify (on a whim)
 Few indicators of Process performance get measured
 We use measures broad outcomes (infections)
 Usually don’t measure leading indicators (adherence to
sterile process for central lines)
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What is the Result of “Bad” Process?
 Wasted Time…
 In end to end processes (Clinic door to door, ED door
to door, surgery appointment to discharge) 75% or
more of the time is wasted.
 Time = money and patient satisfaction
 Defects…
 Healthcare Business processes often run at 50%
defect levels
 Defects (like insurance information) often have to be
fixed. 25% plus of the billing department are often
working on fixing Admissions Defects
 Defects = money, patient safety & satisfaction
 Net result is 40-70% of what we do is pure
waste!
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The Universal Complaint (UC)
“If [Department X] would just do their job,
then we [Department Y] could do our job
better, easier, faster, cheaper…”
Sometimes (rarely) it is the people, but far
more often it is the Process that is Broken
• 1% of the people in an organization should probably
be in another line of work…
• But that means that the other 99% can be very
effective—If we get the Process(es) right.
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Decoding the Universal Complaint (UC)
 Processes usually go wrong at the interfaces and
handoffs. Therefore the UC is caused by:
 The Process actually is designed well, but Depts X
and Y don’t have a single view of how the process
works so they don’t interface correctly (Rarely).
 OR (more likely) The process never worked right &
even if X and Y “did their jobs”, they would still be
frustrated and Defects and Waste would rule the day.
 Therefore if you put good people into a bad
process, they will perform badly.
 Bottom Line: If you are have a problem, put 99% of
your effort on changing the process, 1% on changing
the people.
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How Can LSH Help?
 It provides tools and methods to:
 See where Waste is happening
 Find the Root Cause of Defects
 Redesign the Process to dramatically reduce
both
 It engages the staff to:
 Apply their intelligence and “profound
knowledge” of the Process to fix global problems
 If they help design it, they have ownership of
the Process
 It gives the organization principles to make
effective change and lead LSH expansion
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The LSH Equation
 Give people the Tools to Lead Change and Lead
Projects
 Work on the 20% that cause 80% of your Problems!
 Redesign High Defect or Time Inefficient Processes
 Get processes to 99.5% “good service” and high
Time efficiency
 Data and statistics get easier
 Minimize the number of LSS tools and learn to use the
“vital few”
 Simple Process and Value Stream mapping
 Six Sigma DMAIC project management methods
 Fishbone and the 5 Whys for getting at Root Cause
 Fail Early and Cheaply…
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“OTIFNE” Work
 Work is defect free ONLY if it is:
 On Time – the next process step doesn’t have to
wait for it
 In Full – completely finished so nobody
downstream in the process has to “fill in the blanks”
 No Errors – there are no defects that somebody
downstream has to fix or the customer will see.
 Simple Process Redesign Can Get You There
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LSH Defect Goals
 Manufacturing aims for 6 Sigma performance,
or 3.4 defects per million opportunities…
 But, Healthcare isn’t Manufacturing. They are
way ahead of us!
 Healthcare should start with a goal of ~4.5
Sigma, or 5 defects per 1000 opportunities
 If we do something 1000 times, we should expect
no more than 5 OTIFNE errors (more on this later)
 Don’t design new processes that can’t meet that goal.
 Design Safety Critical processes so they are
“failsafe”
 Design all others to meet this “Lean” Goal
 Lean Sigma Healthcare will get you There
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Defects are Just Symptoms…
 BUT…You Can’t fix Symptoms
 You Can Only Fix Root Causes!
 Example “Shortness of Breath”
 Is only a symptom. To fix it, the ED Doc has to find the
Root Cause
 Root Causes of “SOB” (a few of 100 or so)
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Altitude induced pulmonary edema
Pneumonia
Heart disease
COPD
 All of those Root Causes require different
treatment!
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Tools 1 -- DMAIC
 Define – what do we want to do?
 Measure – how can we see what we do now
and set an improvement goal
 Analyze – see what our data tells us and
find the Root Cause of our issues
 Improve – design an new process, try a
pilot of the new process, debug, improve,
train & scale
 Control – select a few key metrics that tell
us whether we have actually improved
things. Use them to control the process in
operation.
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DMAIC Solves Four Big Problems
 Answers 4 Key Questions Before we Start
 Are we working on the Right Stuff (in the
Right Way)?
 Do Management/Leadership &
Stakeholders approve of what we are doing?
 Who should be on the Team?
 When will we be done?
 It answers the fear-inducing question:
 What do we do next?
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Tools (2 of 4)—Process Mapping
 We see too much
of this…
 Problems
 Hard to see who
does what
 Very hard to see
Waste
 Problems at
handoffs not
obvious
 Can’t figure out
what to do next.
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Better Process Mapping - Swimlanes
 Much better to do
this…
 Advantages
 Easy to see who
does what
 Easy to see Waste
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Defects/Inspection/
Rework
Overprocessing
 Handoffs explicit
(messages)
 Easy to figure out
what to do next.
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Tools (3 of 4)—Fishbone
 World’s best
brainstorming
tool
 Advantages
 Aims directly at
Root Cause(s)
 Avoids
patching
symptoms
 Pareto voting
narrows the
investigation of
potential Root
Causes
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Fishboning turns Symptoms into
Root Cause(s) of Defects
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If you’re fixing a Defect problem, at first you only have the
Symptom (the Defect).
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“300/1000 [=30%] of our Radiology orders have Defects”
If you throw “solutions” at it, they will probably won’t fix the
problem and will add Complexity to your process and Create
Waste!
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People who actually work on the process have a lot of
ideas about what might Cause the Defect.
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Fishbone Diagrams are a structured brainstorming
technique to get their ideas out.
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Once you get all of the ideas out, you can Pareto the ones
you want to work on.
In our work, we almost always find that the Team correctly
identifies the Root Cause with a Fishbone Diagram.
The beauty of Root Cause is it saves you from
working on the 80% of the “issues” that won’t solve
the problem
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Deep Dive on Causes…The “5 Whys”
 Why do we create Defects on the
“rooming form” (1)?
 Because we feel rushed
 Why do you feel rushed (2)?
 Because we only have 5 minutes
 Why do you only have 5 minutes (3)?
 Because the Provider is Waiting and Impatient
 Why is the provider waiting (4)?
 Because there are a lot of patients in the exam
rooms
 Why are there lots of patients in exam rooms (5)
 Root Cause = Because we send them back
whether we are ready for them or not….
The real Root Cause of a problem is often at the bottom of the 5 Why chain.
Everything above that is a symptom, not a cause.
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Tools (4 of 4)—Graphing
 Visualize your
data 1
 Advantages
 People draw
conclusions from
graphs, fall asleep
looking at data
tables.
 95% of the time,
don’t need much
statistical
analysis.
1) Needless to say, you have to make
Process measurements in the first place
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Selecting the Right Project
 Good Projects
 Clear Objectives
 Directly connected to customer needs
 Project is Scoped Correctly
 Able to Complete within 3-4 months
 Fixing Problem is Relevant to the Business
 Fixing the Problem is Part of Team Leader’s (GB’s)
job responsibility
 Makes life much easier
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Data is easily available
Benefits are easy to calculate
Have a high likelihood of Success
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Good Projects have SMART Objectives
 Specific
 Is it obvious what we want to do (and what’s out of
scope (bounds))?
 Measureable
 Can we count defects and measure time, money,
and other important variables?
 Aggressive (but Achievable)
 Is it a little bit of a “stretch” but still possible?
 Realistic
 Can we do it with the people, skills, time, and money
we have available?
 Timebound
 Have we specified when we plan to get it done?
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LSH Projects Ideas on New Initiatives
Build It Right the First Time
 Processes that take less time, reduce cost, AND give
you the results you need
Coming Down the Pike…or already on you!
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PCMH/ACO/VBP
ICD-10/JC
EMR MU, etc…
Tend to add cost, because we layer them on over
already-stressed Processes
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The path forward…what we need to do
 Life is Short…Eat Dessert First
 Change our thinking
 We can't solve problems by using the same
kind of thinking we used when we created
them.” Albert Einstein
 Set new goals
 5 defects/1000
 50%+ Flow Time Efficiency
 Use new Tools
 Lean Sigma Healthcare to eliminate Defects and
Wastes of time and human potential
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LSH Services through WY ORH
 eMaster Black Belt Services (eMBB)
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Project Oriented Team Training, Mentoring, Facilitation
 Virtual eMBB – high value, effective projects
 Combo Virtual and On-site – SMS resource leading on-site partly
 Single and Dual Project MBB – for facilities
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Facility PI/QI/Data Analytics Redesign
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Green/Black Belt Project Mentoring
 LSH Practitioner Certification Services
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Mentored Green or Black Belt certification in LSH
Online Training
 Yellow Belt Certification Course – 4o Hrs of detailed training for
team Leaders
 Team Training Course – 4 hrs of basic training for team members
 Multi-Platform Data Reporting and Analytics
Software sales, implementation, and PS
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