The Power of Lean Thinking in Health Care

Summary
Lean management principles have been used effectively in manufacturing companies for decades, particularly in Japan. The Institute for Healthcare Improvement believes that lean principles can be indeed, already are being  successfully applied to the delivery of health care. Lean thinking begins with driving out waste so that all work adds value and serves the customer’s needs. Identifying value-added and non-value-added steps in every process is the beginning of the
journey toward lean operations.

In order for lean principles to take root, leaders must first work to create an organizational culture that is receptive to lean thinking. The commitment to lean must start at the very top of the organization, and all staff should be involved in helping to redesign processes to improve flow and reduce waste.

Although health care differs in many ways from manufacturing, there are also surprising similarities: Whether building a car or providing health care for a patient, workers must rely on multiple, complex processes to accomplish their tasks and provide value to the customer or patient. Waste of money, time, supplies, or good will — decreases value.

Examples in this paper of lean thinking in health care demonstrate that, when applied rigorously and throughout an entire organization, lean principles can have a positive impact on productivity, cost, quality, and timely delivery of services.

 

Introduction
The concept called “lean management” or “lean thinking” is most commonly associated with Japanese manufacturing, particularly the Toyota Production System (TPS). Much of the TPS way of thinking is based on the work of quality guru W. Edwards Deming, who taught, among other things, that managers should stop depending on mass inspection to achieve quality and, instead, focus on improving the production process and building quality into the product in the first place.
So what is meant by “lean thinking”? Simply put, lean means using less to do more.

Lean thinking is not typically associated with health care, where waste — of time, money, supplies, and good will — is a common problem. But the principles of lean management can, in fact, work in health care in much the same way they do in other industries. This paper presents a brief overview of lean management principles, and provides examples of two health care organizations that are successfully using lean thinking to streamline processes, reduce cost, and improve quality and timely delivery of products and services.

Lean thinking is not a manufacturing tactic or a cost-reduction program, but a management strategy that is applicable to all organizations because it has to do with improving processes. All organizations — including health care organizations — are composed of a series of processes, or sets of actions intended to create value for those who use or depend on them (customers/patients).

The Power of Lean in Health Care

The core idea of lean involves determining the value of any given process by distinguishing valueadded steps from non-value-added steps, and eliminating waste (or muda in Japanese) so that ultimately every step adds value to the process.

To maximize value and eliminate waste, leaders in health care, as in other organizations, must evaluate processes by accurately specifying the value desired by the user; identifying every step in the process (or “value stream,” in the language of lean) and eliminating non-value-added steps; and making value flow from beginning to end based on the pull — the expressed needs — of the customer/patient.

 

When applied rigorously and throughout an entire organization, lean principles can have a dramatic affect on productivity, cost, and quality. Figure 1 presents some statistics that testify to the power of lean thinking in industry. There is no a priori reason why much of this same effect can’t be realized in health care.

 

The Power of Lean in Health Care
Virginia Mason Medical Center in Seattle, Washington, has been using lean management principles since 2002. By working to eliminate waste, Virginia Mason created more capacity in existing programs and practices so that planned expansions were scrapped, saving significant capital expenses: $1 million for an additional hyperbaric chamber that was no longer needed; $1 to $3 million for endoscopy suites that no longer needed to be relocated; $6 million for new surgery suites that were no longer necessary.

Despite a “no-layoff policy,” a key tenet of lean management, staffing trends at Virginia Mason show a decrease in 2003 and 2004, after six years of annual increases in the number of full-time equivalents (FTEs). Using lean principles, staff, providers and patients have continuously improved or redesigned processes to eliminate waste, requiring fewer staff members and less rework, and resulting in better quality. Consequently, as employees retire or leave for other reasons, improved productivity allows for them not to be replaced.

All 5,000 Virginia Mason employees are required to attend an “Introduction to Lean” course, and many have participated in Rapid Process Improvement Weeks (RPIW). RPIWs are intensive weeklong sessions in which teams analyze processes and propose, test, and implement improvements.

The results from the 175 RPIWs that were conducted from January 2002 through March 2004 are shown in Figure 2. 

Key Concepts in Lean Thinking: Lessons from the Experience in Industry Virginia Mason’s achievements were based on lean thinking, the major precepts of which are as follows:

Key Concepts in Lean Thinking: Lessons from the Experience in Industry

Leadership: Introducing lean thinking in an organization is, in the words of those who have done it, not for the faint of heart. It cannot be done piecemeal, but must be a whole-system strategy. There is no single “silver bullet” solution such as a new computer system or automated equipment that will achieve the same results. And it cannot be done only by middle managers or frontline workers. Those at the very top of the organization must lead it. Implementing lean thinking requires major change management throughout an entire organization, which can be traumatic and difficult. Strong commitment and inspiring leadership from senior leaders is essential to the success of an effort this challenging. The CEO must be a vocal, visible champion of lean management, create an environment where it is permissible to fail, set stretch goals, and encourage “leaps of faith.” A senior management team that is aligned in its vision and understanding of lean is a critical foundation for “going lean.”

Culture: A lean culture is the backdrop against which lean tools and techniques are implemented. That culture differs in some significant ways from a traditional culture in business, as well as in health care. Figure 3 offers some examples.

 

Getting Started
To create the perfect process, begin by identifying the key processes (value streams) in your organization.
Key processes are those that support core “products.” In health care, a core product might be an office visit, or an inpatient stay, or a visit to the emergency department. For each of those core products, identify key processes, both primary and internal, that support them. Identify the person responsible for thinking about each process as a whole, how it works, and how to make it better. In most organizations, there is no one performing that role. Leaders should appoint someone who is widely respected within the organization to “own” each process in its entirety. This is not a full-time job, should not require reorganization, and needn’t involve a supervisory role over those who work within the process. It does require attention to relentless pursuit of driving waste out of the process.

Lean experts note that the only sustainable process is one that participants believe in. The best way to create belief in a process is for participants to be able to see it in its entirety and to understand its logic. The best way to create vision and understanding is to directly involve participants in improving the process.