Lean and TOC in Healthcare

1. Lean and TOC in Healthcare

2. Learning Objectives • Explain the Lean and JIT philosophy • Define waste in a Lean environment • Understand push versus pull production • Explain JIT manufacturing and Services • Understanding Six Sigma • Understanding TOC in the context of healthcare

3. Just-In-Time • Getting the right quantity of goods to the right place – exactly when needed! • Just-In-Time= not late & not early

4. Philosophy of Lean and JIT • Elimination of waste • Broad view of operations • Simplicity • Continuous improvement • Visibility • Flexibility

5. Eliminate Waste • Waste is anything that doesn’t add value: • Unsynchronized production • Inefficient & unstreamlined layouts • Unnecessary material handling • Scrap & rework

6. TMC classified waste into seven major categories – examples in Healthcare • Over production • Waiting Time • Transportation • Processing • Inventory • Motion • Production Defects

7. Broad View of Operations • Understanding that operations is part of a larger system • Goal is to optimize the system – not each part: • Avoid narrow view: “That’s not in my job description!” • Avoid sub-optimization

8. Simplicity • It’s often easy to develop complex solutions to problems by adding extra steps • Goal is to find a simpler way to do things right: • Less chance to forget extra step • Fewer opportunities to make mistakes • More efficient

9. Continuous Improvement • Traditional viewpoint: “It’s good enough” • JIT viewpoint: “If it’s not perfect, make it better”

10. Visibility • Waste can only be eliminated after it’s discovered • Clutter hides waste • requires good housekeeping

11. Visibility

12. Flexibility • Easy to make volume changes: • Ramp up & down to meet demand • Easy to switch from one product to another: • Build a mix of products without wasting time with long changeovers

13. Three Elements of JIT

14. JIT in ManufacturingExamples in Healthcare? • Kanbans & pull production systems • Quick setups & small lots • Uniform plant loading • Flexible resources • Efficient facility layouts

15. Pull Production & Kanbans

16. Quick Setups & Small Lots • Setup times = time required to get ready • E.g.: clean & calibrate equipment, preparing Operating Rooms • Internal versus external setups • Stop production or setup will still be running • Internal setups = lost production time • Inefficient setups = waste

17. Uniform Plant LoadingOperating Rooms?

18. Flexible Resources • General purpose equipment: • E.g.: printer-fax-copiers, etc. • Capable of being setup to do many different things • Multifunctional workers: • Cross-trained to perform several different duties, transport personnel aware of patient movement procedures or patient handling

19. Efficient Facility Layouts • Workstations in close physical proximity to reduce transport & movement • Streamlined flow of material • Often use: • Cellular Manufacturing(instead of job shops) • U-shaped lines: (allows material handler to quickly drop off materials & pick up finished work)

20. Job Shop Layout

21. Cellular Manufacturing

22. TQM & JIT • Quality at the Source • Jidoka (authority to stop line) • Poka-yoke (foolproof the process) • Preventive maintenance

23. Respect for People:The Role of Workers • Cross-trained workers • Actively engaged in problem-solving • Workers are empowered • Everyone responsible for quality • Workers gather performance data • Team approaches used for problem-solving • Decision made bottom-up • Workers responsible for preventive maintenance

24. Respect for People:The Role of Management • Responsible for culture of mutual trust • Serve as coaches & facilitators • Support culture with appropriate incentive system • Responsible for developing workers • Provide multi-functional training • Facilitate teamwork

25. Supplier Relations & JIT – Can these be applied in Healthcare? • Use single-source suppliers • Build long-term relationships • Co-locate facilities to reduce transport • Stable delivery schedules • Share cost & other information

26. Benefits of JIT • Smaller inventories • Improved quality • Reduced space requirements • Shorter lead times • Lower production costs • Increased productivity • Increased machine utilization • Greater flexibility

27. Lean and JIT in Services/Hospitals • Multifunctional workers • Reduce cycle times • Minimize setups • Parallel processing • Good housekeeping • Simple, highly-visible flow of work

28. PUSH Typically, a schedule is driving the suppliers or providers. No clearly-identifiable customer is in sight Production is its own end objective PULL In Pure Pull, Nothing is done unless there is a signal from the customer--that is, the next process. When the signal does come, responsiveness better be there! Push vs. Pull Operations 11-18

29. Push-Mode “Justification” 11-19 • Long lead times • Inflexibility of provider’s resources • Separation of provider and customer • Erroneous costing • Attempts to justify capacity and/or budget allocations

30. Toward Pull-Mode Operations 11-20 Pull-mode operations are more likely when: • Employees are empowered to stop production Personnel are multi-skilled • Undercapacity scheduling is the policy • Simple, flexible, movable equipment is the rule • Flow distances are shorter • Lead times are shorter

31. Six Sigma and Quality • Brief History of Quality Management • Measurement and Inspection • Industrial Revolution • Statistical Quality Control • Six Sigma - Motorola

32. Healthcare is one industry that is adopting fundamental quality principles and methods, including Six Sigma initiatives. • “Incentives from Fortune 500 companies are driving Six Sigma and other initiatives in US healthcare.

33. Six Sigma • “A business improvement approach that seeks to find and eliminate causes of defects and errors in manufacturing and service processes by focusing on outputs that are critical to customers and result in a clear financial return for the organization”

34. Anything that cannot be measured cannot be controlled • Because hospital processes are largely people driven, measurements are often ill-defined. • Therefore create measurement systems before collecting data. • Ex: Time of Entering Emergency Department measured by security. • Key Measures: Accuracy, Cycle Time, Cost, Customer satisfaction.

35. What Causes Most Quality Problems? • VARIATION! • Six Sigma is a method to reduce variation.

36. The Normal Distribution

37. Six-sigma equates to 3.4 errors per million opportunities. • A “stretch goal” “have all critical processes at a six-sigma level of capability” – near zero defects!

38. 3 sigma level of capability • Until now, we assumed process output should be modeled as +/- 3 standard deviations • By doing so, we ignore the 0.26% of output that falls outside +/- 3 sigma range • The result: a 3-sigma capable process produces 2600 defects for every million units produced

39. Six Sigma Capability • Six sigma capability assumes the process is capable of producing output where +/- 6 standard deviations fall within the design specifications (even when the mean output drifts up to 1.5 standard deviations off target) • The result: only 3.4 defects for every million produced

40. 3-Sigma versus 6-Sigma

41. How do we achieve those Quality Levels? • Technical Tools • People Involvement

42. Problem Solving or QC Tools • Cause-and-Effect Diagrams • Flow Charts • Check Lists • Control Charts • Scatter Diagrams • Pareto Charts • Histograms

43. Cause-and-Effect Diagrams • Also called Fishbone Diagrams • Help identify potential causes of specific ‘effects’ (quality problems) • Examples in Healthcare

44. Flow Charts • Diagrams of the steps involved in an operation or process

45. Checklists • Simple forms used to record the appearance of common defects and the number of occurrences

46. Control Charts • Track whether a process is operating as expected

47. Scatter Diagrams • Illustrate how two variables are related to each other

48. Helps identify the degree of importance of different quality problems

49. Value Stream Mapping • Value Stream Mapping is a method of visually mapping a product's production path from "door to door“- “admitting to discharge” • Draw a visual representation of every process in the flow. Ask key questions and draw a "future state" map of how value should flow. • VSM can be a communication tool, a business planning tool, and a tool to manage change.

50. Key Differences between Lean and Six Sigma • Lean addresses visible problems while six sigma with less visible eg variation • Lean tools are easier to apply while six sigma requires advanced training Both, however, aim to eliminate waste