Lean process improvement is becoming a popular method for hospitals looking to streamline processes, reduce costs and improve quality. While the general principles of Lean management are increasing value and eliminating waste, Lean has five performance measures hospitals should be aware of to best leverage this strategy. Marc Hafer, CEO of Lean transformation company Simpler Consulting, explains the five key performance dimensions of Lean.
1. Human development. Human development is the engagement of all stakeholders in the improvement process. "Lean engages people in daily problem solving and furthers their involvement in running the business as opposed to a top down approach," Mr. Hafer says. Involving all hospital staff and physicians in process improvement can improve physician and employee satisfaction because they feel more valued in the organization, according to Mr. Hafer.
2. Quality. The second performance area is quality, as Lean projects aim to improve quality by eliminating unnecessary processes. As hospitals focus more on quality and patient safety, they may turn to Lean to guide quality improvement initiatives.
Mr. Hafer says hospitals may at first underestimate Lean's influence on quality. "The Lean approach can have a tremendous effect on improving quality, so much so that it really causes healthcare officials and clinicians to think differently about what their goals are in improving quality," he says. "[Lean causes] people to recast their vision and strategies around achieving higher quality."
For example, Mr. Hafer says hospitals and health systems have taken on the challenge of zero defects only in the last eight to 10 years, as it initially seemed an impossible goal. Lean's results, however, in addition to other factors, spurred hospitals to attempt this objective.
3. Service. The service dimension of Lean relates to on-time delivery — such as the ease of scheduling an appointment at the hospital, a short wait time for services and smooth patient flow between departments. This area of performance is "a way that hospital organizations and clinics can differentiate themselves in a competitive environment, and how they can attract more patients to their facility," Mr. Hafer says. In addition, providing services efficiently can attract physicians because they will be able to deliver care more easily.
4. Cost. Cost, which is tied to productivity, is an element of Lean that is becoming more important today in an environment of reduced reimbursement. Lean process improvement can decrease costs by eliminating unnecessary steps and increasing productivity. Lean practices may also help hospitals cut costs without needing to lay off employees, according to Mr. Hafer.
5. Growth. Hospitals need to implement a growth strategy concurrently with a Lean approach to optimize the benefits of Lean processes. "To achieve productivity gains and not lay off people, there has to be parallel marketing plans, plans for expansion and [plans for attracting] more patients, more clinicians, more physicians to absorb productivity gains and continue to grow that organization," Mr. Hafer says.
As Lean streamlines processes, staff who may not be needed for certain processes can be redeployed to other areas, such as expanded services. By pursuing a growth strategy, hospitals can reinvest the savings achieved through Lean to continuously improve — one of the tenets of Lean.
An important part of a hospital's growth strategy is transparency, according to Mr. Hafer. "Promoting transparency promotes trust in the community and [presents] an opportunity to grow based on the trust being built between hospitals and clinicians and patients."
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1. Human development. Human development is the engagement of all stakeholders in the improvement process. "Lean engages people in daily problem solving and furthers their involvement in running the business as opposed to a top down approach," Mr. Hafer says. Involving all hospital staff and physicians in process improvement can improve physician and employee satisfaction because they feel more valued in the organization, according to Mr. Hafer.
2. Quality. The second performance area is quality, as Lean projects aim to improve quality by eliminating unnecessary processes. As hospitals focus more on quality and patient safety, they may turn to Lean to guide quality improvement initiatives.
Mr. Hafer says hospitals may at first underestimate Lean's influence on quality. "The Lean approach can have a tremendous effect on improving quality, so much so that it really causes healthcare officials and clinicians to think differently about what their goals are in improving quality," he says. "[Lean causes] people to recast their vision and strategies around achieving higher quality."
For example, Mr. Hafer says hospitals and health systems have taken on the challenge of zero defects only in the last eight to 10 years, as it initially seemed an impossible goal. Lean's results, however, in addition to other factors, spurred hospitals to attempt this objective.
3. Service. The service dimension of Lean relates to on-time delivery — such as the ease of scheduling an appointment at the hospital, a short wait time for services and smooth patient flow between departments. This area of performance is "a way that hospital organizations and clinics can differentiate themselves in a competitive environment, and how they can attract more patients to their facility," Mr. Hafer says. In addition, providing services efficiently can attract physicians because they will be able to deliver care more easily.
4. Cost. Cost, which is tied to productivity, is an element of Lean that is becoming more important today in an environment of reduced reimbursement. Lean process improvement can decrease costs by eliminating unnecessary steps and increasing productivity. Lean practices may also help hospitals cut costs without needing to lay off employees, according to Mr. Hafer.
5. Growth. Hospitals need to implement a growth strategy concurrently with a Lean approach to optimize the benefits of Lean processes. "To achieve productivity gains and not lay off people, there has to be parallel marketing plans, plans for expansion and [plans for attracting] more patients, more clinicians, more physicians to absorb productivity gains and continue to grow that organization," Mr. Hafer says.
As Lean streamlines processes, staff who may not be needed for certain processes can be redeployed to other areas, such as expanded services. By pursuing a growth strategy, hospitals can reinvest the savings achieved through Lean to continuously improve — one of the tenets of Lean.
An important part of a hospital's growth strategy is transparency, according to Mr. Hafer. "Promoting transparency promotes trust in the community and [presents] an opportunity to grow based on the trust being built between hospitals and clinicians and patients."
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