Lean, Six Sigma and Innovation: Natural Companions

Lean, Six Sigma and Innovation:

Natural Companions

Ian R. Lazarus, FACHE

Richard Rawson, CHE

Glenn Crotty, Jr., MD

Mark Herzog, FACHE

We believe that healthcare leaders

should have all the tools they need

to excel in their mission.

Resource rich site at

www.creative-healthcare.com

2

Program Overview

• Introduction to Lean & Six Sigma

• One Hospital’s Initial Journey

• Proof of Concept Exercise

• Another System’s Success

• Taking the methods as far as they can go

3

Program Overview

• Proof of Concept Exercise

• Another System’s Success

About our audience….

About your handouts….

4

First, learn to tell a story…

5

6

After shopping spree…compliments of Air France

7

Why improve processes

when you can simply apologize nonstop?

8

Better Idea: Learn to “Lean”

Accelerate the speed and reduce the cost of any process by removing non-value-added activities

“Re-examine the way you think about waste, as it is often difficult to recognize.

Start by making waste obvious to everyone.”Taiichi Ohno, Founder

Toyota Production System

9

10

Better Idea: Learn to “Lean”

Accelerate the speed and reduce the cost of any process by removing non-value-added activities

“Re-examine the way you think about waste, as it is often difficult to recognize.

Start by making waste obvious to everyone.”Taiichi Ohno, Founder

Toyota Production System

11

Cost of Quality

Up to 40%Productive

Quality

Adding

Features

• Preventing

problems

• Detecting and

correcting

problems before

the customer

sees them

• Dealing with

problems after

they occur

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Eight Causes of Waste

Defective

Products/

Services

Over

Production

Excessive

Inventories

Excessive

Motion

Excessive

ProcessingTransportation Waiting

Underutilizing

Talent

13

PULL

PERFECTION

Principles of Lean Thinking

VALUE1.

VALUE STREAM2.

FLOW3.

4.

5.

13

Why is it so difficult to

expose waste?

Patient

Asks for

Information

Patient

Gets

Answer

PERCEIVED WAIT TIMEPatients over estimate their wait

time by 50% or more;

PERCEPTION IS REALITY

A B C D

ACTUAL WAIT TIMEDetermined by the process to

retrieve information

15

Signs of

Non-Value Added Steps

• Large file areas and frequent archiving

• Waiting time and multiple handoffs

• Written correspondence required for the process to complete

• Multiple approvals

• Frequent rework

• Process is seen as complex (mystical)

• Procedures passed on by word of mouth, no SOP’s or SOP’s don’t reflect

actual process

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VALUE-ADDED

• Alters the work

• Meets customer

wants or needs

• Is done right the first

time

NON-VALUE ADDED

• Eliminate it

• Consolidate it

• Automate it

Protocol to Eradicate Waste

16

Goal: “Perfection”

Patient

Asks for

Information

Patient

Gets

AnswerA B

ACTUAL & PERCEIVED WAIT TIMEMinimized by reducing waste

• When the value stream is transparent,

perfection can be obtained

– Culture Shift: Makes waste obvious!

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Two Six Sigma “blackbelts” sitting at a bar...

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Six Sigma is Process Improvement

Process

X1

X2Y

X3

Process Input

Variables

Process Output

Variable

Customer

Requirements

In-Process

Variables

X1 X2 X3

X…n

Six Sigma focuses on the “critical X” that drives process performance

more than any other variable.

The aim of Six Sigma is to fix the problem “for the last time”

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Six Sigma is Project Management

Who is the customer?

What do they want?

Is the data clean or dirty?

What is the baseline performance?

What is the project objective?

What are the various x’s?

What are the critical x’s?

What solutions will control the x’s?

What are the specs for the x’s?

What is the data integrity of x’s?

What is the capability of the x’s?

Can the improvement stand the test of time?

Y

x

Define

Measure

Analyze

Improve

Control

Describe

The customer

experience

Optimize

The customer

experience

21

Goal of Six Sigma

Identify and eliminate NVA activity

Identify and reduce variation

Understand and optimize y = f (x1+x2+x3+….xn)

22

A “Six Sigma” Process

s s s s s s

LSL m

A six-sigma (6s) process

23

The distance between the mean

(m) and the inflection point is the

standard deviation (s).

System Performance

0

100

200

300

400

500

600

700

800

900

50.00% 60.00% 70.00% 80.00% 90.00%

(Utilization (Throughput / Max. Theoretical Throughput)

Cy

cle

Tim

e O

R W

ork

in

Pro

ce

ss

Cycle time = WIP

TH

What’s Going On Here? Understanding The Role Of Variation In Process Performance

24

System Performance

0

100

200

300

400

500

600

700

800

900

50.00% 60.00% 70.00% 80.00% 90.00%

(Utilization (Throughput / Max. Theoretical Throughput)

Cy

cle

Tim

e O

R W

ork

in

Pro

ce

ss

Cycle time = WIP

TH

Impact

of variation

What’s Going On Here? Understanding The Role Of Variation In Process Performance

25

Linking Lean and Six Sigma

• While Six Sigma will focus on the “critical few,” Lean focuses on the “trivial many”

• Lean focuses on speed, efficiency, and waste

• Six Sigma focuses, defects, variation and quality of products and processes

LEAN Six Sigma

Six SigmaLEAN

Either method provides a prescriptive approachto performance improvement

26

USLLSL

CenterProcess

Reduce spread

USLLSL

Off-Center

USLLSL

Unpredictable

Centered

A BTarget

Remember... customers

experience our variation, not

our averages

Lean/Six Sigma Improvement Strategy

27

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•1. Loma Linda

University Medical Center

– Murrieta, CA

• 2. Charleston Area Medical Center,

Charleston WV

•3. Holy Family

Memorial,

Manitowoc WI

Today’s Program is a “3 - Act Play”

Richard L. Rawson, MBA

Chief Executive Officer

Loma Linda University Medical Center - Murrieta

Richard L. Rawson, MBA

Chief Executive Officer

Loma Linda Medical Center - Murrieta

29

Segment Overview

I. Loma Linda University Medical Center – Murrieta

II. Launch of a Lean Program

III. Industry Changes – Requiring Agility & Change

30

Loma Linda University

Medical Center-Murrieta

• 106-bed hospital located in

Murrieta, California – serving

Southwest Riverside County.

• Affiliated with Loma Linda

University Medical Center,

large academic medical center

located in Loma Linda, CA

(approx. 30 miles away). Part

of Loma Linda University Health

system.

• Faith-based system sponsored

by the Seventh-day Adventist

Church.

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Loma Linda University

Medical Center-Murrieta

• Provides a wide range of services including:

• Cardiac Surgery

• Interventional Cardiology

• Bariatric Surgery

• Neurosurgery

• Orthopedic Surgery

• Obstetrics

• Staffed by both community physicians as well as faculty physicians from the university.

• Engaged physicians and staff

• New culture developing

• Rapid growth and reputation brought the hospital’s volume to capacity in 2012.

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Our Challenges

• Growing programs with physical capacity limits put a premium on our ability to maximize throughput.

• Many internal processes and systems were underdeveloped.

• Focus was on getting the hospital opened quickly.

• Low initial volumes precipitated cutbacks.

• Rapid growth since May, 2012 have stressed many of our processes.

• Processes needing revision and development.

• Revenue Cycle

• IT deployment

• Employee Scheduling

• ED throughput.

• Pretty much everything!

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State of the Hospital – 2012

• Opened one year

• Volumes had been flat at about 50% occupancy since January – growth had stalled.

• Revenue cycle was broken – days in A/R of 150.

• Leadership was discouraged.

• Desire to be “world class” but not supported by excellent systems.

• Assets– Very talented and engaged team.

– Good job of employee selection.

– Patient Satisfaction scores in excess of 90th percentile.

34

Culture Development

• Needed to address broken and underdeveloped processes.

• Unique opportunity to build a new culture on a foundation of

performance improvement.

• Achieve the teams “world class” ambitions by deploying

“world class” tools.

• Engaged Creative Healthcare to partner with us in the

development of a Lean program.

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Elements of our Lean Six Sigma Deployment

• Management Training

– Administrative team had not been exposed to Lean/Six Sigma tools.

• Leadership and Candidate Assessment

• Lean & Six Sigma Training

• Training Projects and Certification

• Governance Program for Sustainability

• Project Management Application to track ROI

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Deployment Approach

Becoming an Emotionally Intelligent Leader

• Leadership Assessment Tools

• Leadership Education

Candidate Assessment and Support Program

• Personality assessment tools

• Interview process

• Team dynamics

Program Launch

• Training

• Projects

• Governance

Building Strong Lean Teams

• Getting the right people on the bus

• Well-balanced Teams

Projects Complete

• ROI verified

• Report outs

• Pipeline replenished

37

Leadership Assessment

• Starts with Leadership – the entire team needs to be on board to support the program.

• CHC Executive Coach administered a behavioral and motivational assessment of the

hospital leadership team.

– Debriefed executives on results and behavioral characteristics.

– Compared characteristics with benchmarks of behaviors and values for Lean training developed by

Creative Healthcare.

– Improved the teams ability to understand the team dynamics as well as their own personal part of

it.

– Developed understanding of the Lean/Six Sigma program and their potential contribution to its

success.

• Perform baseline survey of management team to track culture improvement using three key

questions:

– How capable are we to articulate a vision of excellence for our patients and staff?

– How competent are we to mobilize resources toward that vision?

– How capable are we to sustain the positive changes we’ve made?

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Leadership Behavioral Assessment

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Program Launch

• Identify and train 12 “Lean Leaders”.

• Prioritize and deploy project teams.

• Identify and prepare team Champions.

• Establish a Lean Six Sigma Steering Committee

and governance structure.

• Publicize

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LLUMC-M Proof of Concept Project

Emergency Room – Left Without Being Seen

Problem Statement: The approximate percentage of patients that leave the ED without being seen by a MD is 7.85%. Operating at this rate, 2,865 patients will leave without being seen in 2013 for an approximate net revenue loss of $1,713,419. This figure does not include revenue potentially lost from patients admitted. Loss of revenue and loss of goodwill can have a continued and increasingly damaging impact on the viability of the institution, while being contradictory to the hospital’s healing mission.

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What is Critical to Quality to the Customer?

(Customer CTQ)

Output Requirements

Patient Visit Pleasant

Compassionate

TimelyDoor to Triage

Door to MD

Patient Satisfaction –

Overall ED

Patient Satisfaction – RN

treat you with courtesy &

respect

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Recommended SolutionsRapid Medical Exam

Open 7 days 9am – 11pm

Two week trial period – prototype. (subsequent roll out)

Four designated assessment chairs and one gurney.

Reassigned RN assignments and bed numbers.

Patient sign in sheet amended to include: Vital signs, ESI level, Current

Meds, allergies, history

Added a MD/PA workstation.

Staggered staffing to better accommodate workflow.

ED tech assignments redefined.

A Patient Access workstation has been moved into the ED.

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Go Live 9-11-13

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Improvement Impact Summary - 40 daysBefore After Impact

LWOBS 7.85% LWOBS 3.0% 62% reduction in

patients leaving

$142,922. in lost net

revenue per month


revenue per month

$88,574. reduction in

lost revenue per month

ED Patient satisfaction

overall score – 57.6%

ED patient satisfaction

overall score – 67.4%

Increased by 10%

Duplicate patient

records created in ED

requiring manual fix by

HIM – 71

Duplicate patient

records created in ED

requiring manual fix by

HIM – 29

Reduction of duplicate

records by 59%

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Improvement Impact Summary 2013 - 2014

2013 2014 Impact

LWOBS 7.85% 2% LWOBS 5.85% reduction in

patients leaving

2,868 patients will

LWOBS

730 patients will

LWOBS

2096 patients will stay

and see a MD


revenue per month

$ 36,478 in lost net

revenue per month

$106,444. in potential

net revenue saved per

month

$1,715,064. in lost net

revenue per year


revenue per year

$1,277,328 in potential

net revenue saved per

year

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Next Steps

• Continue to publicize wins and gain momentum

within the organization

• Further build the organizational structure around

Lean and PI

• Prepare to launch additional projects and education

47

The Case for Lean, Six Sigma & Innovation

• Lower “per unit” reimbursement.

• Higher Volumes due to expanded coverage.

• Focus on Quality/Patient Safety with meaningful

incentives and penalties.

• Integrated Healthcare delivery systems to

coordinate care for a population.

48

LLUH – Center for Strategy & Innovation

Innovation

Making meaningful change to improve health care cervices,

processes, or organizational effectiveness and create new value for

stakeholders. Innovation involves adopting an idea, process,

technology, product, or business model that is either new or new to its

proposed application.

Adopted from the Baldrige Healthcare Criteria fro Performance Excellence

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Better

HealthLower

Utilization

Lower Cost

Improved

Well-Being

All Are Linked

Poor

Health

High

Utilization

Higher Cost

Lower Quality of Life

All Are Linked

Better

Health

Lower

Utilization

Lower

Revenue

All Are Linked

Poor

Health

High

Utilization

Higher

Revenue

All Are Linked

Vicious CyclesHealth System Perspective Community Perspective

50

51

Purpose: Establish a Center for Strategy and

Innovation to support the LLUH strategic

planning process and to innovate

new delivery models that engage

the community.

Catalyst for Regional

Innovation

InnovationCreating Networks and Multidisciplinary Teams

Informal Networks to Incubate New Ideas

Piloting New Care Models within the System

Transforming the Experience and

Delivery of Healthcare

Enhanced SupportCommunity Health Development

Business Development

Clinical Decision Support

Finance

Philanthropy

FunctionsHealth Services Utilization/Data

Integration

Health Surveillance

Community Engagement

Innovation

Strategic Decision Support

Strategy/Innovation Think Tank

FunctionsCommunity Health Management System

- ESRI/GIS

Consulting Services

Educational Forums

Innovation Facilitation

Strategic Planning

Center for

Strategy &

Innovation

StrategyStrategy Development

Strategic Analysis

Environmental Scan

Strategy Deployment

and Alignment

Community Health

Needs Assessment

Community EngagementCommunity Benefits

Community Health

Needs Assessment

Grant Writing

Collaborative Initiatives/

Civic engagement

Loma Linda University Health

Burning Questions

• Do we have the necessary information and competencies to

manage the risk of populations?

• Are we proactively innovating ahead of external pressures?

• Do we have a robust methodology for developing and adapting

new approaches?

• What will it take to move our organization to where we want to

be?

52

Signs of Trouble…

• “That’s not what I meant”

• “That’s not how it’s done”

• “That’s not how we measure it”

53

A Leader’s Challenge: Contain Ambiguity

54

Proof of Concept from NPR

• Hearings attempt to distinguish detainees who are legitimately

being held from those to be released.

– A judge must decide whether the government has proven a detainee is

dangerous.

• Which standards should be used? The rules are so unclear

that judges are applying different standards – leading to

different outcomes based on the same evidence.

• "It would have helped if Congress had given us a definition (of

an enemy combatant)” said Judge Royce Lamberth. "The

Bush administration gave us four different definitions; the

Obama administration gave us another definition; each of our

courts is deciding for themselves the proper definition.”

55

Can we agree on the definition

of “a good cookie?”

…and apply it successfully?

56

Proof of Concept – Your Turn

57

Setup: You have been hired as a Quality Manager for an animal cracker business. The company has

a “zero defects” philosophy regarding its products. You are also on a QA team (at your table).

Work with your team to establish the operational definition for a perfect animal cracker. Embody the

delicate balance between quality and productivity. Due to time constraints, assume that crackers

surpass expectations regarding “taste” for your entire inventory.

Write the operational definition in the space indicated below (take 5 mins).

Open Product. To practice application of the definition, apply it to one bag of product. Count those

crackers meeting the definition (“Pass”) and those that do not (“Fail”). Tally the quantity of passing

product on a separate piece of paper. Name this result Trial A.

When finished with above step, switch your product AND definition with the team across from you.

Adopt their definition, and apply to their product. Repeat the inspection exercise and tally results.

Name this result Trial B.

Lean, Six Sigma and Innovation:

Natural CompanionsPractical Application: Use of A3 Problem Solving Tool

Glenn Crotty, Jr., MD

Charleston Area Medical Center

Charleston, WV

Objectives

• Outline CAMC’s foundation for PERFORMANCE

IMPROVEMENT and INNOVATION.

• Share our RESULTS.

• Describe how we ACHIEVED these results.

• Demonstrate how INNOVATION EXPANDS

THINKING to solve challenging problems.

59

CAMC Health System, Inc.

CAMC

Health

Education

and

Research

Institute,

Inc.

Charleston

Area

Medical

Center

Foundation,

Inc.

Charleston

Area

Medical

Center,

Inc.

Integrated

Health Care

Providers,

Inc.

CAMC General Hospital – 268 beds (Neurosciences, Orthopedics, Trauma)

CAMC Memorial Hospital – 424 beds (Cardiovascular, Oncology)

CAMC Women and Children’s Hospital – 146 beds (NICU, PICU)

CAMC Teays Valley Hospital – 70 beds – (Community hospital services)

60

CAMC Service Area

Cabell

Mingo

LincolnWayne

Wirt

Jackson

Kanawha

Roane

RitchieWood

Boone

Raleigh

Wyoming

McDowell

Logan

Mercer

Clay

Gilmer

Upshur

Lewis

Calhoun

Braxton

Webster

PocahontasNicholas

Tyler

DoddridgeHarrison Taylor

Barbour

Monroe

Greenbrier

Summers

Fayette

Ohio

MonongaliaWetzel

Marshall

Brooke

Hancock

MarionPreston

Pendleton

Mineral

Grant

Hardy

Tucker

Randolph

Jefferson

Berkeley

Morgan

Hampshire

Mason

Pleasants

Putnam

Primary Service Area

Secondary Service Area

West Virginia’s Population: 1.8 million

Primary and Secondary Service Area: 557,328

A community

hospital and

tertiary referral

center

61

Mission

Striving to provide the best health

care to every patient, every day.

Charleston Area Medical Center, the best health care provider and teaching hospital in West

Virginia, is recognized as the:

Best place to receive patient-centered care.

Best place to work.

Best place to practice medicine.

Best place to learn.

Best place to refer patients.

Vision

62

Awards and Recognitions • CAMC received the TPE Platinum Award (Ohio, Indiana, WV state level Baldrige program) and is

eligible to apply for the Malcolm Baldrige National Quality Award – the first organization in West

Virginia to win this award.

• Distinguished Hospital Award for Clinical Excellence from Healthgrades for ranking in the nation’s

top five percent of hospitals for mortality and complication rates. CAMC is the only

hospital in WV and one of only 260 hospitals nationwide to receive this award for providing

comprehensive high quality care across multiple clinical specialties.

• CAMC’s Cancer Program was awarded "Full Accreditation with Commendation” in May 2014 by

The American College of Surgeons' Commission on Cancer. CAMC earned all 7 commendations

in this survey which creates eligibility for consideration for the Outstanding Achievement

Award in 2015.

• 2014/2015 Consumer Choice Award winner by the National Research Corporation for hospitals

and health systems chosen for the best overall quality and image through a comprehensive

consumer assessment recognizing the hospitals and health systems chosen as among the best by

those they serve.

63

Leadership SystemWhat A Leader Must

Ensure Is Achieved

Our Foundation

(Vision, Mission)

Our Beliefs

(Values)

Behaviors A Leader

Cannot Delegate

Incorporates the Expectation for

Leaders to Improve

Performance /Innovate

64

Innovation: An Operational Definition

• Making meaningful change to improve healthcare services,

processes or organizational effectiveness and create new value for

stakeholders. Innovation involves adopting an idea, process,

technology, product or business model that is either new or new to its

proposed application. The outcome of innovation is a discontinuous

or breakthrough change in results, services, or processes [Source:

Baldrige]

• CAMC adds: Intervention that produces a statistically significant

change in results, or a 30% improvement over baseline

65

Innovation System

66

67

•1. Strategic Planning Process -

establishes 4 year and annual goals

aligned by “pillar” Best Place to

Receive Patient Centered Care

•BIG DOTs/ Scorecards established

for each goal

• 2. Impact Leadership (capability and

capacity) prioritizes Six Sigma/Lean

resources to support goals for

improvement or innovation• 3. Systematic scorecard

review for corporate, hospital

and department results for key

measures

•4. Identify need

for innovation

to achieve

breakthrough

performance. EXAMPLE: TCT

PUTTING IT ALL TOGETHER. . .

RESULTS. . .

68

Clinical

Results

69

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

2009 2010 2011 2012 2013 2014

Projection

Ob

served

To

Exp

ecte

d R

ati

o

CAMC Premier Top 25% Premier Top 10%

100 Top Hospitals National Avg

Go

od

Inpatient Mortality

-0.20

0.05

0.30

0.55

0.80

1.05

2010 2011 2012 2013 2014

Projection

Rate

CAMC Premier Top 10% Premier Top 25%

Go

od

Inpatient HARM

Rapid Improvement

Industry & Benchmark Leadership

1,752 lives saved 2010-2013

Value

Creation

Indicator Metric2009

Baseline2012 2013 2014 Improvement

Employee EngagementIHI Engagement Survey results

[1-5 scale]3.64 3.91 4.02 4.01 10%

Employee SatisfactionCAMC Employee Satisfaction Survey

Results3.43 3.73 3.89 3.98 16%

Patient ExperienceHCAHPS Overall Rating

63.9% 66.3% 68.9% 68.7% 8%

Productivity FTEs per 1000 Adjusted Patient Days 5.67 5.25 5.45 5.39 5%

$-

$50,000,000

$100,000,000

$150,000,000

$200,000,000

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Financial Impact2001 - 2014 October

Cumulative Total Annual Improvements

70

Rapid Modeling Corporation for IHI ; over 350 hospitals are participating; work sampling studies are conducted twice per year on each unit

48%

56%

40%

45%

50%

55%

60%

Baseline Current

Bottom Quartile = 47.9%

Median = 51.8%

Top Quartile = 55.6%

2012 – 2014 Value Added RN Time:

Hours: 180,483 FTEs: 86.77 Cost: $4,719,623

RN Direct Patient Care Time

71

Engagement in A3 / Top 5 Board Teams

72

A3 PROBLEM SOLVING

73

What Are Problems?

PROBLEMS:

• Are abnormalities that vary from the desired or expected condition

• Are OPPORTUNITIES for improvement

• Are a normal part of daily operations

GOT ANY???

74

A structured method to

determine the quickest, most

cost effective way to ensure the

root cause of a problem is:

Identified

Addressed

Permanently Eliminated

A3 Problem Solving

Highest quality

Lowest cost

Continuous improvement

Just

in

time

Built

in

Quality

Problem solving

Standardization

Human Centered work

Visual Management5S

75

Why Use the A3 Problem Solving Process?

• Provides an effective, repeatable process to prevent problem

recurrence

• Intuitive and easy to learn and remember

• Can be used to create better and fewer meetings

• The A3 form is both a template for problem solving and

documentation of the efforts

• The A3 process is satisfying to everyone who uses it, especially

frontline staff members

76

A3 Problem Solving Process

Direct Cause

Cause

Cause

Cause

Initial Problem Perception

(Large, Vague, Multiple Problems)

Five Why’s?

Investigation to

Root Cause

Clarify the Problem

Problem Defined

Most Likely Cause

Corrective Action

Share Best

Practices

Basic Cause / Effect Investigation

Root Cause

Why?

Why?

Why?

Why?

Why?

Go and See

77

A3 Problem Solving Tool

The A3:

1. Is an objective, pencil and paper tool designed to solve small,

specific problems.

2. Is completed on the front side only of an 11x17 (or A3) sheet of

paper.

3. Defines the current condition and looks at the root cause of the

issue.

4. Guides the user to define clear steps to implement changes and

builds accountability.

5. Provides a tool to validate problem solving work with staff

members.

6. Can be posted for easy sharing with staff members and others.

78

A3 Problem Solving Report

79


The left side of the A3 report

is used to document the

current state of the problem.

80


The right side of the A3 report is

used to document the

future state of the problem.

81


In the DEFINE section, the TOPIC/ISSUE

describes what is going on with this problem,

specifically through the eyes of the customer.

BACKGROUND/PROBLEM STATEMENT:

Includes information for understanding the issue.

(When, where, how does it occur? How big is

the problem? What is the impact?) Includes

history and data that is pertinent to the issue.

GOAL STATEMENT: Good problem and goal

statements are SMART: Specific, Measurable,

Achievable, Relevant, and Time-Bound. Keep it

brief, simple, yet specific. Do not assign blame.

Do not assume solutions. You may not have

enough information at this point to complete the

goal statement. Review and update it after the

Analyze phase.

82


In the MEASURE section, the CURRENT

STATE of the problem is described.

Draw a diagram of how the work process

happens now. Do direct observation of the

work process to ensure that reality is

reflected. Highlight the specific problems/

issues/waste with storm clouds or stars.

What specifically about the problem/issue is

not defect-free? Can you measure the

waste?

BASELINE METRICS: Include pertinent

current state measurement data that is

aligned with the Problem Statement and

Goal Statement. Include specific

information for the source(s) of data, as well

as clear definitions for the metrics.

83


In the ANALYZE section, identify specific

problems and waste with the current condition.

(as identified by storm clouds above). Get to

the root cause(s) for the problem(s).

Consider using one or more of the following

tools:

• 5 Whys

• Brainstorming

• FMEA (Failure Modes Effects Analysis)

• Fishbone

Update Goal Statement: Be sure to update

the Goal Statement based upon the findings of

the Measure and Analyze phases of problem

solving.

84


In the IDEAL FUTURE STATE

section, draw a diagram of what

should be happening (a better way to

work). Include specific measurable

targets.

Highlight the improved features using

circles, or call-outs. Make the

changes and improvements obvious

to anyone reviewing your document.

These should address the problems

or storm clouds in the Current State.

85


Under SHORT TERM SOLUTIONS, identify what

we are going to do in the short term to have

immediate impact on the problem. Short term

solutions should address any immediate safety or

major financial implications.

Under LONG TERM SOLUTIONS, identify what

we are going to do to move to the IDEAL STATE.

Solutions may need to be evaluated and

prioritized. Pilots or PDSA tests of change may

need to be conducted on solutions.

A cost/savings analysis and summary may be

required for solutions. This supports decision

making and prioritization of solutions, as well as

facilitates the effective management of resources.

86


In the IMPLEMENTATION PLAN section,

include the specific actions of implementing

solutions.

For each action, include who will do it, by

when, and the expected outcome. This

optimizes your probability of success and

creates accountability.

87


In the SUSTAINMENT/FOLLOW-UP

section, include when, how, and by whom

follow-up will be conducted.

What are the results compared to the goals?

What are the strategies for sustaining

improvements? (Examples: 5S, visual

management, single point lessons,

standardized work, error proofing, etc.)

88


On the bottom left, include the date, or

date range, when this A3 was

completed.

Include the names of all participating

team members. Identify a key contact.

On the bottom right, include

documentation of any approvals that

are required of these solutions.

What stakeholders will need to be

informed and approve solutions?

Remember any regulatory entities.

89

A3 Problem Solving Report Functions

• Sets a standard for a common format

• Displays the originator’s thinking

• Prompts use of a thorough problem solving process

• Gives a “snapshot” overview

• Records the anticipated dates of completion

• Maintains the history

• Shares best practices

• Applies solutions to similar problems in other areas

90

A REAL LIFE EXAMPLE

The Important Message from Medicare is required under the Patient

Rights section 200.62 in Medicare (CMS-R-193)

As of July 2014, our compliance was only 17%.

91

A3 TO THE RESCUE

92


Table Assignment

Problem to Address:

Improving the delivery of the IMM

93


Important Message from Medicare

(MM)•Must be signed for patients who are

Medicare recipients admitted to an acute

care hospital upon admission and 48

hours prior to discharge unless LOS is

less than 2 days.

94


In the MEASURE section, the CURRENT

STATE of the problem is described.

Current process reviewed:

•Admission

•Patient status change to inpatient

•Notification of pending discharge

•Nursing Discharge Checklist

BASELINE METRICS:

Only 17% of Medicare patients were

meeting the Important Message from

Medicare (MM) requirement using the

current process.

95


In the ANALYZE section, identify specific

problems and waste with the current condition.

Updated Goal Statement: Achieve 100%

compliance with IMM.

• Identified that the “Potential Discharge”

was not always getting placed. This order is

the trigger to start the workflow process.

• Staff (Health Unit Coordinators) did not

understand the importance of compliance.

•Communication breakdowns following

multi-disciplinary rounds

•Missed opportunity for workflow alerts

96


IDEAL FUTURE STATE

•IMM signed for all Medicare patients within 48 hours of

admission and 48 hours of discharge.

•Registration obtains admission IMM for patients

registered in Admitting or the Emergency Department.

•If the IMM is not obtained on admission, the Health Unit

Coordinator (HUC) on the inpatient unit receives an alert

at the 24th hour of admission and obtains the IMM.

•If a patient is admitted as observation status and then

coverts to inpatient status, the HUC will obtain an

admission IMM.

•If a patient is discharged to a lower level of care, a

discharge IMM is signed, dated and placed in the

medical record.

97


Under SHORT TERM SOLUTIONS, identify what we

are going to do in the short term to have immediate

impact on the problem.

Solutions – SHORT TERM•Assign ownership of daily Incomplete IMM Report•Determine root cause of defects•Benchmark•Determine additional root cause of defects in process:

1. admitted through the admitting department or ER 2. become an IP admission once on the nursing units 3. determination of anticipated discharge date4. completion of second IMM prior to discharge. 5. determining root cause of education and training

failures

Solutions – LONG TERM•All key process steps identified, performing as designed, monitored, and with zero errors.

98


In the IMPLEMENTATION PLAN section, include

the specific actions of implementing solutions.

Implementation Plan

ActionsWho By When Expected Outcome

Initial IMM training for

Registration clerks

JR Completed Initial IMM 100% of those

through the admissions

office

Initial IMM for those

converted to IP status

LS Completed HUCs trained and retrained

Identification of Medicare

Advantage Patients

JR Jan 15, 2015 Capture the remaining

patients missed

Identification of pending

discharge

Nurse

managers

In process

99


In the SUSTAINMENT/FOLLOW-UP

section, include when, how, and by whom

follow-up will be conducted.

• Online education for new hires, HUCs and

admitting staff

•Electronic Audits by unit

100

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

Jul-14 Aug-14 Sep-14 Oct-14 Nov-14

% Met

101

CAMC Important Message for Medicare

Compliance

Introduction to

Blue Ocean Strategy

Introduction to Blue Ocean Strategy

• “Blue Ocean Strategy” is a best selling book and

philosophy that is increasingly finding its way into

healthcare strategic planning

• BOS is strategic alignment of Value, Profit and People to

systematically maximize opportunity while minimizing risk

• BOS depends on the creation of “Value Innovation,”

achieved by lowering industry cost structure while

increasing perceived value

• More at www.blueoceanstrategy.com

103

Blue Ocean Strategy, Explained

Value

104


Value

Costs …while pushing for

a sharp drop in the

industry’s cost structure

105


blue

ocean

Value

Costs …while pushing for

a sharp drop in the

industry’s cost structure

106

“Red Oceans” vs. “Blue Oceans”

Red Ocean Blue Ocean

Compete in existing market space

Increase share – fight for existing demand

Create uncontested market space

Increase market – Create new demand

Exploit existing demand

Get bigger share of customers

Either differentiate or be low-cost leader

Don’t get stuck “in the middle”

Segment the market

Focus on special needs

Create and capture new demand

Look for non-customers

Differentiation AND low cost

Simultaneous pursuit = Value Innovation

De-segment the market

Look for widely shared needs

107

Very

High

Very

Low

Low

Med

Med

High

Price Meals Lounges Seating Choice Hub Connectivity Friendly Service SpeedPoint-to-Point

Departures

Southwest

Car Transport

Average Airline

Strategy Canvas

Southwest Airlines

108

Very

High

Very

Low

Low

Med

Med

High

Price Meals Lounges Seating Choice Hub Connectivity Friendly Service SpeedPoint-to-Point

Departures

Southwest

Car Transport

Average Airline

Strategy Canvas

Southwest Airlines

109

More Blue Oceans

• HealthTap

• iTriage

• Keona Health

110

– 50% of people in the ED don’t have qualified

emergencies

– 73% can’t access their physician during an urgent

episode

– 38% of users select an inappropriate level of care

– Unsustainable and likely exacerbated under ACA

The Problem

© Keona Health 2012

111

Workflow

Web/Mobile App:

Intelligent

Personalized

Interview

• Emergency

Screening

• Priority

• Disposition

Recommendation

Education Materials

Patient

Nurse/Care Team

Clinical Summary

Triage Protocols

Nurse Dashboard

Prioritization

Safety Check

Insight Engine

112

Patient

Practitioner

Contact Center

Save Costs

Add Value

80%

Look for advice online

50%

Reduce unit

labor cost

62%Of practice’s patients willing

to switch for online access

$922 Per ED visit

Payer

A Bona Fide Blue Ocean!

113

Success Story:

• > 50% time savings

• Caller & Staff

Satisfaction

114

Improvement & Innovation: Foundations for Strategic Transformation

Holy Family Memorial

Manitowoc, WIMark Herzog, FACHE

President & CEO

Holy Family MemorialMANITOWOC, WI

• Manitowoc County

Pop. 82,000

• City of Manitowoc

Pop. 52,000

– 80 miles north of

Milwaukee

– 35 miles

southeast of

Green Bay

116

Milwaukee

Green Bay

Madison

Independent, Single Market, Tightly Integrated System

• Laboratory for integration,

improvement & innovation

• Physicians: 90 provider employed

multispecialty group

• Hospital: Orthopedics, OB,

Interventional Heart Center, Cancer

• 1200 employees avg tenure 15

years

• Community grounded & focused,

Faith-based organization

117

The Holy Family Memorial StorySince 2010 HFM has presented at:

• ACHE Congress 2010-2015

• AHA’s Healthcare Forum, Partnership for Patients and

Society for Healthcare Strategy & Market Development

• American Society for Quality International Forum

• Beryl Institute

• CoDev 2013 International Open Innovation Conference

• College of Healthcare Information Management Executives

• National Center for Healthcare Leadership

• University of Michigan Health Management and Policy

Program

• Griffith Leadership Center Symposium

118

HFM’s “Why”

Holy Family Memorial is a

network of health

professionals who, rooted

in the healing ministry of

Jesus Christ, provide

services to help

individuals and our

communities achieve

healthier lives.

Mission VisionHoly Family Memorial, as a

network and in partnership

with others, will be the clear

choice for healthcare in the

lakeshore region, recognized

as the leader in patient-

centered, excellent medical

care, while delivering valued

outcomes in a Christian

environment.

2

117

Core Belief: Doing What’s Right

“Start by doing what is necessary; then do what is

possible; and suddenly you are doing what is

impossible”St. Francis of Assisi 1181-1226

“Are you meeting the needs of a community, or the

needs of a corporation?”Sr. Laura Wolf 2013

120

The Big Picture: First-Curve to Second-Curve HOW WILL HOSPITALS SUCCESSFULLY NAVIGATE THE SHIFT?

121

• Fee-for-ServiceReimbursement

• High Quality Not Rewarded• Acute Inpatient hospital

focus• Stand-Alone Care Systems

Can Thrive• Regulatory Actions Impede

Hospital-Physician Collaboration

VOLUME Based• Payment Rewards

Population Value: Quality & Efficiency

• Quality Impacts Reimbursement

• Scale Increases in Importance

• Realigned Incentives, Encouraged Coordination

VALUE BasedTHE GAP

American Hospital Association “Hospitals & Care Systems of the Future” Fall 2011

At 21st & Franklin Street September 2012

122

At 21st & Franklin Street June 2013

OPEN Innovation

External

Disruption

Innovation: DEFINED

STRATEGICInnovation

Redefine

the process

BLUE OCEAN Thinking

Redefine

the market

OPERATIONALInnovationImprove the

process

123

IMPROVEMENT

• Lean Healthcare

• Six Sigma

INNOVATION

• Bright Ideas

• SPUR

TRANSFORMATION

• Open Innovation

• Proactive Disruption

• Culture of adaptability

HFM’s Reform RoadmapTransforming Culture and Care Through Improvement & Innovation

MOVING CULTURE & CARE TO THE RIGHT

Staff & Physicians LeadershipTransforming Partnerships

124

2001:

Over 100

2008: Focus on Health of a Community

2014:

90 Employed Providers

2001:

90 bed hospital

2001:

35 Employed Physicians

2001: Focus on the Sick

HOSPITAL

PHYSICIANS & NP/PA

MISSION FOCUSMANAGEMENT

2014:

35 bed hospital

2014:

Under 50

2001-14 HFM Care System Transformation

125

Transformation Metrics2001 - 2014

• Based on and facilitated by Improvement principles and tools:

• Reduced admissions by nearly 50%

• 5% inpatient market share shift

• Patient safety top 5% in nation; safest patient is the one never

admitted

• 40% growth in clinic visits

• Margins last 3 years 0-3%, 220 Days Cash on Hand

• S&P BBB+ stable outlook

• Care delivery system among top 13% in Wisconsin

126

200%

100%

150%

Source: WHA 3/20/14

TRANSFORMATION’S IMPACT ON

Hospital Use and Cost to Society

• Population adjusted regional growth in amount of

hospital charges 2001 through 2013:

127

Outagamie

135%

Brown

208%

Manitowoc*

122%

*If HFM were the only provider the increase would have been 82%

If HFM Were the Only Choice UNCOVERING SAVINGS FOR MANITOWOC COMMUNITY

Amount our Community

Spent on Hospital Care

If Manitowoc used

HFM ONLY

$286 Million

$241 Million

$45 MILLION!Potential Savings for

our Community

Source: WHA 1/10/14 2001 through 2012 Data

128

How did we do it?FOCUS ON CULTURE

129

CULTURE OF INNOVATION & ADAPTABILITY

1• IMPROVEMENT: Lean Healthcare

• CULTURE: Staff & Physician Engagement

2• OPEN INNOVATION: Partnerships & Practices • CULTURE: Individual accountability & Leadership Skill

3

• TRANSFORMATION: Leveraging SPUR strategically

• Systematically challenge each service’s effectiveness, reason for being and strategic ‘fit’

2005 Missed the Green

• My Initial focus on Innovation– No time to innovate? Hired analyst

– Leaders not ready/field unplowed

– Had the ‘curves’ backwards

– Redeployed analyst

• 2006 shifted focus to Improvement– Lean/Six Sigma Focus- imperfection OK, small steps

– Change Management Processes; HFM Way

– Outside Innovation: Sensei – Knowledge transfer & multiplier

– Creative Healthcare Engagement

130

Source: Human Synergistics, Michigan

Shaping a Culture of Innovation

2009 CULTURE

• Conventional

• Dependent

• Approval-Oriented

IDEAL CULTURE

• Humanistic/ Encouraging

• Self-Actualizing

• Achievement

131

2009 Focus: Innovation Mulligan

• Created Innovation Department

– Open Innovation Management Systems

• Dedicated Staff

• R&D, concept studies, business plan models

– Focus on deployment process – “Bright Ideas”

• Staff Engagement Process

– SPUR Process to drive Open Innovation

• Community & Board Engagement

• Roadmap for full engagement/integration

St. Mulligan

132

Improvement + Innovation = ChangeCHANGE MANAGEMENT AT HFM

• More than 200 bright ideas for improvement and innovation

suggested by staff each year.

• 30% of employees annually involved on projects include

significant, meaningful physician involvement.

• Over 80% of leaders have been trained on change

management tools

• Culture emphasizes use of project teams to quick solve

problems and implement solutions

133

Leadership Team Assessment Tool

134

A B C

EMPLOYEE NAME

Lead

ers

hip

Insti

tute

JOB DESCRIPTION

Co

re R

ole

Co

mp

ete

ncy

Matr

ix R

ole

Co

mp

ete

ncy

Fu

ture

Po

ten

tial:

*Co

ura

ge

*Cre

den

tials

*Cap

acit

y

RE

QU

IRE

D

PO

SIT

ION

:

ed

ucati

on

Y/N

Weighted

Score

Column

A

Weighted

Score

Column

B

Weighted

Score

Column

C

Total

ScoreScore %

2014 PAR

Scores

1-2-3-4-5 1-2-3-4-5 1-2-3-4-5 Y/N 30% 40% 30%

Division Name

2014 Leadership Team Assessment - By Score

Leadership Team Assessment Criteria

A. Core Role competence:

• Capability within current role

B. Matrix Role competency:

• Core competence + strength in influencing others outside of

your current department and/or leading project teams, etc.

C. Future Potential:

• Core + Matrix competence + high potentiality (curiosity, insight,

courage and determination)

• Distinguishes second curve talent to influence and lead larger

groups

135

Leadership Between the Curves• First & Second Curve Competencies not the same

– Only 30% of leaders strong in both

• Curve Delta: Rearview Mirror versus Headlights

• Applying Change Management HFM:

– Reduced senior leaders by 60%, and total full-time leaders by

over 50% over last 10 years

– “more with less” becomes “more with many”

– Significantly enhanced physician and leader engagement and

staff participation in change

136

137

Call Us From Our Settled Ways

Call us from our settled ways,

Out of old habits & established traditions.

Call us into the land of promise, to new life & new possibilities.

Make us strong to travel the road ahead.

Deliver us from false security & comfort,

And the desire for ease and uninvolved days.

Let inspiration dwell in us

That our mission may be fulfilled for the well-being of all.

138

Donald Rumsfeld

Source: brainyquotes.com

“There are known knowns.

These are things we know that we know.

There are known unknowns.

That is to say, there are things that we know we don't know.

But there are also unknown unknowns.

There are things we don't know we don't know.”

139

Organizational Intelligence (OQ)

“It takes meta-cognition,

in this case, awareness of our lack of awareness,

to bring to light what the group has buried in a grave

of indifference or suppression.

Clarity begins with realizing what we do not notice,

and don’t notice what we don’t notice.”

-Daniel Goleman, Focus 2013

140

Strategic Program Unit ReviewKNOWLEDGE DOMAINS

141

KN

OW

LED

GE

AWARENESS

KN

OW

DO

N’T

KN

OW

NOT AWARE AWARE

Source: Gary Hauer, Bay Park Associates Inc. Copyright 2012

What you know, and

you're aware you

know it.

DAY-TO-DAY FUNCTION

What you know,

and you're not aware

you know it.

INSIGHT & DISCOVERY

What you don't know,

and you're not aware

you don't know it.

BLUE OCEAN

What you don't know,

and you're aware

you don't know it.

RESOLVE WITH

EDUCATION & TRAINING

Avoiding the binge/purge cycle of fads & reactivityStrategic Program Unit Review (SPUR)

142

• Repeating process reviewing all programs and service units– Asks what, why, how, how well, how can we do it better?

– Objective

– Systematic

– Consistent

• Each review models a scenario for program/unit:– Growth

– Improvement

– Repositioning

• SPUR integrates LEAN principles such as: • Outside eyes

• A3 planning

• Improvement toolbox

• Elevates “ideal future state” definition for a given process to disruptive ideation

Strategic Program Unit Review (SPUR)What great thing would you attempt

if you knew you could not fail?

• Creates a safe place for leaders to ask for help and redesign their service delivery with the knowledge that every program undergoes SPUR every 3-4 years

• Routinely ‘cleaning our closets’ frees energy & resources

• Team approach hardwires buy-in for big things

• Uses “outside eyes” to spur creativity

• Nearly 20% of the time, we transition to a new business model

143

Identifying the

Future State

144

Research:• Grow

• Improve

• Reposition

Ideation

Measure,

PDCA

Identify Future State!

Action Plan Implementation

The Green Dollar Difference2009 - 2013

145

Total financial gain:

$11.8M!

$5M INNOVATION

IMPACT

$6.8M inIMPROVEMENT

SAVINGS

SPUR RESULTS: 2009 - 2013

146

19% of projects

REPOSITION

41% of projects

GROW services

to produce

measurable financial

outcomes

40% of projects

maintain or

IMPROVE

current operations

and customer

service

Strategic Program Unit Review

▪ 104 SPUR Projects conducted

▪ 43 projects focusing on

GROWTH

▪ 42 projects focused on

IMPROVEMENT

▪ 20 projects focused on

REPOSITIONING

(internally or externally)

Open Innovation: Partnerships

147

CLINICAL OPERATIONAL

COMMUNITY

LEARNING

BUSINESS

CareTech

Leveraging Innovation: CONNECTING THE CHC FLYWHEEL AND THE HFM SPUR

148

1. IDEATION,

INCLUDE

OUTSIDE

EYES

2. RESEARCH &

CROWDSOURCING 3. ACTION PLAN

IMPLEMENTATION

4. MEASURE,

PDCA

HFM’s Lessons Learned

1. Change Management empowers associates to have control over

their work and engagement in the future.

2. Achieving success in transformation inspires confidence & optimism.

3. A disruptive change model engaging stakeholders at all levels

provides a method to respect tradition while transforming for the

future.

4. A cultural foundation built on individual and collective ownership of

change is crucial to successful transformation.

149

RIGHTCARE

RIGHTSETTING

RIGHTOUTCOMES

THE RIGHT CHOICE

150

Copyright © 2013 Holy Family Memorial. All rights

reserved.

APPENDIX

Dr. Glenn Crotty

151

Ian R. Lazarus Mr. Lazarus is Principal and Founder of Creative

Healthcare, which provides training and technologies

to support healthcare performance improvement.

CHC also provides training and certification in Lean

and Six Sigma methodologies. Mr. Lazarus' career

has included long term executive positions at Kaiser

Permanente, McKesson and Voluntary Hospitals of

America.

He has presented at ACHE’s Congress on Health Administration for the past 12

years, presents across the U.S. at ACHE regional clusters, and received the

ACHE Distinguished Service Award in 2011 for his years of voluntary service. His

articles have appeared in The Journal of Healthcare Management, Managed

Healthcare Executive, and Becker’s Hospital Review.

152

Richard RawsonLoma Linda University Health System recently named Richard L. Rawson Chief Executive Officer of Loma Linda University Medical Center–Murrieta and Senior Vice

President for Strategic Planning for the health system.

LLUMC-Murrieta opened in early 2011 and is currently growing rapidly under Rawson’s leadership. With a focus on patient care and quality, Rawson is driving many key initiatives and leading service line development that will give the community access to more healthcare services.

With more than 28 years of health care experience, Rawson is a visionary leader, with a track record of growth and financial performance, creating new innovative programs with a focus on patient experience, leadership development and performance improvement.

Previous to joining LLUMC-M Rawson held a variety of administrative and financial positions throughout Northern and Central California.

He holds a Master of Business Administration from California State University, Bakersfield.

153

Glen Crotty Jr, MD, FACPGlenn Crotty, Jr., MD, FACP, is the Executive Vice President and Chief Operating Officer of the Charleston Area Medical Center (CAMC) located in Charleston, West Virginia.

Dr. Crotty oversees the operations of a three-hospital system with 1800 open-heart procedures per year, an ACS certified level one trauma center and a Women and Children’s Hospital with level three NICU and PICU.

He is responsible for CAMC’s Quality Improvement Program and is the corporate sponsor of CAMC’s Six Sigma Program. In 2009, Dr. Crotty was appointed to the National Board of Quality Examiners for the Baldrige National Quality Program.

154

Mark Herzog

Under Mark’s leadership, Holy Family Memorial has

been recognized nationally for innovation, safety, and

delivery system transformation.

The HFM transformation story has been presented to

diverse audiences such as ACHE, AHA, CoDev

International Open Innovation Conference, National

Center for Healthcare Leadership, and the Griffith

Leadership Center Symposium.

Mark serves in various board roles with WHA and

AHA, and was a 2012 finalist for AHA’s Shirley Ann

Munroe Award.

He holds a MHSA from the University of Michigan

and BA from St. Laurence University, Canton, NY.

155

Mark Herzog, FACHE

President and CEO

Holy Family Memorial,

Manitowoc, WI

Presenter Contact Information

• Ian R. Lazarus

– [email protected]

• Richard Rawson


• Glenn Crotty Jr, MD


• Mark Herzog


156

Six Sigma DMAIC

157

DEFINE - What is the problem?

MEASURE - What will be measured? What

is the target you want to achieve?

ANALYZE - What is keeping you from

achieving the target? What are the most

important causes of the problem?

IMPROVE - What did you do to remove the

causes of the problem?

CONTROL - How are you going to sustain

the improvements?

DEFINE

MEASURE

AN

AL

YZ

E

IMPROVE

CO

NT

RO

L

5 Whys

• Used to determine the root cause

• Repeatedly ask the question, “Why?”

• Peels away the layers of symptoms which can lead

to the root cause of a problem.

158

Fishbone

159

Topic/Issue: What is going on? What is the issue through the eyes of the customer/patients?

Background/Problem Statement: Include information for understanding the issue. (when, where, how does it occur? How big is the problem? What is the impact?) Include history and data that is pertinent to the issue.

Goal Statement:Good problem and goal statements are SMART: Specific, Measurable, Achievable, Relevant, and Time-Bound. Keep it brief, simple, yet specific. Do not assign blame. Do not assume solutions. You may not have enough information at this point to complete the goal statement. Review and update it after the Analyze phase.

Ideal Future State:Draw a diagram of what should be happening: a better way to work.Include specific measurable targets. (quantity/time)Highlight the improved features using circles or call-outs. Make the changes/improvements obvious to anyone reviewing your document. These should address the problems, or storm clouds in the Current State.

DE

FIN

E

Current StateDraw a diagram of how the work process happens now.Do direct observation of the work process to ensure that reality is reflected.Highlight the specific problems/issues/waste with storm clouds or stars.What specifically about the problem/issue is not defect-free?Can you measure the waste?

Baseline Metrics Included pertinent current state measurement data that is aligned with the Problem Statement and Goal Statement. Include specific information for the source(s) of data, as well as clear definitions for the metrics.

ME

AS

UR

E

AnalysisIdentify problems and waste with the current condition. (as identified by storm clouds above)Get to the root cause(s) for the problem(s).Consider using one or more of the following tools:• 5 Whys• Brainstorming• FMEA (Failure Modes Effects Analysis• Control/Impact Matrix• Relationship Matrix

Update Goal Statement: Be sure to update the goal statement based upon the findings of the Measure and Analyze phases of problem solving.

AN

ALY

ZE

IMP

RO

VE

Solutions – Short TermWhat are we going to do in the short term to have immediate impact on the problems.Short term solutions should address any immediate safety or major financial implications.

Solutions – Long TermWhat are we going to do to move us to the Ideal State.Solutions may need to be evaluated and prioritized.Pilots or PDSA tests of change may need to be conducted on solutions.

A cost/savings analysis and summary may be required for solutions.• Supports decision making and prioritization of solutions• Facilitates the effective management of resources

Implementation Plan

ActionsWho By When Expected Outcome

Include specifics of implementing

solutions

Sustainment/Follow-up PlanWhen and how will follow-up be conducted? By whom?What are the results compared to the goals?What are the strategies for sustaining improvements?• Examples: 5S, visual management, single point lessons, standardized work, error proofing,.

CO

NT

RO

LDate: Include the date, or date range, when this A3 was completed.

Team Members: Include the names of all participating team members. Identify a key contact. Approvals:What stakeholders will need to be informed and approve solutions? Remember any related regulatory entities.

A3 Problem Solving Reference Guide

160

Related Reading• “What will it take? Exploiting trends in strategic planning results in practical steps to prepare for

reform,” by Ian R. Lazarus, FACHE, The Journal of Healthcare Management, March/April 2011

• “Lean Thinking: Banish Waste and Create Wealth in Your Corporation,” by James P. Womack and

Daniel T. Jones, Free Press, 1996, Revised 2003

• “Six Sigma enters the Healthcare Mainstream,” by Ian R. Lazarus, FACHE and Wendy Novicoff,

Ph.D., Managed Healthcare Executive, January 2004

• “Blue Ocean Strategy,” by W. Chan Kim and Renée Mauborgne, Harvard Business Press, 2005

• “The Innovators Prescription, A Disruptive Solution for Healthcare,” by Clayton Christensen,

Jerome H. Grossman MD, and Jason Hwang MD, McGraw-Hill, 2009

• “Innovation Is Everybody's Business: How to Make Yourself Indispensable in Today's

Hypercompetitive World,” by Robert B. Tucker, Hoboken, NJ: Wiley, 2011

• “Where Good Ideas Come From: The Natural History of Innovation,” by Robert Johnson. New

York: Riverhead, 2010

• “Chasing the Rabbit,” by Steven J. Spear

• “Understanding Variation: The Key to Managing Chaos,” by Donald J. Wheeler

• “Managing the Unexpected,” by Karl Weick and Kathleen Sutcliffe

• 2013 Malcolm Baldrige Award Criteria

161

Leadership & Management

Lean, Six Sigma and Innovation: Natural Companions