Texas Hospital Saves Money Occasionally With Lean Six Sigma… But Can Do More, More Often?

I saw this headline the other day about University Medical Center in Lubbock, Texas:

“UMC finds savings through waste“

The headline really should say “through waste reduction.”

Reducing waste is, of course, a good thing. Reducing waste usually saves money for the organization.

From the article:

“What was promoted through the Waste Walk is ‘it's the small things,' ” said Lisa Barrington, Lean Six Sigma manager for UMC. “It's the less than $5,000 ideas that come in from directors.”

This sounds, in a way, like the classic “Kaizen” strategy of engaging everybody in identifying small improvements. In my experience, organizations with a culture of continuous improvement, as highlighted in Healthcare Kaizen, don't focus exclusively on cost savings. They let staff improve things that matter to them — in the name of safety, patient satisfaction, quality, patient flow, and other goals.

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Cost savings often follows and even if we don't require a cost savings or ROI for every improvement, we can tally up cost savings where we find them. Franciscan St. Francis Health saves a few million each year through its Kaizen program and culture. KaiNexus customers have saved more than $400 million, in addition to improvements in other measures.

Now that I re-read that quote, I wonder why the ideas only come in “from directors” and not others in the organization?

Back to the UMC article, the head of Lean Six Sigma is said to have said:

“Lean Six Sigma is a managerial approach focused on efficiency, she said.”

That's not a direct quote. I hope the reporter misinterpreted Lean Six Sigma as being focused on efficiency. Later in the story, we thankfully hear about quality and other goals… see further down in this post.

The Toyota Production System has two main areas of focus:

1. Just in time (flow)
2. Jidoka (quality at the source)

Flow is not the same as “efficiency.” Efficiency is usually measured as outputs divided by inputs. A highly efficient or highly utilized system will tend to have very poor flow and might also have poor quality if people are stretched too thin.

Lean or Lean Six Sigma shouldn't focus primarily on efficiency or cost. The measures that matter are usually Safety, Quality, Delivery, Cost, and Morale.

Focusing too much on cost and efficiency runs the risk of not engaging healthcare professionals, who might not really care about those goals. They might care more about safety and quality… and engaging them in those improvements often leads to cost savings as an end result… the indirect or “oblique” strategy to cost reduction.

This article only reports quantified cost savings and, again, that could be because of the journalist:

“The hospital found $3.7 million in hard dollar savings for the 2017 budget, Barrington said.”

The one aspect of their approach that's a bit unusual is the “100-day waste walk” that was “conducted by UMC administrators.”

Why is waste reduction, at UMC, a special activity that just occurs in these 100 days? A Lean culture or a culture of continuous improvement would have everybody looking for waste and reducing waste every single day – everywhere they walk.

“The Waste Walk was created to promote [efficiency].”

You'd hope a “waste walk” would indeed inspire daily improvement that continues after those 100 days… and with participation and input beyond the directors. Sometimes that happens in an organization… and sometimes not.

“This is the second Waste Walk conducted for the hospital, she said. The first was conducted in 2015.”

So they only do waste reduction over 100 days every two years?

It sounds like there is some lost opportunity there.

As Masaaki Imai says, Kaizen should be everybody, everywhere, every day.

Later in the article, the head of Lean Six Sigma does mention quality, thankfully:

“Our Waste Walk is an effort in not only finding good ideas so that we can be more efficient,” Barrington said. “It's also to promote the stewardship of the organization and making sure we're taking care of not only ourselves from a quality perspective. We're asking that our directors and our decision-support group help quantify financial values, whether it be hard dollars or soft dollars. Our financial group is coming in and validating the dollars that are associated with the ideas.”

Why aren't waste walks happening every day, though?

Later in the article, they also bring up patient flow as a goal:

“Much of the outcome of ideas submitted during the Waste Walk was focused on dollars saved, but the initiative also yielded some ideas for improving efficiency in patient flow.“

Again, I think they're using a different definition of “efficiency.” I hope they mean “better” patient flow.

On the one hand, it's good to hear that UMC is seeing results from Lean and Six Sigma… but it seems like they are just scratching the surface. I hope what seems to be their infrequent “waste walk” approach is just a starting point, not their end state in terms of an improvement methodology.

If it's baby steps… then great, I wish them great success in continuing to “practice Lean.”

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