Reflections on lean in healthcare

It is still unclear whether lean thinking will turn out to be a wave or a fundamental driver for change in healthcare, not just in this country but across the world. The prognosis is positive. Lean has outlasted most of the other business improvement waves and is being taken up by industry after industry as the foundation of their improvement efforts. No one has yet found an alternative to the core principles of lean, although many management consultants have tried to re-brand their versions of it. Meanwhile Toyota, the reference model for lean, goes from strength to strength towards being number one in the auto industry.

The early days of lean in healthcare have also followed a very familiar pattern seen in other industries. Initial enthusiasm for lean was built on rapid improvement events to seek out and eliminate all forms of waste within a defined area. Many people experience the liberation of being able to change things quickly, instead of seeing every idea killed off by endless consultation. They also begin to see how broken the processes are in which they work, while they clear away a lot of low hanging fruit.

In my view, lean actually starts when we begin experiments to take a series of activities and turn them into a process; for instance, designing a new clinical pathway for cardiac patients or a new process for managing the flows through the pathology lab. This means we need to see real demand and capacity, to understand the current performance and the patient’s experience of the process and the variability of each step, which is critical if we really want to link them. But this is just the start.

Traditional management systems in any industry organise knowledge, careers and resources vertically in functions, departments and budgets. This is the right thing to do. However, the fundamental insight from lean thinking is that customer value is created by the actions of lots of different people across many departments and organisations. Linking these together into a seamless end-to-end process or value stream reveals literally hundreds of opportunities for streamlining the flow, eliminating non value creating steps and aligning the rate of flow with customer demand. Improving the performance of the organisation is the direct result of making these end-to-end value streams flow. The management challenge is to see and manage these horizontal value streams at the same time as organising knowledge in vertical departments.

Although healthcare initially appears very complex, in fact most patients travel down one of only a few value streams through a hospital or a healthcare system. In a hospital, two entry points feed maybe five basic value streams – medical, surgical, outpatients, children and gynaecology . However, many types of patient share each of these primary value streams, and enabling them to flow involves synchronising many more subsidiary but equally important value streams so that the right people, records, beds, tests, porters, supplies etc. are in place at the right time.

The consequences of this very typical current situation, where no one is responsible for these end-to-end value streams, was brilliantly revealed in the Gerry Robinson programmes. The great disappointment was that he offered no method for solving these problems. Many people now recognise that lean is actually a management system as well as a set of principles for understanding value from the customer’s perspective and for designing end-to-end value streams.

Seeing lean as just another improvement method or tool box completely misses the point of lean. Seeing it as a job for outside consultants to sort out your operations for you is also an illusion. It has to be home grown, and it has to go right to the top. Management processes turn out to be as broken as operations, and they have a pervasive influence right across the hospital.

For example strategy and planning processes typically mirror the political fight for resources at the national level. Every department holds its cards close to its chest as it bargains for extra resources. A lean policy management process, on the other hand, achieves the organisation's strategic objectives through process improvements planned by each value stream manager, based on a very clear knowledge of the resources required.

Another example is the very protracted process for hiring new employees. This is often actually used as a way of rationing heads and beds. But if the real work is known then activities can be correctly staffed quickly and with minimum frustrations on all sides.

Finally the procurement and replenishment process. Walk round any ward or theatre and open the cupboards and you will find tens of thousands of pounds of stock hidden away. If supplies to wards and from suppliers into the hospital were replenished daily as Tesco and Toyota do, it should be possible to reduce the purchase spend of the hospital by a third. Multiplied across the NHS and the savings would be huge.

Effective progress in streamlining these processes depends on knowing what actions to take to solve which problems. In an environment where processes are not clear and real time data is hard to come by, it is not surprising that managers have a hard time defining the problems to tackle and all too often end up jumping to solutions based on opinions and hearsay. In our experience, the real problem that needs tackling is invariably very different and so is the right solution.

Doctors are used to making quick diagnoses. Indeed it only takes doctors an average of 19 seconds to come up with a diagnosis – with an 85% success rate! This is pretty impressive and of course their initial hypothesis may or may not be modified by subsequent tests. The real, sometimes fatal danger here is being unwilling to challenge the initial incorrect diagnosis in those 15% of cases, even in the face of subsequent evidence to the contrary.

My hunch is that the numbers are reversed when it comes to diagnosing management problems. How do managers know what is really going on and what the causes are of things going wrong? Collecting data and running simulations may be useful, but as Taiichi Ohno said, “facts are better than data”. The real situation can only be grasped by going to the Gemba – to the place where the value creating work is actually done – and asking the right questions. If problems are hidden and management is all about “making (read gaming) the numbers” it is not so easy and you are unlikely to get straight answers.

Indeed, the truth is that it takes two parties to diagnose a problem and to evaluate alternative solutions. Senior management understands the context of the problem while the shop floor understands the details of how work is actually done. This is true at every level in the organisation. Hence the need for a common language for the dialogue that brings together the context and the details, that helps to frame the problem correctly and then to plan and monitor the experiments to test alternative solutions. This is what Toyota’s A3 thinking process is all about.

Knowing how to ask the right questions to provoke the right kind of thinking about the right things is a challenge for managers used to people looking upwards to them for the answers. Giving answers is not only dangerous but it takes away the opportunity for employees to learn how to think. Getting everyone in the organisation to think in the right way about the right things and to continually challenge the way things are done is one of the most powerful results of lean thinking.

Daniel T Jones is chairman of the Lean Enterprise Academy