In every industry, its important to strive for organizational excellence. But while some companies such as General Electric (GE) have been using the LEAN and Six Sigma methodologies for years to make their organizations run more efficiently, the majority of healthcare companies have not yet embraced this process of identifying, and then providing, what their customers want.
A business management strategy, Six Sigma strives to identify and remove the causes of defects in manufacturing and business processes by using statistical methods and other quality management strategies. Lean is the set of tools that assist in the identification and steady elimination of waste, improving the flow of work and resulting in the meeting of customer expectations. “While the use of Lean and Six Sigma may not be very widespread in the healthcare industry, its use is quite widespread throughout other industries, where it has proven its worth,” said Dr. Narendra Kini, president and CEO, Miami Childrens Hospital. “This is not a new or radical concept; it is a time-proven methodology.”
To help healthcare CEOs and COOs understand the value of Lean and Six Sigma, The DEIVIN Group will be hosting a seminar on November 7, 2008 entitled Driving Organizational Excellence Using Lean and Six Sigma. The seminar, which will take place from 8 a.m. to 4 p.m. at the Conrad Miami, will feature Dr. Kini and Kaj Ahlmann, former GE executive and Six Sigma Winery owner, as its keynote speakers. Attendees will also be able to participate in educational workout sessions and in an interactive question-and-answer session.
According to Ahlmann, the former CEO of Employers Reinsurance Corp. (a division of GE), a lot of companies started using standard deviation after World War II as a way to measure quality in their manufacturing businesses. “One of the biggest difficulties that people in the service industry have is getting their heads around the idea of a defect in the company,” he explained. “In the manufacturing industry, its easier to measure quality because if theres a defect, it can be seen in the product. But in the service industry, its harder to see where problems lie; how do you measure a defect in a financial institution like a bank, or in the services of a healthcare provider?
“Even if you ask a customer what it is they want, they may have trouble defining their needs,” he added. “What services do they expect their bank to offer, and how can those services be measured?”
Identifying what the customer wants is one of the most important factors in the Six Sigma process. “A customer dealing with an auto insurance company doesnt want to spend a lot of time talking to an agent; they want reporting a claim to be as short and sweet as possible,” explained Ahlmann. “If they have to spend a lot of time on the phone and then it takes six months to receive a check, they are going to be frustrated.
“The bottom line is that within 48 hours, the customer wants their insurance company to cut a check,” he continued. “If that doesnt happen, he or she wont care whether the problem is in accounting or IT. This is why its also important to have a process in place to connect different departments so that everyone is working to meet the customers needs.”
“What many companies dont realize is that they often must change the entire culture of an institution in order to make Lean and Six Sigma methodologies succeed,” said Dr. Kini. “They must introduce a culture of transparency and accountability which often requires a substantial amount of change. Employees must also develop brand new skill sets, and the company must make continuous improvement a very important piece of their everyday operations.
“In healthcare, for example, most processes are defined by the point of view of the provider and not that of the customer,” he added. “Every clinical process that drives patient care must be examined from that point of view.”
For the past three months, Dr. Kini has been introducing Lean at Miami Childrens Hospital. Now in its initial phase, about 10 percent of the staff has been trained on the use of the methodology, and Dr. Kini says he expects to see solid results from the process in approximately six months. Dr. Kini was previously part of a GE team that deployed Lean at a large healthcare system in the Midwest.
Ahlmanns keynote address will discuss how he uses the Six Sigma method at his winery in California. “Auto insurance is boring, but everybody likes a story about wine,” he said. “Six Sigma methods apply to all businesses, and Ill talk about how to apply these methods all along the line.”
