Cutting costs, reducing waste, and streamlining clinical and business processes are key steps to improving a health care organization’s financial performance. But many South Florida hospitals, physician groups and other providers find it difficult to implement quality improvement programs, even though they recognize the need, according to Steven G. Ullmann, a professor at the University of Miami School of Business and director of its Center for Health Sector Management and Policy.
"Quality improvement initiatives can dramatically transform a health care organization for the better," says Ullmann. "That’s why our course on ‘Lean Six Sigma’ principles and practices is a highlight of our School’s Executive MBA in Health Sector Management and Policy Program."
The Lean Six Sigma course – officially known as "Statistical Analysis for Managerial Decision Making" – is taught by Howard Gitlow, professor of management science and executive director of the School’s Institute for the Study of Quality. An expert on quality, statistical analysis and organizational behavior, Gitlow has consulted for a wide range of companies, including Hill-Rom Holding, giving him a firsthand perspective on improving performance."Traditional management methods of management by objectives and performance appraisal have failed," says Gitlow. "Today, many health care organizations are in financial distress or holding onto their capital, rather than investing in fixing the internal processes that can generate additional revenue and boost patient satisfaction, engagement and loyalty."
To help health care professionals gain a fresh perspective, Gitlow offers a hybrid approach to organizational improvement, drawing on his own studies in the 1970s with W. Edwards Deming, an innovative American thinker who pioneered the use of statistics for improving business processes in a working climate based on cooperation and trust. His class in UM’s Executive MBA in Health Sector Management and Policy program incorporates the Six Sigma management system for reducing errors and process variations. It also focuses on Lean strategies designed to eliminate wasteful practices and deliver greater value to patients, families and other stakeholders.
"Our integrated approach is working very well, based on feedback from our students and alumni," says Gitlow. As part of the health care Executive MBA program, Gitlow’s students take part in quality improvement projects related to their own organizations. "We’ve seen some spectacular successes in cutting cycle times, decreasing no-shows, reducing medical supplies inventory and cutting waiting times in the ER," he says. In addition to business process success stories, the Executive MBA student projects can also result in dramatic improvements in clinical care, such as a reduction in "never events" like patient falls from hospital beds.
Ullmann points out that clinical and operational improvements are increasingly important for South Florida hospitals facing a decline in revenues or operating margins. The average hospital today has a 2.3 percent operating margin, and there are indications of future reductions in revenue, Ullmann says, noting that large physician groups are facing similar financial issues. "Across the country, many leading health care systems are implementing Lean Six Sigma programs and enjoying quite significant benefits."
But beyond the financial benefits, Lean Six Sigma initiatives can pay off in an improved quality of life for administrators, physicians, nurses and other health care staffers, says Gitlow. "When times are tough, top management often finds it hard to move away from traditional management by objectives or performance appraisal systems that clearly are not working," he says. "Shortening the leash and tightening the collar creates a stressful atmosphere with unhealthy psychological and physical side effects. But when top management makes a commitment to a Lean Six Sigma type of initiative, the whole organizational climate can change for the better."
The University of Miami School of Business has offered its Executive MBA in Health Sector Management and Policy program for more than 30 years. It is currently ranked nation’s No. 6 such program by Modern Healthcare magazine. The next class begins in January 2014, with classes held one weekend per month. Students in the program include physicians, nurses, mid-to-high level executives and other highly experienced health care professionals working in group practices, hospitals, government agencies, biotechnology and pharmaceutical firms, insurance companies, managed care organizations, and medical device companies.
