5 Guiding Principles for Transforming Healthcare

Lean
in Healthcare

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The term “lean” was first introduced in 1988 by John Krafcik¹, at the time a graduate student at MIT working with Jim Womack and Dan Jones on the International Motor Vehicle Program research², which eventually led to the publication of the book “The Machine That Changed the World”³. As more organizations and industries were exposed to the potential of lean thinking, it became clearer that its teachings did not apply only to manufacturing. As we entered the new millennium, lean arrived in healthcare, improving patient flows, reducing length of stay and improving the quality of care. Today, there are successful examples of lean application in healthcare all over the globe, with more hospitals joining these efforts every year. A recent survey by UC Berkeley involved more than a thousand hospitals, two thirds of which were engaged in lean implementation (and similar approaches, such as lean six sigma or process improvement), with many reported performance achievements, such as employee engagement, greater service capacity in the emergency department or reduced spending. A comparative analysis of quality measures (before/after lean) also found a reduction in the unplanned 30-day readmission rate; in the mortality rate for surgical patients with critical conditions (Z score); and in spending, with a consequent increase in operating margins⁴.

The Lean Global Network (LGN) supports dozens of lean transformations in healthcare. Five of the authors were directly involved in some of the early lean transformations in healthcare in their respective countries, either as internal change agents — at Beth Israel Deaconess Medical Center (USA), Flinders Medical Centre (Australia) and Instituto de Oncologia do Vale (Brazil) — or acting as external supporters to pioneering organizations — at Instituto Lean Management (Spain) and Lean Institute Brasil (Brazil).

DESIGNING
OUR INITIATIVE

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Often, a healthcare organization can take a decade to develop and sustain the capabilities needed for a lean transformation. These capabilities are basically associated with problem-solving skills at different levels of the organization and the ability to reshape management systems and leadership behavior.

We believe that “ten years” is too long, especially if we consider the urgent problems the industry faces today: patient harm, an aging population, tight budgets and an increase in chronic diseases. And if we consider that only a small fraction of the world's hospitals are practicing lean and many are only beginning their journeys, the work ahead seems even more challenging.

In September 2015, the LGN appointed a lean healthcare working group (LHI — Lean Healthcare Initiative) to gather and analyze data and build on the findings to identify critical “guiding principles” that a healthcare organization should consider in order to reduce the time it needs to develop the necessary capabilities and sustain the lean transformation. The working group represents five LGN institutes: USA, Brazil, Spain, Russia and Australia.

The exploratory sample includes eight organizations: [1] Beth Israel Deaconess Medical Center (USA), [2] Lynn Community Health Center (USA) and [3] Stanford Children’s Health (USA), [4] Hospital São Camilo (Brazil) and [5] Instituto de Oncologia do Vale (Brazil), [6] Consorci Sanitari del Garraf (Spain), [7] Bud’ Zdorov (Russia) and [8] Flinders Medical Centre (Australia). The organizations range from large teaching hospitals in the United States to small practices in a developing country. There is a mix of private practices and public organizations in Europe and Australia.

DON'T WAIT
FOR THE CEO

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Data from the American College of Healthcare Executives show that the annual turnover level recorded in 2017 is among the highest calculated in the last two decades, around 18%⁸. By comparison, CEO turnover in healthcare is six times higher than in the insurance industry and twice as high as in retail⁹. So we cannot depend on the CEO to lead a transformation every time. We observed CEO turnover in more than half of the eight cases studied, which could be a disruptive factor for lean efforts.

CEOs have responsibilities for the entire organization. It can be difficult to get the CEO's attention. What we noticed when studying the eight initiatives mentioned above is that, while having an engaged CEO is extremely beneficial in the medium and long term, starting a transformation is something that can be done without the direct involvement of the organization's most senior leader¹⁰. In fact, a transformation can be initiated at different levels of an organization (in a department or in a nursing team) and begin with the simplest of experiments¹¹. In our experience, involving key physicians or other clinical leaders at the beginning is a key strategy, because they have multiple roles and understand the work, have strong influence over teams and leaders, understand the scientific process and are a stable workforce. It is also crucial to ensure that area managers have a leadership role in the lean transformation, since the necessary changes will greatly influence their work and that of their teams¹². This approach can help mitigate the challenge of CEO turnover and of distraction.

Reflecting on our studies, we agree that it is preferable to have a supportive CEO; however, a neutral CEO can also work if physicians and other leaders are visibly engaged. What will not work is a CEO who seems negative or who actively disrupts progress. If the CEO is kept informed about progress and results, he or she will probably become more supportive as long-standing problems are tackled and value streams are improved. As the benefits of lean become clearer and the first results appear, most CEOs tend to gradually become more involved. But there is no need to wait for them to start the efforts. You can start a transformation if your CEO is indifferent, supportive but not involved, engaged or even leading the efforts, but it will be very difficult if he or she is negative about it.

Someone must lead the lean transformation. And that is the person who takes on a great deal of responsibility for advancing, spreading and deepening the transformation and who thinks about what the next step should be. We call this role the Chief Architect (CA)¹³. At the beginning, when there is limited internal capability, the CA role can be filled by an external coach who will work to develop an internal CA, who in turn will be able to guide the transformation from there. The CA can be a key leader from within the organization — it may have been his or her idea to try a lean approach — or can emerge from within the organization during the transformation.

In an ideal world, we would not need a formal CA, but at the beginning of the transformation the organization needs knowledge and experience. This makes the CA a person a newly started transformation cannot do without. The effectiveness of an external coach depends entirely on what happens after he or she leaves: an outsider will not achieve much unless he or she challenges people to break down barriers, create solutions to problems autonomously and actively suggest improvements.

WHAT IS YOUR NEXT STEP?
AND WHY?

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Whether you are trying to identify your first step or simply understand what the next step should be, you should always seek to focus on an urgent need¹⁴.

When starting a transformation, you need to understand what is important to your CEO, your board and the organization as a whole. Which problems seem most urgent? Which safety concerns should the organization focus on? What do patients care about? Once you have created a focal point for the improvement effort, everyone can row in the same direction. Examples that work generate interest. With meaningful experiments, people will follow¹⁵. “I like that improvement in patient flow in the surgery department. I need to learn how to improve flow in my department… can you help me?”.

If you don't know where to start, we have found that simply focusing on turning chaos into stability can be of great help. Make the patient journey and the work visible and you will see significant improvement.

When we bring about change through lean, we create new knowledge. A very important lesson we have learned over the years is that you cannot leave lean “running on its own” and expect it to sustain itself. The reason is that every situation is different, every department goes through different problems, and every person perceives these problems in a different way. You can be inspired by an external solution, but you cannot simply drop it into a different context in which it is not relevant. Another negative effect of such behavior is that it deprives people of the ability to understand and learn together. People need to feel emotionally connected to the transformation: they need to co-create experiments and share learnings, instead of simply applying something someone else developed.

As we take our first or next step, we have learned the importance of balance between the social and technical elements of lean. It doesn't matter whether you start by trying to change the culture in your organization (social) or by focusing on a specific project (technical), as long as your actions are connected to real problems.

OWN THE PROBLEM

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Earlier, we talked about emotions, stating that if people feel emotionally connected to the problem, they will take ownership of it. Therefore, creating ownership is essential to the transformation. When you lead people to take ownership of problems, you achieve not only organizational change but also personal transformations¹⁶.

In a lean organization, once problems have been identified, the experiments begin in earnest. That is when we need to transition responsibility to a frontline leader (it can be anyone: a nurse, a receptionist or a physician). Respect for people, one of the two pillars of the Toyota Way¹⁷, means giving independence to the people on the improvement team. Let them take responsibility for identifying and solving problems, and let them feel safe enough to ask for help when needed.

As lean practitioners, we can greatly influence the rate of improvement by reflecting on and adjusting our own mindset and our own practices. Sometimes we are the problem behind stalled progress. Instead of demanding that others change, ask yourself “what can I do differently to move things forward?”. Don't underestimate the value of reflection at the individual and team levels. It can also be useful to seek an outside perspective to challenge and broaden your thinking. The right question asked by the right person at the right time can make a big difference¹⁸.

THE RIGHT KNOWLEDGE
FOR THE RIGHT PERSON AT THE RIGHT TIME

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The speed of the transformation depends on our ability to develop the right capabilities quickly and effectively. But how do we do that? By providing the right information to the right people at the right time. Healthcare staff are very busy. We must give people the right amount of knowledge they need to solve their problems. Don't overload people by bombarding them with knowledge they have no way of using yet. Instead, wait until they need it. When you learn something and apply it the right way, you remember it.

When developing capabilities, we need a combination of mindset, practice in the gemba and tools. Tools alone will not change the culture. The continuous practice of lean tools and principles builds confidence and competence at the same time, but the new approach to work must be learned on the front line, where the work can be observed extensively and, ultimately, understood.

Structured learning with a coach will help people build the habits and behaviors we need to have in our lean organization. Make sure you are using the right teaching method, which may include traditional classroom training, coaching through questions and, predominantly, learning based on practice in the gemba¹⁹.

As discussed earlier, involving physicians early is a key strategy. Build relationships and trust through a deep understanding of their work and their daily frustrations, and then partner with them to improve the situation. The same principles apply to senior leaders, but with them there is more to do. Unlike physicians, many senior leaders are far removed from frontline work. In our experience, we have found that training leaders in the basics of lean and learning to see reduces this distance and builds empathy and trust toward the front line. Along with this, learning and practicing A3 thinking will reduce the tendency to provide solutions to problems they do not understand.

CROSS-POLLINATION

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As lean thinkers, we believe that deep knowledge comes from hands-on experience. However, this is something that cannot be taught; it can only be learned. How can we expose more people to direct experience and use it to accelerate the development of a Chief Architect? The answer is cross-pollination.

In a large Australian hospital, the nursing teams' first improvement efforts focused on building two model lines — one outpatient and one surgical. Over time, nursing leaders recognized the need to spread the good practices identified beyond these areas. The approach adopted consisted of bringing four additional nursing teams to these lines: they could choose their improvements and adapt them to their own environments. In some instances, the next generation of improvements was subsequently adopted back on the lines. Another benefit of this approach was the breaking down of traditional organizational silos.

Cross-pollination also works across different organizations and different industries. We encourage practitioners to meet regularly to share new insights and reflect on progress²². When people leave their workplaces and their comfort zones and draw a parallel with the work others are doing, they understand how universally applicable lean ideas are. In Catalonia, for example, cross-pollination was the main driver behind the development, in just a few years, of a brilliant lean healthcare community of 12-15 hospitals.

We believe this community-based model of cross-pollination is completely replicable: people move around and talk, which means that spreading the word is really easier than you might think. It is essential that good examples and results are well documented for sharing.