INCITO CONSULTING GROUP 8 R E A S O N S W H Y L E A N M AT T E R S M AY 2 7,

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1 INCITO CONSULTING GROUP 8 R E A S O N S W H Y L E A N M AT T E R S M AY 2 7,

2 QUICK INTRODUCTION (THANK YOU!) Incito Consulting Group 6/2/2015

3 ISIDRO IZZY GALICIA PRESIDENT & CEO San Francisco, CA ENGLISH & SPANISH MBA - Global Management, BSBM - California State University, Master Black Belt Six Sigma Over 24 year s global leadership experience in Lean Enterprise Transformation. Senior-executive roles within industry and consulting including within Toyota Motor Corporation (North America and Japan) Significant international experience working with various industries which include automotive, finance, aerospace, food processing, military, real estate, construction, mass transportation sectors across the United States, Europe, Asia, Canada and Latin America. Recipient of the distinguished Shingo Prize, National Institute of Standards and Technology award and the (NAM) Award for Workforce Excellence Recognized leader and professional speaker/ lecturer in the areas of Lean and Six Sigma. Clients: Toyota, Nike, Kroger, Del Monte Foods, Bombardier, United Airlines, Catholic Healthcare, Ford Motor Company, General Motors, Afton Chemical, Novartis, Silgan Containers, Schreiber, TAMKO, Sony, General Mills, Safeway, Cardiovascular Healthcare, Turner

4 WHAT IS LEAN, (ENTERPRISE)? Incito Consulting Group 6/2/2015

5 WHY A LEAN ENTERPRISE? Every morning in Africa, a gazelle wakes up. It knows it must run faster than the fastest lion or it will be killed. Every morning a lion wakes up. It knows it must outrun the slowest gazelle or it will starve to death. IT DOESN T MATTER WHETHER YOU ARE A LION OR A GAZELLE WHEN THE SUN COMES UP, YOU HAD BETTER BE RUNNING.

6 TRADITIONAL IMPROVEMENT APPROACH

7 LEAN IN HEALTHCARE

8 LEAN IN HEALTHCARE?

9 IS LEAN IN THE HEALTHCARE INDUSTRY NEEDED? Today s healthcare organizations are under extreme pressure to improve: THE HEALTH OF THEIR PATIENTS IMPROVE PATIENT SATISFACTION THE HEALTH OF THEIR BOTTOM LINE The Cost of Providing Care is going up Patient injuries and deaths due to preventable errors occur far too often Healthcare employees, nurses, and physicians are often frustrated with the recurring problems they face every day An administrator at a prestigious University stated, We have world-class doctors, world-class treatment, and completely broken processes.

10 PATIENT SAFETY FACTS Industries with a perceived higher risk such as aviation and nuclear plants have a much better safety record than health care. There is a one in 1,000,000 chance of a passenger being harmed while in an aircraft. In comparison, there is a one in 300 chance of a patient being harmed during health care.

11 PERFORMANCE/ OUTCOME/ EFFICIENCY Hospitals payment will increasingly be based on their performance on performance/ outcomes/efficiency

12 8 REASONS WHY LEAN MATTERS IN HEALTHCARE

13 8 REASONS WHY LEAN MATTERS IN HEALTHCARE 1. LEAN PROVIDES TOTAL MANAGEMENT SYSTEM 2. LEAN PROVIDES A SYSTEMATIC APPROACH TO IMPROVE 3. LEAN PROVIDES A PROCESS TO IDENTIFY WASTE 4. LEAN PROVIDES A PROCESS TO ELIMINATE WASTE AND OPTIMIZE PERFORMANCE/ OUTCOMES/ EFFICIENCY 5. LEAN PROVIDES PLATFORM FOR CONTINUOUS IMPROVEMENT 6. LEAN INSPIRES LEADERS AND TEAM MEMBERS 7. LEAN PROVIDES A PROCESS TO MEASURE WHAT MATTERS 8. LEAN PROVIDES A SYSTEM TO SUSTAIN IMPROVEMENT AND DELIVER WORLD- CLASS CARE FOR ALL Lean is not a program, it is a total strategy -Taiichi Ohno

14 #1 LEAN IS A TOTAL MANAGEMENT SYSTEM

15 WHAT IS LEAN? Lean is a total management system and philosophy that can dramatically improve the way healthcare businesses are organized and managed Lean is not a program, it is a total strategy -Taiichi Ohno

16 #2 LEAN PROVIDES A SYSTEMATIC APPROACH Incito Consulting Group 6/2/2015

17 SYSTEMATIC APPROACH

18 TOTAL PROCESS CONTROL

19 #3 LEAN PROVIDES A PROCESS TO IDENTIFY WASTE Incito Consulting Group 6/2/2015

20 VALUE STREAM MAPPING Definition: Eliminating WASTE and the stagnation of work in and between processes, in an effort to eliminate variability and create flow Strategy: To create an arrangement of people, processes, technology and methods in a standardized and sequential order to allow a smooth uninterrupted flow in an effort to minimize variation

21 #4 LEAN ELIMINATES WASTE IMPROVE PERFORMANCE/ OUTCOMES/ EFFICIENCY Incito Consulting Group 6/2/2015

22 (3) ELEMENTS OF WASTE MURI Overburdening or pushing Team Members, instrument or equipment beyond their comfortable or practical limits. MURA Unevenness or fluctuations in the flow of patients, schedules and information, MUDA WASTE - Waste is anything that uses time, resources or space but does not add value to the service from the patient s perspective. Activities that consume resources, but create no additional value

23 PERCENT OF VALUE ADDED

24 RELENTLESS ELIMINATION OF WASTE (TIMWOODS) TRANSPORTATION INVENTORY MOTION WAITING OVER PRODUCTION OVER PROCESSING DEFECTS SKILLS

25 #5 LEAN PROVIDES PLATFORM FOR CONTINUOUS IMPROVEMENT 2015 Incito Consulting Group 6/2/2015

26 CONTINUOUS IMPROVEMENT: Value Stream Mapping Kaizen- Continuous Improvement Teams Standardize Processes

27 QUOTE: Where there is no Standard there can be no Kaizen / continuous improvement Taiichi Ohno

28 SPAGHETTI DIAGRAM (MOTION) Data collected, with electronic pedometers, showed a medical/ surgical unit nurse consistently walked miles per day

29 CAN WE SIMPLIFY?

30 CAN WE IMPROVE?

31 CAN YOU FIND WHAT YOU NEED WHEN YOU NEED IT? Could someone else?

32 5S IMPROVEMENTS IN OR STORAGE ROOM BEFORE AFTER

33 OR STORAGE ROOM 5S IMPROVEMENTS BEFORE AFTER

34 #6 LEAN INSPIRES LEADERS AND TEAM MEMBERS (INVERTED TRIANGLE) 2015 Incito Consulting Group 6/2/2015

35 FOCUS ON CULTURAL, BEHAVIOR AND EMOTIONAL CHANGE Leadership Challenge Lean deployment MUST BE PACED: Alignment of True North Strategic Priorities (Vision Elements) Creating a change platform and sense of urgency Implementing quick wins to gain momentum Coaching to ensure transition from disbelief to confidence Coaching to achieve more than was thought possible 73% of organizations FAIL at deploying Lean after year 1 due to the following reasons (not limited to) Focus on Tools (FOTM) Lack of Discipline Frustration Impatience (Tactical $$) Anger Mistrust of the process Behavior change to complex Lack of Accountability

36 INVERTING THE TRIANGLE Utilize People to Reduce Cost INVERTING THE TRIANGLE Building an entire culture of Problem Solvers that implement world-class value solutions to every day problems through a blend of people and technology

37 TEAM CONCEPT (EXAMPLE) Benefits: Response time Communication Span of Support Rotation Problem Solving Maximum Results

38 #7 LEAN PROVIDES A PROCESS TO MEASURES WHAT MATTERS 2015 Incito Consulting Group 6/2/2015

39 SUSTAIN THROUGH GEMBA WALK (GO-AND SEE) MANAGEMENT Reviewing Communication Board Go to the point where value is being added

40 WHAT TYPES OF IMPROVEMENTS MAY WE SEE WITH LEAN? Significant gains in PATIENT SATISFACTION, PRODUCTIVITY, EFFICIENCY and overall QUALITY OF CARE, which translates into reduced healthcare costs for the organization and the patient. Improvements may include: Patient Safety Patient Satisfaction Employee Retention Physician satisfaction Revenue Increase Decrease in Emergency Department Wait Time Improved Operating Room Utilization Improved Emergency Room Boarding Reduced Patient Discharge Delays Lab turnaround Time Reduced Labor costs Reduced Labor shortages Payer Reimbursement delay reductions Quality and rework costs Space constraints Costs do not exist to be calculated. Costs exist to be reduced -Taiichi Ohno

41 #8 LEAN PROVIDES A SYSTEM TO SUSTAIN IMPROVEMENT AND DELIVER WORLD-CLASS CARE FOR ALL 2015 Incito Consulting Group 6/2/2015

42 CASCADING MODEL SHIFT DAILY WEEKLY MONTHLY QUARTERLY Executive Governance Team Quarterly Performance Review Senior Leadership Hospital/Clinic Performance Review Corporate Office Department Manager Service Line Leader/ Value Stream Leader Value Stream Performance Review PMO Office Group Leaders Flow Cell Performance Review Project Management Office (PMO) Team Leaders Shift Performance Review Performance Boards Team Members Performance Boards

43 PDCA ROOM MODEL (OBEYA) Clearly Articulated Vision and Strategy Dedicate time and space Coordination and problem-solving Minimize organizational barriers Clear visual management 3 minute interpretation Effective communication Patient focused Plan, Do, Check, Act approach Team based approach and accountability

44 REMEMBER..

45 QUESTIONS? THANK YOU!

46 INCITO CONSULTING GROUP 8 R E A S O N S W H Y L E A N M AT T E R S M AY 2 7,

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