Being Clear About Project Goals

A friend sent me a newspaper article about a Canadian healthcare organization that is having some trouble with a major Lean initiative.  Here’s a bit of what the article included:

The president of the Saskatchewan Union of Nurses says her members are worried about changes under a program known as Lean.  The Saskatchewan government is paying $40-million over four years for the program, which looks for ways to reduce spending and streamline health care.

Union president Tracy Zambory says nurses hoped that Lean concepts would be effective, but she says it’s been disappointing.  “Now that Lean is being put into practice, we are seeing the primary focus is on creating efficiencies, waste reduction and budgetary savings only. It … is unfortunately proving to have little impact on direct care at the bedside and patient outcomes,” Ms. Zambory said in a statement released Tuesday.

“We are finding that Lean does not fit with the registered nursing process, safe nursing practice, registered nurse decision-making or the formulation of nursing diagnoses.”  Ms. Zambory said Lean is supposed to be an inclusive process and when the largest provider of direct patient care says it’s not working, “we have to go back to the drawing board.”

Premier Brad Wall has defended the program. He has said it has already paid for itself with savings on two new hospital designs and with ways to reduce waiting times. The Premier says it’s about better care and more efficiency.

Health Minister Dustin Duncan said he was taken by surprise by Ms. Zambory’s statement because nurses had supported Lean.  Ms. Zambory herself said in August, 2013 that there are “many commendable transformational changes” happening under the umbrella of Lean.

 “We have 44,000 employees in the health-care system and to get everybody to agree to anything is probably not going to be possible, but I’m a little bit surprised by the release today from SUN,” Mr. Duncan told reporters at the legislature.

The friend, who sent me the excerpt from an article in a local paper, asked my opinion.  My first comment is that there isn’t enough information in this release to make any judgment.  The article suggests that the program was launched to “reduce spending and streamline health care” but doesn’t get very specific about that.  It’s easy to imagine that a program could save lots of money by changing the way suppliers are handled, or how accounting was managed, while not having much impact on interactions between nurses and patients, and still be judged a success.  On the other hand, if one of the specific goals of the initiative was to reduce the costs or to improve the quality of nurse-patient interactions, and that wasn’t being achieved, then we would have a problem.  As I say, we simply don’t have enough information to judge this program.

I am impressed that the hospital system is planning to spend $40 million over the course of four years.  That suggests that the effort will need to save $40 million in four years, just to break even, and will need to save quite a bit more to really justify the time and effort the hospital will invest in this effort.  The Premier suggests that Lean has already paid for itself by proposing changes to two new hospital designs – something not usually associated with Lean — and it would be interesting to hear more about that.

Again, we don’t know anything about the lean initiative that the hospital is pursuing.  Lean can refer to a very sophisticated effort to rethink how the value streams in the organization work – and can even include the development of employee teams that focus on continuous improvement, as defined in the Toyota Production System, or it can refer to a much more modest effort that focuses on eliminating wasteful activities.  It’s awfully hard to get large savings from the incremental elimination of waste, while it’s much easier to obtain major savings by automating major processes.  Again, we simply don’t know what is being attempted.

The problem with a lean initiative, in the abstract, is that lean can be a very narrowly focused initiative, highly structured for manufacturing environments.  Many of the elements that a process improvement team can bring to bear, as, for example, improving customer-employee interactions, upgrading manager-employee relations, optimizing a decision processes, installing software systems or new hardware to improve processes, or attempting to change the way employees interact with customers, are not typically found in lean engagements.  Again, we don’t know the scope of the hospital initiative being implemented in this case.

Stepping back from this specific case, I am reminded of the importance of being very clear about what an organization is attempting to do before it begins an initiative of this scale. 

In the process domain, I recommend what I usually term a Front-End Analysis (FEA).  Some might call it an audit, although the term audit is often more narrowly construed than my use of FEA.  An FEA depends on using outside consultants to establish clear goals for a process initiative.  Given the time usually allowed, and the paucity of data, an organization should hire a very experienced consultant (or team of consultants) to undertake an FEA.  In effect, someone at an organization has decided that the organization needs to improve its processes.  In the case of the hospital system, someone decided that the system needed to “reduce spending and streamline health care.”  If an executive came to me and told me that was their goal,  there would be a number of questions I would want to ask before either agreeing that such an effort was justified or likely to pay for itself.

There are many approaches to process change – from efforts to analyze and redesign very specific business processes, to projects that seek to completely reconceptualize a major line of business.  Similarly, there are projects undertaken to improve the efficiency of specific process flows, projects designed to improve the quality of decisions made and projects to improve the quality of the interaction between employees and customers.  Each requires a different type of analysis and different redesign techniques.  Some projects require a specific technology, like Lean, or the use of specific software, like BPM or ERP software.  Others require that large numbers of employees be trained in process improvement techniques, or to take responsibility for constantly working to improve a given set of activities.  Others require that managers learn and apply new practices.

The decision to use specific techniques depends on many things, ranging from the problems the organization faces to the maturity and the previous experience of the organization in question.  These are all things that a good FEA team can determine and use in recommending a specific roadmap. 

In an ideal situation, the FEA team ought to visit the organization, making multiple visits if multiple sites are involved.  The team will need to review documents and interview executives, and may conduct group sessions with managers and employees from specific work groups.  The goal is a report in which the FEA team outlines where the organization is today and where it should go to accomplish specific goals.  As with an accounting audit, the team doing the FEA should not be engaged in actually doing the work.  The FEA team should define the situation and establish goals for an intervention and then step back and let the organization engage others to undertake the specific project.  Later, perhaps, the FEA team should be invited back to do a new assessment and adjust its roadmap to reflect results that have been attained.

If the healthcare organization mentioned earlier in this article had had an FEA, both the executives and the nurses would have had a good idea of the goals of the process intervention.  If the intervention was to improve the efficiency of processes, the FEA would have specified the target populations and processes to be made more efficient, and the basic techniques to be used to accomplish those goals would have been specified.  It would have been clear whether or not nurse-patient interactions were to be improved, and there would have been specific measures proposed to determine the nature of the improvement.

If more organizations planning to launch multi-million dollar process improvement projects were to begin with a good Front End Analysis effort, there would be less confusion later in the project.

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