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Lean manufacturing is an approach of continuous improvement that focuses on the removal of waste resources from a process so that the goods flow to the customer at determined rate with minimum inventory. It mainly focuses on eliminating resources that does not create value for the customer. Based on Toyota Production System, Lean concentrates on preserving value with less work. "Lean synchronization is the aim of achieving the flow of products and services which is able to deliver exactly what customers want, in exact quantities, exactly when needed, exactly where required at the lowest possible cost" (Slack et al, 2010). This report evaluates the utility and relevance of basic Lean principles and Management and applies the same principles in contemporary business environment.
First part of the report talks about theoretical aspect of lean. The concept of lean synchronization is explained first. After this the principles of lean and benefits of using lean are described. Subsequently barriers to lean implementation are explained.
Second half of the report accounts practical application of lean in context with healthcare industry. Firstly the need to apply lean in hospitals is determined. Basic need of lean in hospitals is to:
Reduce patient wait time
Reduce cost and increase savings and
Improve staff efficiency.
Lean principles are than applied on hospital operations. Analysis discovered that 'time' creates value to the patient. After this, value stream was assessed and waste processes were identified in the journey of patient's recovery and treatment. Further to this, wastes were identified and recommendations were proposed to eliminate those wastes.
Important Identified Wastes are:
Extra work done for simple and easy tasks.
Investigations and tests those are not required.
Patient waiting for tests and surgeries.
Redundancy in treating a patient.
Recommendations to eliminate such wastes:
Avoid the use of complex equipments that makes the processes tedious and time consuming.
Perform only those tests that are required for the treatment.
Equipments must be ready before a patient comes to pathology lab and operation theatre so as to avoid waste of time.
Things must be done in right way in first attempt so as to avoid repetitive actions.
Concept behind Lean Synchronization
The term lean came into existence post World War II when there was a huge shortage of resources in Automobile sector in Japan. Toyota Company developed the concept of achieving most with optimum resources, by continuous elimination of waste. Today this concept is well known as Lean Manufacturing across the globe and is not limited to manufacturing processes. Lean applies to the whole enterprise including supply-chain, new product development process and services. The concept of lean thinking was introduced to European world in 1991 by the book written by Womack, Jones, and Roos: "The Machine That Changed the World".
According to Slack et al (2009), lean synchronization is concerned all about:
Elimination of waste in whole process
Involving all the resources and
Continuously improving the process
Lean approach simply calls to work smarter rather than harder with value driven sense of purpose.
Organizations that follow lean thinking understand customer value and focus the processes to increase it. The ultimate aim is to create a perfect value process for the customer with zero waste. Such contemporary approach creates processes that enable companies to respond to changing customer desires with high quality, high variety, and low cost with very fast throughput times.
The main guiding principle of lean to create right value for the customer with minimum effort is compounded of five key principles: value, value stream, flow, pull and perfection.
Value: The key principle is to identify the customer's view point about what creates value to the customer.
Value Stream: This is to identify all the steps in value chain and to eliminate all those that do not create value to the end product.
Flow: In order to make a smooth flow of the product towards customer, the value-creating steps must occur in tight sequence.
Pull: Make only what is pulled by the customer and creates synchronization between demand and manufacturing process.
Perfection: Once the value is identified, value stream is specified with wasted steps eliminated and flow and pull are introduced, execute the whole process again and continue until perfection is reached in which perfect value is developed without waste.
Benefits of Applying Lean
Traditional approach assumes that each stage is separated from the other stage by placing the output in an inventory. The next stage will take the outputs from the buffer inventory and will pass them to the succeeding buffer e.g. as shown in fig.2, outputs from stage A are stored in buffer inventory which feeds the system for Stage B. In this manner each stage of the operation acts independently and picks material from buffer inventory and processes it for the subsequent buffer. These buffers insulate each stage from its neighbors and operations of one stage do not hinder the next stage. Hence if operations at stage A cease due to some reason, stage B can still continue for at least one time. The condition of insulation of each stage that seeks to promote traditional approach is indeed the learning argument of this system.
Inventory remains idle.
Slow throughput times since items spend more time waiting in buffer.
Lack of coordination due to insulation of stages.
Problem solving responsibility will be centered on people working in that very stage.
In contrast with the traditional approach, lean approach processes and passes items directly to the next stage, eliminating the buffer inventories, hence reducing the barriers between stages. This provides the required amount of input for each stage at the required time. In this approach, problems at any stage have different impact on the process e.g. in fig.3 if stage A stops its operations, than subsequent stages will immediately notice the issue and the problem is quickly exposed to the whole system. This helps in improving the quality by providing quick feedback at each stage.
In the traditional approach, if one stage stops functioning the other stage may continue to process by the available buffer resources resulting in high capacity utilization. But generally this situation would not sustain for a long period of time and the whole process will come to halt once the buffer is empty. On the other hand, in lean approach each time there is a blockage in any stage of the process, the whole process will come to halt, reducing the capacity utilization initially. Therefore where traditional approach encourages efficiency by protecting each stage from disruption, lean approach motivates the whole system to solve the problem.
Fig.4 Source: Slack et al, 2010
According to Wild (2002), following are the benefits of Lean synchronization. Also evident from the above differentiation:
Reduced inventories and work in progress;
Less use of space;
Shorter throughput times;
Increased employee motivation and participation;
Smoother work flows;
Improved quality and customer service
Barriers to Lean Synchronization
Lean synchronization aims at managing the operations process in such a way that it achieves exactly what customers are looking from the operation. Pure lean synchronization intends smooth, continuous flow without any sort of delay, waste and imperfection.
Following are the major barriers to achieve this ideal state:
Failure to eliminate waste in all parts of the operation
Failure to harness the contribution of all the people involved in the operation.
Failure to establish improvement as a continuous activity.
Source: (Slack et al, 2010)
Waste Identification and Elimination:
Elimination of waste is the basic part of lean thinking and identifying the waste is the first step towards its elimination. Any activity that does not add to value is called as waste. The wastes that hinder the streamlined flow are:
Wait time - worker wait time and machine wait time is waste. This is usually dependant on efficiency of machinery and workers.
Conveyance - Change in layout can bring processes closer resulting in reduced movements.
Inappropriate quantity of production - According to Toyota, supplying less or more quantity than required is the greatest source of waste.
Delivery Time- Early delivery is wasteful. Therefore items must be delivered 'Just In Time'.
Variability- If quality varies according to customer expectations and customer considers to be inadequately supplied than the whole process is wasteful.
Organizations following lean philosophy must encourage its employees to participate in problem solving activity. The intention to encourage the feeling of personal responsibility and ownership within the employees is referred as 'respect-for-people'. Some basic factors in encouraging employee involvement are:
Environment & Safety - safety standards and environment must be followed by everyone.
Flexibility - employees must be given authority to take decisions and restrictive practices must be removed.
Equality - each employee must be treated equally.
Creativity - each person's creativity must be utilized to improve the processes.
Total people involvement- staff must be encouraged to participate in other activities like recruitment, supply chain and customer dealing. This improves the processes and benefits the company as a whole.
Kaizen is a Japanese term for improvement or 'change for better'. In terms of Masaaki Imai, Kaizen is a continuous process of improvement in which each individual of an organization is involved to achieve a state of perfection. Three guiding principles of kaizen as explained by Hill (2005) are:
Process reviews - review of entire process from designing stage to delivery.
People participation - employee's insights to improve the process.
Constant need for change - seeking improvement and implementing changes result in achieving
Fig.6 Source: Archfield Consulting Group
It is also called PDCA cycle which involve a team of people who continuously find improvements in an organization. Waters (2002) defined this cycle as:
Plan - review of existing processes, information gathering, finding alternatives and suggesting improvement plans.
Do - plan in implemented and performance data is collected.
Check - analyzes the collected data to check if expected improvements appear or not.
Act- if improvements are visible, the operation is made permanent else lessons are learnt.
Applying Lean in Healthcare Industry
Applying lean in healthcare industry is similar to its application in manufacturing. Lean manufacturing reduces waste from the set of operations that takes place in producing of items. Similarly lean can reduce waste and improve the services provided to the patients in hospitals. This may also help hospitals to manage issues like financial deficits, infections, waiting queues and capacity management.
Why Lean in healthcare?
Alike other industries, healthcare also face problems like safety concerns, capacity and waiting queue management, low level of efficiency and lack of staff motivation. To get rid of these issues and to deliver improved and timely patient care, it is important to base hospital processes on lean synchronization. Lean implementation in hospitals can also prevent hospitals acquired infections, avoidable injuries, death and less recovery time.
Traditional practice in hospitals
Major time of patients and hospital staff is wasted due to multiple trips made by the patients and the staff members. Once the tests are performed, patient is called for diagnosis after few days. Treatment for the illness may or may not start on the same day. This delay in treatment may cause deterioration in patient's condition. Implementation of lean in hospitals will reduce the time taken in treating the patient. According to lean process, a patient must come once and all the processes must be done on the same day e.g. tests are done and the treatment is started soon after the diagnosis from the tests. The process mentioned in the figure consumes unneeded time of patients and hospital staff and this in turn increases the overall cost and risk to life. Avoiding such unnecessary trips eases patient care and reduces the workload on doctors. Lean eliminates waste processes and increases the overall throughput in hospitals.
Fig.9 Source: NHS Confederation
Principles of lean in healthcare
To ensure patient satisfaction, hospitals need to analyze the patient's viewpoint as depicted in fig.10. Value is the perception of a patient and can be created when right consultation, test, diagnosis, communication, treatment and after care is provided to the patient. By eliminating waste processes and utilizing resources, staff will be able to concentrate more on patient care.
Fig.10 Source: JWA Inc.
Value stream is the process of identifying all the steps that creates value to the patient and eliminating those that creates no value to the patient. Usually hospitals tend to group patients on the basis of clinical similarity. However lean focuses not on similar conditions but similar processes.Fig.11 shows various steps and processes taken to discharge a patient.
Fig.11 Source: Flinders Medical Centre
"In a hospital a value stream is the end-to-end process of caring for a group of patients whose overall care process have enough in common for them to be managed together, irrespective of clinical diagnosis" (David Ben-Tovim, 2006).
Following are the steps that may not create any value to the patient and should be eliminated:
Patient's visit to hospital on different days for different tests.
Time wasted when patient waits to be seen by the doctor.
Unnecessary step of nurse checking the patient.
Time wasted in collecting medical equipments and information.
Repetition of processes such as diagnostic tests and paperwork.
Time consumed in searching medical history of patients.
Performing tests that are not required.
The factors stated above signify that 'time' is the most valued element for the patient as well as for the hospital staff. To eliminate this waste of time, we first need to identify the cause of this waste. Fig.13 shows the causes that increase the waste in waiting time.
Cause and Effect 3.jpg
Waste is anything that does not create value to the patient.
Holding excess material to avoid unreliable supply is referred as inventory waste in hospitals. Eliminating such waste can reduce cost and time of both the patient as well as the hospitals.
Use of complex equipments to conduct simple tests makes processes large and inflexible and may cause stress to the staff.
Unnecessary tests and investigations are referred as overproduction in healthcare industry. These tests must be avoided to save time and cost.
This is the patient wait time that created due to process or material waiting e.g. patients waiting for test or surgery due to equipment readiness.
Movement of patients and materials are considered as waste but these cannot be eliminated completely. Processes must be arranged in a manner that steps become sequential and easy to identify.
Defects increase the processes and are caused due to wrong medication or infections. Doing things in a right way will reduce redundancy as well as defects in a process.
Hospital layout must be in a way that it minimizes the repetition of movements by staff and patients e.g. in operation theatres, all equipments must be in reach of the operation table so as to ease the surgeon while doing surgery.
Mapping Value Stream:
The challenge in value stream is to map exactly the things that actually occur at each stage of patient's journey towards recovery, as depicted in fig.14. Lean redesigns this flow to enable seamless movement of patients to the next step without unnecessary work or wait.
Fig.15 shows an example of process mapping where it just takes one step on the process of 'tests' and lists each step of work that is currently performed. Amount of time, distance covered and required amount of materials can be added to each such step. It is evident that huge amount of work is being done without creating any value. Involvement of staff during waste identification is usually advised so that the effect of one person's actions is visible to all.
Flow is the process where every patient is worked with single unit at a time and passed to the next step without any delay. Following are few processes that can be redesigned in order to implement lean operations:
Concurrent medical problems complicate patient care of an elderly patient who got fractured. Treatment is affected because specialists fail to communicate and coordinate with each other. This problem can be resolved by creating another department called "Trauma Unit" which creates a single team having all kind of specialists. A standard 'hand off' process between each member will make it possible to identify and address treatment issues regardless of who is on duty.
In hospitals, usually same type of operations is conducted on one day and another type of operations on other day. To increase flow through surgeries, it is suggested that few operations of each type should be performed each day. This will reduce waiting time for patients as well as burden on wards.
In outpatient department, patients are usually called in the morning at same time say 9a.m. and it is highly likely that not all of them will be treated at the same time and some have to wait till noon. Hence patients must be called according to priority and severity of the problem.
Samples are held back in pathology to process them in batches. This leads to increase in wait time for patients. Samples must be tested soon they arrive to the lab.
To create value to the customer, services should be provided in line with the demand. If the demand is for 100 admissions a day, it implies that 100 patients must be discharged on that day to accommodate the demand. To achieve this demand in hospitals all the key processes and interfaces between them must be redesigned. The time required to spend on each activity to achieve output in line with demand is called as "Takt Time". It is the time that identifies the speed with which work and materials flow within different departments. In pull system, each patient is treated as one unit at a time and passed to the next level without as soon as it is ready. Fig.16 shows a pull system where each stage of the process pulls the patient towards it.
Fig.16 Source: NHS Confederation
After eliminating all the waste processes without compromising the quality of service, the whole operations process is repeated until perfection is achieved. To achieve perfection in hospitals, following aspects must be taken care of:
After Lean Implementation
Wait time unaccepted
Problems visible to all
End to end process
Service provider first
Problems not visible
Perfection is achieved by continuous improvement of the operations process. It is therefore necessary to that all the staff members and the hospital management must commit to seek perfection at their level. By creating standard, visible and clear processes, we can develop the foundation of uninterrupted improvement, where every new improvement becomes a landmark or platform for future processes.
Advantages of Lean in Hospitals:
It is observed that implementation of lean in hospitals have increased efficiency from 15 to 20 percent with safer and improved services using the existing infrastructure, technology and staff. Hospitals across the globe, which have adopted lean philosophy, have benefited from its implementation. According to David Ben-Tovim of Flinders Medical Centre, Australia, the hospital was struggling to survive and was on the verge of meltdown. But after applying lean in their operations process, they managed to earn more profits and decreased the costs. Some important advantages of lean are:
Reduction of wait time for patients.
Reduced cost and increased savings.
Reduction in physical floor space by 30%.
Productivity increases from 75% to up to 125% in some cases.
Good customer relations.
Staff motivation and reduced stress levels.
The aim of this research was to understand the lean philosophy and to apply lean principles in healthcare industry. It is evident from the study that lean philosophy brings positive results. It improves safety, quality and morale of the staff along with reducing time and costs in the operations process. Lean when enforced in hospital operations can add value to patient care and improve efficiency. Lean principles are generic and can be applied anywhere. If lean principles are applied at each stage of the operations process than huge amount of time can be saved. These principles challenge the whole idea of batching, triage, economies of scale and de-skilling. Results of lean implementation are potentially significant. Lean acts as antidote to traditional approach of performance management. Its emphasis is to put the whole system in a valuable stream. Lean's focus is to improve effort on things that weigh importance to patients and hospital staff. It opposes the external benchmarks which tend to express the things that are indirectly related to improve patient care. It is also evident from the data that hospitals that have adopted lean in their operations have improved in terms of patient care, costs and time. Hence it can be concluded that implementing lean in any industry will prove to be the best bet.