Continuing with my
series on healthcare and my push for everyone to get a copy of Performance Improvement for Healthcare,
let’s now discuss how Six Sigma fits into our healthcare discussion, again
using direct quotes from this wonderful book.
“W. Edwards Deming,
along with others, began emphasizing the need to understand variation through
the use of statistical tools such as Pareto and control charts. This latter
concept, known as Total Quality Management (TQM), also shifted
responsibility for quality improvement to those directly involved in the
process. It was not until Six Sigma came along that all these concepts were
combined into a single methodology. While Deming focused on the cultural
transformation of businesses, other management pioneers, such as Joseph Juran
and Philip Crosby, addressed the management and cost of quality, respectively.
From Crosby’s perspective, expenditures associated with improving quality
should be offset by the resulting savings in warranties, scrap, rework, and
other costs of poor quality.”
“Six Sigma has
emerged as the primary vehicle for improving both manufacturing and service or
transactional business processes. Six Sigma has been defined in many ways. The
following definition, taken from The Six Sigma Handbook, by Thomas
Pyzdek, is perhaps the most inclusive:
“Six Sigma is a
rigorous and systematic methodology that utilizes information (management by
facts) and statistical analysis to measure and improve a company’s operational
performance, practices and systems by identifying and preventing “defects” in manufacturing
and service-related processes in order to anticipate and exceed expectations of
all stakeholders to accomplish effectiveness.”
“Six Sigma applies a
five-step method called Define-Measure-Analyze-Improve-Control (DMAIC). Each
letter represents one of the steps in the Six Sigma methodology, as shown in the
figure below.”
"Certain industries
have been slower to accept certain quality tools and methods from manufacturing
despite more than 50 years of successful application. It is critical to note
that the finding is about acceptance, not applicability; for example, while
control charts have been used extensively in manufacturing since the 1920s,
they are slow to be accepted in direct patient care."
"In healthcare, a Six
Sigma project saves $500,000 annually, according to an article by David Frabatto
in Managed Healthcare. However, in our experience, such claims cannot be
taken for granted, but assuming that the project selection process is attuned,
$500,000 or even more is achievable realistically. For example, a project
within our deployment portfolio on a credentialing process for contracted
healthcare workers resulted in validated savings of $789,000 per year and a
replication potential to save an additional $114 million dollars. When a senior
Six Sigma practitioner, called a Black Belt, normally leads four to eight projects per
year, annual savings from a single Six Sigma Black Belt could exceed $3 million
dollars. As indicated by the positive financial impact that typically far
surpasses its associated costs, quality improvement can be a major factor in a
business’s success."
"It is very
interesting that the same article in which Frabatto cited the $3 billion
revenue gap also stated that New York hospitals would save $3.4 billion
annually by reducing length of stay to national standards. Length of stay is
just one performance gap where the root cause is unknown and where applying the
right tool to the right problem at the right time makes a lot of sense."
"The power of Six
Sigma is its ability to identify root causes of complex problems and reduce
variation, both of which are central to the improvement of processes. Examples
of Six Sigma applications in healthcare include reduction of infection rates,
patient falls, and missed appointments, as well as enhanced medication
reconciliations and coding."
In my next posting we’ll
discuss the concept and application of Constraints Management and then begin to
look at a few real live examples of how this integration is poised to change
the healthcare world.
Bob Sproull
No comments:
Post a Comment