maximize your lean roi

Maximize Your Lean ROI

Brittany Hagedorn, CSSBB, US Healthcare Lead at SIMUL8

Claire Cordeaux, SIMUL8 Healthcare Director

SIMUL8 Corporation | SIMUL8.com | info@SIMUL8.com

Presenters

Claire Cordeaux

Executive Director, Healthcare SIMUL8 SIMUL8 Corporation

claire.c@SIMUL8.com

Brittany Hagedorn

Healthcare Lead, North AmericaSIMUL8 Corporation

brittany.h@SIMUL8.com

Housekeeping

• Audio

• Q and A

• Recording available on SIMUL8healthcare.com

Agenda

• Current State of Lean• Enhanced Lean Practice• Practitioner’s Guide to Simulation• Lessons from Loughborough Workshop

Project: Double Radiology VolumesProject Background:

Outpatient Radiology for patients with a need for sedation prior to their exam. Patients were waiting up to 7 weeks for a Radiology test, which was causing delays in diagnosis and care, poor satisfaction, and lost revenue.

Questions: • How many bed spaces will be needed to handle additional patients? • Will the new staffing model actually work as planned?

Controls:• Number of beds• Number of nurses• Nurse assignments• Appointment schedule

Outputs:• Staff utilization• Space utilization• Patient waiting times

Inputs:• Patient arrival rates• Cancellation rate• Admission durations• Exam durations• Recovery durations

Project: Double Radiology Volumes

Results:• 2 Admission beds and 4 Recovery beds

will be sufficient• Balancing workload among nursing staff

will allow for the handling of the additional patients without adding staff

• Recommendation – Move on to live trials. Jan Feb March April May

Time to Appointment (days)

Click to edit Master title styleClick to edit Master title style

CURRENT STATE OF LEAN

Widespread Adoption

Lean has been widely adopted as the industry standard across healthcare delivery systems.

Widespread Adoption

Do Well Need MoreTraining Implementation……………………..………..

Excitement Culture Change……………………..………..

Strategy Management……………………..………..

Projects ROI…………………..…………..

Tools Measurement…………………..…………..

Within many Lean organizations, there have been a few key areas that could use additional attention.

Healthcare Challenges

• Sustainment of change.• Lots of high priorities.• Adoption/stakeholder engagement.• Complex process interactions.• Interdependent changes/projects.

Healthcare faces unique challenges when it comes to implementing a culture of continuous improvement.

ENHANCED LEAN PRACTICE

Shared Philosophy

• Test before you implement.

• Measure process performance.

• Variability matters to your process.

• Consider everyone’s ideas.

Benefits of Simulation

• Easily visualize complex processes.• Incorporate variability into process mapping.• Test over extended periods of time.• Quickly consider many scenarios.• Test non-existent processes and unlikely events.• Engage stakeholders

Models of Integration

Independent Simulation

Small Model built during a Lean Project

Simulation Integrated into the Standard Lean Process

For free downloadable booklet and models from Warwick University, visit SimLean.org.

When to use Simulation?

Additional factors may also affect the decision to use simulation: • High variability in how long activities take.• Resources constrain the process.• Need to test a range of time or conditions.• Have several scenarios to compare.

Great!

Change Already Happened

Consider using simulation to understand why results were not what you expected.

It worked. No success.

Use simulation to uncover unknown complications, test scenarios, and plan for known risks.

Change is Proposed

Use Lean to develop process, test, and implement.

Complex process. Simple process.

Knowing when simulation will have the greatest impact is critical to maximizing the return on your time investment.

Example Applications

Examples Lean (Excel) Simulation

Staffing • Managing day-to-day schedules.• Understanding existing service

levels over time.

• How many do I need to ___?• Reaching a target service level.• Shift pattern optimization.

Scheduling • Historical lead time.• Measuring call drop rates, no-

shows, cancellations, etc.

• Lead time reduction.• Process bottleneck elimination.• Block schedule optimization.

Revenue Cycle • Financial projections. • Lead time reduction.

Safety • Tracking performance over time.• Dashboards & reporting.

• Hand-off elimination.• Pilot study risk reduction.

Regardless of the type of Lean project, there are opportunities to utilize simulation. A few examples are included below.

Value Stream Mapping

Identify Improvement Opportunities

PrioritizeProjects

Develop Charters

Map Current State

Design Future State

PilotFuture State Implement Sustain

• Conduct observations.

• Collect data.• Document

value stream statistics.

• Document all barriers, rework, and wait times.

• Estimate the impact and effort for each improvement.

• Combine for prioritization.

• Define process and outcome metrics.

• Establish target (%) for improvement.

• Create a detailed process map.

• Identify potential interventions.

• Develop and document a future state process map.

• Implement the proposed future state on a small scale.

• Identify issues & unexpected effects.

• Modify the future state as needed.

• Conduct training.

• Go live.

• Document standard work and policies & procedures.

• Monitor and sustain improvements.

Many Opportunities

Incorporate & visualize variability.

Understand dependencies.

Set evidence-based targets.

Validate your current state.

Reduce risk.

Gain buy-in.

By integrating with the Lean Six Sigma approach, we can maximize the impact of our improvement efforts.

VSM in SIMUL8

• During Event:– Document the VSM in SIMUL8.– Validate the process by checking

that wait times and inventory levels match observations.

– Quantify the impact of potential project ideas in real time.

• After Event:– Set the right performance target

level for each step / resource in order to achieve desired outcomes.

– Organize events (order, resources) based on their expected impact and interdependencies.

Integrating simulation provides quick insight and a validated VSM process map.

Modified VSM

Team deepens understanding of how process times and wait times/inventory are related. Validate that observations are not outliers.

Idea testing in real time lets you select those that will have the most impact in an objective way.

Set improvement goals for each action item based on evidence.

Prioritize improvement efforts to maximize limited resources.

VSM in SIMUL8

Project Prioritization

With a simulation-based VSM, the leadership team is able to quantify the operational, financial, and strategic impact of proposed Lean projects.

Step Standard Practice With Simulation Deliverable(s)

List Opportunities Examine VSM to identify bottlenecks, inventory, etc.

Visualize how variability affects key process measures.

List of potential projects.

Estimate Impact of Individual Projects

Use Excel to extrapolate based on historical data.

Simulate each change to quantify strategic, financial, and operational outcomes.

Project ROI.

Examine Interdependencies

Difficult. Simulate each combination to identify augmented outcomes.

Program Impacts.

Prioritize Pick the project(s) with the highest ROI.

Select the program with the best combined outcomes.

Action Plan.

Setting The Right Target

What is the right target for improvement?

How do your operations impact the key outcome?

Improve throughput

by 50%.

Reduce cost by 30%.

Eliminate overtime.

Increase revenue by $1 M.

Setting the Right TargetBy simulating potential targets, you ensure that projects have achievable goals,

that the target is high (or low) enough to impact the outcome metric, and that you do not waste effort improving a process more than necessary.

Current performance

Necessary performance

Target unnecessarily high

Target too low

Target unrealistic

Process Measure

Post-Kaizen Risk Reduction

Answer questions such as:• Do I have enough resources to handle the increased

throughput?• Is the new process robust enough to handle unusual or

unexpected situations?• What downstream effects have we forgotten to plan for?

After a Kaizen event, there is always some uncertainty about how the new process will work after “go live”. For processes that are critical to

the business, simulation can help mitigate implementation risk.

Stakeholder Engagement

Results in Real Time

With simulation, you can visualize everyone’s suggestions and their impact on key outcome measures – for minimal time or cost.

PRACTITIONER’S GUIDE TO SIMULATION

Ideal Phases of Integration

Adoption – Initial use of simulation as part of the Lean improvement process (ex. VSM).

Engagement – A critical component of the Lean process is to simulate potential new scenarios.

Integration – Simulation is fully integrated into the Lean improvement toolbox and used when appropriate.

Moving too fast through integration can confuse and overwhelm stakeholders.

PDCA Approach to Simulation Building

Using a PDCA-style approach to simulation has many benefits and helps the team address / avoid the typical barriers that can be found in simulation projects.

Design (Plan)

Create (Do)

Validate & Evaluate (Check)

Revise (Act)

ADDRESS BARRIERS:• Create stakeholder buy-in along the way as

the model generates insights during every cycle.

• Identify gaps in data availability early on.

AVOID MISTAKES:• Mitigate the tendency to make the model

unnecessarily complex.• Escape “analysis paralysis” by developing

models that are representative, rather than perfect.

• Revise the model with additional detail only where necessary.

Determine Need for Complexity

Once you have determined the type of question you need to answer, you can set stakeholder expectations and design in only the necessary details.

Time and Effort Investment

exity I need to test

scenarios around my key

constraint.

I need to understand how the complexities

in my system interact.

I need a directional

answer on how a change will affect

the system.

Choosing the Necessary Details

It is easy to add many details to a model in order to achieve “perfect” results, which leads to extensive data collection, complex models, and long lead times. Consider the following:

1. Is this something that my stakeholders frequently complain about?

2. Does this consume my attention and time every day?

3. Do changes affect how my process flows?

4. If there is maintenance/downtime/time off, would it

disrupt normal operations?

Data Accuracy Requirements

How much data do you need in order to build a reasonable simulation?

Approximation is often beneficial for the first phase of a project:• Minimal need for data

collection and analysis.• Can be provided by

stakeholders.• Easy to understand and

communicate.• Represents a typical

day/patient/event, rather than uncommon events.

LESSONS FROM LOUGHBOROUGH

Improving Process Improvement: Utilizing both Lean and Simulation

Workshop at Loughborough University

June 6th, 2014

“Having demonstrated … the opportunities and benefits of using lean and simulation together for healthcare (www.simlean.org), the purpose of this workshop is to further open up the debate on why Lean and Simulation are not being used or researched together more.”

Improving Process Improvement: Utilizing both Lean and Simulation

Special thanks to the many participants for the inspiration for the following ideas, especially:

• Professor Zoe Radnor• Professor Stewart Robinson• Mark Palmer, Managing Director of OEE• Center for Service Management at

Loughborough University

Efficiency vs. Effectiveness

Lean’s principles combine both:– Eliminate waste – efficiency– Create value – effectiveness– Increase flow – efficiency

• Is there too much focus on efficiency? • To create truly patient-centered care, do we need to

spend more energy on creating value?• How does “lower utilization” provide better access,

outcomes, and costs?

How simple is too simple?

Simple Complex

Validation

VisualsTrustUnderstanding

Time to Build

Engagement

There are a multitude of factors that determine how many simplifying assumptions can be made. How do you strike the right balance?

Who holds the power?

Many stakeholders are needed in order to make a Lean project successful. The challenge is to make sure that each voice is heard, including the person who…

– Is “paying for” the time.– Decides what to include.– Is building the model.– Has the information/data.– Interprets the results.– Makes the decision.– Implements the change.– Receives the service (customer).

Should the project facilitator and

model builder be the same person?

How are visuals useful?

Useful for validating :• Work is moving

through the system correctly.

• Queues are building up where you expect them.

Useful for communicating:• With a wider, non-

technical audience.• Demonstrating that the

model mimics reality.• With leadership who

want to see the big picture.

• Faster to review than a table of numbers.

Validation Interpretation Communication

Useful for interpreting:• How the system works.• Why one change is

better than another.• How complex process

flows interact.• Putting results into

context.

Key Takeaways

1. Lean and Simulation share a common philosophy.

2. There are many opportunities to incorporate Simulation into standard Lean practice.

3. Lean ROI can be enhanced by integrating Simulation.

4. Careful deployment and strong advocacy will be required in order to fully integrate Lean and Simulation.

References

If you are working in Lean, you may also find the following to be useful for your work as well:

• Webinar by John Boulton, IHI Fellow– Process Improvement Innovation: Lean and Simulation– December 2013

• Webinar by Todd Robert, Memorial Health System– Improving Planning in the O.R.– May 2013

• LeanSim Toolkit– Free downloadable Lean models– www.SIMUL8healthcare.com/LeanSimToolkit

QUESTIONS

The scientist is not a person who gives the right answers, he's one who asks the right questions.

Claude Lévi-Strauss

QUESTIONS

• Please forward any topics you would like to see covered to brittany.h@simul8.com

• Continue the discussion on SIMUL8 in Health – LinkedIn Group

NEXT WORKSHOP

Simulating Care Outside of Hospital

Tuesday July 22, 11am (Eastern)

Further details & booking info will be emailed to attendees – watch this space!

maximize your lean roi

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