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_______________________________________________________________ Report Information from ProQuest10 March 2015 13:16_______________________________________________________________

10 March 2015 ProQuest

Table of contents

1. Operationalizing Lean Health Assets........................................................................................................... 1

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Document 1 of 1 Operationalizing Lean Health Assets Author: Price, Ilfryn, PhD; Pinder, James, PhD; Wyton, Paul G, MBA ProQuest document link Abstract: To demonstrate the potential of employing unconventional facility/facilities management (FM)performance indicators in healthcare settings to enable more strategic conversations between FM and businessusers concerning asset performance. The theoretical background for a Lean asset approach and a high-level analysis of data from hospital trusts inEngland have been published elsewhere. This paper reports on the first uses of that approach in operationalsettings. Observations are drawn primarily from three case studies. The individual studies support the premise that the conventional emphasis on cost per square meter (m(2)) as apreeminent measure of FM disguises a portfolio of too much underutilized space. They provide a means ofputting a healthcare estates strategy in terms that will engage business users. Despite a growing interest in Lean approaches in healthcare, the philosophy has not yet been extended to theestate. This study demonstrates that alternative benchmarks are possible. Links: Check for full text via SHU links Full text: Headnote Abstract Objective: To demonstrate the potential of employing unconventional facility/facilities management (FM)performance indicators in healthcare settings to enable more strategic conversations between FM and businessusers concerning asset performance. Background: The theoretical background for a Lean asset approach and a high-level analysis of data fromhospital trusts in England have been published elsewhere. This paper reports on the first uses of that approachin operational settings. Method: Observations are drawn primarily from three case studies. Results: The individual studies support the premise that the conventional emphasis on cost per square meter(m^sup 2^) as a preeminent measure of FM disguises a portfolio of too much underutilized space. They providea means of putting a healthcare estates strategy in terms that will engage business users. Conclusions: Despite a growing interest in Lean approaches in healthcare, the philosophy has not yet beenextended to the estate. This study demonstrates that alternative benchmarks are possible. Key Words: Healthcare FM, Lean assets, performance indicators, Goodhart's Law Introduction The Problem Statement The primary raison d'être of a built facility should be to support the business delivered from that facility in themost effective manner. The authors contend here, with particular attention to healthcare facilities, that prevailingpractices and particularly the dominant performance measures of facility/facilities management (FM) fail toservice such a goal. They go on to describe early attempts to implement a different approach. This is termed a Lean approach because, arguably, FM still has to overcome the challenges that faced typicalwestern mass manufacturers in the 1980s when they were trapped in the cost rather than the throughput world(Goldratt &Cox, 1985). Management accounting practices designed to minimize apparent unit production costencouraged the production of excess inventory with no necessary regard for quality and the risk of obscuringtrue production costs. The academic case was argued in Johnson and Kaplan's Relevance Lost (1987);

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however, the book that more than any other came to symbolize the change and that introduced the concept ofLean manufacturing was Womack, Jones, and Roos's The Machine That Changed the World (1990). Lean hasgone on to become a successful management trend with many adherents offering slightly different versions ofthe true way. The authors of this article are not out to claim a slice of the Lean pie. They seek to present adifferent conversation among facility managers, designers, and users about the performance of their space. Thetrigger for this argument was Womack and colleagues' (1990) comparison of Toyota and General Motorsproduction in U.S. car plants. Toyota required 38% less physical space to produce the same volume of output.In FM terms, Toyota produced 62% more per unit area. FM performance measures remain dominated by questions of cost per unit area or, occasionally, per person(Pinder &Price, 2005). Cost per unit area can actually be minimized by the built equivalent of mass production:holding a large amount of low-quality, badly or cheaply maintained space.1 This was the first part of Price's(2007) argument in Lean Assets for performance measures that encouraged the use of less space. By analogywith the Toyota example cited above, the concept requires some measure of the output derived from a givenphysical space. The second part of Price's argument was that measures that present facility performance inbusiness terms have a greater chance of engaging other parts of a business, and hence engaging necessarystakeholders in thinking how more can be delivered from less space. Since 1990, Lean has found its niche inmany areas of management, but it has not-in any work that the authors have located-extended to actuallylooking at built assets in Lean terms. A recent, comprehensive review (De Souza, 2009) makes no mention ofbuilt asset performance.2 For a hospital of a given size, there are conceptual difficulties with an output-based approach. In theory onemight argue for indicators of the delivery of health outcomes per unit area of a facility. In practice such an idealis impractical and perhaps unattainable given the complexity associated with measuring health outcomes ratherthan failure rates or process compliance (e.g., Eddy, 2007; Werner &Bradlow, 2006). That said, the VirginiaMason Institute (VMI, 2009) claims savings of 25,000 square feet and capital receipts of $11 million throughapplication of their version of Lean production. While a majority of facility managers in the National HealthService (NHS) in the United Kingdom (UK) believe that there is a connection between FM and health outcomes,only 16% seek to measure it (May &Pinder, 2008), and those who do continue to classify such factors as patientsatisfaction and an absence of written complaints as health outcomes. This article describes the search foroperational alternatives and the difficulties that remain to be confronted. First, despite recent publicity, for thesake of North American readers, it may be necessary to establish the context of the NHS. The UK Healthcare Context The NHS has been publicly funded since its inception in 1948. Successive governments of whatever politicalhue have accepted the principle of care "free at the point of delivery," and there has never been the political willto depart from that principle. General Practitioners (GPs) and consultant physicians can remain self-employedbusinesses funded according to their patient lists, but also free to pursue private patients. Various healthinsurance plans allow covered individuals access to private care, including inpatient services in privatehospitals. In the early 1990s, a conservative administration wedded to a market-driven political philosophy sought tointroduce market discipline into the service by requiring hospitals to organize themselves as trusts-theoreticallyautonomous units whose services would be provided under contract to GP Fundholders. However, trustscontinued to be bound by national and regional policy guidelines administered by the Department of Health(DoH), the NHS Executive, and regionally based Strategic Health Authorities. The same administration requiredthat nonclinical services be subjected to "market testing" or compulsory competitive tendering, a policy which,among other things, contributed to the rise of the FM industry in the United Kingdom (Price, 2003). The NHSwas the first business sector in the United Kingdom to see the widespread appearance of facility directors withboard- or near board-level authority (Kaya &Alexander, 2005; Payne &Rees, 1999).

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The process experienced its own competition for recognition between professional associations representingthe so-called hard FM (management of buildings) and soft FM (provision of services such as food, cleaning,laundry, or portering within the building). Although some managers from soft FM backgrounds achieved FacilityDirector positions, the majority of such appointments went to individuals with a hard FM background, and theformer Health Estates Management Association re-established itself as the Health Estates and FacilitiesManagement Association. The advisory body for FM within the central NHS Executive continued to be known asNHS Estates. Building-rather than service-thinking predominated. The left-of-center New Labour administration, led by Tony Blair, was elected in 1997. In England policycontinued to emphasize a quasimarket approach, although GP fund holding was abandoned and substitutedwith a system of Primary Care Trusts (PCTs) whose responsibilities included the commissioning of servicesfrom general hospitals (acute trusts), mental health providers (mental health trusts), or-increasingly andcontentiously-private providers of healthcare services. Larger teaching hospitals and particular specializedhospitals with a strong research presence in a given clinical area remained trusts in their own right but hadadditional sources of funding. The picture was complicated because PCTs, in addition to acting ascommissioners (purchasers), also provided various ambulatory care services. Meanwhile in Scotland andWales, where responsibility for healthcare has devolved to the Scottish Parliament and the Welsh Assembly,respectively, policy has veered away from market-led reforms and back to a more centralized service. In England, trusts that meet certain criteria of financial stability and governance have been allowed, since 2003,to seek foundation trust (FT) status, a designation that supposedly allows greater financial and managerialautonomy. The government is introducing plans for "patient choice" whereby income, at least in theory, followspatients who may opt for treatment at a trust of their choosing. Furthermore, as changing medical technologypromotes a greater emphasis on ambulatory care, private operators of ambulatory treatment centersincreasingly are being allowed to compete for centrally funded service provision. The phasing in of what istermed payment by results introduces a national tariff for various treatments that PCTs are obliged to deploywhen purchasing services. A trust that delivers a particular health intervention in less time, or without a hospitalstay, receives the same payment but faces a lower expenditure. The implications for FM remain uncertain. There is evidence (Miller &May, 2006) that some patient groups,especially professional women making decisions about birthing venues, are influenced by the condition of theestate (that is, the total building stock from which a trust operates). The provision and management of parkinglots also appears to be a significant predictor of patient satisfaction with a hospital (Lightfoot, 2002). Meanwhile,trusts are still subject to centralized regulation. Since 2000, a system of Patient Environment Action Teams(PEAT) inspections has required an annual audit of the patient environment against a set of national criteria. In2004, after three rounds of PEAT inspections, "excellent" environments remained the exception (Macdonald,Price, &Askham, 2009a; 2009b) and were not explicable by organizational factors or contractual arrangements.In 2006, in the face of media concern about rising levels of hospitalacquired infections (e.g., Methecillin-Resistant Staphalococcus Aureus and C. Difficile), responsibility for PEAT was transferred to a body known asthe National Patient Safety Agency. A recent study could not find a statistically significant correlation betweenPEAT results and the reported incidence of hospital-acquired infections (May &Pinder, 2008). Trusts remain publicly accountable to the DoH for their resource usage. For some years it has beendepartmental policy to require them to complete an annual return under a program known as Estates ReturnInformation Collection (ERIC), which is intended to "inform a set of indicators to assess the performance ofTrusts Estates and Facilities Services. Over time these will permit Trusts to demonstrate year-on-yearimprovement" (DoH, 2008). The return (i.e., the information trusts are asked to supply) is a fairly typical example of a detailed, cost-basedFM schema in that it consists almost entirely of cost- and volume-related items (see download of guidelines atDoH, 2008). Year-onyear improvement is code for continued reduction in cost per m^sup 2^. The ERIC results

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constitute the only available national data set. In 2006 and 2007, a group of trusts that subscribe to an annualhealth FM research program asked the Centre for Facilities Management Development to determine whetheralternative performance measures could be derived from the ERIC results. Lean Assets in the NHS The Centre treated this request as an opportunity to examine output-based measures using data envelopeanalysis (DEA), following the approach described by Pinder and Price (2005). Then the Centre (May &Price, inpress; Price &May, 2008) examined the ERIC data for ratios that might indicate the "Leanness" of healthproperties, that is, the degree to which they were attuned to optimizing outputs per unit area. The result includesa single entry for the gross internal area (GIA) of a trust's estate, a single entry for the trust's total income, andan entry for a category called the patient-occupied area (POA), defined as: The total internal floor area within the boundary of all departments which provides patient care and wherepatients are exposed to risk (e.g., Wards, OPD, A&E, Theatres, ITU, SCBU, CCU, Day Surgery, Radiology,Clinics, etc.). All Facilities such as offices, toilets, dining rooms, and circulation spaces within the boundary ofthe relevant department should be included, but common circulation spaces (e.g., hospital street, visitors toilets,main entrance reception/waiting, stairways, etc.) outside the boundary of the department should be excluded.Exclude external car parking areas but include multistorey car parking areas used by patients. This figure plusthe total non-patient occupied area and main circulation areas should equal the total occupied floor area for thesite. Excludes leased-out and licensed-out area. (DoH, 2008) The ratio of POA:GIA provides some indication of the design efficiency of an estate. It is far from perfect for thereasons discussed below. The authors also assumed that the total income of a trust provides some indication ofthe volume of healthcare it delivers. They recognize the caveats that must accompany that statement, but theyalso acknowledge the fact that, in the shifting context of the NHS, trust managers-especially in FTs or aspiringFTs-increasingly are concerned with what is in effect commercial performance. Following the Lean asset precepts noted above, the authors suggested that a Lean health estate would, first,show a higher net income per unit area, and second, a higher POA:GIA ratio or, in other words, less estatedevoted to inventory or support processes. The researchers used DEA to contrast relative efficiencies andfound a surprisingly large variation. DEA effectively weights performance ratios for a sample to show each unitin the best relative light. When only two ratios (in this case two outputs for a given input) are considered, therelative efficiency can be displayed graphically (e.g., Figure 1) and an envelope can be defined by the linelinking the best performers on either ratio or a combination of both. The envelope in Figure 1 is described by theline ABCDE. The DEA method assigns an efficiency of 100% to this envelope and calculates the relativeefficiency of other units. Each square in Figure 1 represents a single trust. Consider the example labelled Y.The line XYZ from the origin intersects the envelope at Z and represents the theoretically simplest way for TrustY to achieve 100% efficiency. The current efficiency of Y can be computed by the ratio XY:XZ and is currentlyless than 50%. In other words, Y seems to use twice as much space to deliver the same level of output. There are obvious difficulties with this approach, which are discussed in more detail by May and Price (inpress). The ERIC results may not be accurate, though trust income should be known and can be corroboratedby reference to annual accounts. The authors also make the assumption, which has proved correct when therehas been an opportunity to check, that the GIA of an estate is likely to be known. The POA figure may be moresusceptible to interpretation and the researchers have encountered one example in which the reported figure(as supplied to them from the DoH) was about 50% too low because the POA of one of the trust's two sites hadbeen omitted. Apart from POA, the results do not classify the purpose of the estate. Multistory parking garages are treated asbuildings and included in the GIA, whereas ground-level parking lots are omitted. Although it understandablysurprised an anonymous reviewer, this was not the authors' choice it is a problem with the ERIC results.Similarly, residences for staff, where provided, and on-site processing facilities such as laboratories, laundries,

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workshops, and catering production units are likewise included in the collated GIA figure. Such space, if little isspent on it, serves to enhance apparent cost per m^sup 2^ performance, but it appears to be a source ofinefficiency under the alternative analysis. More importantly, the authors suspect that the apparent inefficienciesmask a stock of underutilized assets. Conservative assumptions put the figure for excess estate at around 20%(May &Price, in press; Price &May, 2008). The next phase of the research, reported here, sought partly to testfor such inefficiency at the level of individual trusts but primarily to engage trust management with estatesstrategy. Essentially, the authors had to adopt a case study approach. Case Studies Case 1, Part 1: Strategic Review Case 1 is a teaching hospital in a large, previously industrial city. It has a significant clinical research portfoliolinked to the activities of a proximate university with a medical school. The trust's estate is spread across twomain sites and combines the activities of what were five separate hospitals, three specialized and two general.The estates department perceived that it had exhausted the possibilities for significant reductions in operatingcosts and was aware that several departments, both clinical and nonclinical, were operating in very poorconditions. Many of the nonclinical functions were located in isolated buildings, some of which had originallybeen constructed as factory owners' mansions. Following NHS Estates guidance, the department had investeda considerable sum in a so-called six-facet survey: a detailed assessment of each building and, whereappropriate, any subelements, in terms of physical condition, functional suitability, space utilization, quality,statutory compliance, and environmental impact. The trust's estate managers found that the results did notinform meaningful strategic discussions with the rest of the organization's executives-another example of theneed for new measures for new workplaces that Price argues for (2007). The authors suggested an alternativeapproach that looked at output ratios; the first challenge was to sell the proposal to the trust board. The presentation was a brief introduction to the Lean asset approach, followed by a series of diagrams,formatted as in Figure 1, which compared the trust to a series of comparators. The first response to the generaldiagram was "Yes, but we are different; we are a teaching hospital." The remark was a cue for the next slide(Figure 2), which showed a comparison with a direct peer group of non-London teaching hospitals. The reactioncan most politely be described as a wry smile. The data pointed to an apparent surplus, relative to the mostefficient trusts in the sample, of approximately 15% of the total estate. There was then a 2-week silence before the trust accepted the suggestion to set up a steering group, chaired bythe service development director and with representatives from all stakeholder departments, to oversee areview of the business utilization of the current estate. The 15% proved surprisingly easy to identify. Most wasaccounted for by the portfolio of former mill owners' houses, some office property rented for the payroll function,some apartment complexes built in the 1960s to provide accommodation for then-junior doctors, and a formerVictorian workhouse, around which a hospital had evolved. There were also two buildings dating from the 1960sand 1970s that had outlived their original educational and research purposes. It seems simple to describe, butinefficiency had accumulated over time through 150 years' worth of building responses to immediate, tacticalproblems. By itself, this failed to convince department heads accustomed to evidence-based decisions andchange. In response, the next stage involved a more detailed analysis of space utilization across departments. Thespace utilization of non-incomegenerating departments was compared using a measure of occupant density(m^sup 2^ per full-time equivalent employee), the most commonly utilized measure of office space efficiency.Flexible working practices, changing management styles, and improvements in information technology meanthat many public and private sector organizations in the United Kingdom are able to achieve occupant densitiesof roughly 7-8 m^sup 2^ per person (Price &Clark, 2009). Occupant densities for the trust's nonclinicaldepartments suggested much lower densities, that is, poor space utilization. Manual validation of the data forone particular department highlighted many errors in the way that space had been allocated, which made the

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occupant density for that particular department look artificially high. Time and resource constraints precluded asimilar validation exercise for other departments; however, the authors surmised that similar allocation errorsexisted throughout the data set. Validating and checking data were therefore seen as priorities to enable thetrust to review and challenge space utilization across its estate. Two additional management information issues presented barriers to understanding how the trust's estate wasbeing used. The first concerned the way that space was categorized: the data supplied categorized space asexclusive, shared, or plant room. A more useful categorization would have indicated the activities occurringwithin the space (e.g., patient occupied, office space). Second, there was a need to develop a betterunderstanding of who was actually occupying or using a space (i.e., mapping people and services to areas) andhow space was being used over time. When comparing the space utilization of clinical departments, the income per m^sup 2^ or m^sup 2^ per personapproaches were considered less appropriate. Different clinical services have different processes and spacedemands; in other words, the comparison would not be apples to apples. Benchmarking externally againstsimilar clinical departments in other trusts was seen as a solution to this problem. Part of the work with the trustinvolved a pilot benchmarking exercise that compared the clinical departments of the subject trust with selectedclinical departments in a number of other trusts, using patient throughput (bed days) per m^sup 2^ as ameasure of space utilization. Although it is difficult to draw any meaningful conclusions from the results of thispilot exercise because of the composition and size of the sample used, the approach adopted might be worthfurther consideration and refinement, if only as a means of identifying and learning from examples of goodclinical space utilization practice in different trusts. Unfortunately, few find it simple because databasesdesigned for building management often do not allocate space to the various "service lines" that generateincome (something which is now changing). Discussions of space utilization often become focused solely on efficiency, even though the value chain of mostservice sector organizations means that effectiveness, not efficiency, should be the parent conversation whenexamining the design and management of space. Efforts to reduce property costs will be (financially) counter-productive if they have a negative impact on patients, visitors, and employees. Improving space utilization,therefore, should be about providing more efficient and more effective (i.e., better quality) space. There is agrowing body of evidence supporting the view that, when designed and managed with users in mind, physicalspace can have a positive impact on the people who use it (review by Price &Fortune, 2008). Studies ofhealthcare environments indicate that better-designed and -managed spaces can have a positive impact onpatient outcomes (Lawson &Phiri, 2003). Limited time and access precluded a proper evaluation of theeffectiveness of the trust's estate (for example, by means of discussions or consultation with different spaceusers). Nonetheless, to be in a position to review, challenge, and improve space utilization, the trust mustunderstand how its space meets (or fails to meet) the needs of patients, visitors, and employees. The comparisons of income per m^sup 2^ and occupation density data were sufficient to motivate a discussionof how departments were consuming space. They supported a business case to remodel the former workhouseas a modern office for various nonclinical functions. At the time of writing, construction work is in progress. Thefloor plate of the nineteenth-century workhouse proved surprisingly amenable to becoming a shell for modernoffices with a considerable saving on embodied energy. Case 1, Part 2: The Estates Relocation The existing estates department was housed in locations on both of the main sites. The provision for officespace varied enormously, but in both cases it was considered inappropriate from a number of angles. On onesite a Victorian villa housed the executive functions and local estate management. This building contained anumber of large single and 2/3-person offices leading to very low occupancy levels by m^sup 2^ per personstandards, but conversely to overcrowded, inefficient, and ineffective space for many other staff working withinthe building. On the other site the offices were located in a set of "temporary" structures that had been in

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operation for many years, were expensive to run, and provided very poor workspace. Meanwhile, the formereducational buildings mentioned above were not being used. Overall the office space presented a poor image ofestates to the rest of the trust, compromising both its professional standing and the department's ability to drivehome the principles of leaner assets elsewhere in the trust. After some discussion, the department waspersuaded that by adopting modern practices it could relocate into part of one of the education buildings. The project was not completely Lean in approach in that it did not utilize the recognized Lean tools at anoperational level and did not involve a change of culture to one of Lean management. However, its strategicintent was drawn from Lean assets, and under a Lean framework (Hines, Holweg, &Rich, 2004) could beargued to hold significant Lean benefits. In practical terms, one of the underlying assumptions of Lean is thatorganizations are made up of processes (Radnor, Walley, Stephens, &Bucci, 2006), and it could be argued thata Lean asset approach applies the appropriate level of provision for those processes. Over-provision of storageand executive offices can be seen as examples of the waste or muda (a holistic Japanese term for wasteful ornon-valueadding activity) targeted by Ohno in the 1950s (Dahlgaard-Park, 2000; Dahlgaard and Dahlgaard-Park, 2006). The particular drivers for initiating the estates project were the desire to reduce space and the opportunitypresented by the upcoming end of the lease on a large off-site office. There was also a need for decent spaceto significantly upgrade the management of emergency patients. The issues associated with change surfacedimmediately. Some powerful individuals resisted the perceived downgrading of their office space and feared"open plan" offices (Price &Fortune, 2008). However, the change highlighted a number of other factorspertaining to standard methods of operation that needed to be addressed. An exercise designed to identifyworkspace need identified the large amount of space dedicated to storage for various legacy paper processes.It was immediately apparent that to move and meet the goals of a Lean asset, working practice was going tohave to change. What began as an office relocation, therefore, resulted in the initiation of significant projects involving computersystems, approaches to flexible working, data storage and retrieval (both electronic and paper based), and newmethods of working for trades staff and stores management. The purposes of the approach were also to openup minds within the department to the possibilities of different ways of working, to acknowledge the importanceof getting closer to the user, and to provide space according to recognized need. The end product was in factsignificantly different and occupied far less space than the original outline plans put together for the estatesteam. The bulk of staff members were relocated to one site, providing far greater opportunities for collaborativeworking and uniting under a single operating approach, improving standardization and meeting severalsignificant factors in reducing waste. A large leased office was released, that is, returned to the landlord, and apreviously occupied but near-derelict office was brought up to appropriate occupancy standards, creating aspace employees would choose to work in. The temporary structures are due for demolition, allowing theground to be reused more effectively in a crowded part of the hospital site. After the event, one senior managerdescribed it as the "best office he had worked in," and another said, "It works very well and the feedback hasbeen good." Other workflows to support the effective functioning of the department are ongoing, but lean assetthinking started a new conversation in the department. Case 2 Case 2 is a mental health trust serving another large city and the greater metropolitan area surrounding the city.Its property portfolio includes a high-security psychiatric hospital, a medium-secure regional facility, and a rangeof clinics/residential units for adult mental health (primarily young men) and older people (primarily acutedementia cases). The trust's overall portfolio (Figure 3) showed it had what appeared to be one of the leastefficient estates in the mental health sector, with up to 33% more space than its income might merit. Again asignificant portion of the total estate consisted of residences, workshops, and underutilized offices. However,

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the trust was able to allocate its income by individual facility (Figure 4). The medium security hospital (SCT), which operates on a stand-alone site without any nonclinical buildings,superficially appears very efficient on the design measure-an observation that raises the question of allocationof central overhead space. A bigger question was raised by the one adult facility (BRK), which appeared to beparticularly efficient in terms of income per m^sup 2^. Again, that particular site was not carrying a largenonpatient space. However, it was recognized within the trust as being old and cramped and failing to meetmodern minimum standards for such facilities. Its performance highlights a potential pitfall in over-reliance onincome as a sole measure of healthcare delivery. It can disguise a tendency to cram patients into a suboptimalenvironment. There were no comparative data on the negative effects of such cramming, such as staff turnoverand stress levels or incidents of abusive behavior by patients. The trust had, however, commissioned acomparative assessment of facility quality at several of its sites. Thus, it was possible to compare quality andincome (Figure 5). The same two sites appear as the most efficient, but the poor quality of BRK is apparentfrom its position in the diagram. The authors used these data to inform a series of focus groups and one-to-one interviews with staff andmanagers involved in the delivery of services from the various sites. All expressed the view that the quality ofcare was affected by the design and condition of the facilities; unfortunately, they were not able to quantify theimpact. Here, as ever, is the real dilemma facing FM in healthcare: a need for more evidence linking facilitydesign and condition with clinical outcomes. Case 3 provides some evidence in that direction. Case 3 This case concerns a PCT serving a metropolitan borough within a larger urban area. When formed, the trusthad inherited a 5.4-acre site containing another Victorian workhouse building and a warren of other buildingsthat had been erected over time and that sprawled around the site. They were all in very poor condition. Despitethis, St. T's, as the site was known after the old workhouse, carried a sentimental attachment for the staff whoworked there. The trust decided on a Lean strategy for the estate and was able to arrange for disposal of St. T's to apurchaser for whom it had a higher in-use value. The trust then took the unusual step of providing a range ofambulatory care services in rented space in office buildings around the town center. The result is a flexible,conveniently located estate with some facilities available for short-term assignment to various providers whowant to operate services such as weekend clinics. The emphasis has been on operating with the minimumnecessary amount of high-quality estate. Recognizing that customized buildings were not needed for many ofthese services allowed for a considerable saving of capital costs in their provision of replacement facilities and afaster relocation from the St. T's site. The Centre for Facilities Management Development was asked to do a series of post-occupancy evaluations bymeans of tours and interviews with the service managers. Among these cases was a drug and alcoholtreatment clinic, a day facility for patients whose condition did not merit hospitalization. The new location for theservice was a leased building refitted from a former industrial unit. It collocated staff from the PCT, the localcourt service, the local mental health trust, and a rehabilitation charity. The building was laid out with the earlypatient experience very firmly in mind. In the words of the service manager, "Service vision was translated intobuilding language." He reported that in the 2 years since the facility opened, there has not been a single"reportable incident," i.e., a case of actual or potential violence to staff severe enough to require formalreporting. He further reported that staff members were now much less reluctant to take on new referrals to theservice, with the result that waiting times for treatment have dropped from 18 months to less than a week. At thetime of writing, the trust is seeking to formulate a Lean approach to developing new community healthcarefacilities within the borough. Discussion The case of an important role for FM: translating organizational aspirations into an enabling facility. Arguably,

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this engagement with users in both the design and operation of buildings distinguishes FM from, for example,building service engineering (Price, Ellison, &Macdonald, 2009). To achieve such an end demands a differentconversation between FMs and occupiers, and performance indicators by which FM describes and justifies itscontribution are part of that conversation (Price, 2007). The authors' trust-level analysis of NHS estates (May &Price, in press; Price &May, 2008) was an initial searchfor different, business-relevant indicators. The cases reported here serve as early, sitespecific tests of theapplication of these indicators. They suggest that the relative inefficiency of some trust estates is partlyoccasioned by an asset portfolio that includes ancillary buildings only indirectly (at best) related to healthcare,and portfolios of underutilized buildings, especially office accommodations. The conventional performancemeasures used in FM and still embodied in Central Government guidance mask that inefficiency and evenencourage it, a perverse case of Goodhart's Law in operation.3 The organizational complexity of the NHS alsomay exacerbate the problem. The use of revenue as an indicator has its own pitfalls. Quite obviously it does not reflect profit or contribution. Itcould potentially encourage facilities to use less space per patient than is ideal for particular care regimes. Thatsaid, the traditional emphasis on cost per unit area certainly masked substandard but underutilized estates.Consideration of outputs per m^sup 2^ provided a means by which an estate and facility strategy could begin tobe expressed in business- and userrelevant language. The case studies also reveal shortcomings in the codes used for the standard ERIC compilations and theestates management systems in common use. The former do not distinguish the various categories ofnonclinical space that might affect performance statistics. The latter do not easily allocate space to particularincome streams or service lines. They may permit efficient building management; they do not enableconsiderations of efficient business use. The authors have scanned the literature for alternative indicators that might be used in healthcare managementin the U.S. commercial healthcare regime. None have been located, which raises the question of whether costrather than throughputbased performance indicators are endemic to FM on both sides of the Atlantic. Leanthinking is now becoming widespread in the provision of healthcare. On May 11, 2009, the search phrase "Leanhealthcare" produced 40,000 Google hits. Only 14 also included reference to "asset performance." There issurely an opportunity for smarter thinking in healthcare FM. As Darwin (1871) observed, "A complex train ofthought can no more be carried on without the aid of words, whether spoken or silent, than a long calculationwithout the use of figures or algebra." The authors have sought to describe an approach, rather than a tool,which should enable FM, designers, and business managers to question, first, how much space they need and,second, the thoughts embedded in their existing performance indicators. Sidebar Cost per unit area can actually be minimized by the built equivalent of mass production: holding a large amountof low-quality, badly or cheaply maintained space. The data pointed to an apparent surplus of approximately 15% of the total estate. The value chain of most service sector organizations means that effectiveness, not efficiency, should be theparent conversation when examining the design and management of space. It was immediately apparent that to move and meet the goals of a Lean asset, working practice was going tohave to change. An important role for FM [is] translating organizational aspirations into an enabling facility. Footnote Notes 1. Putting this view to a class of FM MBA students, one of the authors was told of one public sector operationwhere it was common practice to purchase a warehouse before the annual cost per m^sup 2^ audit. Scott-Morgan (1994) relates a similar example where the unwritten rule for a stores department was to put the stock

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onto a fleet of trucks before the monthly inventory audit. 2. The authors agree with the reviewer who commented that there is much more to Lean than asset inventory.Of course there is. The intention is to extend Lean to thinking about doing more with fewer physical assets,which was arguably the original catalyst for the Toyota Production System (Womack et al., 1990). 3. Charles Goodhart, a former Chief Economic Advisor to the Bank of England, is remembered for Goodhart'sLaw (1975), his formulation concerning performance indicators to the effect that any "observed statisticalregularity [of an indicator] will tend to collapse once pressure is placed upon it for control purposes."Reformulated, it argues that once an indicator or measure is made a target for the purpose of conducting orinfluencing policy, then it will lose the information content that would qualify it to play such a role. Put even morebluntly, people who are measured on key performance indicators have an incentive to play games. An indicatorof organizational performance and a measure of individual performance cannot be the same. References References Dahlgaard, J. J., &Dahlgaard-Park, S. M. (2006). Lean production, six sigma quality, TQM and company culture.The TQM Magazine, 18(3), 263-281. Dahlgaard-Park, S. M. (2000). From ancient philosophies to TQM and modern management theories(Unpublished master's thesis). Linkoping University, Sweden. Thesis No. FiF-a 31. Darwin, C. (1871). The descent of man and selection in relation to sex. London, United Kingdom: John Murray. Department of Health. (2008). ERIC Guideline 25 January 2008. Retrieved September 4, 2009, fromhttp://www.dh.gov.uk/en/Managingyourorganisation/Estatesandfacilitiesmanagement/Propertymanagement/DH_4117912 De Souza, L. B. (2009). Trends and approaches in Lean healthcare. Leadership in Health Services, 22(2), 121-139. Eddy, D. M. (2007). Performance measurement: Problems and solutions. Health Affairs, 17(4), 7-25. Goldratt, E. M., &Cox, J. (1985). The goal. Aldershot, United Kingdom: Gower. Goodhart, C. A. E. (1975). Monetary relationships: A view from Threadneedle Street. Papers in MonetaryEconomics (Vol. I). Sydney: Reserve Bank of Australia. Hines, P., Holweg, M., &Rich, N. (2004). Learning to evolve. A review of contemporary Lean thinking.International Journal of Operations and Production Management, 24(10), 994-1011. Johnson, H. T., &Kaplan, R. (1987). Relevance lost: The rise and fall of management accounting. Boston, MA:Harvard Business School Press. Kaya, S., &Alexander, K. (2005). Classifying FM organisations using pattern recognition. Facilities, 23(13/14),570-584. Lawson, B., &Phiri, M. (2003). The architectural healthcare environment and its effects on patient healthoutcomes. London, United Kingdom: NHS Estates. Lightfoot, A. W. (2002). Models for measurement of FM service quality and satisfaction within the NHS. (MBAdissertation, Sheffield Hallam University, United Kingdom). Macdonald, R., Price, I., &Askham P. (2009a). Excellent patient environments within acute NHS Trusts:External influences and trust characteristics. Journal of Facilities Management, 7(1), 7-23. Macdonald, R., Price, I., &Askham P. (2009b). Leadership conversations: The impact on patient environments.Leadership in Health Services, 22(2), 140-160. May, D., &Pinder, J. (2008). The impact of facilities management on patient outcomes. Facilities, 26(5/6), 213-228. May, D., &Price, I. (in press). A revised approach to performance measurement for healthcare estates. HealthServices Management Journal. Miller, L., &May, D. (2006). Patient choice in the NHS: How critical are facilities services in influencing patient

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choice? Facilities, 24(9/10), 354-364. Payne, T., &Rees, D. (1999). NHS facilities management-A prescription for change. Facilities, 17(7), 217-221. Pinder, J., &Price, I. (2005). Application of data envelopment analysis to benchmark building outputs. Facilities,23(11/12), 473-486. Price, I. (2003). Facility management as an emerging discipline. In R. Best, C. Langston, &G. De Valence(Eds.), Workplace strategies and facilities management (pp. 30-48). Oxford, United Kingdom: Butterworth-Heinemann. Price, I. (2007). Lean assets: New language for new workplaces. California Management Review, 49(2), 102-118. Price, I., &Clark, E. (2009). An output approach to property portfolio performance measurement. PropertyManagement, 27(1), 6-15. Price, I., Ellison I., &Macdonald, R. (2009). Practical post-modernism: FM and socially constructed realities.Amsterdam EURO FM Research Conference. Retrieved October 28, 2009, fromhttp://digitalcommons.shu.ac.uk/fmgc_papers/24/ Price, I., &Fortune, J. (2008). Open plan and academe: Pre- and post-hoc conversations. Proceedings of theCIB w070 International Conference on Facilities Management. Retrieved October 28, 2009, fromhttp://digitalcommons.shu.ac.uk/fmgc_papers/19/ Price, I., &May, D. (2008). Lean healthcare assets challenge FM performance measurement conventions.Manchester, UK, Euro FM Research Conference. Radnor, Z., Walley, P., Stephens, A, &Bucci, G. (2006). Evaluation of the Lean approach to businessmanagement and its use in the public sector. Edingburgh, Scotland: Scottish Executive Social Research. Scott-Morgan, P. (1994) The unwritten rules of the game. London, United Kingdom: McGraw-Hill. Virginia Mason Institute. (2009). VMPS facts. Retrieved October 28, 2009, fromhttps://www.virginiamason.org/home/dept.cfm?id=4626 Werner, R. M., &Bradlow, E. T. (2006). Relationship between Medicare's Hospital Compare performancemeasures and mortality rates. Journal of the American Medical Association, 296(2694- 2702). Womack, J. P., Jones, D. T., &Roos, D. (1990). The machine that changed the world: The story of Leanproduction. New York, NY: Harper Perennial. AuthorAffiliation Ilfryn Price, PhD; James Pinder, PhD; and Paul G. Wyton, MBA Author Affiliations: Dr. Price is a Professor of Facilities Management at the Centre for Facilities ManagementDevelopment in the Sheffield Business School of Sheffield Hallam University, United Kingdom. Dr. Pinder is aDirector of Positive Sum, Ltd., and a Visiting Fellow in the Centre for Facilities Management Development. Mr.Wyton is a senior lecturer in Facilities Management in the Sheffield Business School, as well as a course leaderfor the undergraduate FM program and module lead for the MBA program within the Centre for FacilitiesManagement Development. Corresponding Author: Professor Ilfryn Price, Centre for Facilities Management Development, SheffieldBusiness School, Sheffield Hallam University, City Campus, Sheffield S1 1WB, UK (i.price@shu.ac.uk) MeSH: Great Britain, Hospital Administration -- economics, Hospital Design & Construction, Humans,Organizational Case Studies, Organizational Innovation, State Medicine, Efficiency, Organizational (major),Hospital Administration -- methods (major) Publication title: HERD : Health Environments Research & Design Journal Volume: 3 Issue: 2

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Pages: 13-29 Number of pages: 17 Publication year: 2010 Publication date: Winter 2010 Year: 2010 Section: RESEARCH Publisher: Vendome Group LLC Place of publication: New York Country of publication: United States Publication subject: Medical Sciences ISSN: 19375867 Source type: Scholarly Journals Language of publication: English Document type: General Information, Journal Article Accession number: 21165867 ProQuest document ID: 230003198 Document URL:http://lcproxy.shu.ac.uk/login?url=http://search.proquest.com/docview/230003198?accountid=13827 Copyright: Copyright Vendome Group LLC Winter 2010 Last updated: 2014-04-02 Database: ProQuest SciTech Collection

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