Administrative Lean™

Lean Thinking is an integrated approach to designing, doing, and improving the work of groups of people working together to produce and deliver goods, services, and information.  Administrative Lean™ applies concepts and techniques of the Toyota Production System to office work.  Lean Concepts, LLC, applies theory and practice, based on Lean Manufacturing Systems, to administrative work such as human resources, sales/marketing, accounting and engineering.  In 2003, Lean Concepts, LLC helped pilot and launch Administrative Lean™ at a major automotive company.

The Lean Overview:
The fundamental objective of Lean Thinking is to create the most value while consuming the fewest resources. This is done by defining value from the customer's perspective, and distinguishing process steps that create value from those that do not. Lean goals are to:

  • Reduce lead time & process time, and improve quality by eliminating waste
  • Utilize employee potential
  • Strive for best practice with standard work and built-in-quality
  • Flow and level the process (Value Stream Perspective)
  • Continuously improve (Kaizen)

How Administrative Lean Works:
Administrative Lean™ makes use of Value Stream Mapping, a simple, elegant tool to show how work is done and how to improve that work. This approach ensures that everyone is aware of the process as it works today, agrees on current performance of that process, and is involved in planning its improvement.  The Value Stream Map tool:

  • Shows flow of process steps required to complete a product or service from order to delivery
  • Reveals waste and measures process performance
  • Links material and information flow
  • Gets people involved in planning and deploying a process improvement plan

The work group (employees who know specific details of the process) first draws a Current State Value Stream Map to see and understand how work is presently done.  The work group measures the process time (the amount of work done to complete a task) and lead time (the total time to provide a product or service from order to delivery).  The work group then draws a Future State Map to improve quality and reduce lead time and process time by eliminating waste in the process. Value Stream Mapping shows where to use Lean techniques such as visual workplace, standard/balanced work, one-piece flow processing with cross-trained workers, and pull systems.

The process improvement (Kaizen) plan envisioned in Value Stream Mapping is based on understanding the current state, setting process improvement goals and making a plan to effectively achieve future state objectives.


Lean Techniques:
Workplace organization and standard work are two Lean tools to achieve
Future State objectives. For example, administrative offices are stocked and laid out with visual controls to show at a glance where equipment and supplies belong, with automatic reorder points in each supply cabinet (i.e. a pull system). Standard work specifies content, timing, sequence and outcome of tasks using a learning approach of iterative questioning and problem solving that allows employees to eliminate variation so that deviation from standards is obvious, and there is no ambiguity about who provides what to whom and when and build in quality (error-proof).


Lean Examples:
Below are summaries of results from two manufacturing companies applying the theory and practice of Administrative Lean™. The tables compare Current and Future State Value Stream metrics, and show results when Lean Techniques are put to effective use to reduce process time and lead-time and improve quality.

1. Engineering New Process Value Stream
Metric
Current State
Future State
Improvement
Lead time (days)
255
256
28%
Process time (hours)
240
129
46%
Number of meetings
2
0
Number of operations
155
9
40%

 

2. Vehicle Material Cost Analysis
Metric
Current State
Future State
Improvement
Lead time (days)
128
49
62%
Process time (hours)
161
59
63%
Number of meetings
22
2
90%

Conclusion: The Value Stream Perspective show process flow from a systems view, and reveals how to measure performance of that system. The Value Stream Map and the process improvement plan based on that map are used to put Lean Thinking to effective use throughout the enterprise.


Healthcare Lean™ Case Studies by
John C. Long, MD


Lean Overview
Lean Thinking is an integrated approach to designing, doing, and improving the work of groups of people working together to produce and deliver goods, services, and information. Healthcare Lean™, based on the Toyota Production System, applies concepts and techniques of Lean Thinking to hospitals and physician practices.


Healthcare Lean™ makes use of Value Stream Mapping, a simple, elegant tool to show how work is done and how to improve that work. The work group (employees who know specific details of the process) first draws a Current State Value Stream Map to see and understand how work is presently done. The work group measures the process time (the amount of work done to complete a task) and lead time (the total time to provide a product or service from order to delivery). The work group then draws a Future State Map to improve quality and reduce lead time and process time by eliminating waste in the process. Value Stream Mapping shows where to use Lean techniques such as visual workplace, standard/balanced work, one-piece flow processing with cross-trained workers, and pull systems. The process improvement (Kaizen) plan envisioned in Value Stream Mapping is based on understanding the current state, setting process improvement goals, and making a plan to achieve future state objectives.


Healthcare Lean™ Case Studies
Below are summaries of four Hospital work groups applying the theory and practice of Healthcare Lean™. The tables compare Current and Future State Value Stream metrics of four processes, and show results when Lean techniques are put to use to improve quality by reducing process time and lead-time

1. Hospital Billing Process from Receipt of Voucher toTransmitting Claim or Posting

Metric
Current State
Future State
Improvement
Number of process steps
16
9
42%
Process time (minutes)
86
37
57%
Lead time
5 days
2 hours
90%

 

2. Endoscopy Procedure Process from Patient Arrival to Discharge

Metric
Current State
Future State
Improvement
Process time (minutes)
178
131
26%
Patient wait time (minutes)
81
11
86%
Lead time (minutes)
260
142
45%

 

3. Physical Medicine Office Visit Process from Patient Arrival to Completed Report

Metric
Current State
Future State
Improvement
Number of process steps
24
6
75%
Process time (minutes)
179
58
68%
Lead time (days)
34
1
97%

 

4. Procedure Scheduling Process from Physician inquiry to Scheduled Appointment

Metric
Current State
Future State
Improvement
Number of process steps
14
8
42%
Process time (minutes)
69
18
70%
Lead time (days)
34
3
90%
Percent Rework (rescheduling appointments)
25%
2%
92%


Who is the customer in a Healthcare Value Stream?
The goal of Healthcare Lean™ to improve quality by reducing cost of non-value added steps, that is, work not reimbursed by the payer. This is done by reducing process time and lead time, as shown in the four examples. The intent of Healthcare Lean™ is to improve, not interfere with, the value added process: the encounter of the patient and the caregiver. Value Stream Mapping does this by making clear that the output of the process is delivered to a customer other than the patient. This is shown in the Value Stream examples in which the customer is not the patient:

Process
Output of process
Customer
Hospital billing from receipt of voucher to transmitting claim and posting-payment
Transmitted claim or posted payment in 2 hours
Payer and Accounting Dept.
Endoscopy procedure from patient arrival to discharge
Increase throughput of preparation and procedure steps by eliminating recovery bottleneck
Physician
Physician medicine from patient arrival to discharge
Complete and accurate physical or occupational therapy report in one day
Physician
Procedure scheduling from physician inquiry to scheduled appointment
Scheduled, authorized appointment for a procedure (e.g., chest roentgenogram, colonoscopy, cardiac ultrasound) in 3 days
Resource that does the procedure (e.g., radiology, endoscopy, cardiovascular departments)

Conclusion: The Value Stream Perspective show process flow from a systems view, and reveals how to measure performance of that system. Value Stream Mapping is effective and useful because it makes visible the link between material flow (e.g., scheduled procedure or physician office visit, endoscopy or physical medicine report, or claim for a physician encounter) and information flow (e.g., telephone requests, appointment scheduling software, on-line transmissions from payers). Healthcare does not need more queuing algorithms to optimize flow and reduce labor cost. Healthcare needs Lean Thinking to see processes from a Value Stream Perspective, to understand the role of the patient and the customer in that Value Stream, and to put to effective use improvement plans to build-in-quality eliminating waste in the process.



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