Chapter 11. Implementing a Six Sigma Culture
“First, have a definite, clear practical ideal: a goal, an objective. Second, have the necessary means to achieve your ends: wisdom, money, materials, and methods. Third, adjust all your means to that end.”
—Aristotle
Six Sigma is not green, black, or any color belt. It is not DMAIC (Define, Measure, Analyze, Improve, and Control), DMADV (Define, Measure, Analyze, Design, and Verify), or DFSS (Design for Six Sigma). It is not saving money. It is not the silver bullet that corrects all problems. Organizations that think it is are in for a big surprise and limited success.
What then is Six Sigma? It is a new way of thinking, behaving, and managing. It is a firm belief that we all can be nearly perfect and do nearly perfect work all the time, and that we all have the inert potential to be creative. We need to think of applying this kind of thinking to each of the healthcare stages (see Figure 11.1).
Figure 11.1. The healthcare stages
We are always surprised at the number of organizations that look at Six Sigma initiatives as groups of Green and Black Belts running around solving problems. This has a negative, not a positive, impact upon the organization. They relieve management of accountability for change. In the past, management used the technical talents that were assigned to them. Process optimization was done by design, manufacturing, and quality engineers. Organizations that just use Six Sigma to solve problems have limited success. The organizations, which were the most successful in using Six Sigma as just a problem-solving tool, were the ones that had the most problems to solve. But organizations that used Six Sigma to change their culture were the ones that reaped the big harvest. The difference between these two types of approaches is that the first type of organization measures its success on dollars saved, while the second type of organization measures its success on improving customer satisfaction.
“In healthcare, a million dollar savings is unimportant compared to saving one life that could have been lost.”
—H. James Harrington
In healthcare, there are many opportunities to reduce the number of errors that occur every day and to save lots of money, but most of all there is a unique opportunity to save lives. A typical hospital has millions of opportunities to be successful or fail every day. Healthcare professionals cannot rely on a few groups of Black and Green Belts who are looking for million dollar savings’ project opportunities. At the Six Sigma level, an organization could have more than 1,200 (based upon 1 million opportunities per day) needless deaths per year in just a single hospital. We are lucky that not all of the errors that occur result in death. For example, a nurse could drop a bedpan; it would cause a mess, but not a death. The checks and balances already placed in the system catch some of the other errors. In healthcare, we need to be much better than 3.4 defects per million critical opportunities. We need to be closer to 3.4 per billion critical opportunities. This means that everyone within the healthcare organization needs to be actively involved in the Six Sigma process.
The healthcare professional is faced with a major problem because the specification limits on their product (the patients) they are working with is very broad. A manufacturing operation has many close tolerances on all parts that provide consistency in the process. They all go together in the same way. In healthcare, each patient is different. They have different allergies, different blood types, different medical histories, and so on. It is like having a one-of-a-kind manufacturing production line. This means that the healthcare professional has to be more creative and more adaptive than most other types of professionals. All of these things make up the complexity and increased risk that the healthcare professional faces each day.
In spite of all of this, or maybe because of all of this, there are many opportunities to apply Six Sigma concepts in the healthcare arena. For example, at North Carolina Baptist Hospital, a Six Sigma team attacked the problem of getting patients from the emergency department into the Cardiac Catheterization Laboratory for treatment in the shortest possible time. As a result of this, they were able to reduce the cycle time by more than 41 minutes.1 It is this type of result that converts skeptics into believers.
Bank of America had the right idea. Its Six Sigma program focused on customer satisfaction and resulted in a 25 percent improvement and saved more than $2 billion. They focused on improving customer satisfaction and credit risks assessment reduction plus fraud prevention.2
“In the medical field (alone), bioscience will shift the health paradigm to such a degree that (within two decades) we’ll look back on the medical practices of today the way we now look back on those in medieval Europe.”
—The Long Boom: Schwartz, Leyden and Hyatt
Implementation Process
“For 40 years, I have been lecturing and writing on Process Improvement, and each time management thinks it is a new idea. They must be deaf, blind and forgetful.”
—H. James Harrington
It is not easy to make the required transformation in a healthcare unit. Everyone is already doing their best to do a great job already. Everyone is overworked. Everyone has their own job to do. They all are trying to satisfy the patient, the doctors, the government, the insurance companies, the patient’s families, and yes, each other. Prices keep going up. The medical technology is changing so fast that it is almost impossible to keep up with it, and everyone is looking for a way to earn some easy money by suing the healthcare provider (HCP). With all this going on, who has the time or the desire to take on an additional project? The real answer is that you just cannot afford to fail to continuously improve. The trick is, “How can you convince the Executive Team, key doctors, and enough of the staff that the Six Sigma activities are worth investing their valuable time and effort in so that the Six Sigma project can get started and keep expanding?”
Based upon our experience, the following five-phase approach is one of the most effective methods that we have run across to bring about the required transformation:
• Phase IV—Implementing the Six Sigma System
• Phase V—Internalizing the Six Sigma Culture
“When I climb Mount Rainier, I face less risk of death than I’ll face on the operating table.”
—Donald M. Berwick, CEO of the Institute for Healthcare Improvement, Harvard Medical School
Phase I—Mobilizing
“A useful motto during the start-up phase is ‘Think big—Start small.’”
—Ernst & Young
The mobilization phase is subdivided into seven activities:
• Activity 1—Finding and Developing a Six Sigma Advocate
• Activity 2—Analyzing Six Sigma Fit with the Strategic Plan
• Activity 3—Defining Six Sigma Improvement Opportunities
• Activity 4—Building a Six Sigma Business Case
• Activity 5—Approving and Organizing for Phase III Pilot
• Activity 6—Setting Preliminary Objectives for the Pilot
• Activity 7—Selecting an External Consultant
Activity 1—Finding and Developing a Six Sigma Advocate
“Someone has to lead. Why not you?”
—H. James Harrington
All Six Sigma projects start with a single individual or a very small group of people who want to get more information about Six Sigma and how it can be used to improve the healthcare provider’s performance. We will call this individual—the Six Sigma Advocate (this person may be you). This individual is often a forward-thinking individual who has read articles or talked to friends who have experienced implementing Six Sigma initiatives in healthcare or other industries. Often the Advocate is a new hire who has come from another healthcare provider that is doing Six Sigma, and he/she has already had some experience with the results that a Six Sigma initiative has on the organization that he/she left. Based upon these early contacts related to Six Sigma, the individual will continue to expand his/her knowledge of Six Sigma until reaching a point where he/she feels comfortable enough to contact executive management, requesting permission to conduct a concept study to determine whether Six Sigma is right for the organization. Once the Executive Team approves the concept study, the individual (or group) will start to collect more articles, read more books, and even attend conferences to become knowledgeable about what Six Sigma is and what it can do for the organization. Often the individual will contact consultants to get their advice about what they would do to start a Six Sigma program within the organization.
If the Advocate is convinced that a Six Sigma initiative may be in line with the organization’s culture, the Advocate is ready to move on to Activity 2.
Activity 2—Analyzing Six Sigma Fit with the Strategic Plan
“If the glove doesn’t fit, it is time to quit.”
—H. James Harrington
If the initial study phase convinces the Advocate that the organization could benefit from the Six Sigma initiative, the Advocate will need to prepare a business case that will be used to convince the Executive Team that the investment in time and effort will provide adequate return on investment and improve the organization’s competitive advantage. This business plan has to answer two questions that are on everyone’s mind:
• Why should we do something different?
• Would the Six Sigma initiative be the best answer to the problems we are facing?
We find that during this activity, it is best to have a small group developing the business case. This team should be made up of members from the strategic planning group, finance, practicing physicians, administration, sales, and quality.
The business case should be directed at ensuring that the goals set forward in the strategic plan are met or exceeded. By doing this, the Six Sigma initiative is directly connected to the organization’s day-to-day operations. We cannot overemphasize the importance of developing a good business case, as it will determine whether the organization will go forward with the Six Sigma initiative. It must provide the Executive Team with a compelling reason to go forward with the initiative. The business case must provide logically researched answers to these two questions.
The strategic plan is the baseline and targets all rolled up into one. It should define the future of managed care evolution and its impact upon the HCP. It should answer and incorporate plans to questions such as
• Is our leadership capable of handling dramatic change?
• Has the time come when we need to compete on costs?
• Do we have the ability to shift from treatment to health maintenance?
• Do our rewards and recognition systems motivate staff (support, administration, nurses, and physicians) to invent new creative approaches to medical care?
• Do we have the ability to serve the needs of the population we service, and do we understand how our service population and services’ needs will change over the next five to ten years?
• Do the board, management, clinicians, suppliers, alliance partners, and medical community realize and want change to take place, and if so, what type of change does each stakeholder want?
• Do we understand the difference between customer’s needs (must have), expectations (things they should get), and niceties (things that set the HCP apart from other healthcare providers)?
• How big a change do we need in order to compete in the market today and in the future?
One of the key parts of the strategic plan is a set of vision statements that defines the changes that are required in the HCP. The primary vision statement is the one for the total HCP that defines where the organization is heading. Back in the 1930s, doctors used to come to people’s homes when they were ill. Today, the sick person drags himself/herself to the HCP. Even with the expansion of outpatient care, we still rely on the patient to come to the HCP location for diagnostics and treatment. The future is leading to in-home care where the patient will not have to come to the HCP location. Electronic monitoring devices will become more and more prevalent, allowing the physician to monitor and treat the patient using IT technology as a communication system. This virtual treatment will replace the need for many of the long stays in the hospital.
Kurt Miller, partner with Arthur Andersen Consulting, depicts the traditional healthcare system as laid out in Figure 11.2.3
Figure 11.2. Traditional healthcare system
You will note that in the historical, traditional healthcare system, the groups and individuals involved were connected in a logically sequential flow of activities. Each one had individual and segregated roles and positions in delivering the healthcare cycle.
As Kurt Miller points out, “Managed care has brought together the supplier, selectors, and payers or physicians, hospitals, and insurers. Most importantly, it has aligned hospital and physician incentives to reduce inpatient utilization, and therefore, cost.”
We predict that in the future the individual will become an active participant in the healthcare delivery process and incentive structure.
Based upon considerations like these, you can see why the overall vision statement has to really address what direction the organization is going to take.
Vision statements can define how the key business drivers need to change over the next five- to ten-year period. Business drivers are the controllable factors within the HCP that impact the performance of the HCP. Business drivers are the major parts within the organization that management has the power to change—things that impact the organization’s performance by adding or subtracting resources, changing standards, redesigning processes, or modifying behavioral patterns. There are usually 8 to 12 business drivers in a HCP. One business driver that is common to all HCPs is leadership and support. Another one is the organization’s processes. For each of these business drivers, a vision statement needs to be developed that defines how this business driver needs to change over the next five years. For example, the following is a typical vision statement for operating procedures:
“Major processes are documented, understood, followed, easy-to-use, prevents errors, and are designed to be adaptable to our stakeholders’ changing needs. Staff members use them because they believe that they are more effective and efficient than the other options. Technology is effectively used to handle routine, repetitive, time-consuming activities and to remove bureaucracy from the processes.”
Other types of vision statements focus on things such as
• Technologies. How will the technologies’ information need to change to keep up with the needs of the HCP industry and to remain competitive in the future?
• Structure and facilities. The future configuration and facilities will need to be much different to accommodate the home care approach.
• Markets and customers. Today, we have a hard time even defining who is the customer. Is it the patient, employee, employee’s family, health plan member, insurer, physician, or all of these? What are their future needs? How will we need to service this changing market, and what markets do we need to service? In the future, we will need to establish strategic alliances and partnerships with key customers, suppliers, and other HCPs. There will be a change in the HCP’s scope and variety of products and services to bring them in line with their specific target markets and patient population.
• People. Our people will have even more need for technical knowledge that can be obtained and assimilated much faster than it is today. Teams will give way to teamwork. The future HCP must send a daily flow of communications concerning “What is going on in the HCP?” “How is the HCP changing?” “What is changing that impacts each specific individual?” and “What is the new knowledge related to the individual’s profession?”
The business-driver vision statements are very important because they provide the HCP suppliers, employees, and management with a clear vision of how the organization will be changing and its impact upon how they will be required to perform and be treated. The gap between the present performance and the business-driver vision statement will drive the performance improvement activities over the coming years and will have a major impact on the application of Six Sigma concepts.
Why is improvement for HCPs so important? The National Committee for Quality Assurance (NCQA) in its 2005 “The State of Healthcare Quality” report, produced by the U.S. News and World Report magazine, reported that over the past six years, quality improvements in healthcare has resulted in the prevention of 67,000 deaths. These improvements were applied to 64.5 million people. If the payment in a wrongful death suit is only $1 million, that amounts to a savings of $67 billion to the HCP industry.
“Any kind of health plan might potentially be an excellent plan. But realistically, only the ones that measure quality are going to achieve excellence.”
—Margaret E. O’Kane, NCQA President4
As healthcare providers, we can’t just focus on servicing the sick. We also have to help the well stay well and live longer. The estimated deaths attributed to failure to deliver recommended care in 2004 were by category:5
• Controlling high blood pressure: 12,000 to 32,000 deaths
• Smoking cessation: 8,300 to 13,200 deaths
• Diabetes care—HbA1c control: 5,300 to 11,700 deaths
• Colorectal cancer screening: 4,100 to 6,200 deaths
• Cholesterol management: 3,400 to 7,200 deaths
• Prenatal care: 1,000 to 1,750 deaths
The strategic plan should also include a set of Performance Indicators measurements called KPIs (Key Performance Indicators). There are different performance indicators for each of the many levels and departments within the organization. The HCP should have a high level set of measurements that are in keeping with the balanced scorecard concept. Typically, these high-level KPIs are things such as
• Percent of customers who document complaints
• Bed occupancy percentage
• Percent utilization of high-cost special equipment
• Staff satisfaction level
• Turnover rates
• Operating cost ratio to dollars collected
• Percent increased in collections per year
• Percent of insured inpatient stays billed
• Percent of insured outpatient visits billed
• Average age of insured claims outstanding
The HCP should have a set of lower-level measurements called CPIs (Critical Performance Indicators) that back up and support the higher-level measurements. They may or may not be included in the strategic plan, but there should be a relationship of the CPIs in the individual units and departments to the high-level KPIs. Often these CPIs are efficiency and/or effectiveness measurements of the processes within the departments. For example:
• Average wait time to be admitted
• Average time to process specific lab work
• Percent lost records
• Average response time to a bed call
• Average time in critical recovery by operation type
• Percent billing errors
• Percent of patients who receive recommended healthcare
“In a study conducted by Rand Health and Pfizer Inc. in 2005, evaluating 182 measurements of health for 22 common medical conditions covering more than 300 patients, they found that only 55 percent of the patients received the recommended care.”6 This study revealed that the current practice of examining administrative records alone does not provide an accurate picture of how the recommended procedures are being implemented. When just the administrative information was used, it indicated that 83 percent of the patients received the recommended care. This is more than a 50 percent higher rate than the actual quality of the treatment.
Having a good set of measurements that relate to the HCP’s vision statements is a good starting point. But, to understand what needs to happen, there should be a set of improvement objectives year by year for each KPI and CPI. These improvement objectives provide good insight into the areas that are in need of and have the priorities for major improvement.
The Strategic plan should have both strategic initiatives and tactical initiatives included in it. Examples of strategic initiatives include the following:
• Financial stability plans
• Formation of Knowledge networks
• Continuous care model
Examples of tactical initiatives include the following:
• IT expansion
• Training plans
• New equipment plans
• New Service Plans
Activity 3—Defining Six Sigma Improvement Opportunities
“The big opportunities that lead to renewal and the strategic decisions that capture them seem more like the whimsical flight of a butterfly than the path of a carefully aimed arrow.”
—Robert H. Waterman, Jr.
The Six Sigma team needs to also review the customer satisfaction data to define hot spots that provide opportunities for increased customer satisfaction. It is also recommended that meetings with some small focus groups of employees and customers are conducted to define the important improvement opportunities as viewed from their standpoint and to provide them with a quick overview of Six Sigma.
Another good information source is the projects that are being implemented or that are approved for implementation. Many of these projects are IT projects that will result in major changes in the organization’s processes. Frequently these proposed projects are excellent candidates for the Six Sigma initiative.
Six Sigma has built into in it some effective approaches to redesign the HCP processes. Making a list of the HCP business processes and then evaluating them to define how well they are performing is another way to identify Six Sigma improvement opportunities. The following lists provide examples of typical HCP core processes and sub-processes that could be Six Sigma improvement opportunities.
Typical HCP sub-processes:
In the Riddle Memorial Hospital’s 2006 Process Improvement Initiative Business Plan, it defined the following processes as core processes:
• Emergency room
• Inpatient encounter
• Pharmacy
• Imaging
• Physician practices
• Advanced life support
• Operating room
• Out-patient encounter
• Registration and scheduling
• Housekeeping
• Cerner information system
In addition, it defined the following processes as support processes:
• Labor relations
• Technology
• Facilities management
• Supply chain management
• Project management
• Billing
• Credit and collections
• Legal
The Patient Journey
“The truth of the matter is that when it comes to quality, the customer has all the votes.”
—John Guaspari
One of the best ways to identify improvement opportunities is to define the patient journey throughout the care cycle. Figure 11.3 shows a typical journey.
Figure 11.3. The patient’s journey through the care cycle
In order to understand how the physicians’ and staff’s daily behaviors and practices in the HCP setting follow the patient journey, the following approaches may be used:
• Walking in the Patient’s Shoes. In this approach, team members actually go through the patient treatment process. Often these individuals are not identified to the hospital staff as “test patients,” so they get no special treatment. In the consumer business, these individuals are called mystery shoppers. This allows them to experience anxieties, expectations, discomfort, and emotions that a real patient would experience.
• Document tracking. Using the patient’s chart, analyze each step the chart takes. This helps to understand how the chart-handlers feel about how the patient is being taken care of.
• Shadowing Staff. Team members accompany the doctors, nurses, and staff, observing their work and the bottlenecks they face in their daily routines.
• Patient and Family Interviews. This approach provides data about their expectations, feelings, and disappointment as they progress through the patient journey.
• Process Walk-Through. Using the major processes as a starting point, a team follows the process flow, reviewing each step in the process. This helps define problems in the hand-off between each department.
• Workflow Analysis. By looking at the movement of patients and staff, you are able to identify wasted effort and increased cycle time. This can include workflow mapping by area or in some cases, just observing what is going on in a specific location within the HCP (for example, emergency care admittance).
Typically, the patient’s journey has six improvement opportunities:
1. Entering the HCP
2. Being informed
3. Finding the way
4. Waiting for service
5. Using the care facilities
6. Paying the bills
Based on this body of knowledge and information, the team should be able to identify a number of opportunities to apply the Six Sigma methodology to. We suggest that the team review these opportunities based on a set of guidelines that the team develops. Figure 11.4 is a two-dimensional analysis based on
• Impact on the HCP
• Likelihood of success
Figure 11.4. Selecting the right project
In most cases, these two-dimensional approaches are inadequate to make these important divisions, as many factors need to be considered. The following are typical factors that HCP may use to help select the opportunities that will make up the pilot phase:
• Does it support the strategic plan?
• Is it a patient safety issue?
• Will it improve patient central care?
• Will it decrease death rates or just save money?
• Will it improve the work environment?
• Is there a high payback if the problem is solved?
• How hard is the problem to solve?
• Is it a problem that the Six Sigma methodology can address?
• Will it provide a competitive advantage?
Informed Approach to Selecting Opportunities
“Make a habit of discussing a problem on the basis of the data and respecting the facts shown by them.”
—Dr. Kaoru Ishikawa
World-class organizations continuously strive to provide superior products and services to their customers. As a result, they ensure that all improvement efforts focus on improving external customer satisfaction. Because a Six Sigma effort is a major undertaking for all organizations, which directly impacts the service-related customer interface, it should be linked to customer satisfaction.
Traditional approaches to define improvement opportunities can be thought of as “internally focused” and “defensive mechanisms” that try to correct and prevent problems from recurring. A more appropriate approach is “customer-focused” and “offensive mechanisms” so that business processes are truly world-class. The informed approach we are going to describe in this section is an objective method for prioritizing business processes, based on the importance of the process (as determined by external customer expectations), and the degree to which the process can be improved (as determined by its current quality).
This approach embodies the following principles:
• Linking improvement efforts to customer expectations
• Focusing on prevention, as well as correction, activities
• Emphasizing the areas with the greatest potential for improvement
• Working on a manageable number of projects
• Using facts, not perceptions, for selection of projects
• Ensuring constancy of purpose
The informed approach differs from the other approaches because it is based largely on actual data collection from customers and internal operations, instead of opinion. It is therefore more time-consuming. The Executive Improvement Team should undertake this effort by
• Understanding External Customer Requirements. External customers have several requirements related to the facilities and the services (both healthcare- and administration-related) that are provided by the HCP. The service-related requirements are satisfied by the organization’s business processes; therefore, it is essential to understand these requirements. This can be done by actually talking to customers and documenting their requirements, or by using information that already exists in various parts of the organization (comment cards, customer service data, and so on). It is important to understand not only the requirements but also the importance of each of those requirements, because the aim of the organization should be to focus on the key requirements.
• Evaluating the Importance of Business Processes. External customer requirements are met by the organization through the execution of one or several business processes. This needs to be understood by management, and is best achieved by identifying the processes that directly and indirectly impact the external customer. Once the business processes that impact the external customer have been identified, the importance of these processes can be evaluated. Those processes that have major impact on important external customer requirements will be rated the highest, and will be considered primary candidates for the Six Sigma project.
• Evaluating the Improvement Opportunities. No process is so perfect that it cannot be improved. Continuous improvement is the basic principle of quality and business everywhere; the degree of improvement possible depends on the current state of the process. There are several key indicators of effectiveness, efficiency, and adaptability, such as cycle time, rework, backlog, cost, and so on. The Executive Team should select a handful of meaningful indicators and then rate every process based on the information it can gather about the process. Processes with greater opportunities for improvement should be rated the highest, because they are primary candidates for DFSS (Design For Six Sigma).
• Selecting the Critical Processes. After gathering the data on the processes, the Executive Team is now ready to select the critical processes for improvement. It should be obvious that the critical processes are those that are high in importance as well as high in improvement opportunities, and these are the ones that should be attacked first. Correspondingly, processes that are not very important from a customer viewpoint and appear to be functioning quite well should not be selected for initial improvement efforts. Figure 11.5 shows a matrix that can be constructed based on the data gathered. It is a helpful tool that provides a clear overview of all processes and helps make the final selection.
Figure 11.5. Matrix for setting process priorities
The same approach can be applied to improving the internal workings of the organization, by replacing the external customer with the business unit. This is not as self-serving as it might seem. As you improve the internal workings of the organization, you reduce cost and provide a better quality of work life for the employees. As internal costs go down, the cost to your external customer can be reduced. As the quality of work life improves, the organization’s output improves.
Remember that every process, every activity, and every job within an organization exists for only one reason: to provide our customers and/or consumers with products and services that represent value to them. The rippling effect of improving any activity should have a positive impact on the external customer.
Weighted Selection Approach
“It is not the employer who pays the wages. Employers only handle the money. It is the customer who pays the wages.”
—Henry Ford, Sr.
In this opportunity-selection approach, each opportunity is evaluated on a number of parameters. For example:
• How changeable is it? = 2 points
• Will it reduce cost? = 2 points
• Decreased death rates = 5 points
• Improve patient care = 4 points
• Improve staff morale = 3 points
• Reduce wait time = 1 point
Each of these parameters is weighted by a point score from 1 to 5. A rating of 1 indicates that it is a low priority and a 5 that it is a very high priority.
In Table 11.1, typical improvement opportunities are listed with the six parameters defined in the previous example.
Table 11.1. Typical Improvement Opportunities
• Reducing inpatient wait time
• Reducing billing errors
• Reducing pharmacy errors
• Reducing response time to bed calls
• Improving information sharing
• Reducing record errors
• Offering better customer parking
• Increasing inventory turns
• Reducing tobacco cessation
• Improving risk management
• Reducing medication administration
• Recording Medication Administration Records (MAR) errors
• Reducing critical-care recovery time
• Standardizing procedures for different treatments
• Reducing outpatient processing cycle
The six evaluation parameters are listed A through F in the top of Table 11.1 along with the related weighting factor. Each of the improvement opportunities are evaluated on a scale of 1 to 5 for each evaluation parameter. A rating of 5 indicates that the opportunity will be easy to take advantage of or that it will have a big impact on the HCP. This rating is then multiplied by the weighted factor for the parameters being evaluated to define a score for the opportunity/evaluation parameter combination. For example, in Table 11.1, Reduce Billing errors was evaluated at the 2 level (difficult to change) and column A (how changeable is it) has a weighting factor of 2. The total score for the “Reduce Billing Errors / How Changeable Is It” combination is 4 (2×2=4).
By summing up the individual scores for each parameter for an opportunity, the total weight for that opportunity can be calculated.
Based upon the analysis in Table 11.1, MAR errors are the most important improvement opportunity. Prescription errors are estimated to kill up to 25,000 people a year.7 You might think that physicians care more about their money than the health of their patients. When they write a check, they write out the dollar amount and then double-check it by writing out the amount in numbers. The same physicians scribble in almost illegible instructions on prescription forms. Errors are very common—for example, the interpretation of the prescription was 10mg and it should have been 1.0mg.
Selection Process
As you finalize your selection of the business processes that will have Six Sigma applied to them, remember the 4 Rs:
• Resources. There is a limited amount of resources available, and the present processes must continue to operate while we are improving them. Often, this means that a new process will be operating in parallel with the old process while the new process is being verified. Don’t overextend yourself.
• Returns. Look closely at the potential payback to the business. Will the process reduce costs? Will it make you more competitive? Will it give you a marketing advantage?
• Risks. Normally, the greater the change required, the greater the risk of failure. Major changes always are accompanied by resistance to change. Breakthrough activities have the biggest payback, but they also have the biggest chance of failure.
• Rewards. What are the rewards for the employees and Six Sigma Team (SST) members working to improve the process? How much will their quality of work life be improved? Will the assignment be challenging and provide them with growth opportunities?
Based on the results of this analysis, the Executive Team will typically select 10 to 25 critical processes to which the Six Sigma approach will be applied. The number will vary based on the size and complexity of the organization.
Using one of these three approaches, the Executive Team can decide which opportunities will be part of the pilot phase and which can be scheduled for later analysis. Consideration should be given to balancing the workload within the organization and ensuring that all functions are participating. This approach concentrates attention on critical issues, sets priorities for resources, and ensures that the effort is manageable. While it is a relatively simple and useful way to select business opportunities, this approach has a number of drawbacks, including
• “Pet projects” commonly are identified.
• Management perspectives may not be supported by hard facts.
• Top management may sway the decision.
Medication Administration Records (MAR) Errors
Although MAR errors are a big healthcare problem, it is not one that should be tackled by the SST. Six Sigma projects should last less than three months in most cases.
“We believe we can change how healthcare uses I.T. and it starts with the federal government.”
—President George W. Bush speech at Vanderbilt University Medical Center, May 2004
The U.S. Department of Health and Human Services awarded more than $8 million in contracts in 2005 to 15 projects designed to help clinicians, facilities, and patients implement evidence-based patient safety practices.8
Dr. David Brailer, the former National Health IT coordinator, defines his goal as improving the nation’s quality of healthcare and reducing cost through the use of technologies such as electronic health records and electronic prescription-ordering systems. It is estimated that these types of IT systems will save the U.S. $140 billion per year by improving patient care and eliminating redundant tests.9
Brailer worked with the Santa Barbara County Health Data Exchange to design and install the first peer-to-peer electronic healthcare information data exchange in the U.S. It allowed hundreds of physicians, hospitals, and labs to have timely access to patients’ medical formation.
As you can see, correcting MAR errors is a big problem and a major project with a lot of IT involvement. It is not a SST-type project that can be put to bed in three months. That does not mean that the Six Sigma approach cannot help to solve this problem. In fact, you should at least have one Six Sigma Black Belt on the MAR transformation team to help them analyze the problems and the potential solution.
Activity 4—Building a Six Sigma Business Case
“If we look at Quality as it has been implemented in the past, we won’t be successful in reducing patient errors.”
—Monica Berry, President, American Society for Healthcare Risk10
With the help of the selected guidelines, the team should select a small quantity (two to five projects) to build a business case around. The business case should include both tangible and intangible impacts. It also should include the estimated cost to investigate, analyze, and define the solution to the selected opportunities. In most cases, the projects should last less than three months. If the business case looks good (and it usually does look good), the team should schedule a meeting with the Executive Team to provide them with a quick overview of the Six Sigma methodology and present the business case to them.
Often it helps if you use some examples to back up your business case. Typical Six Sigma savings as reported in “Six Sigma and Its Impact on American Business,” a presentation by Dr. Ronald Snee (Sigma Breakthrough Technologies, Incorporated, October 17, 2000,), are as follows:
• Increase dryer throughput — $100,000
• Reduce freight cost (shipping) — $700,000
• Reduce warranty manufacturing — $150,000
• Reduce cost of waste disposal environmental — $320,000
• Reduce time to issue bills by 50 percent ($2.6 million)
• Implemented forecasting model sales — $500,000
• Reduce obsolete inventory and production planning — $1.7 million
• Increase warehouse input by 100 percent — $250,000
• Reduce travel cost — $1.3 million
Activity 5—Approving and Organizing for Phase III – Pilot
“You must have your senior leadership team committed to doing this (Six Sigma). Expect that the first year will be the most difficult, but it will be easier from there.”
—Louise Goeser, Vice President of Quality, Ford Motor Co.
The desired outcome from this meeting is an improved budget to train three to five teams of Green Belts and cover their efforts to solve the selected projects. These Green Belts will make up three to five Six Sigma Improvement Teams. It should also include the cost of bringing in a consultant Black or Master Black Belt to provide the training and to work with the Green Belts to take full advantage of the pilot improvement opportunities. Sometimes the HCPs prefer to select an internal person to train as a Black Belt to lead the pilot projects. On the surface, this may look like a less-expensive way to go. In reality, it is usually more expensive as it slows down the projects and decreases their impact.
The Executive Team should also, at this point in time, select an individual to become the Six Sigma Champion. The Six Sigma Champion is typically an upper-level manager who leads the implementation of the Six Sigma program. Often, as a result of this meeting, a Six Sigma Executive Improvement Team is formed. Sometimes this is a very small team made up of three to four members. In other cases, it becomes a very big team. The following is an example of the people who could make up the team:
• Chief Executive Officer
• Chief Medical Officer
• Chief Financial Officer
• Chief Operating Officer
• Vice President, Management Care
• Vice President, Hospital Administration and Nursing
• Director, Quality Improvement
• Director, Quality Management
• Director, Care Management
• Vice President, Sales and Marketing
• Chairman, Primary Care
• Chairman, Medical Specialties
• Chairman, Surgical Specialties
• HCP Health Plan Director
• Associate Director, Care Management
• Associate Director, Information Systems
• Outside consultant
For each of the selected opportunities, an Executive Sponsor should be assigned. This individual will watch over the Six Sigma activities to be sure they are on schedule and help if SST runs into any organizational bottlenecks that it cannot address.
Activity 6—Setting Preliminary Objectives for the Pilot
“We must stop comparing ourselves against yesterday and start measuring ourselves against tomorrow.”
—Colby Chandler, past Chairman and CEO, Eastman Kodak Company
Once the Executive Team has selected the pilot opportunities to which Six Sigma will be applied, it should develop a set of preliminary objectives that will be used to provide vision and direction to the Six Sigma Teams (SST). These preliminary objectives will ensure that an initial common understanding exists between the SST and the Executive Team. Depending on the amount of knowledge and the data that the Executive Team has about the selected processes, these objectives will be more or less quantified. In some cases, the objectives may only set the direction for the SST (for example, reduced cycle time). In other cases, improvement objectives may be provided (for example, reduced cycle time by 20 percent). The preliminary objectives should address effectiveness, efficiency, adaptability, and cycle time. In all cases, the objectives should be focused on meeting or exceeding customer expectations and can drive incremental or breakthrough improvement, depending on the degree of improvement desired.
It is very important not to blindly accept the preliminary objectives as the goals for the SST. Normally, these objectives are set without detailed data or understanding of the present opportunity. Letting the SST set its own goals provides needed ownership. These goals often are more aggressive than the Executive Team-set objectives.
Activity 7—Selecting an External Consultant
The last activity in Phase 2 Planning is selecting an External Consultant to help with the training and implementation of your Six Sigma initiative. This is one of the most important activities in your Six Sigma initiative.
“All of the most successful implementations have used experienced external consultants who have saved these companies months and even years in their implementation process.”
—Michael Brassard and Diane Ritter
This is no place to try to save money. The consultant cost will be 2 percent of the total cost and less than .1 percent of the savings. It has always been my dream to find an organization that would let me put in a Six Sigma program for free and just give me 10 percent of the savings. Time after time, it has been proven that you get the best return on investment when you select the very best consultant without basing your selection on consulting cost. Your risk of failure goes up exponentially when you try to cut cost by using less experienced consultants or when you decide you can do it yourself by just sending a few people to Black Belt classes. It is just like taking a doctor right out of school with no internship and putting them in charge of the Heart Surgery Protocol Flow Committee. Time after time, when we have talked with organizations that complain that Six Sigma or TQM did not work for them, we find that they tried to do it without the proper experienced help and with little or no budget set aside for the initiative. You cannot expect an individual who you send to a Six Sigma Black Belt class to have the depth of understanding to attack all of the complex problems that your organization is facing without years of experience in using these complex approaches. The problems you are facing today are very complex or you would have already solved them. Even a trained Black Belt is an apprentice until he/she has five or six different projects under his or her belt.
Six Sigma consultants can be divided into three major categories, each of which has their own advantages and disadvantages:
• Instructors
• Implementers
• Process Experts
Instructors
Instructors are those individuals who usually come out of universities and have a great deal of experience in adult learning. They can take a book, a curriculum, or another person’s material and do an excellent job of presenting it in an interesting and informative way. They typically have read a lot and, as a result, have some excellent examples that back up the materials they are presenting. They do an excellent job of presenting materials for management, and Green Belt and Black Belt certification. Their disadvantage is they have had little or no experience in implementing Six Sigma programs and are only familiar with the Black Belt body of knowledge. It is difficult for them to relate theory to practices.
Implementers
These consultants are experts in installing Six Sigma initiatives throughout an entire organization. They know what steps need to be taken to bring management on board. They know how to sell Six Sigma programs across the entire organization. They do an excellent job of developing business cases. They work very well with the Executive Team and finance. They are big-picture consultants that need to understand the corporate strategy. They usually are less effective at working with and motivating the first-line managers and employees. They do not like to get their hands dirty. They are very good in the conference room but not as good in the classroom.
Process Experts
These are the people who want to understand the details. They spend most of their time in the processes not at their desks. They can be found in the operating room, morgue, test laboratories, and admissions. They are excellent net workers. They know the processes and problems firsthand. Their weakness is they are not as good at teaching as the other two types of consultants but get to the heart of the problem much faster and are usually much better change agents.
Making the Selection
How do you know which type you need? Table 11.2 indicates the strength of these three types of consultants and should help you make your selection. You may want more than one consultant. Select an organization that has all the skills that you need, but stay with one consulting firm so they get to know your culture.
Table 11.2. How Different Types of Consultants Perform
Of course, you would like consultants that do all three activities outstandingly, but this is really not the case. When you do find these consultants, they are more generous and do an acceptable job in all three areas, but do not excel in any one of the areas. As a customer of the consultants, define what activity is most important to you and target to get a consultant who excels in that activity. In most HCP Six Sigma initiatives, you will want to find a consulting firm that will provide three different consultants who excel in each of the three areas.
The following are other things to consider when using and selecting a Six Sigma consultant:
• Have they managed a business?
• Have they had experience working with SSTs solving problems?
• Do they have experience in dealing with and mentoring senior executives?
• Do they understand the IT enablers?
• Is their expertise limited to Six Sigma?
• Do they have good chemistry with the senior executives?
• How will they get the total HCP personnel involved?
• What kind of result have they had in improving customer satisfaction?
Most consultants want to talk about dollars saved. The true value of Six Sigma is improving customer satisfaction.
• Are they Certified Quality Engineers?
• Are they Certified Project Managers?
• What software do they used to track assignments?
• What software do they used to track project status?
• How have they been recognized by their professional societies? (Example: The American Society for Quality in the United States, The European Organization For Quality in Europe, The Asian Pacific Quality Organization in Asia.)
• What books have they written? Are they creators or followers? What approaches do they have to training Green Belts and Black Belts?
• How many Master Black Belts do they have in their organization?
• Who will be working on the floor helping solve problems on all three shifts? (Be sure that you meet these individuals and like them.)
• What kind of results have they had in the HCP industry? Who on their team was on the SST that solved the problem and what was that consultant’s role?
Our advice is to select the consultant who can help work with you on the floor to the advantage of your opportunities, not the one who has the flashiest presentation.
Phase II—Planning
“The healthcare system is not built around quality. It also doesn’t really care about costs.”
—Michael Porter, Professor, Harvard Business School
Once the pilots are approved by the Executive Team, the Six Sigma initiatives start in earnest. The external consultants and the Six Sigma Sponsor will be the primary drivers of this phase. It is made up of the following seven activities.
• Activity 1: Define the Scope of Each Opportunity
• Activity 2: Define the Six Sigma Team (SST) Members
• Activity 3: Train the SST Members
• Activity 4: Organize the SSTs
• Activity 5: Define Measurements
• Activity 6: Prepare a Project Plan
• Activity 7: Prepare the Organizational Change Management Plan
“It is better to prepare and prevent rather than to repair and repent.”
—H. James Harrington
Activity 1—Define the Scope of Each Opportunity
What is the difference between 3 Sigma and 6 Sigma in HCP? Let’s look at one example. Let’s assume that the HCP treats 2 million patients per year, and 50 percent of them undergo medical tests. What would be the impact on the HCP services?11
• 2 Sigma = 106 prescription errors per day
• 3 Sigma = 11 wrong medical tests per day
• 4 Sigma = 2 misplaced personal items per day
• 5 Sigma = 1 wrong test per month
• 6 Sigma = 1 customer complaint in 2.3 years
It is very important to bring the external consultant into the organization and provide him/her with an excellent understanding of the organization’s objectives and culture. At a minimum, consultants should have an excellent understanding of the following documents:
• Vision statement
• Mission statement
• Values
• Strategic focus
• Critical success factors
• Five- to ten-year business objectives
• Performance goals
• Improvement strategies and active projects
The consultants also should understand the product and services that the organization provides, the types of customers that it services, and the culture within the HCP organization. The consultants would need to know how you define customer needs and how you measure customer satisfaction. This type of indoctrination pays off big as the consultant helps you get full value from the Six Sigma initiative.
Armed with this type of understanding and knowledge, the consultant would be able to aid the Six Sigma Sponsor or the Sponsor’s delegated representative to define the scope of the opportunities that make up the pilot phase. The scope of each opportunity needs to be defined so that the people who make up the SST will have the right background and interest. The scope of the opportunity can vary all the way from a single task in an activity that is part of a bigger process, made up of hundreds of activities, to other opportunities that will include the total process that flows through many departments and functions within the HCP.
Another consideration is determining what needs to be accomplished. Basically, there are two options:
• Reduced variation
• Relocate the medium or center point
In the first case, we reduce the deviation around a center-preferred operating point. For example, if an injection was defined as 1.0mg + or –0.1mg of fluid and through experiments, you were able to calculate that the 3 Sigma limit was + or –0.1mg, the objective for the SST would be to reduce the 6 Sigma level to + or –0.05mg. As Figure 11.6 indicates, during Phase A the major effort is directed at bringing the process under control. During Phase B, the processes stabilize so we can start to focus on reducing variation at that activity. In Phase C, we reached the Six Sigma point where the variation at a 3 Sigma level is equal to or less than half of the specified limits. This approach is often used to improve manufacturing operations that have specific tolerances which combine to produce a deliverable end-product.
Figure 11.6. Reducing variation
In the second case, the SST will be assigned to set a new center point (see Figure 11.7.) It is typically used when the objective is to reduce cost, cycle time, or processing time. This type of opportunity is usually directly related to a complex process that goes across many units (see Figure 11.8).
Figure 11.7. Setting a new center point
Figure 11.8. The DMAIC process
The DMAIC (Define, Measure, Analyze, Improve, and Control) is used to reduce variation on simple process improvement projects. The DMADV (Define, Measure, Analyze, Design, and Verify) is used to define new products and processes and to improve present products and processes (see Figure 11.9).
Figure 11.9. Two Six Sigma improvement concepts
Note that in both cases the first three activities are the same (Define, Measure, and Analyze). It is only in the last two activities that there is a change, but don’t be misled. The activities that go on during Define, Measure, and Analyze are very different in the two improvement cycles. The DMAIC cycle is used to reduce variation and to improve simple processes. It is usually applied when
• Customers’ needs can be mapped by refining the existing process
• The project is part of an ongoing continuous improvement program
• A single activity or task within the process needs to be changed
• A single customer performance requirement needs to be changed
• Competitors’ performance is relatively stable
• Customers purchasing behavior is stable
• Technology is stable
The DMADV cycle is a more rigorous cycle and can be applied to major processes. It is based upon the process redesign and benchmarking methodologies previously developed. It is used when
• No processes exist in the present time
• Existing processes need to undergo a major improvement greater than 20 percent
• The project is of strategic importance
• Multiple activities need to be changed
• Multiple customer requirements need to be addressed
• Customer behavior patterns are changing
• Competitors’ performance is improving rapidly
• Supporting technology is changing
Activity 2—Define the SST Members
“Few incentives are more powerful than membership in a small group engaged in a common task, sharing the risks of defeat and the potential rewards of victory.”
—Robert Reich
The consultant and the Six Sigma Sponsor need to define the make up of the individual SST based upon the types of changes that will need to be made. For example, if the opportunity is limited to one natural work team’s environment, the SST will need to be made up of these people who are involved in the activity being studied. You may also need technical people who support the equipment the natural work team is using and someone from IT who is familiar with the supporting software. Often, the problem is not the fault of the natural work team; it might be because the supplier is not providing the correct inputs to allow the natural work team to do error-free work. It is sometimes good practice to have the customer for the output on the SST, particularly when that customer is an internal customer.
For complex, cross-functional processes, the consultant should prepare a block diagram of the process that identifies who is performing each key operation. This is a very important step in the cycle because it forces the consultant to mentally walk through the total process. It is strongly recommended that the consultant do some research before he or she starts to construct the block diagram. He/she should read the prevailing procedure and talk to the people in the process. The consultant must have a good view of the total process before putting pencil to paper.
Figure 11.10 is a typical block diagram that was used by a consultant and the Six Sigma sponsor to define the team members. Once the block diagram is prepared, the consultant should meet with the manager of each department on the block diagram to discuss the project with them and explain what the project’s mission will be. They should also define who the proper person is within that department to represent the department as part of the SST.
Figure 11.10. Block diagram of selecting the process team
SST Members
An SST is a group in which members are working together as a collective, cooperative, and cohesive force. Great care should be taken in selecting the members of each SST because individuals will be working together for an extensive period of time.
The SST members will be charged with the responsibility for creating a solution that takes advantage of the assigned opportunity. They primarily represent his or her department on the team and will be trained to become Six Sigma Green Belts.
Major responsibilities include the following:
• Participate in all SST activities (Example: training in Six Sigma techniques, attend meetings, conduct walk-through, participate in problem-solving, collect and analyze data)
• Conduct SST activities in his or her department as required by the Black Belt (Consultant) (Example: Obtain local documentation, develop a flow chart of the department’s process activities, measure efficiency, and help implement department changes)
• Obtain appropriate resources (Example: Time for the activities to be performed within his or her department)
• Implement changes in the process as they apply to his or her department (Example: Supervise production of new documentation, organize training, and perform follow-up work)
• Chairs a sub-process team as appropriate
• Support Change (Example: Provide information, encouragement, and feedback, and listens to complaints)
• Train and evaluate other department members as appropriate
• Solve process-related problems
• Provide his or her department with a better understanding of how it fits in to the total process and Six Sigma program
• Collect and analyze data
SST Membership Time Requirement
The SST members should expect to devote roughly four hours per week to the project. However, depending on the application selected, the time requirement could be as much time as 50 percent of the work week during the first two months. For example, the Executive Team might decide that a critical process (billing, accounts payable, outpatients’ treatment) requires immediate attention. This could mean a full-time assignment for about four weeks for all team members. The full-time approach is frequently used to prepare a business process for computerization or to have a significant immediate impact on the organization’s near-term performance. Although the Executive Team should be ready to make the appropriate investment, launching an SST generally does not require this level of commitment. It is important that the SST members are relieved of some other normal work in order to participate on the SST. It is not fair or practical to expect them to continue all of their present assignments that are already keeping them busy 125 percent of their time and add to it an additional assignment as a Green Belt.
Activity 3—Train the SST Members
“World-class companies realize that firms have access to the same equipment, technology, financing, and people. The ‘half-life’ of any academic degree is extremely short; therefore, the real difference among companies is the degree to which employees are developed.”
—Ernst & Young
The implementation model we are suggesting makes use of a consultant as the Six Sigma Master Black Belt that will manage the three to five opportunities (pilot project). The team members will be trained as Green Belts and function as Green Belts. At the end of the pilot, the best performing Green Belts will be recommended for Black Belt training.
Green Belt training is typically 40 classroom hours. Subjects to be covered are
• Introduction
• Enterprise-Wide Deployment
• Why companies initiate Six Sigma
• The necessity to revise cultural thinking
• Six Sigma roles and responsibilities
• Six Sigma deployment models
• Cost of quality
• Business examples
• Beginning the case study
• Focusing on the Customer
• Customer analysis
• Customer CTQs (Critical-to-Quality requirements)
• Changes in customer needs over time
• Customer requirements versus customer needs
• Customer alignment matrix
• Continuing case study and applying new knowledge
• Business Process Improvement
• What is a business process improvement?
• Looking at the organization as a system
• Process flow
• Reengineering versus process improvement
• Process matrix
• Moments of truth
• Detailed process mapping
• SIPOC analysis
• Business examples
• Continuing the case study and applying new knowledge
• Define
• Target (board)
• Benchmarking
• Area activity analysis
• SIPOC
• Process definition and mapping (high level)
• Continuing the case study and applying new knowledge
• Measure
• Detailed process map (“as-is”)
• Identification of process Xs and Ys
• What to measure
• Why, where, and when to measure
• How to collect data
• Five-step data collection plan
• Continuing the case study and applying new knowledge
• Analyze
• Visually interpret data
• Value-stream analysis
• Vital few analysis
• “Should-be” process map
• Opportunity analysis
• Continuing the case study and applying new knowledge
• Improve
• Solution analysis
• Charter revision
• Final revision of “as-is” map
• Cost-benefit analysis finalized
• Completion of project plan components
• Scheduling models
• Change management strategy
• Project planning strategy
• Risk analysis
• FMEA (plus other risk analysis models)
• Continuing the case study and applying new knowledge
• Control
• Maintaining the gain
• Measurement plan
• Control tools
• Standards
• Procedures
• Accountability
• Continuing the case study and applying new knowledge
• Introduction to Lean Thinking
• What is “lean thinking?”
• “Lean” topics for the Black Belt
• How is lean thinking applied to DMAIC?
This training can be presented in a number of ways. The most conventional way is to have the consultant conduct a five-day class for each of the teams. We believe that this approach is not the correct one for HCPs. Taking a group away from the day-to-day activities puts a big strain on the organization. Our experience is that it’s next to impossible to get a physician to take five days off in a row, let alone the 20 days that are recommended for a Black Belt.
One of the big advantages of having a consultant leading the pilot programs is that this person can give Just-In-Time training to the SST members. We suggest that the team meets two times a week for two to three hours for 12 weeks in order to complete its assignment project. At each of these meetings, the consultant will present the SST members with the tools needed to continue their assigned project. This way, they will learn the required Green Belt tools while they are working with real-time improvement opportunities that they will get credit for solving. Not only will the organization benefit from the new skills these teams acquire, but also it will benefit from the money saved as a result of taking advantage of the improvement opportunities. In most cases, the money that is saved by the SSTs will more than pay for the consulting cost, the SST members’ time away from their normal jobs, and the cost of making the change. At the end of the 12-week period, the consultant will provide the SST members with an instructional class that will fill in any of the Six Sigma tool requirements that they have not had an opportunity to use in solving their specific opportunity. There should also be a Green Belt competency test given to them at this point in time to be sure they understand the Green Belt tools.
Activity 4—Organize the SSTs
“You can’t make bread with just flour. The same is true of teams. It is the mixture of skills that makes the breakthroughs.”
—H. James Harrington
The SST has been formed for a specific purpose. The Sponsor has initiated this team because there is a process or problem to address or a new innovation is soon to be launched. The SST members have been chosen as a part of this team because they have specific knowledge, expertise, or experience that is considered invaluable to the success of the team’s task. Do not make the mistake, however, of assuming that this assignment is already translated into the goals that are necessary for a successful team outcome. The goals are set when the group can wholeheartedly agree on them. Figure 11.11 is a typical project charter worksheet.
Figure 11.11. Typical project charter worksheet
The Charter
The charter is a written project plan that identifies what will be done, how it will be done, why, and when. It should be no more than two pages. It is generally written by the Sponsor (sometimes with the Black Belt) as a starting point, and should be modified by the team as needed.
The team should carefully review its charter and make necessary modifications to ensure that the charter accurately reflects the objectives and the scope of this team. The team will also need to change the charter to reflect any change in direction that the team deems necessary.
Once the team finalizes the charter, team goals should be developed along with operating ground rules. (See Figure 11.12 for a typical Facilitator’s team charter.)
Figure 11.12. Facilitator team charter
Goals
Although your charter has a stated objective, the team will need to decide whether that objective should be divided into goals. Discussing and agreeing on specific goals will help the team get on the “same page” regarding the implications of the charter objective and how the team plans on achieving it. The team should never assume that everyone on the team understands the charter in the same way until they have discussed and agreed on its meaning.
Common goals provide team members with the following:
• Purpose. Goals are designed to help the team accomplish its charter.
• Clarity. Goals help the team transition from abstract ideas to concrete tasks.
• Direction. Goals help the team identify next steps to take.
SMART goal characteristics are as follows:
• Specific. Goals should be specific
• Measurable. Goals must be measurable
• Attainable. Goals are attainable
• Relevant. Goals are relevant to the charter
• Time-bound. Goals are time bound
Ground Rules
The ground rules are a set of standards of behavior and attitudes that the team agrees to abide by. They should be established in the beginning stages of the team’s formation and should include expectations regarding
• Punctuality
• Respect for team members
• Member responsibilities/commitments
• Meeting etiquette
• Juggling team tasks with normal work tasks
The entire team is responsible for seeing to it that the ground rules are established and followed.
The following is a set of typical ground rules:
• Attendance
• Arrive on time, and stay until the end.
• Start on time and finish on time, unless otherwise agreed.
• Make every effort to attend. Provide advance notice to the meeting chairperson if you cannot attend, and arrange for a representative to attend in your place.
• No unannounced interruptions.
• Objectives and Agenda
• Publish an agenda and stick to it unless otherwise agreed.
• Clearly state the objective for the meeting and stay focused.
• Use the group’s time wisely; deal with the most important issues, or share information of general interest.
• Communication
• Use active listening; recognize that every idea or concern may be valuable.
• Do not dominate the conversation.
• Be concise.
• Use sensitivity; question, do not challenge.
• Participation is essential. Express your honest viewpoint or concern.
• No hidden agendas.
• Focus constructive criticism at exposing or removing obstacles.
• Respect and Courtesy. Avoid behaviors that discourage involvement:
• Interrupting
• Side conversations
• “Killer” phrases, body language, or gestures.
• Not paying attention.
• Respect and understand others’ position and feelings.
• Teamwork
• Explore and disagree within the meeting. Present a single approach outside.
• Strive for consensus. Use appropriate decision-making tools if necessary. Resolve irreconcilable differences outside the meeting.
• Have some fun: Set up $1 fines for improper behavior, or go out to dinner together each month or quarter.
• Support and Follow-up
• Review meeting effectiveness periodically.
• Address problems openly.
• Assign a facilitator to monitor team processes and behaviors.
• Assign a scribe to record and issue minutes.
• Assign a timekeeper to keep the meeting on schedule.
• Make clear action assignments and carry them out.
• Use visual media (flipcharts, overheads) to share ideas.
Team Development
HCP executives who are familiar with Six Sigma will understand the benefits of having ordering physicians, medication supplies’ dispensing, pharmacists, delivering nurses, and support staff work as a team to reduce medication errors. Together they can define how prescription errors occur (for example, a pharmacist read it incorrectly), when it occurred (physician wrote it incorrectly) and/or why it occurred (technician inputted it incorrectly).
It is well understood that a team does not begin functioning at full efficiency from its very inception. Basically, the team is like a husband and a wife who have to learn how to live together, to respect the other’s good points, and to forgive their weaknesses.
Stages of Team Development
There are four key stages (see Figure 11.13) in the development of a team. Each stage is important to the successful lifecycle of your team.
Figure 11.13. Four key stages of team development
The stages of team development are
• Forming
• Storming
• Norming
• Performing
The Forming Stage is marked by uncertainty and tentativeness:
• Accepted behaviors are not yet clear.
• Member feelings may reflect excitement and anticipation.
• Statements about what the team should do are ambiguous.
• Members usually try hard not to offend each other.
The Storming Stage is signaled when members are no longer tentative and ambiguous and are willing to express their differences of opinion:
• Resistance to different approaches may develop.
• Members express strong opinions.
• Members who agree may try to band together.
• Sharp attitude changes may accompany disagreement.
• As conflict is expressed, some members may attempt to withdraw.
• If handled improperly, tension and disunity can undermine the success of the team.
During the Norming Stage, the team begins to “rally” around their ability to accomplish the team objective:
• Members learn how to communicate with each other.
• Members develop trust and respect.
• Dissent and social conflict die out.
• Members have learned how to give and receive feedback.
• Responsibilities are evenly distributed.
• Decisions are made.
At the Performing Stage, both the team dynamics and the team’s product become tangible to the members (see Figure 11.14).
Figure 11.14. Life cycle of a team
• Members experience a high level of interaction.
• Members experience positive synergy and increased performance.
• Members are comfortable with each other.
• Members reach consensus and are confident of their solutions.
There can be many circumstances that trigger a return to a previous stage, such as a new Sponsor, a change of scope, or a change of deliverable (see Figure 11.15). If a new member joins the group, the team will return to the Forming Stage until everyone is familiar with the new team member. If a Sponsor adds a specification to the charter late in the project, the team may return to the Storming Stage.
Figure 11.15. Looping back to previous stages
Types of Teams
“The greater the loyalty of the members of a group toward the group, the greater is the motivation among the members to achieve the goals of the group and the greater the probability that the group will achieve its goals.”
—Renis Likert
In the sports world, there are many types of teams. Most of us were first introduced to the team concept in school while playing on or watching sports. In sports, you have three outcomes: The team can win, lose, or tie. When the team ties, no one wins or loses. In business, we need an outcome where everyone wins.
Football is an example of a group of people working in a team. The decisions are made by the quarterback or the coach. Everyone has his/her own role to play, and each person plays that role independently. The plays are pre-planned, and everyone has his/her own work assignment. This is very much like the way the laboratories perform in HCP organizations. Working in a team has its own set of characteristics:
• Activities are pre-planned and go on in parallel.
• Management makes all the decisions, as decisions are centralized.
• Personal focus is hierarchical.
• The major disadvantages are the lack of flexibility and the long cycle time to make a decision.
Another type of team has its members work as a team. Basketball is a good example of this type of team. The activities of a basketball player have to be integrated with the other team members. Decisions must be made fast and on the spot; everyone is involved and contributing all the time. Anyone can score. The players are continually making the decisions. The coach develops their skills and builds their morale, but success depends on the decisions that individual players make during the game. The nurse and the physician working in the operating room work in much the same way that a basketball team works together. Working as a team has its own set of characteristics:
• Activities are not pre-planned. The team’s activities are interdependent and integrated.
• The players make most of the decisions spontaneously.
• Players have on-the-spot flexibility.
• The weakness to working as a team is that it takes time to build the required level of trust.
When playing baseball, the players work on a team. They all are working toward the same goal. They all have different jobs and their own set of measurements. Most of the decisions are made by the manager. In this case, the team is a lot like a project management team in HCP organization. Each team member is doing his/her job of batting, pitching, or catching, but the result of the activity is not based upon help from other team players. The characteristic of working on a team are
• Activities take place in sequence, usually independent of input from the previous activity.
• Each player is an independent expert.
• Although the team is measured on the final score, each team member is also measured individually.
• Decisions are a combination of decentralized (“Shall I swing at this pitch?”) and centralized (“When will the pitcher be removed from the game?”).
• The weakness in working on a team is the lack of opportunity for the players to help each other. An example is that no one on the team can help the person who is up to bat.
The Different Ways SST Are Influenced
“If management is split about teams, implementing them won’t work, plain and simple.”
—Deborah Harrington-Mackin
In a Six Sigma project, a number of types of people influence the SST. They can be classified as
• Managers
• Team Leaders
• Facilitators
• Advisers
The Manager is the one who makes the final decision. The organization’s employees are charged with the responsibilities but do not have the authority to deviate from the manager’s direction. This leads to bureaucracy throughout the organization (see Figure 11.15).
Figure 11.16. Manager influence on SST
The Team Leader is an individual who is part of the team and shares decision-making with the team. The leader takes an active role in keeping the team on track and growing the abilities of the team. He/she is a Green or Black Belt (see Figure 11.17).
Figure 11.17. Team Leader influence on SST
The Facilitator for a team does not get involved with the team’s decisions, but he/she is involved with the team decision-making process. The Facilitator focuses on the team process, not on the problem the team is solving (see Figure 11.18).
Figure 11.18. Facilitator influence on SST
The Adviser is not a member of the team, but he/she is invited to help the team when its members feel that they have reached a point where they need someone with specific technical skills. For example, a Master Black Belt could be asked to help design a very complex experiment, or someone from IT could be asked to recommend a software package or to evaluate a number of software packages before they are purchased (see Figure 11.19).
Figure 11.19. Advisor influence on SST
Activity 5—Define the Measurements
“A good measurement system listens to many voices.”
—H. James Harrington
When you talk about measurements, you have to consider five different voices:
• The Voice of the Customer
• The Voice of Management
• The Voice of the Supplier
• The Voice of the Employee
• The Voice of the Process
Each of these voices tells you different things, and usually they have different requirements. You need to listen carefully to all five voices.
“In Japanese, the same word—okyakusama—means both ‘customer’ and ‘honorable guest.’ Disney World has always thought of its customers as its ‘guests,’ and many companies address their customers as being part of their ‘family.’ Customers in today’s marketplace are looking for the special treatment that typically honors guests—and they are receiving it.”
—Peter Capezio and Debra Morehouse
The Voice of the Customer is a very key part of the Six Sigma process, as Six Sigma is specifically designed to meet customer expectations. Typically, the Voice of the Customer has three different ingredients:
• It defines what they must have. These are the basic ingredients; without them, the customer will be very dissatisfied.
• It defines the things that they expect to have, although these are not things that they need to have. They will compromise these to get a lower price.
• It defines things they would like to have. These are the nice things—the frosting on the cake. If they get these, they’re delighted with you. These are the ones that really lead to long-term customer relationships—customers for life. These customers feel that they have been given the greatest value by interfacing with your organization.
“The Voice of the Customer guides world-class leaders’ every action and decision.”
—Y.S. Chang, George Labovitz, and Victor Rosansky
The Voice of Management is also a very important input. Management has an obligation to keep the company profitable, to be able to meet payroll, and to pay the investors a reasonable return on their investment. Management focuses heavily on efficiency and cost control.
The Voice of Supplier is another important input. We are all very dependent on the suppliers, and if the supplier cannot meet our requirements, there is little chance that we will succeed. Imposing unrealistic requirements on your supplier can lead to failure throughout the organization.
“If your employees are your most valuable asset, your suppliers run a very close second.”
—H. James Harrington
The Voice of the Employee is a key element. Our employees are a major asset, and we must take care of them. We must ensure that they are properly trained and motivated. We have to understand that change is difficult for them, and we need to control the amount of stress that change is subjecting them to. Our employees are an investment, not a cost.
The Voice of the Process involves the process itself. It speaks loud and clear about its capabilities. Too often, we ignore the Voice of the Process or don’t listen to it. It is absolutely essential that we certify each piece of equipment and each step in the process to understand its capabilities, and when it goes into the unreliable and erratic state, we correct the situation. The least complicated condition for the SST is when the assignment is to reduce variation related to a specific dimension on a print. In this case, the customer requirements are specified and the tolerance limits are documented. All the SST needs to do is to reduce the variation down to the point that the calculated Six Sigma limit and the print limits are the same. Unfortunately, that is often a lot easier to say than to do. We have seen SSTs working for weeks trying to refine a specific sequence of activities to reduce variability when the equipment’s capability exceeded the specification tolerance. Don’t accept that the print tolerance is correct. Often, the print tolerance is set arbitrarily, and it is much easier and more effective to change the print specification than to buy new equipment. Often, a combination of refining the task and adjusting the print limits is the correct answer.
When it comes to process type improvements, there are three main measurements:
• Effectiveness. The extreme to which an output of a process or sub-process meets the needs and expectations of its customer. A synonym for effectiveness is quality. Effectiveness is having the right output at the right place at the right time at the right price. Effectiveness impacts the customer. Typical effectiveness measurements are appearance, timeliness, accuracy, performance, reliability, usability, serviceability, durability, cost, responsiveness, adaptability, and dependability.
• Efficiency. Relates to the extent that resources’ usage is minimized and waste is eliminated. Productivity is a measurement of efficiency. Typical effectiveness measurements are
• Processing time
• Resources extended per unit of output
• Value-added cost per unit of output
• Percent of value-added time
• Poor-quality cost
• Wait time per unit
• Adaptability. The flexibility of a process to handle future changing customer expectations and today’s individual special customer request. It is managing the process to meet today’s special needs and future requirements.
Adaptability is an area largely ignored, but it is crucial for gaining a competitive edge in the marketplace. Customers always remember when you don’t handle their special needs. Basic quality involves satisfying customer requirements; however, for many customers today, good enough is not enough anymore. HCPs must exceed customer needs and expectations, now and in the future, by
• Empowering people to take special action
• Moving from meeting basic requirements to exceeding expectations
• Adjusting and adapting to ever-changing customer expectations
• Continuously improving the processes to keep ahead of the competition
• Providing a non-standardized activity to meet a special customer need
Typical measurements of adaptability would be
• The average time it takes to get a special customer request process compared to standard procedures
• The percentage of special requests that are turned down
• The percentage of time the special requests are escalated (for example, in the HCP industry the more people a customer has to talk to in order to get a need satisfied, the less chance that person will be satisfied)
Adaptability requirements should be established at the beginning of a process improvement cycle so that the improvement activities can consider these parameters and data systems can be established to measure adaptability.
Activity 6—Prepare a Project Plan
“Plans are nothing; planning is everything.”
—Dwight Eisenhower
Project management is one of the most important Six Sigma tools that the SST has available. It is very important that each project uses this tool effectively to manage the assigned project. The Project Management Methodology has been well defined by the Project Management Institute in a methodology they call PMBOK (Project Management Body of Knowledge). The project management knowledge areas are
• Integration Management
• Scope Management
• Planning and Estimating Management
• Documentation and Configuration Management
• Time Management
• Financial and Cost Management
• Quality Management
• Human Resource Management
• Communication Management
• Risk Management
• Procurement Management
Everyone who manages a project should have a detailed understanding of each of these knowledge areas. It also advisable that all members of the project team have a working knowledge of them. We feel that every Master Black Belt should also be a Certified Project Manager if he/she is going to work well in leading the Six Sigma activities.
The project plan is used to pull together the key project information into a single place. It should include things such as
• Project mission
• Project budget
• Project objectives and goals
• Risk analysis
• Assumptions
• Schedules (work breakdown structures)
• Training plans
• Project charter
• Team Members’ names and committed times
• Any special directions/limitations
One of the most important parts of the project plan is the work breakdown structure. It defines what will be done by whom and when. Figure 11.20 is a sample work breakdown structure. We feel that the Microsoft Project software package is an effective tool to generate work breakdown structures for the SST. It does an excellent job of organizing a single project and defining the critical path through the project. However, it has major drawbacks when it comes to managing a portfolio of projects like the Master Black Belt needs to do.
Figure 11.20. Combined three-year improvement plan
For more information on how to manage projects, we suggest reading Project Management Excellence by Dr. H. James Harrington and Dr. Thomas McNellis (Paton Press, 2006). Appendix A in that book provides a list of the PMBOK 75 tools and techniques along with a self-evaluation quiz to determine how good your project management skills are.
“Defining an objective is like telling a railroad ticket clerk your destination before you buy a ticket. If you have not decided on a destination, you cannot buy a ticket.”
—Katsuyoshi Ishihara
Activity 7—Prepare an Organizational Change Management Plan
The biggest single reason that Six Sigma and TQM programs have failed is that they have focused on the technology, knowledge, and processes and have forgotten the “people side” of the equation, and people is what change management is all about. (see Figure 11.21).
Figure 11.21. Change management
Almost all the major Six Sigma process changes have a major impact upon the people working in the process that is being improved. Sometimes it affects just one person; other times it affects everyone within the process. Many of the Six Sigma programs have eliminated many jobs, because the re-work assignments and no-value-added jobs are removed and business-value-added activities are removed from the process. In Six Sigma, we treat organizational change management as a process (see Figure 11.22).
Figure 11.22. The change management process
The Change Management Process starts with the individual in the current state. This is a state where he/she feels very comfortable. The person is in control, has his/her own specific job, and knows more about it than anyone else. As we apply change to the process, the individual goes into a transition state. At this point, the person has lost control of his/her job and doesn’t know if he/she will be able to function in the new environment. The person is worried, and often resistance groups are formed. Eventually, the individual moves into the future state with the promise that this new state is a better condition than he/she had in the current state. Unfortunately, it’s very difficult to get the individual to move from one state to another. If he/she feels that there is less pain in the current state than the pain he/she perceives will be subjected to during the transitional period and in to the future state, it is next to impossible to get anyone to change (see Figure 11.23).
Figure 11.23. Pain management
You would think that the individual understands the pain he/she is having in the current state better than anyone can, and it’s usually true they do. But, there is another part of current-state pain that he/she usually doesn’t understand. It is the “what if we don’t change” pain related to the current state. Very often if we don’t change, it could mean the organization will lose its competitive advantage and jobs will be eliminated. Management has to surface “what-if” pain so that individuals can make a fair decision about how much resistance they are going to apply to the change. As an SST member, you need to look at the individuals who will be impacted by your proposed improvement and answer the following three questions for them:
• What’s in it for him or her?
• Why is the change necessary?
• Why is it important to the organization?
Resistance is normal, so it should come as no surprise to the SST. In fact, the team should be concerned if there is no resistance because that often means that the affected people have just given up and will not cooperate when you need their support and/or their acceptance of the change. If the affected people will not accept the required changes, even the very best Six Sigma program will fail.
Your change management plan has to create a burning platform that will cause the individual to move from the current state, through the transitional period, to the future state. This change management plan should be part of your project plan.
For more information on organizational change management, we suggest you read Change Management Excellence by Dr. H. James Harrington (Paton Press, 2006).
Once the organizational change management plan has been integrated into the project plan, the updated project pan should be reviewed and approved by the Executive Team. This approval allows the project to enter into Phase III Piloting.
Phase III—Piloting
“Pilot because, as a wise man once said, ‘The best-laid plans of mice and men often go astray.’”
—H. James Harrington
The Piloting Phase is subdivided into five activities:
• Activity 1: Define
• Activity 2: Measure
• Activity 3: Analyze
• Activity 4: Improve or Design
• Activity 5: Control or Verify
Hopefully you have recognized these activities as DMAIC or DMADV approaches to the Six Sigma Improvement Strategy that we have already discussed earlier in this book.
Note that some of the tasks usually done during the Define activity have already been completed in Phase II Planning. The SST has been formed, and initial training has been completed. The SST has been assigned, and a project plan has been prepared and approved by the Executive Team.
This is the most interesting and challenging part of the Six Sigma process. We liken it to a “Who Done It?” story, only with Six Sigma it is “What Caused it?” story. Too often, the organization tries to turn Six Sigma activities into “Who Done It Activities.” This is absolutely the wrong way to operate. There is enough blame for everyone, so there is no need to waste time defining “Who Did It?” It is always better to spend your effort in defining “Why It Happened” and how the processes can be changed to keep it from recurring.
The crime has already been committed: There are too many errors, too many customer complaints, it takes too long to do it, or it costs too much. These are the crimes that Six Sigma has been designed to solve and return the criminal (the process) back to a productive member of society.
Well, the call is out. Sherlock Holmes, with his black cape and his trusty magnifying glass, has been replaced with an electronic microscope that can see all the way down to 3.4 defects per million and beyond. Along with him are his trusted friends, “The Watson Green Family of Process, Problem and Analyst, Laboratory Technicians, and IT Specialists.” Together there is no crime so complex that they cannot solve. The first job this team has is to get to the crime scene and start to collect clues that can be analyzed and put together to solve the puzzle.
Just like the Sherlock Holmes story on TV, which lasts 60 minutes minus time for the commercials, the Six Sigma project should be time-boxed in to a three-month maximum, minus the time to do the team’s regular work assignments. Unlike the detective story that ends with the detective bringing the suspects and interested parties together at the scene of crime and revealing the culprit along with the explanation that proves the culprit caused the crime, the SST has to go further to define the cause, which is often hard. But creating a permanent fix that prevents the problem from recurring is the real challenge. It is like the detective having the responsibility for defining the rehabilitation of the criminal, and then having to justify the return on investment for the rehabilitation process.
Often Green and Black Belts become part of long-term research projects that last for one, two, or even three years, but these are not real Six Sigma projects. Sure, the skills that these Black and Green Belts have often are very valuable in these research projects and should be used.
It is not our intent to take you back through how to use DMAIC and DMAV methodologies; that would be redundant. But based upon our experience and other studies, the following are the most useful SST tools:
• Process Mapping
• Root Cause Analysis
• Cause and Effect Analysis
• Process Redesign
• Benchmarking
• Failure Mode and Effects Analysis (FMEA)
• Lean
• Process Capability
• Project Management
• Brainstorming
• Workflow Analysis
• Trend Analysis
• Design of Experiments (DOE)
• Error Proofing
• Standardization
The DMAIC cycle has 12 toll gates designed into it. They should be followed to be sure you come up with the best answer (see Figure 11.24).
Figure 11.24. Six Sigma tollgates
Just one word of caution from a dear departed friend of ours, Dr. Kaoru Ishikawa, the man who made quality happen in Japan:
“It is true that statistical methods are effective, but we overemphasize their importance. As a result, people on the Executive Team fear or dislike quality control as something very difficult. We overeducated people by giving them sophisticated methods where at that stage simple methods would have sufficed.”
—Kaoru Ishikawa, What Is Total Quality Control: The Japanese Way (Prentice Hall, 1985)
At the end of the improvement or design activities, the SST has defined its preferred solution to take advantage of the opportunity, along with an estimated cost to implement the solution and the projected savings as a result of this implementation. This information should be presented to the Executive Team for its approval. Often, the Executive Team will accept these results, if they are well-presented and supported by sound reasoning, as proof that the Six Sigma approach is good for the organization. In other cases, they will hold off approving the Six Sigma approach until the solutions have been implemented and the results are well-documented. In Executive Team case, the Executive Team will be required, at some point in time, to take a position to define if the pilot was successful or unsuccessful and to make a decision about what the organization’s future involvement in the Six Sigma initiative will be.
If you did a good job in conducting the pilot and had selected opportunities that had real potential, the Executive Team will not only approve the project to continue in Phase IV (Implementation), but it will be excited about reaping the additional benefits from entering into the project very fast. For purposes of this book, we will assume that the Executive Team is anxious to continue the Six Sigma initiative. We will also assume that more than 60 percent of people were able to pass the Six Sigma Green Belt exam and were certified as Green Belts.