CEO SUMMARY: Are Lean and Six Sigma techniques ready to make a big contribution in the laboratories of smaller hospitals? If you ask lab managers at Mayo Clinic’s Scottsdale Hospital, the answer is an unqualified “Yes!” Their 15-week Lean project in the hospital’s high volume core laboratory produced worthwhile improvements. It also formed the foundation for expanding Lean methods into other parts of the lab, as well as other departments within the hospital.
QUALITY MANAGEMENT METHODS of Lean and Six Sigma are transforming laboratory operations at Mayo Clinic’s hospital in Scottsdale, Arizona.
This is a noteworthy development. First, when Mayo Clinic speaks about healthcare innovation, people listen. It is one of the nation’s most credible medical institutions.
Second, Mayo Clinic’s hospital is a 193-bed facility, not big by industry standards. Yet it was willing to underwrite the cost of a major Lean/Six Sigma makeover of its high volume core laboratory because of the resulting downstream benefits.
This Lean-based makeover is an important demonstration of how quality management methods can boost the performance of laboratories located in smaller hospitals. It demonstrates they have the same opportunities, albeit with a smaller specimen volume, to slash test turnaround times, boost quality, and increase productivity.
THE DARK REPORT recently visited the Mayo Clinic Scottsdale Hospital to learn, first-hand, how and why Lean/Six Sigma techniques made such a big difference. Enthusiasm for the changes was obvious. The laboratory staff was proud of the project and its outcomes.
“Since the construction of this hospital in 1998, we’ve had explosive growth in patient volume,” stated Linda Pearson, Laboratory Operations Administrator at Mayo Clinic Hospital in Scottsdale. “Not only is our hospital a major transplant center, but it services a significant number of outpatients.
“Like laboratories in other fast-growing hospitals, we found ourselves squeezed for space and stretched to the maximum for lab test capacity,” she said. “Even though our laboratory was relatively new and was designed around ‘best practices’, the steady growth in specimen volume was pushing our operational capabilities to the limit.
“I recognized the potential of quality management methods, like Lean and Six Sigma, to fundamentally change the operational philosophy of our laboratory and push it to a significantly higher level of performance. I also believed it would enhance the day-to-day working environment for our medical technologists and staff, allowing them to contribute more with less stress,” she explained.
Pearson’s first step was to bring in a consultant to assess the existing situation, identify opportunities for improvement, and provide projections on the resulting cost savings. “I knew that, before I could get the money to fund this Lean project, I had to make both a clinical case and a business case to my hospital administration,” Pearson said.
Making The Business Case
“We did our homework. The consulting group we used was from Ortho-Clinical Diagnostics (OCD), a Johnson & Johnson company,” she said. “Our presentation to hospital administration covered all the bases. We were given a budget and a top- level commitment to succeed. We were also told that we would be watched closely. If this Lean project achieved our objectives in the lab, administration would be ready to introduce Lean techniques in other departments in our hospital.”
The assessment and budget authorization took place in the fall of 2003. Pearson’s next step was to pick a lab team to implement the Lean project. “In our hospital lab and clinic lab, there are 153 FTEs,” she said. “We had 17 people volunteer for the eight Lean team positions! That’s because many in the laboratory were excited about the opportunity to fix problems and make this a better working environment. The Lean project was scheduled to take 15 weeks and would require a full-time effort from the eight team members.
“We conducted interviews and selected our team in time for a February start,” added Pearson. “OCD had already done the assessment, so our plan of attack was ready. The first week was spent teaching our Lean team about the fundamentals and principles of quality management. Then the hard work began.
“The Lean project targeted our high volume core laboratory. Automated chemistry, hematology, and coagulation represents 90.8% of our total test volume. Every improvement in this section of the laboratory would produce significant gains,” explained Pearson.
Those operational gains are listed in the sidebar above. The outcomes are of the same magnitude and scale as the outcomes of other hospital labs’ Lean/Six Sigma projects that the THE DARK REPORT published last year. (See TDR, September 8, 2003.)
Because it is a laboratory in a smaller hospital, several aspects of this Lean project are particularly interesting. One potential issue was whether the laboratory staff would accept and support a major transformation of their daily work routines. Lab staff reaction and involvement will be the theme for the remain- der of this intelligence briefing.
“At the start, our biggest hurdle was to convince people that their daily work patterns were not the best possible. There was a better way to do that work,” stated Mike Mansfield, Lead Technologist on the day shift and a member of the Lean Team.
“Our approach was to help them understand two principles to our Lean makeover,” he explained. “One, there would be no change to the fundamental protocols used to perform our tests. We were not tinkering with the science behind the test result. Two, our change efforts would be focused on the operational processes which supported the analysis of the specimen.
“One message was stressed throughout: ‘To help you do a better job, we are eliminating the obstacles and barriers’,” said Mansfield. “That could mean reducing the number of steps they had to walk as part of their routine or simply eliminating phone calls that disrupted their work.”
Laboratory OutcomesFrom Lean Project
IN PREPARING FOR ITS LEAN PROJECT, the laboratory at Mayo Clinic Hospital in Scottsdale, Arizona identified high volume, automated testing as the likely source for major improvement.
Total test volume at this laboratory site is 700,000 billable tests per year. The Lean project targeted automated chemistry, hematology, and coagulation. These three areas of the laboratory generate 90.8% of total test volume.
Upon completion of the Lean project, which lasted from February through May, 2004, the following outcomes were generated:
- Reduction in average turnaround time of 37% (order to verified result).
- The new work cell configuration requires two less FTEs to run the same number of instruments. Those individuals now perform other duties in the lab.
- Overall productivity improvement of 27% as a result of the first Lean project.
Fix Poor Work Processes
“In particular, the med techs needed to know that no one was challenging either their technical skills or their performance. The single objective of this Lean project was to attack the organizational impediments and hurdles that created the same problems every day,” added Linda Paige, Systems and Procedures Manager for Mayo Clinic Scottsdale and a member of the Lean team.
“Once the laboratory staff understood this was not about them, but was about improving our work flow and work processes, we began to see increased support and enthusiasm,” declared Pattie Glick, Laboratory Manager. “Because quality management methods are data-driven, our med techs quickly grasped how the numbers helped us identify bad processes and operational bottlenecks. For them, this was credible evidence that a specific work process should be changed.”
“From the outset, we did make clear that there were non-negotiable items and negotiable items,” explained Pearson. “These ground rules could not be broken. For example, two non-negotiable items were single-piece flow (not batch) and standard work methods. Two negotiable items were process sequence and operator walk patterns.”
“These are easy to illustrate,” interjected Mansfield. “For example, all phlebotomy was converted to ‘draw one person and send the specimen to the laboratory’ before doing another draw. That is single-piece flow versus batch. It was non-negotiable. How- ever, in establishing a single layout and supply inventory for all phlebotomy carts, the phlebotomists could make suggestions and negotiate the final configuration of the cart.”
“There was another concern we had to address as we started the Lean project,” noted Tom Leto, Lean team leader. “Many individuals were apprehensive prior to the start of the project. They asked questions like ‘how will I fit in after the Lean project? Will I lose my job? Will my job change?’
“Questions like these quickly taught us the importance of clear, detailed, candid, and frequent communications,” said Donna Passante, Quality Coordinator and a Lean team member. “We had hospital administration speak to the laboratory staff about their support of the Lean project. We held regular meetings and provided frequent written updates.
“You must over-emphasize communication,” continued Passante. “Med techs often have a decade invested in one job done in one way. These are deeply-ingrained patterns that a Lean project disrupts. We were compassionate, but unyielding, about processes that needed to change. That is where using data helps the staff understand why specific changes must be implemented.”
During THE DARK REPORT’S site visit, Lean team members offered some practical pearls of wisdom. These were gleaned from their experience at introducing Lean and Six Sigma quality management principles into their laboratory.
“Using Lean made us recognize how often, pre-Lean, our management approach was to use a ‘work-around’ to solve a problem,” said Becky Stewart, Microbiology Supervisor. “Inevitably, once you gather accurate data, you see that a ‘work-around’ fix only added complexity—even errors—to the overall work flow. “
“An important reason for the success of this Lean project is that we didn’t try to ‘home grow’ it,” observed Glick. “It was important to bring in experts who could teach us these techniques, show us how to apply them in real-life situations, and offer us practical wisdom that comes from having done this in other laboratories multiple times. Most importantly, they could insure that we implemented Lean and Six Sigma techniques correctly and hit our goals.
“Another key insight from our experience is that our work processes now treat all specimens equally, “ continued Glick. “We don’t separate specimens by classes of patients—stroke versus transplant, for example. Our work processes now allow us to treat all specimens the same, as well as to meet and exceed our targets for turnaround time, quality, and reduction of errors. That’s been a major benefit from our Lean experience.”
“It is important to also mention that Lean is not a universal problem solver,” offered Mansfield. “Lean is a mindset, a philosophy, and a set of tools to solve part of the management issues involved in laboratory operations. But many lab management issues remain which require attention. In fact, some of these issues originate outside the laboratory.”
Growing Use of Lean
Lean management methods appear to have established themselves within the Mayo Clinic Scottsdale Hospital. Lean projects are being planned, not only for the laboratory, but for other departments within the hospital. There are also plans to introduce Lean methods into the laboratory at the Mayo Clinic Scottsdale, which is at a separate location away from the hospital.
“What continually amazes all of us in laboratory management is how differently we now view lab operations and work processes,” offered Pearson. “By simplifying our work flow and individual work processes, by eliminating waste, and by reducing cycle time, it has dramatically changed our laboratory’s working environment.
Learning To Love Lean
“A growing number of our laboratory staff understand this new management philosophy,” she said. “Once the changes are in place and they become familiar with the new routines, they appreciate how the design of the sys- tem greatly affects their ability to improve quality, generate test results faster, and deal with fewer system-generated errors.”
Pearson also had another comment, one that profoundly touches the future of laboratory management. “Automation and new diagnostic technology, properly operated, means that most labs will soon generate results of comparable quality,” she observed. “When that day arrives and all labs get the same clinical answer, then the point of differentiation will shift in favor of laboratories organized around better work flows and better work processes! Lean is helping our laboratory develop that differentiation.”
Pearson’s prediction should give pause to all laboratory directors and pathologists. If the day arrives when almost every laboratory delivers the same, high-quality test result, competitive advantage will accrue to labs which differentiate themselves in other ways.
In fact, that is just what Linda Pearson is doing with her laboratory. As a leader, she visualized how Lean and Six Sigma management methods could provide that to her laboratory organization. As a champion of this idea, she sold it to senior administration and obtained both scarce capital to fund the project, as well as the support of Mayo Clinic Scottsdale’s top leadership.
This a good example of how laboratory leaders can change the status quo in radical ways. It is also a great example of how leadership can stimulate positive change even in smaller hospitals. The laboratory at Mayo Clinical Scottsdale Hospital is farther down the Lean/Six Sigma road than the Mayo Clinic Rochester laboratory or Mayo Medical Laboratories.
Laboratory administrators and pathologists willing to push forward with innovation should take inspiration from the experience of the laboratory at Mayo Clinic Scottsdale Hospital. Good ideas, implemented for the right reason, are difficult to stop. The laboratory director and her management team at this 193-bed hospital have just demonstrated that fact.