Toyota has built a solid reputation as a world-class production and manufacturing organization through the application of quality principles referred
by CHRISTOPHER CALDERONE, MA, MBA

Toyota has built a solid reputation as a world-class production
and manufacturing organization through the application of quality
principles referred to as “lean thinking.” At Toyota,
lean thinking concepts have resulted in better quality, improved
efficiency and reduced costs, and they have helped the automaker
become a manufacturing model of excellence.

Toyota has standardized its production processes using carefully
created documents and checklists to support and guide daily work.
The company also relies on “built-in quality,” meaning
that inspection occurs throughout the assembly process, not just at
its end. This concept has fostered a greater sense of ownership and
quality accountability among Toyota's workers.

Developed for use in the manufacturing setting, lean quality
concepts have spread to service-based businesses and health care
providers. Major health care organizations such as Wellmark Blue
Cross/Blue Shield, Virginia Mason Medical Center and the University
of Michigan Health System have adopted lean approaches with
impressive results: better outcomes, reduced waste and improved
patient satisfaction.

In fact, in the endless quest for good process management, the
principles of lean thinking can provide most companies with
powerful tools and techniques for fundamental process improvement
from beginning to end.

It's Time to Go Lean

The term “lean” refers to the concept of doing more
with less — less human effort, less time, less equipment and
less space — while consistently providing customers with
exactly what they need. Lean thinking focuses on:

  • Reducing waste;
  • Designing processes based on the customer's requirements;
  • Achieving standardized work;
  • Reducing rework;
  • Eliminating bottlenecks; and
  • Reducing lead times, wait times, and process times.

Another major focus within a lean approach involves finding any
problems as quickly as possible, identifying the root cause and
correcting it so that the problem does not reoccur. The root cause
emphasis is worthy of attention because it is not uncommon for
managers or employees in any company to work on eliminating the
symptoms of problems rather than attacking their true cause.

Part of the appeal of the lean approach is that it is based on
designing and improving processes from the customer's perspective.
Too often, quality-minded improvement projects tend to take an
inside-out perspective instead of an outside-in perspective. Lean
requires that we view each process and each transaction through the
eyes of our customers, both internal and external.

Lean Comes Home

Can the HME industry benefit from the lean approach? The short
answer is a definite yes.

Given the difficulties of the current HME environment with
increasing costs and decreasing reimbursement, providers need
standardized, efficient processes, zero defects, reduced rework and
minimal waste.

Now is the perfect opportunity for HME providers to look to
Toyota and other health care organizations and apply the same lean
techniques to become more efficient, more customer-focused —
and better positioned to deal with tighter margins and rapidly
changing market conditions.

In one example, MedEquip, the University of Michigan Health
System's HME department, recently incorporated lean methods in the
redesign of a cumbersome intake process that was riddled with
inconsistent communication. The revised process involved
implementing cells of intake teams as well as changing the office
layout, which resulted in better communication and coordination
among staff.

A lean tool known as “value stream mapping” was used
to understand the current process as well as design the ideal
process. Under the new process, incoming calls were more directly
routed to the appropriate area. Customer service improved, and
phone wait times decreased by nearly 30 percent during peak call
periods.

MedEquip also used a lean concept known as “5S” to
revamp its equipment processing and testing area. This involved
creating a neat and highly organized work environment where
workflow was made more visible. Tools and other materials were
neatly arranged using clear signage and labeling.

This approach was based on Toyota's obsession with cleanliness
and workplace organization. The reorganization played a part in an
18 percent productivity gain and improved staff performance, as
less time was spent searching for tools, forms and equipment.

Lean Applications for HMEs

Use the “Five Whys” approach to
understanding the root cause of a problem.

The problem: Chronic late deliveries.

Why? Drivers leaving the warehouse late.

Why? Difficulty pulling orders and supplies.

Why? Stock shortages and excessive time spent searching for
items.

Why? Inconsistent purchasing patterns.

Why? Lack of performance standards and accountability for
purchasing staff.

Remember that the lean approach involves correcting the true
cause of the problem. An example of attacking a symptom of late
deliveries instead of addressing the root cause would be to assign
additional staff to help load or stage orders.

While providing extra staff to help pull and load may result in
improved driver start times, the true cause of those late
deliveries (purchasing performance) is sill an issue.

  • Standardized work can become more of a reality through
    the use of task-specific checklists that ensure all work is
    completed before moving to the next step in the process.

    Insist on “quality at the source” in order to reduce
    costly rework elsewhere in your value stream.

    Quality at the source means that inaccurate or incomplete work
    is not passed on. An ideal focus for this concept in any HME is the
    intake process, where incomplete and inaccurate work often seems to
    sneak through.

    Standardized checklists and frequently updated intake forms that
    reflect changing payer guidelines can help ensure clean claims at
    the end of the process. A typical checklist should include every
    task or requirement that is needed to ensure an order can be
    converted to a successful claim.

    Providers can benefit from having payer-specific requirements
    and intake performance standards clearly displayed at workstations
    and/or in a central location. Ideally, this information would also
    be available in an electronic format for staff.

  • The layout of the office should be based on the actual,
    logical flow of work, not only on function according to an
    organizational chart.
    If two different departments perform
    certain aspects of their work in conjunction with each other, then
    consider a layout that will facilitate communication, reduce
    footsteps and enhance cooperation.

    For example, providers might benefit from having a billing
    specialist work in closer proximity to the intake area. Billing
    personnel can provide near real-time assistance with questions
    about quantity issues, coverage guidelines and non-billable vs.
    billable items for payers. Getting the correct payer-specific
    information up front can prevent unnecessary headaches later on at
    the claims submission point and beyond.

  • Implement a “pull system” when downstream
    tasks begin to back up and create bottlenecks.
    For
    example, when the number of customer calls reaches a certain
    volume, additional staff can be automatically assigned to assist.
    The same approach can be used when call wait times exceed a certain
    limit. Many phone systems have associated software that allows call
    volumes to be monitored in real time.

    Smaller providers may want to consider focusing on
    cross-training and cross-coverage in order to get more flexibility
    with staff and become more responsive to customers.

    Providers should also find ways to free up employees from doing
    routine, repetitive and time-consuming tasks such as filing, fax
    processing and taking routine re-supply orders via the phone.
    Streamline these tasks with a desktop fax software program. A
    document scanning system should be used so files can be digitized
    and easily managed.

    The use of an online ordering system for patients can also help
    reduce the amount of time spent on the phone for routine re-supply
    orders. A well-designed and informative Web site can be an
    efficient method of providing patients with product and service
    information.

    Automating as many tasks as possible will give small providers
    more flexibility to use their people for more productive tasks.

  • Don't overload downstream processes with excess
    work.
    Each step of a business process should be designed
    in a way that can effectively absorb the volume of work being sent
    from the previous step. If you are processing 100 orders per day
    upstream, then make sure you can adequately and consistently
    process the same volume at each downstream step.

    Small and large providers alike should consider eliminating as
    much paper as possible. For each paper-based transaction, carefully
    assess whether the transaction could be carried out electronically.
    Reducing the dependence on paper can help prevent other steps
    within a process from becoming overloaded.

  • Work leveling is essential to maintaining the required
    throughput.
    Designate “floats” or
    “rovers” who can be rapidly (and automatically)
    redeployed to assist in any area that is encountering delays. For
    example, allowing confirmation paperwork to pile up can have
    devastating effects within the last part of the business
    process.

    Encourage everyone involved to become an inspector and
    aggressively monitor confirmation work-in-progress and other key
    metrics such as UPS orders (mail orders) and total orders
    processed. Use the floater to assist when work begins to pile
    up.

    For a large provider, work leveling might mean assigning
    designated staff to an area where paperwork is proliferating, such
    as filing, shipping and receiving or order confirmation. A smaller
    provider can designate when high-priority and low-priority tasks
    should be worked on. Filing and routine paperwork should occur at
    the slowest time of the day, for example.

    All providers need to make sure employees have a good sense of
    work prioritization. Employees can quickly become overwhelmed with
    their workload and may require some additional structure for their
    daily work routines.

  • Pick proficiency for mail orders can be improved by
    adopting Toyota's method of having quality built in as part of the
    process.
    Toyota's inspection checks take place throughout
    its production process, not at the end of the assembly line.
    Inspecting work only at its completion can mean many errors before
    they are eventually (and hopefully) caught.

    In addition, employees have little incentive to get it right the
    first time if they know that mistakes will be caught prior to
    actual ship-out. In other words, inspection should take place
    shortly after products have been picked, not near the end of the
    day when everyone is rushed and thinking about going home.

    HME companies should consider including “order picked
    by” information in each package to help foster a sense of
    ownership and responsibility among employees. Businesses that use
    this approach report higher customer satisfaction and greater order
    accuracy than those that don't.

    The Role of Leadership

    Planning to build a lean culture is the easy part. Implementing
    and sustaining it can be a difficult task for providers if the
    company is not properly prepared to go lean.

    In order for a lean culture to take hold, top leadership
    commitment is absolutely essential. Lean thinking is often referred
    to as a culture change because it is about so much more than just
    the tools and the techniques.

    Most successful quality initiatives have unwavering leadership
    commitment within the context of a performance-based organization.
    If these two dynamics are missing, chances are that a lean
    initiative will come up short.

    Lean is a way of thinking, and it should become a fact of daily
    organizational life. The lean concepts that have been the most
    successful, such as quality at the source, are those that have been
    ingrained into the people that actually carry out the daily
    work.

    HME providers can learn valuable lessons from their colleagues
    in the broader health care sector and those in manufacturing that
    have successfully implemented Toyota's lean thinking approach.
    After all, increased efficiency, improved service and reduced waste
    are worthy goals for all companies, regardless of industry.

    With an MBA and a master's degree in organizational management,
    Chris Calderone is a project manager at the
    University of Michigan Health Systems' Home Care Services division,
    and founder of Lean Homecare Consulting Group, Jackson, Mich. He
    can be reached at 734/709-5487, at chrisc@leanhomecare.com, or through www.leanhomecare.com.

    Lean Thinking

    Lean thinking is a quality-focused approach designed to
    improve processes and:

    • Improve quality and efficiency
    • Reduce rework, bottlenecks and defects
    • Decrease wait time and process time
    • Achieve process standardization

    Lean thinking is lean because it provides a way to do
    more with less:

    • Human effort
    • Human equipment
    • Time
    • Space
    Lean Tools

    5S - Creating a visual workplace to improve
    productivity, safety and quality. A 5S workplace will also impress
    accreditation visitors.

  • Value Stream Mapping - Helps to
    “see” waste in the form of waiting, rework and
    bottlenecks, and serves as a plan for the improvement
    initiative.

  • Root Cause Analysis - Helps to identify and
    eliminate the true cause of problems.

  • Error Proofing - Helps to prevent errors and
    costly downstream rework.

    The 5S Workplace

    • Sort - Keep only what is needed.
    • Straighten - Make sure everything has a place.
    • Sweep/Shine - Clean areas can help expose abnormal
      conditions.
    • Standardize - Develop methods to monitor and maintain the first
      three S's.
    • Sustain - Use self-discipline to maintain the 5S
      workplace.
    More Lean Tips

    • Utilize document imaging to reduce searching time and storage
      space.
    • Implement desktop faxing for efficient document
      management.
    • Electronic alerts can facilitate communication across the
      entire business.
    • Carefully consider printer and copier placement to minimize
      footsteps.
    • Maximize software capability (and use an auto-populate
      function).
    • Get rid of the clutter in warehouse and office space.
    Getting to Lean

    • Begin implementing 5S in the warehouse/equipment processing
      area with signs and labels. Clean and organize the entire
      area.
    • Start small. Select a manageable value stream/process to map
      out.
    • If nothing else, map out processes so staff can gain a better
      appreciation of the company's flow of work.
    • Address the process first, not the people. Lead an effective
      root cause analysis.
    Examples of Waste in an HME Business
    Over Processing Multiple paper hand-offs, rechecking for signatures, lot
    numbers, serial numbers, authorizations, repeat paperwork,
    excessive paperwork
    Waiting Waiting for authorizations, signatures, paperwork return,
    approval from others, system downtime, etc.
    Defects Wrong items picked and shipped, missing signatures, lot numbers
    and serial numbers
    Inventories Excessive inventory, paperwork awaiting further processing
    (confirmations, Rx processing, etc.)
    Movement and Worker Motion Missing charts (searching for files), searching for supplies
    and equipment