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STEVE HOEFT • ROBERT W. PRYOR, MD

The Power of Ideas to

Transform Healthcare
E ngagi n g S ta f f by B uilding D aily
Lea n M a n a g e ment Sy stem s
The Power of Ideas to
Transform Healthcare
STEVE HOEFT • ROBERT W. PRYOR, MD

The Power of Ideas to

Transform Healthcare
Engagi ng St af f by Bu ild in g Da ily
L ean Manageme n t S yste ms

Boca Raton London New York

CRC Press is an imprint of the

Taylor & Francis Group, an informa business

A PRODUCTIVITY PRESS BOOK

Credit on cover photo: Gary L. Hansen, Scott & White Health, 2006: Daytime June 2010

All proceeds to the authors will be donated to the Scott & White Healthcare Foundation. Information on the foundation can be
found at http://foundation.sw.org

CRC Press
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Contents

Foreword..................................................................................................... xi
Acknowledgments.................................................................................... xv
1 Introduction..................................................................................1
What Can Lean Do for My Organization?...................................................6
Bob’s Background........................................................................................8
Steve’s Background......................................................................................9
2 Why Lean? Why Now?.................................................................11
The Healthcare Desert Oasis.....................................................................12
Healthcare Challenges Nationwide............................................................14
New Challengers: Non-Traditional Healthcare Providers......................17
Keeping Up with Change......................................................................20
S&W’s Particular Challenges......................................................................22
S&W’s Growth Era.................................................................................22
S&W’s Financial Model..........................................................................23
S&W’s Secret to Low Costs—Integrated Health Delivery.....................24
How S&W’s “Secret Sauce” Helps Improve Population Health............26
Rapid Growth and Pride........................................................................27
Confusing Leaders—Management Systems and Gurus Everywhere.......29
Systems Thinking: Big and Small..........................................................32
Lots of Operating Systems: Which One?...................................................33
A System That Ties Together Other Good Micro-Systems...................34
Bob’s Bold Statement.............................................................................35
Toyota Changed the Value Equation (aka Only One Way to Thrive)......38
The Promise...........................................................................................43
What Percentage of Your Creative Brainpower?.......................................44
Countering the Two Biggest Excuses........................................................45

v
vi ◾ Contents

3 Philosophy..................................................................................47
Toyota’s Philosophy....................................................................................48
Patient Centered.........................................................................................50
The Improvement Philosophy for Healthcare...........................................53
Bob Finds His People-Based Lean Philosophy.........................................54
Go, No-Go #1: CEO-Driven.......................................................................59
Go, No-Go #2: No Layoff Policy...............................................................59
It’s All about People...................................................................................61
The Goal: Building a Culture of Continuous Improvement.....................63
Investing in People.................................................................................64
Philosophy—Inclusiveness......................................................................... 67
The Toyota House......................................................................................70
The Toyota Way Principles........................................................................76
Toyota’s Patience—San Antonio............................................................79
All Staff Need to Develop “Eyes for Waste” (DOWNTIME).....................81
Lead Time and Value-Added Time............................................................84
The Customer Determines Value...............................................................86
Types of Work........................................................................................88
Scientific Method....................................................................................89
Lean Thinking Penetrates Every Part of the Organization: Baldrige
Framework.................................................................................................91
Tensions Are Natural in Every Transformation.........................................95
Standardize vs. Improve: Defending Standardized Work.....................96
(Forced) Standard Improvements vs. Team-Based Improvements.......99
Detailed Standard Work or General....................................................100
Do It This One Best Way vs. Figure Out Best for You (Rigid vs.
Flexible)................................................................................................100
SMART vs. Stretch Goals..................................................................... 102
Problem Solver vs. Problem Finder..................................................... 102
No Layoff Policy vs. Layoffs for Volume Imbalances..........................103
Not Big Enough vs. Too Big................................................................103
4 How S&W Did It—Applying TPS to Healthcare........................105
Step 1. Lean Training and Tools.............................................................. 111
Orientation and Two Hats................................................................... 114
Continuous Improvement Training...................................................... 116
Common Core Training and Applications for All Staff....................... 118
Advanced Development Tracks for Select Staff..................................122
Lean Steering Council..........................................................................124
 Contents ◾ vii

Sausage Diagram and Project Identification—System-Wide Value

Stream Mapping...................................................................................126
Project Prioritization and Selection Matrix..........................................129
Maintaining the Matrix: How Detailed?..............................................134
Step 2. Major Lean Projects: Self-Sufficiency Plan..................................134
Leader Roles......................................................................................... 135
Self-Sufficiency Philosophy..................................................................139
Many, Many Projects............................................................................ 140
Setup Checklists................................................................................... 143
Tracking Return-on-Investment (ROI)................................................. 147
Lean Project Example—Chemo Infusion (VSM Workshop)...............148
Re-Casting a VSM Vision...................................................................... 150
Spreading Ideas from One Area to Another....................................... 152
Why Doing Only Lean Projects Will Not Work.................................. 155
Step 3. Align All Staff through Hoshin Kanri......................................... 158
All 13,000?............................................................................................160
Catchball and Contribution to the Leaders’ Goals—Different for
Everyone............................................................................................... 169
S&W’s Hoshin Forms........................................................................... 171
Linking Human Resource Backward-Looking Annual Reviews
with Forward-Looking Hoshin............................................................ 178
Strategy................................................................................................. 178
Advanced Practice Professionals (APPs).............................................. 179
S&W Strategy Development.................................................................182
Population Health.................................................................................184
Step 4. Daily Lean: Lean Management System-Building (LMS)..............186
Unleashing Ideas—The Iceberg...........................................................186
“Ultimate Arrogance”...........................................................................190
Four Parts of Lean Management System (LMS)...................................190
Part 1: Leader Standard Work.............................................................. 192
Part 2: Visual Controls......................................................................... 194
What Do You Put on a Huddle Board?...........................................196
Workers Need Input or In-Process Measures to Do
Experiments.................................................................................. 197
Must-Haves.......................................................................................200
Could-Haves/Should-Haves..............................................................200
Close-Up of a Hand-Tracked Measure.............................................200
Close-Up of All Three Sections of Huddle Board...........................201
viii ◾ Contents

Part 3: Daily Accountable Process.......................................................203

Huddles.............................................................................................203
Gemba Walks...................................................................................206
More Gemba Walks, More Time...................................................... 211
Daily Experiments............................................................................ 213
LMS Examples...................................................................................... 215
Nursing—Labor and Delivery (L&D)............................................... 215
Temple Memorial—Overall Patient Satisfaction Effort Using
Huddles............................................................................................. 218
Quotes from Nursing Leaders.......................................................... 218
Monthly LMS Huddle Success Stories.............................................. 219
Temple Environmental Services (EVS).............................................221
Everyone at Every Level Huddles—A Tier-3 Leader Huddle..........222
S&W’s Employee Engagement “Outlier”..............................................224
Summary of S&W’s Idea Generators.......................................................225
5 The Huddle System (LMS)—In Detail.......................................229
Keep It Simple: Two Guardrails to Guide All Daily Lean Ideas............230
Leadership, Gemba, and PDCA Cycles...................................................232
Small “l” Leadership First.....................................................................233
New Ways of Thinking........................................................................235
Slow Data Feedback to Team Means Slow PDCA Experiments.........238
Building LMS............................................................................................239
Lean Leadership (LMS) Course................................................................240
Required Courses?................................................................................244
More on Gemba Walks in the LMS Class............................................244
Idea Lists..................................................................................................246
Leader Standard Work.............................................................................247
Visual Controls.........................................................................................248
Chaining All Huddle Boards Together—No Weak or Missing
Links................................................................................................. 248
Three Tiers...........................................................................................249
Keep It Simple......................................................................................250
Execute!................................................................................................ 251
Daily Accountability Process (Huddles).................................................. 251
Part A: The Huddle..............................................................................253
Huddle Tips...................................................................................... 255
Part B: Leader Gemba Walks...............................................................256
Part C: Increased Floor Time for Leaders............................................260
 Contents ◾ ix

Leaders Must Keep Teams Moving up the Stairs................................263

Examples of Huddle Boards (Old and Newer).......................................266
Memorial ICUs......................................................................................266
Medical Intensive Care Unit (MICU)................................................ 267
Surgical/Trauma Intensive Care Unit (STICU).................................269
Cardiothoracic Intensive Care Unit (CTICU)...................................269
Temple HR Recruiting..........................................................................271
Taylor POS Collections.........................................................................272
Temple Orthopedic Clinic....................................................................272
Temple GI Procedures.........................................................................275
Taylor Lab.............................................................................................276
McLane Children’s Hospital Physical Therapy/Occupational
Therapy (PT/OT)..................................................................................277
McLane Children’s Hospital Imaging...................................................278
McLane Children’s Hospital Lab..........................................................278
Llano Nutrition Services.......................................................................279
Hillcrest Baptist Physical Therapy (Re-Evaluations)............................279
Temple Pulmonary Lab........................................................................280
Entering a Huddle: Senior Executives.....................................................281
Elevation System—The Strong Chain......................................................284
Colored-Card System to Track Elevated Ideas....................................284
Interventions to Accelerate Ideas............................................................288
Analysis.................................................................................................288
Interventions.........................................................................................292
A3 Waves..............................................................................................292
Results...................................................................................................293
Major Projects.......................................................................................294
Huddle Tracking System..........................................................................295
Handwritten Trackers...........................................................................299
Managing Two-Deep...............................................................................299
Spread...................................................................................................301
Communication....................................................................................301
Tracking Huddles Two-Deep...............................................................302
Huddle Board Audit System....................................................................302
Layered Audits......................................................................................306
Lean Tools S&W Uses in Huddles...........................................................309
Tools..................................................................................................... 310
Rebalance and Workshare in Huddles.................................................... 311
Rebalance Process................................................................................ 313
x ◾ Contents

Workshare in the Huddle..................................................................... 315

Same Day Appointments (SDA) Effort—Using Huddles......................... 318
6 Tips and Techniques................................................................. 319
Tip 1: To All Leaders: Have Patience!...................................................... 321
Tip 2: Make It Visual!...............................................................................323
Tip 3: Be Flexible.....................................................................................325
Tear ’em Down.....................................................................................327
Tip 4: Understand How Change Affects People.....................................327
Tip 5: What You Measure Is What You Get; So, Be Careful What
You Measure............................................................................................328
Tip 6: Put Some “Teeth” into Hoshin Goals...........................................328
Tip 7: Partner with a Lean Leader—Even in Another Industry............. 331
Tip 8: Steve’s Sensei Folder......................................................................332
Tip 9: Using Assessments or “Scores” to Grade One’s Progress............332
Overall Lean Maturity Score................................................................333
Lean Assessment by Tool or Principle with Radar Chart...................334
Baldrige (or Several Other) Framework...............................................336
Tip 10: Tip of the Week Emails and Intranet Fresh Articles..................338
Top Five Lists for Huddles...................................................................339
Top Five Reasons to Huddle............................................................339
Top Five Things We Huddle About (Focus Topics)........................340
Tip 11: Building the Internal Lean and LMS Toolkit...............................343
Tip 12: Using Videos to “Get the Message Out”.....................................345
Tip 13: Have a Bias for Action.................................................................345
(Story 1) Must Cut Inventory in Half—A Bias for Action....................345
(Story 2) Door Here!.............................................................................348
Tip 14: Stop Lean and Huddles during New or EMR Rollout?...............350
Tip 15: Stop Lean and Huddles during a Merger or Acquisition?...........350
Tip 16: Get Flow...................................................................................... 351
Tip 17: The ROI Trap and Role of Training............................................ 352
Tip 18: Kaizen or Kaikaku: Redirecting Labor........................................ 352
Flexing Staff to Other Sites..................................................................356
Appendix A: Forms.........................................................................361
Appendix B: Acronyms and Some Terms........................................ 375
About the Author.............................................................................401
Foreword

I first met Steve Hoeft in a phone conversation. He described the Lean

management system he had been involved in implementing at Scott &
White Healthcare, telling me they used the description of the Lean manage-
ment system in Creating a Lean Culture as a template, and with great effect.
“Come spend a few days with us, see what we’ve done, and give us your
feedback,” he said. I agreed to Gemba the Lean management implementa-
tion Hoeft had described. By the time I made the trip, Scott & White had
merged to become Baylor Scott & White Health (BSWH).
I’ve seen hundreds of applications of Lean management systems. No
two are alike, so it wasn’t surprising that the application I saw at BSWH,
described in the pages that follow, was not the same as others I had seen.
What was surprising was its effectiveness, exemplified by this hallmark:
The Scott & White system, at the time this book was written, counted 2000
implemented ideas for improvement from employees per week from their
16,000 employees, this in an environment that included recent budget and
staff cuts. That number is unheard of in my experience outside of a few
high-volume, low-variety automotive manufacturers, mainly Toyota and some
of its suppliers.
That level of employee engagement is for me the sine qua non of a suc-
cessful Lean implementation supported by a robust Lean management sys-
tem. You will find descriptions of many elements of both systems here. One
thing I’ve learned after repeatedly being surprised by Lean management
implementations described as “taken straight from the book” is this: There
are many ways to do it right. The “right” way is the one you have developed
yourself that works for you, as long as it adheres to a few principles start-
ing with focus on the process. But most applications, even very good ones,
do not produce the high level of front-line engagement reported clearly and
credibly in this book.

xi
xii ◾ Foreword

What I saw in late 2014 at the legacy Scott & White hospitals and clinics
was the product of a Lean journey begun in 2008. Prompted by accelerat-
ing change particularly on the financial side of healthcare, CEO Bob Pryor
was looking for ways to get ahead of the curve. He caught a glimpse of
the future in a benchmark visit to a Toyota assembly plant with its highly
engaged production employees and the thousands of implemented ideas for
improvement they submitted annually.
Steve Hoeft is a teacher and coach with firsthand experience in Toyota’s
thinking and approach. Pryor knew the direction he wanted to go: sustained
high levels of employee engagement in improving S&W’s performance.
Together, they developed an approach to move in that direction. Either
would tell you they are far from done. However, the distance they have tra-
versed and the progress they have made stand as significant achievements,
chronicled in the pages that follow.
The hardest part of Lean is creating the conditions that engage the hearts
and minds of those who do the actual work—the nurses, MAs, techs, house-
keepers, providers, and other professionals—in an ongoing improvement
process in which “bottom-up” suggestions for improvement are a significant
component.
This book documents the path the authors created at Scott & White, now
up to the merged BSWH to continue. It started with a familiar approach:
creating metrics, defining targets, identifying gaps, and chartering projects to
deploy Lean applications to close significant gaps. Many projects were suc-
cessful, but problems were growing faster than projects could reduce them.
Concurrently, many leaders were trained in Lean approaches and tools, but
few knew what to do as leaders to engage those they led.
In response, the authors developed their own approach for the next
steps. It did not come from a book or a consultant. Instead, they created the
next steps based on Pryor’s goal of high engagement at every level in the
organization: Hoeft’s Lean expertise, their experience up to that point, and
the gaps they observed in leaders’ behaviors and staff disengagement. They
combined equal parts of three-tiered accountability meetings, employee idea
processes, layered audits, Gemba walks, leader standard work, and visuals
for each team in each tier displaying goals and gaps appropriate to the team
in five areas consistent across teams and tiers. It is a systematic approach,
and it is working.
I believe the single ingredient essential to this success was the example
that Pryor, the CEO, set for his team and everyone in a leadership posi-
tion at every level throughout the organization. This was not something
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