Making the case for Lean Six Sigma in the healthcare sector

The Lean healthcare systems worldwide witnessed a significant evolution in the past two decades by transforming the processes and the behaviors within the healthcare firms. For example, Mayo Clinic in the USA implemented Lean in the early 2000s and achieved higher customer satisfaction among the cancer patients in their chemotherapy department.

Another such example is the National Health Service in the UK, where Lean deployment has improved hospital performance and delivered significant cost savings.

Even in developing economies such as India, Lean implementations have transformed both clinical and non-clinical processes among the hospitals. For example, in 2019, Fortis hospital, India's second-largest hospital chain, declared that it cut costs by 20 per cent by embarking on Lean deployment.

In an interview with an executive director of the Apollo Hospitals Group, it was mentioned that they have been practicing Lean in their work processes to improve both efficiency and effectiveness.

While Lean implementation in the healthcare sector has provided some success, it had its share of drawbacks.

First, most of the Lean works in healthcare links to the traditional Toyota Production System and have not included the recent developments in Lean.

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Second, implementing Lean in hospitals has been a daunting task in many countries, as Lean does not demand a data-driven approach.

Third, several studies emphasised that the leading cause for poor patient care in hospitals is the incorrect selection of Lean projects based on hospital management's intuition.

Further, in many organisations, Lean has been perceived as an ad-hoc activity without considering its systemic implications. While the Lean literature endorsed several field-based tools like value stream mapping and visual management, it missed recognising other important continuous improvement (CI) tools like process mapping, control charts, root-cause-analysis, etc.

Importantly, Lean does not address process variation related issues. Finally, the criticism that Lean lacks a project management framework to execute projects has been a concern among practitioners.

Alongside these, the healthcare sector's inherent challenges like unevenness in healthcare operations, measurement system and quantification challenges, demarking healthcare as a market, defining patient as a customer, have been vague and, in fact, majorly unaddressed. 

With the recent development of Lean Six Sigma, a hybrid method that combines the rapidness of Lean and Six Sigma's robustness, most of these problems get addressed.

Our research and practice of applying Lean Six Sigma in various healthcare contexts, including out-patient departments, mobile hospitals, pharmacies, healthcare insurance, diagnostic labs, intensive care, and in-patient admits, have convincingly endorsed Lean Six Sigma's fitness for providing high-quality and low-cost healthcare services.

While Lean Six Sigma was built on Six Sigma's original Define-Measure-Analyse-Improve-Control (DMAIC), and Define-Measure-Analyse-Design-Verify (DMADV) roadmaps, it is a data-driven, process-oriented continuous improvement approach that focuses on identifying and eliminating process defects, variation, and non-value-adding time to improve healthcare service efficiency and effectiveness.

Simultaneously, it helps improve process flow, utilisation, flexibility, and service capability towards delivering greater value to patients and other healthcare beneficiaries.

We had opportunities to apply Lean Six Sigma in Indian hospitals. For example, a multi-specialty hospital in India that we deployed Lean Six Sigma suffered from a low patient satisfaction rate of about 78 per cent in the cardiology department.

The turnaround time (an average of 315 minutes, with a standard deviation of 24 minutes) was reported as a major contributor to patient dissatisfaction and identified as an opportunity for process improvement by the department's management. Data analysis revealed a poor process capability to deliver services within the set objective of 210 minutes.

By applying the Lean Six Sigma toolkit, we were able to identify the root causes of the problem. Lack of scheduling, incomplete patient information, lack of test result alerts, lack of clarity in patients about the hospital layout, workstation downtime, delays from other appointments, and demand fluctuations were a few of the root causes.

Lean Six Sigma tools like Pareto analysis, Control charts, Value Stream Maps, and data analytics were used as part of the project.

The integrated mobile alert system, standardising the lab data reporting, revamping the scheduling system, eliminating non-value adding activities and process bottlenecks, staff training, etc., were a few improvements executed in the cardiology department.

Consequently, the turnaround time was reduced to 240 minutes, with a standard deviation of 9 minutes. The Lean Six Sigma project delivered an annual cost saving of about INR 3.4 million, increasing patient satisfaction to 91 per cent.

Further, it contributed to learning, excitement in the participating stakeholders towards a cultural change. Customer centricity, process orientation, data-driven decision making were a few learnings highlighted by the participants. 

In another Indian hospital, the accuracy of the Medical Records Department was improved from 89 per cent to 97 per cent using Lean Six Sigma. Another example was reducing the turnaround time in a mobile hospital that provides free medical services to ~3000 villages in the Indian state of Andhra Pradesh, using Lean Six Sigma'ss DMADV methodology.

In another assignment, we noted a significant reduction in medical insurance claims from 1.5 per cent to 0.8 per cent. Here, by improving the process sigma value from 3.66 to 4.52, the healthcare firm realised a cost avoidance benefit of about INR 38 million. 

An overview of research literature on Lean Six Sigma indicates that ~20 per cent of publications on Lean Six Sigma in services sectors are specific to healthcare. This shows an increasing interest in Lean Six Sigma by healthcare practitioners.

While it offers both process and data lenses to examine problems towards a resolution roadmap, practitioners endorse it to be easy to learn and effective when applied.

Thus, it will be a worthy future direction for healthcare professionals like doctors, administrators, lab personnel, and other clinical and non-clinical technicians to learn and apply Lean Six Sigma for continuous improvement. 

Alongside management learning, it sets an agenda for total personnel participation towards building a continuous improvement culture (beyond individual projects), a critical gap to bridge, and a worthy opportunity to pursue in the healthcare space.

With digital automation, robotics, and information and communication technologies being applied faster in healthcare institutions, it is important for them to embark on the Lean Six Sigma journeys. As a pre-requisite to technology deployment, Lean Six Sigma would help hospitals and other healthcare institutions streamline their processes and improve them as deserving candidates for digitisation.

The writer is an Assistant Professor of Practice at the Indian School of Business (ISB), Hyderabad, India. He is a Lean Facilitator and Six Sigma Master Black Belt practitioner, and an Affiliate Faculty with the Max Institute of Healthcare Management (MIHM) at ISB.