Regardless of whether your preferred change metaphor is the product life cycle, the second curve, VUCA (volatility, uncertainty, complexity, ambiguity) or strategic inflection point, all signs indicate that health care in the United States is at a critical point of transition. The well-traveled road of volume- and supplier-driven reimbursement is rapidly transitioning into a hairpin turn of pay-for-performance risk.
This dynamic reform-driven marketplace can be characterized by eight key principles (or P’s) of the new health care delivery system:
- Patient-centered: Care that respects individual patient preferences, needs and values.
- Participation: Real-world patient outcomes representing an adaptive return to society (i.e., productive activity, supportive relationships and independent living).
- Performance: Demand for evidence-based, highly reliable, harm-free and durable treatment outcomes.
- Public: Increasing transparency of provider price, process and outcome.
- Payment: Payment shift from reinforcing volume to value/outcome.
- Process: Continuous re-engineering to reduce variation in care process and outcome (the Six Sigma principle).
- Parsimony: Streamlined care that avoids unnecessary demands on limited resources (time, motion, equipment, supplies, energy and talent) — the lean principle.
- Pragmatism: Results matter; methods and systems that adaptively produce results will survive.
While change is a management constant, the accelerating pace of transitions along multiple simultaneous fronts (pay-for-performance penalties, talent wars, unprofitable growth, facility and technology obsolescence, the moral imperative of improving health and lives) indicates ours is an industry looking for solutions.
The 30/30/30 Solution
In 2010, about the time the Patient Protection and Affordable Care Act was signed into law, the leadership team at Memorial Health System — a nonprofit, four-hospital system based in Springfield, Ill. — self-acknowledged that we were not designed for success in a future of unprecedented focus on outcome. We were good (in the ways that one thrived under the traditional system) but not great. The low-hanging fruit had been harvested and consumed. Amazingly, research indicated that operational inefficiency is the norm across most U.S. industries, including health care. The typical organization squanders the equivalent of 30 percent of annual gross revenue due to defect-producing practices and overutilization of resources.
Rejecting “typical” as contrary to our vision of success, we determined to re-engineer our structures and processes as these are the necessary precursors to outcomes. We also recognized the need to find new ways to engage with our medical staff, and ultimately inform the training of next-generation physicians and health care professionals, to build a sustainable path.
In response to these imperatives, we modified traditional administrative structures to better partner with high-influence physicians (i.e., “silverbacks”) via dyadic relationships and team roles and to identify and prioritize high-value opportunities. We then adopted Lean Six Sigma, a rapid-cycle, data-driven process change methodology from industry that produces quality, safety, service and cost benefits that matter to stakeholders.
The focus on lean and Six Sigma was important and, in hindsight, critical to our approach. True high reliability can only be achieved, in our opinion, when (1) unnecessary process steps are identified and removed and (2) those steps that remain are improved to as close to 100 percent reliable as possible. In this way, lean and Six Sigma are complimentary but different approaches to the same endpoint — two sides of the same coin.
Six years later, over 300 Lean Six Sigma improvement projects yielding nearly $30 million in positive financial impact have transformed the Memorial culture. Today, our approach is known as "The 30/30/30 Solution": in each of the last five years, we have trained and certified 30 percent more Lean Six Sigma process change experts (“belts”), completed 30 percent more projects, and achieved an average project improvement of at least 30 percent on any project undertaken.
Projects have spread to all areas of the organization: clinical, financial, service, production, facilities, inventory and workforce management. We believe acceleration to be a key feature of our 30/30/30 Solution: We need to continually increase and expand the compounding scope of the program, to develop the escape velocity to overcome the gravity of past beliefs, behaviors and practices to reach new frontiers of quality and safety. Along the way, the approach has netted some state and national recognition; our flagship hospital recently received the 2016 American Hospital Association–McKesson Quest for Quality Prize. It’s not enough ... we’re not there yet. We’re questing, not resting.
Paradox of flawless execution
Memorial Health System has adopted an aspiration of “zero defect” performance based on the prevention of harm and enhancement of well-being for those we serve. It is tempting, therefore, for management to impose the dictum of flawless execution on its workforce.
While this dictum may produce short-term, limited gains, however, it may paradoxically undercut the emerging quality culture in at least two ways. First, this dictum promotes a risk-averse posture among a staff and management team now afraid to fail, which ultimately destroys the motivation and innovation required to reach new heights of performance. Second, it suppresses the reporting of harm events or near-miss learning opportunities — the essential inputs for improvement cycles leading to the intended goal of high performance.
The solution to the paradox is found in senior leadership engagement in the evolving quality and safety program, where leaders model their personal investment in discovering new problems to solve collaboratively. The 30/30/30 Solution is not about a collection of techniques but rather a transformation of our culture.
Part of this transformation in our organization today, embedded in our Lean Six Sigma training and medical education partnerships, focuses on deployment of new tools like discrete event simulation (i.e., computer) modeling and in-vivo live team simulations of complex care processes. These “wind tunnel” experiments offer a safe way for stakeholders to experiment with care innovations in a forum that fosters team dialogue, performance analysis and workflow debugging in a way that shields both patient and provider from harm.
Both design and training occur in the safe simulation environment at the Memorial Center for Learning and Innovation, with innovations brought to the front lines of care only when a robust care process has been achieved. In this way, failures are fast, safe and cheap, and energize the improvement culture.
The road ahead
Looking ahead, our 30/30/30 Solution will remain focused on strategic quality priorities that are updated annually, reflecting national and local imperatives. In particular, achieving an elevated patient experience and optimized workforce across our health system will be cornerstones of near-term work. In all, the 30/30/30 approach to leadership is certainly more effortful and time-intensive than a laissez-faire style of management, though the results are greater and consistent with what our patients and families deserve.
Charles D. Callahan, Ph.D., MBA, FACHE, is executive vice president and chief operating officer of Memorial Health System in Springfield, Ill. Todd S. Roberts, MBA, is vice president, quality and safety, of Memorial Health System.