Mit16 660jiap12 2-4H

Improving the Enterprise
Learning Objectives
At the end of this module, you will be able to:
• Recognize that enterprise improvement requires more
than “local lean thinking”
• Describe how lean organizations are able to adapt to
external constraints and disruptive events
• Participate in a Rapid Process Improvement
Workshop to achieve larger-scale lean improvements
• Implement a Daily Management System
• Describe some of the difficulties of large-scale change
• Explain a future state map for a process
Improving the Enterprise V7.5 - Slide 2

© 2012 Massachusetts Institute of Technology
Enterprise Issues
• HC operations are often impacted by
decisions made at higher enterprise levels
• Regulations, insurance, billing…
• Resource constraints and performance
demands
• HC networks need (ultimately) to be optimized
at an enterprise level
• With poor coordination, local optimization may
sub-optimize the enterprise (and vice-versa)
• Done right, enterprise resources and removal of
enterprise constraints may allow much greater
efficiencies at the local level

Constraints and
Disruptions
• Higher level decisions and systems may
appear as constraints to local attempts at lean
• Billing and paperwork requirements
• Hiring rules, credentialing requirements
• Budget cutbacks
• Higher level improvements may appear as
disruptions to local attempts at stable process
• EMR
• Consolidations, HC networks
• Changes in insurance or law

Living with change
• Lean organizations are, by their nature,
adaptable to change
• Process orientation allows efficient process
change and quicker stabilization
• Standardization means fewer things have to
change (i.e. change and train the standard, not
many individual processes)
• Rapid cycle time means changes take effect
quicker
• Continuous improvement culture means people
are practiced at change, know how to minimize
disruptions, quickly stabilize the new state
Higher level change requires greater levels of

organization and planning
CPI Framework
Problem perceived
A P Grasp current situation
S D Steps are the

Diagnose root cause
same,
Consult affected
Devise root cause
treatment options organization
and
stakeholders
Visualize future state
emphasis
Create implementation plan
are different
A culture of
Develop follow-up plan
mentorship and
personal growth Obtain stakeholder buy-in
Execute implementation plan
Execute follow-up plan
Achieve
an outcome acceptable enough to
standardize?
Adapted from: Sobek, Durward K., Smalley, Art.,
(2008). Understanding A3 Thinking: A Critical
Component of Toyota’s PDCA Management
Establish standard process
System. Boca Raton: Productivity Press, Taylor Improving the Enterprise V7.5 - Slide 6
& Francis Group © 2012 Massachusetts Institute of Technology
Healthcare Enterprise
Stakeholders
Patients & Medical
Families Staff
Other
Insurers
employees
Healthcare
Enterprise
Directors &
Suppliers Management
Government Businesses
“Any group or individual who can affect or is affected

by the achievements of the organization’s objective”
Freeman, Strategic Management: A Stakeholder Perspective, Pittman, 1984

Stakeholder Value
“Value - how various stakeholders find particular

worth, utility, benefit, or reward in exchange for
their respective contributions to the enterprise.”
Murman et al., Lean Enterprise Value, Palgrave, 2002
Value Expected Value

from the Contributed to
Enterprise the Enterprise

Visualizing: The Ideal State
• “Giving customers exactly what they want,

when they want it, is a core principle of an ideal
state. As you observe work in progress, note
the delays in care created by caregivers waiting
for necessities from their suppliers (…). It is
easy to see the delay passed onto the patient
and the costs passed onto the organization”*
• An Ideal State Map is often a useful exercise for

determining what directions improvements
should follow.
* Cindy Jimmerson, Value Stream Mapping for Healthcare Made Easy
Rapid Process Improvement
Workshop (RPIW)
• Focused on a specific improvement
opportunity
• Chartered by a sponsor who gives
improvement goals and organizational
constraints, and provides resources
• Lean coaches & facilitators provided
• Event is up to a week in duration
• Several months preplanning
• Involves all important stakeholders
• Data driven process
• Ends with implementation plan
• Implemented outcomes measured Photo by Earll Murman
JHC AMI RPIW – Apr 2009
RPIW is the tool for enterprise level changes

RPIW Flow
Strategic Choice
25
20
15
10
Planning Stage
5
3 – 6 months
1 2 3 4 5 6 7 8 9 10
Enterprise performance
RPIW Charter
Resources
RPI Workshop
Process data 3 – 5 days
Future state
A P process Follow-up Stage
Implementation 3 – 6 months
plan
S D
RPIW Participants
Objectives Resources
Team Domain Experts

Stakeholders
Sponsor Champion
Lean Experts Facilitator Support Team

Lean Coach,Lean Fellow IT, Facilities...
Image by MIT OpenCourseWare.

RPIW Workshop
• Day 1 – Team building, Gemba walks,
current state map, brainstorming
• Day 2 – Morning: develop future state
improvement strategy
• Day 2 – Afternoon: brief management
• Days 3 & 4 – Prototype improvement
strategy, including: mockups,
testing, develop training materials,
engaging affected stakeholders
• Day 5 – Wrap up & brief management
Photos by Earll Murman
Shorter RPIWs for simpler improvements

Daily Management System
Photos by Earll Murman
• DMS focuses on a 5 minute meeting of ALL clinic

personnel at day’s start to:
• Review previous day’s performance
• Transmit any new enterprise directives
• Review current day’s plans
• Note any special achievements or issues
• Organized and run by clinic administrative lead
Wrap Up
• Enterprise level issues may create constraints and
disruptions at the local level
• Enterprise level LEAN can provide much greater
benefits than local efforts, however
• The CPI framework applies, although the
emphases are different
• Stakeholder value and Ideal State vision focuses
direction
• Structured teams (RPIW teams) will be needed,
and with them methods for team collaboration and
management
We will continue exploring RPIW events and tools
in the upcoming simulation exercise
Acknowledgements
Contributors
• Hugh McManus – Metis Design
• Earll Murman – MIT
• Deanna Willis, MD – Indiana University School of
Medicine
Collaborators
• Jackie Candido – MIT EdNet
• Sharon Johnson – WPI
• Steve Shade – Purdue University
• Julie Vannerson, Indiana University
• Whitney Walters – Univ. of Michigan Health
System

MIT OpenCourseWare
http://ocw.mit.edu
16.660J / ESD.62J / 16.53 Introduction to Lean Six Sigma Methods

IAP 2012
For information about citing these materials or our Terms of Use, visit: http://ocw.mit.edu/terms.

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Improving the Enterprise

Improving the Enterprise V7.5 - Slide 2

Improving the Enterprise V7.5 - Slide 3

Improving the Enterprise V7.5 - Slide 4

Higher level change requires greater levels of

A P Grasp current situation

S D Steps are the

Execute implementation plan

Execute follow-up plan

“Any group or individual who can affect or is affected

Improving the Enterprise V7.5 - Slide 7

“Value - how various stakeholders find particular

Value Expected Value

Improving the Enterprise V7.5 - Slide 8

• “Giving customers exactly what they want,

• An Ideal State Map is often a useful exercise for

JHC AMI RPIW – Apr 2009

RPIW is the tool for enterprise level changes

Team Domain Experts

Lean Experts Facilitator Support Team

Image by MIT OpenCourseWare.

Shorter RPIWs for simpler improvements

Photos by Earll Murman

• DMS focuses on a 5 minute meeting of ALL clinic

Improving the Enterprise V7.5 - Slide 16

16.660J / ESD.62J / 16.53 Introduction to Lean Six Sigma Methods

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