Post on 28-Apr-2020
Enhancing Continuous Improvement,
Lean and Six Sigma Efforts
with Employee Suggestion Programs
Presented by
Presentation Overview
• Continuous Improvement, Lean and Six Sigma efforts
increasingly common in healthcare today
• Those efforts can be enhanced through a well-designed
team-based employee suggestion program
• Results from healthcare institutions that have launched
such programs
Ron Bachman
– Former Ohio hospital CFO/CEO
– Leads Advisory Board for Performance Plus
– Twice earned Ohio Health President’s Award
for clinical quality, patient satisfaction,
employee engagement/satisfaction and
financial performance
Presenters
Bob Stergos
– 20 years experience in employee engagement
– Designed, sold and implemented team-based
engagement/suggestion programs for major
hospitals, airlines and manufacturing
companies
– Served as successful Team Leader in
6,000-employee program
– Active member of Ideas America (national
suggestion system association)
Presenters
Current cost-cutting strategies
• Become part of a system rather than remain independent
• Downsize
• Join Group Purchasing Organization (GPO)
• Create small group of Continuous Improvement/Lean/Six Sigma
specialists to work on select, management-directed projects
• Continuous Improvement (CI)
– Gradual, never-ending change
• Lean
– Elimination of all non-value activities and waste
• Six Sigma
– Decrease in process variation
Definitions
• Typical suggestion program– Low-key, ongoing
– Under-promoted
– Individual idea submitters
– Nominal results
• Well-designed suggestion program– High-energy, short-term
– Highly-promoted
– Team-based
– Dramatic results
Definitions
Typical Suggestion Program
• Individual initiative
• Low management priority
• Long-term, low-key
promotion
• Undocumented ideas
Well-Designed Suggestion Program
• Voluntary cross-functional
employee teams
• Highest management priority
• 90 days, energized promotion
• Fully-developed ideas by
teams
What are the differences?
Typical Suggestion Program
• No training for
participants or evaluators
• Evaluation perceived as
subjective and slow
• Negligible impact on P&L
Well-Designed Suggestion Program
• Extensive orientation and
training
• Timely and objective
evaluation process
• Significant impact on P&L
What are the differences?
Typical Suggestion Program
• Limited recognition of
employee efforts
• Cash awards lack trophy
value/proven not as
effective
• Does not address
implementation
Well-Designed Suggestion Program
• Broader recognition of
employee efforts
• Promotable merchandise
awards that produce
greater results
• Drives implementation
What are the differences?
CI/Lean/Six Sigma
• Less than 10% of
employees involved
• Management-directed
projects
• Low-key management
support
Well-Designed Suggestion Program
• 15-75% of employees
involved
• Frontline-employee
initiated projects
• Highly-visible
management support
What are the differences?
CI/Lean/Six Sigma
• Very small number of
employees trained
• Involves a small number
of lengthy projects
• Limited awards and
recognition
Well-Designed Suggestion Program
• Every team leader, team
coach and evaluator trained
• Motivates hundreds of ideas
in 3-month timeframe
• Positive, immediate and
certain awards and
recognition
What are the differences?
CI/Lean/Six Sigma
• CI/Lean/Six Sigma specialists confined to limited number of projects per year
• No element of “gain-sharing” at frontline employee level
Well-Designed Suggestion Program
• CI/Lean/Six Sigma specialists
serve as team coaches,
helping dozens of employee
teams document their good
ideas
• High-degree of “gain-sharing”
instilled at frontline employee
level
Comparisons
Shortfalls of Current Strategies
• Healthcare systems lessen local control;
decisions are made from corporate perspective
• Downsizing obviously lessens employee morale
• GPO arrangements focused heavily on supply chain
• CI/Lean/Six Sigma projects directed by management and
involve small percentage of employee population
• Specialized process control and cost-containment training
confined to “the few” rather than “the many”
• Organizations still struggling to positively engage frontline
staff
Suggestion Program Structure
Cross-Functional Teams(1 Team Leader per 5-member Team)
Team Coaches(8-10 Teams each)
Program Manager(In larger organizations,
may need Assistant
Program Manager)
Evaluators
Implementer(s)
• Select, research and develop
ideas
• Document and submit ideas
• Assist teams in program
mechanics and idea valuation
• CI/Lean/Six Sigma specialists
Resource
Personnel
• Administers program
• Manages program results
• Evaluate ideas
• Assign/initiate implementation
of approved ideas
• Provide costing info to teams
• Close the loop; implement ideas
Motivation: Award Opportunities
Team Members
• Share equally in awards for approved
ideas based on projected net value
Team Coaches
• Earnings based on performance of their
teams
Evaluation Committee Members
• Typically VP level and above
Motivation: Award Opportunities
Program Manager
• Earnings based on execution of
assigned duties and performance
against program goal
Resource Personnel
• Earnings based on supplying timely
information
Top Performers
• Earn pre-determined top awards
The Role of Team Coaches
• Coach teams to success
• Facilitate idea generation and
concept development
• Provide initial screening of ideas
• Act as intermediary for required information
• Assist teams in idea valuation, utilizing
Continuous Improvement, Lean/Six Sigma
training
• Maintain program enthusiasm
The Role of Leadership
• Actively supporting and
encouraging participation
• Challenging employees to find
solutions
• Making exchange of information
and data easy and transparent
• Reviewing ideas and giving
feedback on a timely basis
• Celebrating success
History
• First team-based programs began in 1982
• Typically high-energy, short-term programs
• Operated 200+ programs over 20 years
INDUSTRY PROGRAMS IN SAMPLE
EMPLOYEES IN SAMPLE
ANNUALIZED SAVINGS
$/APPROVED IDEA
MANUFACTURING 48 122,109 $448,618,714 $18,440 PUBLISHING 11 13,957 $31,527,763 $18,351
AIRLINES 13 314,193 $574,036.000 $55,331 HEALTHCARE 83 170,855 $186,498,806 $13,674 INSURANCE 15 43,301 $107,142,000 $19,048
BANKING 16 33,363 $79,011,000 $16,626 TELECOM 5 34.750 $103,027,900 $17,059
Sample Healthcare Results
(80+ total healthcare programs)
CLIENT ELIGIBLE EMPLOYEES
# OF IDEAS IMPLEMENTED
ANNUALIZED SAVINGS
$/APPROVED IDEA
Baylor Hospital 5,452 524 $8,452,380 $16,033 Good Samaritan 4,217 347 $5,490,257 $18,288 Marion General 800 163 $1,170,558 $ 6,969
Pennsylvania Hosp. 3,500 358 $2,366,000 $17,385 St. Thomas Hospital 2,975 355 $5,533,850 $16,025
Tulsa Regional 1,581 161 $3,248,735 $19,673 Mercy Hosp. (FL) 1,372 173 $2,305,908 $13,329
Scott & White Hosp. 2,980 207 $3,217,110 $15,542 Mt. Sinai Hosp. (NY) 7,165 221 $5,335,923 $24,144 Fort Sanders Hosp. 2,378 573 $3,162,825 $5,520
Baptist Med Ctr. 2,100 402 $6,956,055 $17,304
Current Case Studies
CLIENT ELIGIBLE EMPLOYEES
# OF IDEAS APPROVED
ANNUALIZED SAVINGS
$/APPROVED IDEA
Methodist LeBonheur
11,000 15 $1,015,240 $63,452
Children’s Health Campaign 1
6,000 79 $4,387,772 $55,541
Children’s Health Campaign 2
6,000 66 $1,974,911 $ 20,572
OSF HealthCare 2 hospitals of 8
1,400 63 $615,466 $8,431
• Kim Besse, CHRO
“I was impressed by the creativity and engagement of team members to suggest improvements and to work together to identify ways to improve our organization. Many ideas required cross-functional teamwork and exploration…and all involved were willing to learn from each other to achieve a positive outcome.”
Children’s Health
• Joe Don Cavendar, Associate CNO
“I was impressed with the number of ideas submitted. Many were: ‘Wow. Why didn’t I think of that? Ideas.’ I was particularly impressed by the thought and thoroughness behind many of the ideas. Many were final and ready for implementation the moment they were submitted. I really appreciate all the hard work on behalf of the staff.”
Forecasting Your 1st Year Return
Eligible Employees 10,000
X Participation Rate x 25%
Employee Participating 2,500
÷ Members per Team ÷ 5
Number of Teams 500
x Ideas per Team x 2.5
Ideas Generated 1,250
x Approval Rate x 35%
Ideas Approved 438
x Savings per Idea x $25,000
1st Year Gross Savings $10,950,000
• ROI Calculator to forecast savings:
http://bit.ly/1Rxtn5G
Forecasting Your Savings
Suggestion Program Benefits
• Disseminates continuous improvement principles to frontline
staff by utilizing PI/Lean/Six Sigma specialists as
team coaches
• Improves business literacy and transparency at all levels
• Engages greater number of employees in
cost-reduction efforts
• Improves interdepartmental teamwork
and communications
Suggestion Program Benefits-2
• Impacts financial, organizational and employee needs
• Drives auditable financial results and significant ROI
• Program investment largely contingent upon results
• Provides WIIFM (“What’s In It For Me”) to frontline staff
• Reinforces “gain-sharing” culture via visible, tangible rewards
and recognition
Performance Plus Contacts
Bob Stergos
Vice President, Engagement Practice
bstergos@performplus.com
M: 636.795.5192
Ron Bachman
Advisory Board Member
rbachman@Columbus.rr.com
M: 614.361.4308
www.ideasatwrk.com