What if Deming Ran Your Hospital? - ASHNHA€¦ · Baptist, was a specialty orthopedic hospital,...

What if Deming Ran Your Hospital?

Alaska State Hospital and Nursing Home AssociationWorkshop Session

September 26, 2018

James L. Reinertsen, [email protected]

A personal journeyQuality is the result of brilliant doctors & nurses using scientific advances

Frustrated about “things that go wrong,” but completely clueless about how to improve anything

Quality is a systemproperty! There is a method for improving systems!

35 years experience applying this method, from local projects to organizations to national health systems

Without “profound knowledge,” QI methods and tools fall short of their potential

QualityIssues

QI Methods

By What Method?

Everything else

Current Results

Basic Sciences

Better Results

PROFOUND

KNOWLEDGE

Statistical Process Control

Rapid Cycle Improvement

Lean Production

Innovation and Design

Human Factors

Safety Science

High Reliability Organizations

Clinical Sciences

Two Pathways to Improvement (Modified from Batalden)

Current Results

Basic Sciences

Better Results

Appreciation for a system

Understanding of variationAnalytic statistics

Theory of human psychologyIntrinsic Motivation

Volitional Work

Theory of knowledgeScientific method

Statistical Process Control

Rapid Cycle Improvement

Lean Production

Innovation and Design

Human Factors, Safety Science

Reliability Science

Sustainability

Change Management

Clinical Sciences

Two Pathways to Improvement (Modified from Batalden)

“Profound Knowledge” Questions Deming Might Ask Leaders in Alaska

1. System-ness: Is the job of various parts of your organization to optimize the overall system, or to optimize their own part of the system?

2. Variation: Do you make important decisions based on opinions, or on “statistically literate” interpretation of data?

3. Motivation: If a Martian were to examine your organization, what theory of human motivation would he infer from your policies?

4. Knowledge: By what method do you connect theories with data, to generate learning and improvement, in daily organizational life?

Opinions

• Psychologist working with Israeli Air Force: “Research shows that compliments work better than reprimands when teaching student pilots.”

• Flight instructors: “You’re wrong. Performance gets better after reprimands, and gets worse after compliments.”

When do you think the instructor gave reprimands? Praise?

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Flight Performance Rating for 1 Pilot Over 16 Flights

Common Cause Variation, a System Property! Praise and Reprimand Had Nothing to Do with It!

Kahneman and Tverski, Scholtes

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Reprimand

Praise

Superstition, or “Management?”

Kahneman and Tverski, Scholtes

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Kiss the fuselage

Light a candle

0

20

40

60

80

100

120

140

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Financial Performance By Month

“Last month’s financial performance showed

nice improvement. Good job, everyone!”

Healthcare leaders are not illiterate.

But many of them appear to be

“innumerate.”

If Deming ran your organization, your leaders would know and use

operational statistics—and not just for QI projects! They would

separate signal from noise, and respond appropriately. And your

budgets would be based on statistical prediction, not on political

gamesmanship.

Questions to consider:

• Where, outside of QI projects, do you regularly see and use run charts and control charts?

• What is the basis for decisions in your organization: opinions, or data?

Deming’s “Theory of Knowledge”• You can have ideas, and hunches, and theories

about what might lead to improvement, but the only way to know if they are right is to try them out in the field.

• A “Deming practice” would look a lot like a series of clinical trials—comparing someone’s idea of better care with current practice.

• These “clinical trials” would require standardization—not just in QI Projects, but for everything that is plainly “standardizable.” You can’t learn anything from a practice where each practitioner does things her own way.

From The Improvement Guide by Langley, Nolan, Nolan, Norman, Provost

Aims

Measures

Ideas

Sequential Learning:Repeated Use of the Cycle

Hunches Theories

Ideas

Changes That Result in

Improvement

A PS D

A PS D

From The Improvement Guide by Langley, Nolan, Nolan, Norman, Provost

In God we trust, all others bring…

If Deming ran your organization…

• You’d use Plan-Do-Study-Act cycles for everything, not just in “Quality Projects.”

“Profound Knowledge” Questions Deming Would Ask Leaders


2. Variation: Do you make decisions based on opinions, or on “statistically literate” interpretation of data?

3. Motivation: If a Martian were to examine your systems, what would he conclude were your beliefs about what motivates people?


A Story About Two Managers

$100 $80

An Engineer Gets an Idea

$130 to control BOTH, with ONE device

“Where is this device mounted?”

$80 cost goes to ZERO

$100 cost goes to $130

The idea, which would have saved $50 per car, was never implemented

$100 $80

Questions to Ponder:

• Why did these managers make these decisions?

• Is this story relevant to health care? How so?

My Health Care Version of the Automobile Story (1)

In 1999, the 6 hospital Boston system called “CareGroup” was going bankrupt, fast.

CareGroup had borrowed a lot of money to build facilities, including hospital beds.

Revenues could not rise fast enough to pay the debt service. CareGroup had about $300 million in cash, and was spending that down

by $100 million per year.


A group of executives came up with an idea. One of the 6 hospitals, New England

Baptist, was a specialty orthopedic hospital, with about 125 beds in service. It was

located on a prime hilltop, and the land on which it stood was worth hundreds of

millions to Boston developers, if the Baptist campus could be sold.

The New England Baptist Hospital Campus


Another CareGroup hospital, the Deaconess, was walking distance from the Baptist, and had excess capacity. With some reconfiguration, the

entire Baptist operation could be moved onto the Deaconess campus, and operated in a separate wing as its own hospital. The only

change in the Deaconess’ operations would be that Deaconess orthopedic services would need to be combined in the new “Baptist” part of the

Deaconess campus.

The Deaconess Campus (West Campus of Beth Israel Deaconess)


The proposal was brilliant. In a single master stroke, CareGroup would generate enough cash from the sale of the Baptist campus to pay off its entire debt. (Note: the alternative—a major reduction in staffing costs, would come with significant risks for patient safety.)

All that would be required would be for the Baptist staff to give up their cherished hilltop location, and for the Deaconess (Harvard) orthopedic service—a relatively weak department—to work side by side

with the Baptist (Tufts and private) service—widely regarded as the best in Boston.

So, what do you think happened?

Deming’s View of SystemsOut of the Crisis

A system is a network of interdependent components that work together to try to accomplish the aim of the

system.

Production Viewed As A SystemDeming, Out of the Crisis

Deming’s View of Systems (2)Out of the Crisis

A system must be managed. It will not manage itself. Left to themselves in the Western world, components become

selfish, competitive, independent profit centres.

Deming’s View of Systems (3)Out of the Crisis

The secret is cooperation between components toward the aim of the organization.

We can not afford the destructive effect of

competition.

Some Rules About Systems

• Every system is perfectly designed to produce the results it gets. (Batalden)

• In order for a system to be optimized, one or more parts must often be sub-optimized. (Deming)–If each part seeks to optimize itself, the

whole system will be sub-optimized.

3 ways to achieve a number1. Improve the system (achieve the number in a

way that truly makes things better)2. Sub-optimize the system (achieve the

number for one part of the system at the expense of other, unmeasured, perhaps more important, aspects of the system

3. CheatW. Edwards Deming

Beware of Targets!!

So…for conversation…

• Can you think of any personal examples of “lack of system-ness?”

• How does lack of system-ness impair quality and safety?

• What could you do as a leader to encourage systems thinking?

“Profound Knowledge” Questions Deming Would Ask Leaders


2. Variation: Do you make decisions based on opinions, or on “statistically literate” interpretation of data?

3. Motivation: If a Martian were to examine your systems, what would he conclude were your beliefs about what motivates people?


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Would she swing any higher if she had an incentive?

Incentives, Pay for Performance…

• …Generally work best for simple tasks, not so well for complex problems.

• …Hurt performance on creative tasks.• …Drive achievement of what you incent,

so choose very, very carefully.• …Often lead to distortion of data.• …Substitute extrinsic motivation (and

external control!) for intrinsic motivation.

Cable and Vermeulen, Harvard Business Review, February 26 201642

What theory of motivation lies behind your dashboard?

Theory X: The average human being…

• Dislikes work and will avoid it if possible• Must be coerced, controlled, or threatened

to put forth adequate effort to achieve organizational objectives

• Prefers to be directed, to avoid responsibilities, is unambitious

• Needs carrots and sticks!Douglas McGregor, The Human Side of Enterprise

Theory Y: Most human beings…

• Find physical/mental effort at work as natural as play or rest

• Will exercise self-direction and control in the service of objectives to which they are committed

• Find that the most powerful rewards for achievement of objectives are intrinsic: ego and self-actualization

• Have a surprisingly high capacity for imagination, creativity, and ingenuity in solving organizational problems

• Only partially utilize their intellectual capability in modern industrial settings

Douglas McGregor, The Human Side of Enterprise

What would Deming think about…?• Your incentive compensation systems for

leadership and management?• “Pay for Performance” programs for

physicians?• Your performance appraisal systems for

employees?• …and how any of these practices relate

to the current epidemic of burnout?

In most organizations, there is an enormous reservoir of

energy, ideas, and engagement that is never tapped into, because of

management practices that reduce intrinsic motivation,

and hinder joy in work.

Leaders work on the system.

Workers work in the system.

Deming

Summary: If Deming Ran Your Organization…

• All parts of the system would cooperate to optimize the performance of the whole system to deliver highly valued services to the customer.

• You wouldn’t have an “org chart.” You’d have a system diagram.• All leaders would be required to be “numerate,” to standardize what

is plainly standardizable, and to learn from the interplay between data and theory.

• Your financial plans and big decisions would be grounded on statistically solid predictions, not on political gamesmanship.

• Piecework pay, individual incentive compensation and performance “ratings” would be abolished.

• The prime directive for leadership would be to remove barriers to joy and pride in work for front-line workers!

QualityIssues

QI Methods

By What Method?

Everything else

What if Deming Ran Your Hospital? - ASHNHA€¦ · Baptist, was a specialty orthopedic hospital,...

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