MARCH 2013 / MANAGED CARE 21

By Preetinder S. Gill

A healthy workforce is critical to the success of an organization or a society. Properly man-aging the delivery of health care is thus an

important function of modern health care systems. However, health care delivery today is rife with waste and inefficiency. Kohn et al. (2000) es-timated 50,000 to 100,000 lives are lost each year because of medical errors. Schoen et al. (2006) found that 42 percent of the respond-ers in a survey, “Public Views on Shaping the Future of the U.S. Health System,” felt that the health care system was inefficient. In 2011, Schoen found that efficiency in the U.S. health care system remained low, costs rose and disparities persisted. This although health care accounts for over 17 percent of U.S. gross domestic product (OECD, 2012). Re-searchers have identified several common causes of waste in health care.

There seems to be a consensus that problems in health care delivery need resolutions. Systematic approaches from other fields can be applied to reach such resolutions.

Product engineeringProduct engineering is a multidisciplinary

approach geared toward designing, developing and managing a product through its life cycle. A product could be tangible or intangible vis-à-vis hardware, software or processed materials. Job responsibilities of a product engineer include, but are not limited to, material selection, cost control, manufacturability/serviceability assurance, test-

ing, quality assurance, reliability/warranty issues, product releases, and changes. A product engineer needs to be knowledgeable about physical sciences. The engineer also needs to be competent in project management and have statistical and mathemati-cal competencies. Above all, however, a product engineer needs to be an efficient problem solver.

There are many tools — structured methods — which are employed by product engineers. Listed are five methods that can prove useful in health care management.

Five engineering toolsIs–Is not problem analysis. The Is-Is not

team approach can be used to clearly define a problem or failure. This method answers four questions associated with a problem: what, where, when, and how often. The differences

highlighted by these four questions are then used to arrive at the clear description of a problem. In some cases the Is–Is not problem analysis can help reach the most probable cause. However, it must be noted that each cause will have to be verified with actual testing. The Is–Is not worksheet (see page 22) provides an illustration of the four questions

5 Product Engineering Methods To Use in Health Care Management

These tools, often adopted by other industries, can help insurers improve health care delivery

Preetinder S. Gill has more than 10 years of product engineering/management experience in

the North American automotive industry. He holds a master’s degree in mechanical engineering from the University of Michigan. His PhD research

focuses on health care management.

Common causes of inefficiency• Longturnaroundtime• Inconsistentcycletime• Stafftask–skillmismatch• Useofpremiumstaff• Unnecessary/inappropriatestay• Prescription/medicationerrors• Unnecessarytesting• Excessivereiterationforprocedures/admissions/testing

• Procedure/contractnoncompliance• Inappropriatelevelofcare• Conditions/infectionsacquiredduringcaredelivery

PreetinderS.Gill

22 MANAGED CARE / MARCH 2013

asked by this method. Once the Is–Is not review has been completed, the differences or distinctions can be analyzed to arrive at a concise description of the problem or failure. The following hypotheti-cal example can further illustrate this method: A new cleaning company was hired by ABC hospital for its satellite locations. Soon after, many of the hospital staff started developing a rash. The rash didn’t afflict all the staff — neither did it affect all the shifts. The rash occurred only on the face, arms, and hands. This scenario is perfect for Is–Is not problem solving.

Fish-bone diagram. Once the problem has been clearly defined, the fish-bone diagram can be used to identify the various causes associated with the problem. In order to complete a fish-bone diagram, a team must brainstorm to illustrate the effects of various factors that have a role to play in the problem. A fish-bone diagram is also known as the Ishikawa diagram and starts with a broad arrow pointing towards the problem statement. Branches representing various factors influencing the prob-lem are then connected to the broad arrow. Some commonly used factors include:

6 Ms. (Wo)Man, Method, Materials, Measure-ment, Man, and Mother nature/environment. This set of factors is commonly used in the manufac-turing/plant environment. In a health care setting these factors can be represented in a laboratory.

8 Ps. Procedures, Processes, Policies, People, Promotion, Price, Product, and Place. This set of

factors is commonly used in the administrative setting. In a health care setting these factors can be used to analyze patient data in the handover from one department to the next.

4Ss. Skills, Surroundings, Suppliers, Systems. This set of factors is commonly used in the service industry. In a health care setting these factors can be used in an emergency room triage.

The 8Ps and 4Ss factors have been used in the service sector, especially in accounting, sales, cus-tomer service, and administration. These factors exist in many subsectors associated with health care delivery. For example, health insurance companies can use factors similar to 8Ps or 4Ss to construct a fish-bone diagram.

The team then brainstorms to identify causes associated with each of the factors. Typically, this is repeated by employing the 5-times why rule. Quite simply, this entails repeatedly asking the question why until the root cause is reached. The 5-times why tool is commonly used by Six Sigma DMAIC (Define Measure Analyze Improve Con-trol) practitioners who as a rule of thumb maintain that in five iterations one can peel away the layers of symptoms to reach the root cause of a problem.

Once this step is completed, the team can then subjectively arrive at the most probable causes by studying the plausibility and/or feasibility of each branch. The team could also choose to assign red, yellow, and green colors to various causes to high-light its likelihood of occurrence. The fish-bone

Is–Is not work sheetQuestion Is Is not Differences

What exactly is the problem?What is the object/subject?What is the defect?

Rash Nototherailments Somethingtouchestheskin

Where exactly does the problem occur?Geographical locationLocation in the process/subjectLocation on the object

Satellitelocations Mainhospital Differentcleaningsupplies&contractors

When exactly did the problem occur?First timeAny patternWhen during the life/process cycle

Summer Fall Humidity

How often did the problem occur?% of object/subject affectedHow many defectsTrends

Face,arms,hands Otherbodyparts Exposedsurface

Probable cause Ingredientsinthenewcleaningsuppliesinhumidconditionsirritateexposedskin.

MARCH 2013 / MANAGED CARE 23

diagram thus provides a comprehensive visual rep-resentation of the cause-effect relationship. For a fish-bone diagram for a hypothetical scenario associated with high turnover of triage nurses, see the illustration above.

Decision matrix. A decision matrix is a team-based brainstorming tool that can help to evalu-ate and prioritize a list of alternatives. A decision matrix can also come in handy when decisions need to be based on several criteria. A set of cri-teria is established first by the team to evaluate the alternatives. Each criterion is then assigned a weight based on importance. Typically, the higher the weight, the more the importance associated with a criterion. A scale of 1–100 could be used for weighing the criteria. The team then evalu-ates each alternative for each criterion. A ranking/

rating scale of 1–10 can be used to compare alter-natives for a given criterion. Again, the higher the score, the better the alternative. The weighting and ranking scores are then multiplied to calculate the weighted evaluation. Subsequently, the summation of the weighted evaluations can help identify the best possible alternative in a quantitative matter. An electronic spreadsheet, for example Microsoft Excel, is best suited for a decision matrix. Below is a decision matrix involving the selection of a health care waste removal vendor.

Value stream mapping. VSM is a tool that can be used to identify sources of wasteful activities in a given process. Once identified, specific corrective actions can be initiated to remove the source of the waste. Researchers report that VSM can help to reduce cycle time and costs while improving

Fish-bone diagram with 5-times why approach

A simplified example of a decision matrix

Aufnahme Drucksensor High turnover

of triage nurses

Management effectiveness

Compensation

Opportunity for development& recognition

Alignment with organization Communication

Why # 1: Is low

Why #2: Low benefits

Why #1

Why #2 Why #3

Why #4 Why #5

Why #1

Why #1

Why #1

Why #1

Why #1

Why #1

Why #1

Why #1

Why #1

Why #1

Why #1

Why #1

Why #3: Lack of chiropractic support

Low Likelihood

Medium Likelihood

High Likelihood

Confirmed

Ruled Out

Legend

Criteria

Suppliers

Clean Co. Green Inc. Fast Clean Ltd.

Weight RatingWeighted

evaluation RatingWeighted

evaluation RatingWeighted

evaluation

Technology 25 5 125 10 250 8 200

Cost 45 3 135 5 225 10 450

Volumescalability 5 8 40 4 20 3 15

Environmentfriendly 25 10 250 7 175 8 200

Totalscores 550 670 865

24 MANAGED CARE / MARCH 2013

ing health care. In fact the Joint Commission on Accreditation of Healthcare Organizations’ Stan-dard Req. L.D. 5.2 is dedicated to Health-FMEAs. Stalhandske et al. (2009) illustrated numerous ex-amples where FMEAs have been implemented in a health care setting.

FMEA is a cross-functional, team-based ap-proach for identifying risks in a product or a process. Once the risks are identified, they are pro-ranked. This is followed by identification of preventive and/or detection actions by the team collectively. Just as with VSM, once the actions are implemented risks need to be re-evaluated to establish whether or not they had the desired effect. Three important terms associated with FMEA are:

• Failure modes — describing what can go wrong.

• Failure causes — reasons for manifestation of the failure modes.

• Failure effects — consequences of failure modes to higher level systems/assemblies.

The risks are ranked in terms of a risk priority number (RPN). The RPN is a multiplicative product of severity (S), occurrence (O), and detection (D) associated with a specific risk. S can be described as a quantification of effects associated with a fail-ure mode. O can be defined as a likelihood that a failure cause would happen given the preventive measures in place. D can be defined as likelihood that a failure cause or the associated failure mode can be detected given the detection measures in

quality. With use of specific symbols, a map can be drawn which highlights bottlenecks in the pro-cess from start to finish. Software packages such as Visio, eVSM, iGrafx and, Edraw Max could be used to draw value stream maps. Furthermore, the waste can be quantified in terms of waiting time between various process steps. A cross-functional team, involving people with different functional expertise working toward a common goal, is indis-pensable for the success of VSM. For a hypothetical application of VSM in an emergency room, see the illustration above. Guidelines to perform analysis using VSM include:

1. Creating current value stream map to identify existing problems.

2. Quantifying wasted efforts preferably in terms of wait/inventory time.

3. Brainstorming possible corrective actions.4. Creating the ideal future state map with an

assumption that corrective actions will be implemented.

5. Quantifying new wait/inventory time and potential improvement/difference between current state and future state.

6. Implementing the corrective actions.7. Verifying whether corrective actions had the

anticipated effect.

Failure mode effect analysis. Failure mode effect analysis (FMEA) is a technique that was first used by the U.S. military. Today this systematic proactive tool is used in a whole range of industries, includ-

Current state value stream map for registering a new patient at the ABC hospital emergency room

Info

sys

tem

New

pat

ient

Regi

stra

tion

ER s

taff

New patient arrives

1

Sign in at the front desk

10–15

Log ID and insurance information

0.5-1

10 1

Print out ID tag

0.5

ER staff escorts patient

010

Patient in ER care

Central server

5

Registration staff not notified about new patient. >Install camera system

1

Call ER staff

0

Have to wait for an elevator>Construct ramp Process time:

Min.: 13.5 minsMax.: 18.5 mins

Wait time:Min.: 25.5 minsMax.: 26.0 mins

Lead time:Min.: 39 minsMax.: 44.5 minsER staff not

automatically notified>IT notification system

An example of a current state value stream map

MARCH 2013 / MANAGED CARE 25

place. The S, O, and D are assessed on a scale of 1 to 10, where 10 is the worst case rating. Ranking/valuation tables for S, O, and D are published by various organizations such as the Society of Auto-motive Engineers.

Successful implementationThe five tools presented could be very useful

for health care managers and providers alike. It is worth reiterating that all of these tools require a team effort, especially cross-functional, efficient teams. Team members using these tools can be classified as:

• Core members: A group of 4 to 6 people with-out whom progress cannot be made. Core team can be assisted by knowledgeable mod-erator who can guide them.

• Ad hoc members: Subject matter experts in-vited as needed.

While the VSM and FMEA are proactive in na-ture the IS-IS Not, fish-bone diagram and decision

matrix can help solve problems that have already occurred. With the increasing demands on health care resources, continuous improvement is critical to the economic feasibility of any health care orga-nization. These five product engineering tools could prove potent supplements to such an effort.

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technology: An introduction to management for engi-neers. Upper Saddle River, NJ: Prentice Hall. 2002.

Gill, P. S. Application of Value Stream Mapping to Elimi-nate Waste in an Emergency Room. Global Journal of Medical Research, 2012;12 (6), 51–56.

Dennis, P. Lean production simplified: A plain-language guide to the world’s most powerful production system. New York. Productivity Press. 2007.

Kohn, L. T., Corrigan, J., & Donaldson, M. S. To err is hu-man: building a safer health system (Vol. 6). Washing-ton, DC. Joseph Henry Press. 2007

Latino, R. J., & Flood, A. Optimizing FMEA and RCA ef-forts in health care. Journal of Healthcare Risk Man-agement. 2004; 24(3), 21–28.

Organisation for Economic Co-operation and Devel-opment. (06–28–2012). OECD Health Data 2012. Retrieved from http://www.oecd.org/health/health-systems/oecdhealthdata2012.htm

Pyzdek, T., & Keller, P. A. The Six Sigma handbook: a com-plete guide for green belts, black belts, and managers at all levels (pp. 3–494). New York: McGraw-Hill. 2003.

Reiling, J. G., Knutzen, B. L., & Stoecklein, M. FMEA—the cure for medical errors. Quality Progress, 2003;36(8), 67–71.

Schoen, C., Sabrina, M. S., How, K. H., Weinbaum, I., Craig, J. E., & Davis, K. (08–17–2006). Public Views on Shap-ing the Future of the U.S. Health System. Retrieved from http://www.commonwealthfund.org/Publications/Fund-Reports/2006/Aug/Public-Views-on-Shaping-the-Future-of-the-U-S — Health-System.aspx.

Schoen, C. (10–18–2011). Why Not the Best? Results from the National Scorecard on U.S. Health System Performance, 2011. Retrieved from http://www.commonwealthfund.org/Publications/Fund-Reports/2011/Oct/Why-Not-the-Best-2011.aspx?page=all.

Stalhandske, E., DeRosier, J., Wilson, R., & Murphy, J. Healthcare FMEA in the veterans health administra-tion. Journal of Systems Safety. 2011;47(1), 24.

Tague, N. R. The quality toolbox. Milwaukee, WI: ASQC Quality Press. 1995.

Womack, J. P. Value stream mapping. Manufacturing Engi-neering. 2006;136(5), 145–156.

Reactive tools • Is-is not • Fish-bone diagram • Decision matrix

Proactive tools

• Value stream map • Failure mode analysis

Continuous improvement

cycle

PreparedBy:Item:Keydate:Team:

DocumentNumber:Page:Created:2/13/2013LastModified:2/13/2013

Curent State Future StateDesiredFunction

PotentialFailureMode

PotentialEffect(s)

S PotentialCause(s)

O PreventiveAction

DetectionAction

D RPN RecommendedActions

Responsible/Deadline

Status S O D RPN

FunctionABC

FailureModeXYZ

Effect_1 5 Cause_1 8 PreventiveAction_1

DetectionAction_1

10 400 PreventiveAction_2 Supervisor

3/27/13

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5 4 3 {60}

DetectionAction_2

Failure mode effect analysis form sheet template

Continuous improvement through product engineering tools