Six Sigma Practices

• The funding for improvement projects at healthcare organizations is limited, so when one is undertaken, senior executives are demanding increasingly solid ROI--a strong orientation of Six Sigma.
• The complexity of healthcare processes requires objective data as the foundation of any improvement-driven activity.
• The rigorousness of Six Sigma work is particularly appropriate for the rather unorganized delivery of care and management of business operations in healthcare, say initiative leaders. Even creating a Six Sigma strategy, using specific Six Sigma tools, and training staff members through the yellow, green, black, then master black belt chain of certifications is demanding and involves a high degree of structure.

The need to organize initiatives is "why Six Sigma fits in so well" in hospital improvement work, says Bay Medical Center’s Watts (who holds a Six Sigma black belt, meaning he is certified to lead initiatives and teach concepts). "It’s a far cry from the TQM initiatives of the past," he says. "The problem was that [TQM] had no real structure. It had local optimization, and people tried to improve everything, but locally. It didn’t help the whole system." Thus, a TQM project in one area could disrupt processes in another.

By its nature, Six Sigma can work only if it is championed directly by an organization’s CEO and executive management team. With its strong emphasis on data, objectivity and bottom-line results, Watts emphasizes, "Six Sigma forces improvements across the organization."

Six Sigma’s unapologetic focus on the bottom line and quantifiable results is highly appealing to senior executives, says consultant David Silverstein, president and CEO of Breakthrough Management Group (BMG), Longmont, Colo., which advises organizations in many industries on Six Sigma. For most of his clients in the healthcare industry (which include HIP and BCBSFL), reducing administrative costs is a major goal. Silverstein says that targets have included reducing billing errors to recapture "billions of dollars" in unachieved reimbursements, reworking the hiring process to speed job offers to nurses and become more market-competitive, and streamlining and optimizing such nonclinical tasks as delivering patients’ meals.

Northshore-LIJ’s Gallo notes that Six Sigma work is particularly valuable for organizations like hers--a huge multi- hospital system created through mergers and acquisitions, with many operational silos. Hospital executives decided to use Six Sigma as a "management vehicle," she says, because "We wanted to improve productivity and efficiency." It will do that and more, she notes.

It’s a vision thing
Although successful Six Sigma work is driven by objective data analysis, having sophisticated information systems is not a requirement for initiating Six Sigma development. In fact, many organizations, including Northshore-LIJ and Bay Medical Center, have yet to install comprehensive electronic medical record systems.

The idea behind the Six Sigma strategy is that organizations use their data to analyze fundamental dysfunctions in their operations: Then they use IT and other tools to correct the problems, rather than implementing information systems and then discovering they’ve automated dysfunctional processes.

During the two years that Schrader headed BCBSFL’s Six Sigma drive, she reported to a CIO who shared her view that business process improvement, enabled by Six Sigma strategies, is the foundation of organizational improvement and that IT enhances improvement. "Good business process is the foundation. Technology can be a wonderful tool to support ongoing operational improvement work," she says. Six Sigma leaders will have to begin work using imperfect data, but as work progresses, IT tools and the Six Sigma methodology in the hands of experts will improve data quality, she contends.

"For me personally, it was a goal to get past the data issue as a barrier. If we sat around and waited to have perfect data, we would never have gotten this thing going," Schrader says. "We didn’t have a lot of baseline data about our processes at first and continue to struggle with that." She and her colleagues have developed, among other things, a project tracking tool using available IT.

IT manager participation has been important at HIP as well, says Karagiorgis. For example, he notes that one IT executive achieved black-belt certification and did a "two-year tour of duty" implementing Six Sigma projects at HIP before going back to his full-time IT role in the organization. HIP’s chief technology officer, a senior vice president, "is looking to do an IT-specific Six Sigma deployment," Karagiorgis says, "one that would involve contracting with a vendor who’s into Six Sigma for software development" and that would focus on improving efficiency in some area of information system operations, such as the help desk.

Steve Gray, a partner at ACS Healthcare Services, Dearborn, Mich., says, "Hospitals and other healthcare organizations definitely shouldn’t delay operational improvement strategies simply because they don’t have the IT resources to manage the data. I haven’t found a single hospital that cannot at least produce basic reports off their computers." In his view, the crucial change is to remove "middle and frontline managers" from daily firefighting duties so they have big enough blocks of time to work on operational improvements.