Applying Lean and Six Sigma to Your Dermatology Practice · The Lean and Six Sigma tool sets, when...

Applying Lean and Six Sigma toYour Dermatology Practice

Jerry Rice, Kathleen Haycraft

WHAT ARE LEAN AND SIX SIGMA?How do you develop an office practice that is patientfocused, effective, and efficient? The Institute of Medi-cine has released two sentinel reports on healthcare er-rors and promotion of quality (Institute of Medicine, 2001;Kohn, Corrigan, & Donaldson, 2000). These reports ad-dress the need to create efficient medical practices whilereducing error rates (Carey & Lloyd, 2001). Lean and SixSigma are tools that will contribute to these goals.

Office practices are busy and sometimes chaotic withmany patients and procedures flowing through in a day.A patient may be in the office anxiously awaiting biopsyresults while the clerk sorts through reports, only to findthat the biopsy has not been reported yet. The medical as-sistant might be requesting the same information fromthe patient that the receptionist just requested. The nursejust finished labeling three biopsy specimens for one pa-tient as she is worrying about being 30 minutes behind. Inthe midst of clinical care, the coding clerk may be ques-tioning if the ICD-9 code assigned to the bill supportsthe CPT code. The opportunities for errors abound.

Lean and Six Sigma are well established in many busi-nesses today. What are they and how do they apply to adermatology practice? Lean and Six Sigma are simply toolsets that allow organizational improvement strategies tobe realized. They are not strategies in and of themselves.A clinic must still have a clear vision of where it wantsto go; Lean and Six Sigma methods will help it get there.

Clinic leadership must be involved to provide vision,basic knowledge, resources, and support necessary to

fully realize the benefits of these tools. The Lean and SixSigma tool sets, when used appropriately, will allow apractice to take advantage of continuous improvementopportunities. These tools, along with others like humanresource development methods, will set any practice onthe path to organizational excellence.

The Lean strategy focuses on the elimination of op-erations that do not add value to a company’s productor service (Womack & Jones, 1996). Anything that doesnot add value is identified as waste. The model relies onvisual cues, workplace organization, mistake proofing,one piece flow, and other relatively simple tools. Leanachieves results through a series of small incremental im-provements (Womack & Jones, 1996). It was popular-ized at Toyota by Taiichi Ohno with the development ofthe Toyota Production System.

In a perfect world, an organization would meet the cus-tomer demand for goods and services with only theminimal resources expended. In the fictional book, TheGoal, Eli Goldratt elucidates a principle of a bottleneck(constraint) by describing a hiking trip with a heavy boycarrying a heavy backpack, walking at the back of thegroup (Goldratt, Cox, & Whitford, 2004). The adultleading the pack is concerned because the troop is get-ting spread out where he cannot keep an eye on all ofthem: The faster boys were getting too far ahead andwould have to stop frequently for the rest to catch up.The boy’s backpack is lightened, and he is placed at thefront of the group. Because of this constraint interven-tion, the group reaches its goal at a more efficient paceand arrives at the destination together. The bottleneckin the process was represented by the heavy boy at theback of the pack with the slower pace. The theory ofconstraints states that a process cannot perform at afaster rate than the constraint regardless of efficienciesin other steps of the process (Goldratt et al., 2004). Leanrefers to customer demand rate as takt time (Womack& Jones, 1996). At minimum, the constraint must oper-ate within the rate of customer demand.

Takt time can be calculated by dividing total netminutes in a normal working day by the daily demand

PERSPECTIVES ON LEADERSHIP

136 Journal of the Dermatology Nurses’ Association

Jerry Rice, ASQ CMQ/OE, CQE, CQA, Quality ManagementDivision, American Society for Quality, Hannibal, Missouri.

Kathleen Haycraft, DNP, FNP, PNP, DCNP, Riverside Derma-tology, Hannibal, Missouri.

The authors declare no conflict of interest.

Correspondence concerning this article should be addressed toKathleen Haycraft, DNP, FNP, PNP, DCNP, Riverside Derma-tology, 163 Medical Dr., Hannibal, MO 63401.E-mail: [email protected]

DOI: 10.1097/JDN.0b013e31824ab91e

Copyright © 2012 Dermatology Nurses' Association. Unauthorized reproduction of this article is prohibited.

(average number of patients per day). The takt time isstated as one patient or process unit per X number ofminutes (Zidel, 2006). For instance, there are 420 min-utes in an 8-hour day (minus 1 hour for breaks). If thereis an average of 50 patients a day coming through thepractice, then the process must be able to handle one pa-tient every 8.4 minutes. Cycle time is the amount of time(both value added and nonYvalue added) it takes the cur-rent process to handle one process unit or patient in apractice from beginning to end (Zidel, 2006).

Lean focuses on waste reduction and matching upcycle time with customer demand. Conversely, Six Sigmafocuses on reducing error rates by reducing variation inprocesses (Barry & Smith, 2005). The Six Sigma modelstrives to understand which process inputs are significantto a given desired outcome and quantifies the effects ofthe inputs on the outcome. This allows everyone involvedto have a thorough understanding of what it takes toachieve the desired outcome every time. Six Sigma is typ-ically used when Lean methods have been instituted andchronic nagging problems persist. It leads to breakthroughimprovements by careful analysis of the process. Manytimes, these improvements may be applied to the con-straint in a system. Six Sigma was popularized byMotorolaunder Bob Galvin and later embraced at General Electricunder Jack Welch.

Before starting the journey to organizational excel-lence using Lean and Six Sigma, it is imperative to re-view the clinic’s strategic objectives. Once the objectivesare in hand, the improvement team will identify the spe-

cific areas or processes that will best help meet thoseobjectives if improved. Once an opportunity for im-provement is identified, the clinic management needs todetermine if a team is needed or if a single individual cancreate the needed change. More complex processes usu-ally require a team to approach the problem at hand (Carey& Lloyd, 2001). Once an area or process is identified, aLean tool called a value stream map is developed.

THE VALUE STREAM MAP IN LEANA value stream map is a Lean technique used to studyand design the flow of tasks, materials, and informationneeded to bring a product or service to the customer(Womack & Jones, 1996). It is a critically important toolto start the Lean journey. Value stream mapping is ac-complished by walking through a process with the pro-cess owners and recording critical information for eachstep (Zidel, 2006). Process owners are those that normallyperform the tasks involved in the process as part of theirnormal duties. An example of the information needed fora task in a value stream map is outlined in Table 1.

Waste in a process can be due to a wide range ofsources (Womack & Jones, 1996). When these sourcesare identified, solutions can be developed to eliminatewaste in the process. Table 2 focuses on the types ofwaste associated with another step in the diagnostic test-ing value stream map.

A value stream map of the ‘‘current state’’ is created,which includes the cycle time, value added time, non-valueadded time, and the percentage of value added time in

TABLE 1. Data for a Single Step in a Value Stream Map for Diagnostic Testing:Test Requisitioning

Data Inputs in Value Stream Mapping Test Requisitioning

How long does this step take? Time to fill out a requisition and each of the steps of the requisitioningprocess.

What has to occur before this step? The biopsy or other procedure.

What happens after this step? The sample and requisition are dispatched to the appropriate laboratory.

What material does this step use? A variety of requisitions, both paper and electronic health record, are used.

Where do these materials come from? The vendors and the electronic health record template.

Is information communicated at this step? The provider instructs the nurse or office assistant to complete the requisition.

Where does the information come from? The provider, the patient, and the electronic health record?

Where does the information go? The requisition is logged into the clinical quality assurance log.

The requisition accompanies the diagnostic sample to the vendorthrough a carrier.

Is the patient paying for this process anddoes it add value to the customer?

The patient does not pay for this service and does not add direct valueto the customer. It is, however, a critical step.

How much physical distance is coveredbetween steps?

Variable (between 20 and 60 feet in distance) depending on wherethe patient room is located.

What is the wait time between steps? The time between the biopsy and the requisition and the requisition/sampleto the carrier/vendor.


VOLUME 4 | NUMBER 2 | MARCH/APRIL 2012 137


the process. See Figure 1 for an example of a valuestream map for diagnostic testing. The improvementteam then creates a new map for the desired or ‘‘futurestate.’’ Focus is placed on reduction of nonYvalue addedtime in this ‘‘future state’’ value stream map. The goalhenceforth is to close the gap between the ‘‘current state’’and the desired ‘‘future state’’ value stream maps. OtherLean tools are then used to help close this gap such as

5S (workplace organization), visual workplace (the useof visual cues to quickly determine if a process isfunctioning properly), setup time reduction, preventivemaintenance, and mistake proofing (Barry & Smith,2005). Table 3 explains the most popular tools in theLean toolbox. An excellent tool for Lean is the spaghettidiagram. A spaghetti diagram is a tool that diagrams thepath of all phases involved in the entire clinic process

TABLE 2. Examples of Waste in the Lean Model: Diagnostic Testing Process

Forms of Waste Examples of Waste in the Diagnostic Test Process

Waste due todefects/rework

Correction of errors adds cost to the productor service because of extra labor, material,transportation, inventory, motion, andenergy expenses.

Biopsy specimen mislabeled.

Repeat appointment.

Biopsy requisition not properly filled out.

Biopsy not sent to appropriate lab for insuranceor other reasons.

Requisition not logged in quality log.

Biopsy results not communicated to patient.

Biopsy results misplaced.

Waste of material(overproduction)

Producing more than necessary wastes timethat could be spent augmenting the constraint.

Diagnostic tests are ordered more frequentlythan needed.

Producing at a faster rate than necessary on anonconstraint task does not reduce cycle time.

Overproduction is done to make up for thedamage of other forms of waste.

Waste ofprocessing

Unnecessary work that does not add to thevalue of the product or service.

Duplication of paper and electronic health records.

Inability to import demographic data from theelectronic health record into the requisition.

Inability to import diagnostic test result into theelectronic health record.

Waste oftransportation

Occurs when materials are moved furtherthan they need to be.

Distance from patient room to the laboratory andthe clinical log.

Waste ofinventory

Accumulation of inventory or carrying morematerial and supplies than are necessary.

Ordering excessive supplies for biopsy that requireadditional physical space and may outdateprior to use.

Waste of motion Any motion of people or machinery thatdoes not contribute value to the customer.

Location of diagnostic supplies, requisitions andquality log to the patient and the staff.

Work site organization and steps betweenprocesses are a critical element to this analysis.

Waste of waiting Occurs when waiting for another processto complete a task.

Wait time for provider to give information necessaryto fill out the requisition for the test.

Wait time for the requisition to be completed.

Wait time for the carrier to pick up the requisitionand test.

Wait time for the test to be completed.

Wait time for the test result to be communicatedto the clinic/provider.

Wait time for the patient to receive the informationon the test.

Wait time for the action indicated by the test.




(Bialek, Duffy, & Moran, 2009). The spaghetti diagram,although time consuming and complex, will provide crit-ical information about poor layouts and excessive phys-ical distances between steps in the process.

As previously stated, Lean can be thought of as aseries of small incremental ‘‘common sense’’ improve-ments. However, it is typical to have a ‘‘Lean event’’ inwhich the team is working to implement as many of thesesmall improvements as possible at once. Lean events canhave a profound positive effect on the workplace. Theoutcomes could be as simple as redesigning the flow ofpatients in a workplace or as complex as redesigning theprocess of patient communication.

SIX SIGMASix Sigma differs from the incremental improvement ofthe Lean model in one major way. Six sigma does notchange the process in small increments as in Lean butlooks for breakthrough thinking. Six Sigma teams areled by trained professionals called black belts. The leader

must have a good understanding of the Six Sigma meth-odologies and the statistical tools needed to solve chronicproblems. The rest of the team is made up of people di-rectly related to the process being improved. The oppor-tunities identified by these teams come from identificationof problems that were not solved by the Lean methods.Six Sigma is used when the problems encountered in thepractice do not lend themselves to the easy answer or aneasy fix. Six Sigma does not change the process in in-crements as in Lean but looks for breakthrough thinking.The focus of Six Sigma is variation reduction and/or errorelimination. The core of its philosophy is doing thingsright the first time, thus avoiding the cost and time asso-ciated with rework (Barry & Smith, 2005). It is critical formanagement to embrace Six Sigma as it sets the tone forthe acceptable error rate.

Six Sigma follows a specific road map. The Six Sigmaroadmap is commonly referred to as DMAIC (for define,measure, analyze, improve, and control). The Six Sigmateam will define the opportunity, determine an effective


FIGURE 1. Diagnostic test value stream map.



way to measure the opportunity, analyze potential causeand effect relationships, identify and plan how the teamwill improve the process, and find ways to control thekey variables and document what was learned. Anillustration of DMAIC (example of coding) is identifiedin Table 4.

DEFINING AN OPPORTUNITY FOR BREAKTHROUGHIMPROVEMENTThe clinic leadership will look at many opportunitieswhen trying to determine what a Six Sigma team willfocus on. It may be what leadership knows is importantto customers, such as wait times or communications.Management may spot an opportunity to reduce costs

such as improving productivity, improving efficiency, orreducing material usage. Perhaps the focus will be errorrates related to diagnostic testing or e-prescribing.

All Six Sigma projects should have the cost associ-ated with the opportunity stated in dollars. In addition,leadership must try to estimate the likelihood of success.The project should be large enough to be of substantialfinancial benefit to the organization without overwhelm-ing the team. The team project should be defined with afinancial outcome. For example, if coding errors arereduced by 60%, the clinic will have an additional in-come of $36,000. Once the team has identified theproblem, a member of the team is assigned to championthe team. The champion’s job is to break down any


TABLE 3. The Lean Toolbox

Value stream map The value stream map is like a flow chart on steroids. It not only illustrates process flow, but italso allows the developer to quickly see the process cycle time and what proportion of thetotal cycle time is nonYvalue added waste. The constraint (bottleneck) in the process alsobecomes quite evident once the value stream map is developed. It is also a great tool fordeveloping the ideal process ‘‘future state’’ so that the most important areas of the processcan be targeted for improvement.

5S 5S is a series of steps used to organize a workplace for efficient operation. The 5 ‘‘S’s’’ stand forthe Japanese terms seiri, seiton, seiso, seiketsu, and shitsuke, which roughly translate to:

(1) Organization: Sort through and sort out. Distinguish between needed and unneededitems. Eliminate unnecessary parts, adjustments, documents, and so forth.

(2) Orderliness: Organize the items determined to be necessary close to where they are usedand in such a way that any waste or abnormality is easily apparent. Set limits to theamounts of supplies that can be stored in the workplace. Make the location of instrumentsand supplies self-explanatory so that everyone clearly sees what goes where.

(3) Cleanliness: Cleaning is a form of inspection. Ensure that equipment, instruments, andthe entire workplace shines.

(4) Standardization: When organization, orderliness, and cleanliness are practiced for a while,a new state of efficiency is achieved. This becomes permanent by sharing informationbetween teams and developing standards throughout the company.

(5) Discipline: Have the self-discipline to stick to the rules that have been developed fororganizing the workplace.

Setup timereduction

Also known as SMED (which is an industrial term for single-minute exchange of dies). However,setup time reduction can be applied to almost any task where a process must be changedover for a new order or patient. Finding ways to reduce change over time can be a greatway to reduce cycle time since it is always nonYvalue added.

Total productivemaintenance

Part of ensuring the day is smooth and predictable is ensuring that the equipment used isavailable when needed. This can be a copier or a piece of diagnostic equipment. Make surepreventive maintenance such as replacing filters and lubricating any necessary equipment isdone on a routine-scheduled basis. Is ink and toner available before it runs out? Is it whereit’s needed when it runs out? Track and plan ahead for maintenance to make sure equipmentis always available when needed.

Kanban Kanban is the Japanese term for ‘‘card’’ or ‘‘ticket.’’ A kanban is a point of use inventorymanagement system that uses visual or other cues to signal when an item needs to bereplenished before there is an outage of an item. Kanban quantities are calculated to maintainthe lowest inventory level possible with minimal risk of ever running out of an item at point of use.

Mistake proofing Great strides can be made in safety, quality, and efficiency by mistake proofing a process.Many times problems can be eliminated quickly and easily using simple low-cost mistakeproofing techniques.



barriers the team may experience while working on theproject.

LEAN/SIX SIGMA APPLICATION TO HEALTH CARELean and Six Sigma can be applied to a wide variety ofproblems in a dermatology office. Examples include, butare not limited to, patient scheduling, financial cycle, andcommunications cycle. An evaluation of patient schedul-ing by walking through the process and developing a

value stream map will result in improvement in staff andpatient satisfaction as well as improvement in the bottomline. A Pareto diagram could assist to identify wheremost of the time is spent in the financial cycle (Carey &Lloyd, 2001). A Pareto diagram for the financial cyclewill determine the 20% of causes where 80% of thefinancial cycle time is spent, thus allowing focus on thepiece of the financial picture that will have the greatestimpact. Using a value stream map for the communication


TABLE 4. DMAIC for Coding Problems

Item Actions Tools UsedDefine Create a problem statement. The coding errors result in reduced clinic

income. Undercoding will result in underpayment. Overcoding may result infines and denial of claims with increased staff time spent in arbitrating theclaim payment. In an attempt to avoid fines and penalties, many providersare undercoding. It is believed the labor costs associated with this problemare less than $10,000. It is believed the undercoding results in a $60,000reduction in income to the clinic. If 60% reduction in undercoding occurs byJuly 2012, the clinic will have an increased income of $36,000.

& Financial analysis

& Customer survey

& Focus groups

& Metrics dashboard

Measure Once the objective of the team is determined, a measure will be developedfor coding errors so that the team can track their performance towardgoal. The measure is objective, information-based, consistent, and assuresthe team is measuring what it thinks it is measuring.

& Pareto chart

& Run chart

& Histogram (frequencydiagram)

& Check sheets

& Repeatability andreproducibility studies

Analyze The goal of the analyze phase is to look at data and information coming outof the process to determine what factors in the process are controllingthe outcome. What factors in the process cause coding errors? Statisticalmodels are used to determine facts related to coding. The analyze phase iswhere the team studies the information coming from the process (passivedata) without actually interfering with the coding process.

& YX diagram

& Process failure modeand effects analysis

& Process capability studies

& Regression analysis,analysis of variance,t-test, Chi-square,correlation, etc.

& Multivariate chartImprove The improve phase is where an active experiment is performed. The goal

of the improve phase is to create a mathematical model of the processderived from the important factors that influence the opportunity. Thismathematical model is used to predict the optimum outcome, sets upthe process inputs, and predicts what will result. Complex statisticaltechniques are used. Once the changes are implemented, the processwill be simplified into only its important elements.

& Design of experiment

& Response surface

& Path of steepest ascent

Control The control phase is where the team takes what it has learned and incorporatesit into the management system of the practice. This ensures the practicedoes not lose the knowledge it has gained. Place the lessons learned intoprocedure manuals and risk management/quality improvement plans.Determine and implement any needed mistake proofing in the process ofcoding. Finally, take a look at any other areas in the organization wheresimilar improvements can be made.

& Control plan

& Mistake proofing

& Instructions

& Setup sheets

Note. DMAIC = define, measure, analyze, improve, and control.



cycle will reduce non-value added time and enhance cus-tomer value.

Lean and Six Sigma work well when the individualsperforming the job are involved in the problem analysisand solution. Involving key staff members in the improve-ment process is the key to its success. The principles ofLean and Six Sigma stay the same. The opportunities towhich they can be applied are broad and numerous. Lookto your dermatology practice to find ways to apply Leanand Six Sigma and improve the customer experience.

RESOURCES

Agency for Healthcare Research and Quality, http://www.ahrq.gov/American Society for Quality (ASQ), http://asq.org/index.aspxBaldrige Performance Excellence Program, http://www.nist.gov/baldrige/Health Care Division for the American Society for Quality, http://asq.org/health/

REFERENCES

Barry, R., & Smith, A. C. (2005). The manager’s guide to six sigma inhealthcare. Milwaukee, WI: ASQ Quality.

Bialek, R., Duffy, G. L., & Moran, J. W. (2009). Quality tools: Processanalysis tools. Quality Tools. Retrieved December 31, 2011, fromhttp://asq.org/learn-about-quality/process-analysis-tools/overview/overview.html

Carey, R. G., & Lloyd, R. C. (2001). Measuring quality improvement inhealthcare: A guide to statistical process control applications. Milwaukee,WI: ASQ Quality.

Goldratt, E. M., Cox, J., & Whitford, D. (2004). The goal: A process ofongoing improvement. Great Barrington, MA: Northriver.

Institute of Medicine. (2001). Crossing the quality chasm. Washington, DC:National Academy Press.

Kohn, L., Corrigan, J., & Donaldson, M. (Eds.). (2000). To err is human:Building a safer health system (1st ed.). Washington, DC: NationalAcademy Press.

Womack, J. P., & Jones, D. T. (1996). Lean thinking: Banish waste andcreate wealth in your corporation. New York, NY: Simon & Schuster.

Zidel, T. G. (2006). A Lean guide to transforming healthcare. Milwaukee,WI: ASQ Quality.




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