The document discusses implementing value stream management in healthcare based on lean manufacturing principles to improve efficiency, effectiveness, quality, and revenue. It outlines various phases of lean project implementation, emphasizes the importance of reducing administrative waste, and aims to enhance the patient experience by standardizing and streamlining processes. The ultimate goal is to transform healthcare into a lean provider model that aligns the needs of patients, providers, and payers.

1. Lean Concepts, LLC. All Rights Reserved
Value Stream Management for Lean Healthcare
by John C. Long, MD, Lean Concepts, LLC
Lean Service Summit June 24, 2004
© 2 0 0 4 L e a n C o n c e p t s , L L C . A l l r i g h t s r e s e r v e d . N o p a r t o f t h i s p r e s e n t a t i o n m a y
b e r e p r o d u c e d , s t o r e d i n a r e t r i e v a l s y s t e m o r t r a n s m i t t e d i n a n y f o r m b y a n y
m e a n s i n e l e c t r o n i c , m e c h a n i c a l , p h o t o c o p y , r e c o r d i n g o r o t h e r w i s e w i t h o u t t h e
p r i o r w r i t t e n p e r m i s s i o n o f L e a n C o n c e p t s .

2. Lean Concepts, LLC. All Rights Reserved
Lean Healthcare
• Based on the Lean Manufacturing concepts and tools
of Toyota Production System
• Used in other service industries to improve efficiency,
effectiveness, quality and revenue
• Can be applied to Healthcare

3. Goal: First Step to Transform Healthcare to a Lean Provider .
Background: Healthcare efficiency, effectiveness, quality and revenue.
Lean Project Phases
Implementation Plan:
Future StateCurrent State
I D T a s k N a m e S t a r t E n d D u r a t i o n
Q 3 0 4 Q 4 0 4
J u l A u g S e p O c t N o v D e c
1 2 6 . 4 0 w1 2 / 3 1 / 2 0 0 47 / 1 / 2 0 0 4
P l a n , P i l o t & L a u n c h T h r e e L e a n
P r o j e c t s
2 0 . 6 0 w7 / 5 / 2 0 0 47 / 1 / 2 0 0 4
P l a n P i l o t P r o j e c t a n d P r e p a r e
W o r k s h o p
3 1 3 . 4 0 w1 0 / 1 2 / 2 0 0 47 / 1 2 / 2 0 0 4V S M W o r k s h o p a n d K a i z e n E v e n t s
4 0 . 4 0 w9 / 3 / 2 0 0 49 / 2 / 2 0 0 4R e v i e w i n t e r i m r e s u l t s P i l o t P r o j e c t
5 0 . 4 0 w9 / 7 / 2 0 0 49 / 6 / 2 0 0 4
P l a n L a u n c h P r o j e c t s a n d P r e p a r e
W o r k s h o p s
6 1 3 . 2 0 w1 2 / 1 3 / 2 0 0 49 / 1 3 / 2 0 0 4
V S M W o r k s h o p a n d K a i z e n E v e n t s
P r o j e c t s 2 & 3
7 0 . 4 0 w1 2 / 1 6 / 2 0 0 41 2 / 1 5 / 2 0 0 4
R e v i e w R e s u l t s P i l o t a n d L a u n c h
P r o j e c t s
8 2 w1 2 / 3 1 / 2 0 0 41 2 / 2 0 / 2 0 0 4
P l a n N e x t P r o j e c t s a n d P r e p a r e
W o r k s h o p s
Transformation to a Lean Provider
Learning &
Launch
Goals
Commitment
Planning
Implementation
(Kaizen Plan)
Value Stream
Mapping
Workplace organization
Standard/balanced work
Built-in-quality
Pull systems/Load leveling
Proposal: Clinical Spheres and the Lean Learning Loop
Planning a Lean Project: Matrix of Value Streams and Spheres of Healthcare Events
One-third of healthcare cost is
non-reimbursed administrative
work. Administrative and
clinical work compartmentalized
in departmental silos, not Value
Streams. Resources do not meet
demand. Patient journey is
erratic, slow, complicated,
inefficient and ineffective.
Nurses and physicians burdened
with non-value added tasks.
Value Stream perspective to
reduce process and wait time and
build-in quality. Value Stream
enhances patient journey and
supports caregiver. Work is
standardized, balanced and
leveled to meet demand of
patient, nurse, physician, payer
and regulatory agencies.Lean
Systems reduce cost and align
patient, provider and payer.
XXXX
Post-clinical
XXXXXXXX
Clinical
XXXXPre-clinical
ComplianceLength
of stay
Med.
&
billing
records
Dx &
Rx.
reports
Mtl.
mgt.
PharmORE
D
Sphere
of Events
Value Streams: X identifies Lean Projects
↓ : supplier to customer connection
Agree on
• Project
• CSM
• FSM
• Plan
P r e - C l i n i c a l
C l i n i c a l
P o s t C l i n i c a l
P r o d u c t
D e v e l o p m e n t
O r d e r t o
D e l i v e r y
S e r v i c e
T h r o u g h
P r o d u c t L i f e
C y c l e
L e a n M a n u f a c t u r i n g L e a n H e a l t h c a r e
S u p p l i e r t o c u s t o m e l i n k
S u p p l i e r t o c u s t o m e r l i n k
S u p p l i e r t o c u s t o m e r l i n k S u p p l i e r t o c u s t o m e r l i n k
A C T
C H E C K
P L A N
D O
G R A S P t h e S I T U A T I O NG R A S P t h e S I T U A T I O N

4. Goal: First Step to Transform Healthcare to a Lean Provider .
Background: Healthcare efficiency, effectiveness, quality and revenue.
Lean Project Phases
Implementation Plan:
Future StateCurrent State
I D T a s k N a m e S t a r t E n d D u r a t i o n
Q 3 0 4 Q 4 0 4
J u l A u g S e p O c t N o v D e c
1 2 6 . 4 0 w1 2 / 3 1 / 2 0 0 47 / 1 / 2 0 0 4
P l a n , P i l o t & L a u n c h T h r e e L e a n
P r o j e c t s
2 0 . 6 0 w7 / 5 / 2 0 0 47 / 1 / 2 0 0 4
P l a n P i l o t P r o j e c t a n d P r e p a r e
W o r k s h o p
3 1 3 . 4 0 w1 0 / 1 2 / 2 0 0 47 / 1 2 / 2 0 0 4V S M W o r k s h o p a n d K a i z e n E v e n t s
4 0 . 4 0 w9 / 3 / 2 0 0 49 / 2 / 2 0 0 4R e v i e w i n t e r i m r e s u l t s P i l o t P r o j e c t
5 0 . 4 0 w9 / 7 / 2 0 0 49 / 6 / 2 0 0 4
P l a n L a u n c h P r o j e c t s a n d P r e p a r e
W o r k s h o p s
6 1 3 . 2 0 w1 2 / 1 3 / 2 0 0 49 / 1 3 / 2 0 0 4
V S M W o r k s h o p a n d K a i z e n E v e n t s
P r o j e c t s 2 & 3
7 0 . 4 0 w1 2 / 1 6 / 2 0 0 41 2 / 1 5 / 2 0 0 4
R e v i e w R e s u l t s P i l o t a n d L a u n c h
P r o j e c t s
8 2 w1 2 / 3 1 / 2 0 0 41 2 / 2 0 / 2 0 0 4
P l a n N e x t P r o j e c t s a n d P r e p a r e
W o r k s h o p s
Transformation to a Lean Provider
Learning &
Launch
Goals
Commitment
Planning
Implementation
(Kaizen Plan)
Value Stream
Mapping
Workplace organization
Standard/balanced work
Built-in-quality
Pull systems/Load leveling
Proposal: Clinical Spheres and the Lean Learning Loop
Planning a Lean Project: Matrix of Value Streams and Spheres of Healthcare Events
One-third of healthcare cost is
non-reimbursed administrative
work. Administrative and
clinical work compartmentalized
in departmental silos, not Value
Streams. Resources do not meet
demand. Patient journey is
erratic, slow, complicated,
inefficient and ineffective.
Nurses and physicians burdened
with non-value added tasks.
Value Stream perspective to
reduce process and wait time and
build-in quality. Value Stream
enhances patient journey and
supports caregiver. Work is
standardized, balanced and
leveled to meet demand of
patient, nurse, physician, payer
and regulatory agencies.Lean
Systems reduce cost and align
patient, provider and payer.
XXXX
Post-clinical
XXXXXXXX
Clinical
XXXXPre-clinical
ComplianceLength
of stay
Med.
&
billing
records
Dx &
Rx.
reports
Mtl.
mgt.
PharmORE
D
Sphere
of Events
Value Streams: X identifies Lean Projects
↓ : supplier to customer connection
Agree on
• Project
• CSM
• FSM
• Plan
P r e - C l i n i c a l
C l i n i c a l
P o s t C l i n i c a l
P r o d u c t
D e v e l o p m e n t
O r d e r t o
D e l i v e r y
S e r v i c e
T h r o u g h
P r o d u c t L i f e
C y c l e
L e a n M a n u f a c t u r i n g L e a n H e a l t h c a r e
S u p p l i e r t o c u s t o m e l i n k
S u p p l i e r t o c u s t o m e r l i n k
S u p p l i e r t o c u s t o m e r l i n k S u p p l i e r t o c u s t o m e r l i n k
A C T
C H E C K
P L A N
D O
G R A S P t h e S I T U A T I O NG R A S P t h e S I T U A T I O N

5. Lean Concepts, LLC. All Rights Reserved
Healthcare efficiency, effectiveness, quality and revenue.
Current State Future State
LEAN ENTERPRISE
One-third of healthcare cost is
non-reimbursed administrative
work.
Administrative and clinical work
compartmentalized in
departmental silos, not Value
Streams.
Resources do not meet demand.
Patient journey is erratic, slow,
complicated, inefficient and
ineffective.
Nurses and physicians burdened
with non-value added tasks.
Value Stream perspective to
reduce process and wait time and
build-in quality.
Value Stream enhances patient
journey and supports caregiver.
Work is standardized, balanced
and leveled to meet demand of
patient, nurse, physician, payer
and regulatory agencies.
Lean Systems reduce cost and
align patient, provider and payer.

6. Goal: First Step to Transform Healthcare to a Lean Provider .
Background: Healthcare efficiency, effectiveness, quality and revenue.
Lean Project Phases
Implementation Plan:
Future StateCurrent State
I D T a s k N a m e S t a r t E n d D u r a t i o n
Q 3 0 4 Q 4 0 4
J u l A u g S e p O c t N o v D e c
1 2 6 . 4 0 w1 2 / 3 1 / 2 0 0 47 / 1 / 2 0 0 4
P l a n , P i l o t & L a u n c h T h r e e L e a n
P r o j e c t s
2 0 . 6 0 w7 / 5 / 2 0 0 47 / 1 / 2 0 0 4
P l a n P i l o t P r o j e c t a n d P r e p a r e
W o r k s h o p
3 1 3 . 4 0 w1 0 / 1 2 / 2 0 0 47 / 1 2 / 2 0 0 4V S M W o r k s h o p a n d K a i z e n E v e n t s
4 0 . 4 0 w9 / 3 / 2 0 0 49 / 2 / 2 0 0 4R e v i e w i n t e r i m r e s u l t s P i l o t P r o j e c t
5 0 . 4 0 w9 / 7 / 2 0 0 49 / 6 / 2 0 0 4
P l a n L a u n c h P r o j e c t s a n d P r e p a r e
W o r k s h o p s
6 1 3 . 2 0 w1 2 / 1 3 / 2 0 0 49 / 1 3 / 2 0 0 4
V S M W o r k s h o p a n d K a i z e n E v e n t s
P r o j e c t s 2 & 3
7 0 . 4 0 w1 2 / 1 6 / 2 0 0 41 2 / 1 5 / 2 0 0 4
R e v i e w R e s u l t s P i l o t a n d L a u n c h
P r o j e c t s
8 2 w1 2 / 3 1 / 2 0 0 41 2 / 2 0 / 2 0 0 4
P l a n N e x t P r o j e c t s a n d P r e p a r e
W o r k s h o p s
Transformation to a Lean Provider
Learning &
Launch
Goals
Commitment
Planning
Implementation
(Kaizen Plan)
Value Stream
Mapping
Workplace organization
Standard/balanced work
Built-in-quality
Pull systems/Load leveling
Proposal: Clinical Spheres and the Lean Learning Loop
Planning a Lean Project: Matrix of Value Streams and Spheres of Healthcare Events
One-third of healthcare cost is
non-reimbursed administrative
work. Administrative and
clinical work compartmentalized
in departmental silos, not Value
Streams. Resources do not meet
demand. Patient journey is
erratic, slow, complicated,
inefficient and ineffective.
Nurses and physicians burdened
with non-value added tasks.
Value Stream perspective to
reduce process and wait time and
build-in quality. Value Stream
enhances patient journey and
supports caregiver. Work is
standardized, balanced and
leveled to meet demand of
patient, nurse, physician, payer
and regulatory agencies.Lean
Systems reduce cost and align
patient, provider and payer.
XXXX
Post-clinical
XXXXXXXX
Clinical
XXXXPre-clinical
ComplianceLength
of stay
Med.
&
billing
records
Dx &
Rx.
reports
Mtl.
mgt.
PharmORE
D
Sphere
of Events
Value Streams: X identifies Lean Projects
↓ : supplier to customer connection
Agree on
• Project
• CSM
• FSM
• Plan
P r e - C l i n i c a l
C l i n i c a l
P o s t C l i n i c a l
P r o d u c t
D e v e l o p m e n t
O r d e r t o
D e l i v e r y
S e r v i c e
T h r o u g h
P r o d u c t L i f e
C y c l e
L e a n M a n u f a c t u r i n g L e a n H e a l t h c a r e
S u p p l i e r t o c u s t o m e l i n k
S u p p l i e r t o c u s t o m e r l i n k
S u p p l i e r t o c u s t o m e r l i n k S u p p l i e r t o c u s t o m e r l i n k
A C T
C H E C K
P L A N
D O
G R A S P t h e S I T U A T I O NG R A S P t h e S I T U A T I O N

7. Lean Concepts, LLC. All Rights Reserved
Clinical Spheres and the Lean Learning Loop
Pre-Clinical
Clinical
Post Clinical
Product
Development
Order to
Delivery
Service
Through
Product Life
Cycle
Lean Manufacturing Lean Healthcare
Supplier to custome link
Supplier to customer link
Supplier to customer link Supplier to customer link
PP--DD--CC--ACycleACycle
ACTION
CHECK
PLAN
DO
GRASPTHEGRASPTHE
SITUATIONSITUATION
HYPOTHESIS
TRY
REFLECT
ADJUST

8. Lean Concepts, LLC. All Rights Reserved
Clinical Spheres and the Lean Learning Loop
Pre-Clinical
Clinical
Post Clinical
Lean Healthcare
Supplier to
customer link
Supplier to custome link
Supplier to customer link
BACKGROUND
CURRENT SITUATION
PROBLEM ANALYSIS
COUNTERMEASURES
IMPLEMENTATION
EVALUATE AND REVIEW
FUTURE ACTIONS
Plan
DoCheck
Act
Identify problem,
Analyze cause,
Select solutions
Develop implementation
plan
Communicate plan, and
execute plan
Monitor implementation,
modify implementation
if necessary, monitor
results of solution
Evaluate results,
standardize the
effective solutions.
Start P-D-C-Aagain.
If results are uneven,
do both
Plan
DoCheck
Act
Identify problem,
Analyze cause,
Select solutions
Develop implementation
plan
Communicate plan, and
execute plan
Monitor implementation,
modify implementation
if necessary, monitor
results of solution
Evaluate results,
standardize the
effective solutions.
Start P-D-C-Aagain.
If results are uneven,
do both

9. Goal: First Step to Transform Healthcare to a Lean Provider .
Background: Healthcare efficiency, effectiveness, quality and revenue.
Lean Project Phases
Implementation Plan:
Future StateCurrent State
I D T a s k N a m e S t a r t E n d D u r a t i o n
Q 3 0 4 Q 4 0 4
J u l A u g S e p O c t N o v D e c
1 2 6 . 4 0 w1 2 / 3 1 / 2 0 0 47 / 1 / 2 0 0 4
P l a n , P i l o t & L a u n c h T h r e e L e a n
P r o j e c t s
2 0 . 6 0 w7 / 5 / 2 0 0 47 / 1 / 2 0 0 4
P l a n P i l o t P r o j e c t a n d P r e p a r e
W o r k s h o p
3 1 3 . 4 0 w1 0 / 1 2 / 2 0 0 47 / 1 2 / 2 0 0 4V S M W o r k s h o p a n d K a i z e n E v e n t s
4 0 . 4 0 w9 / 3 / 2 0 0 49 / 2 / 2 0 0 4R e v i e w i n t e r i m r e s u l t s P i l o t P r o j e c t
5 0 . 4 0 w9 / 7 / 2 0 0 49 / 6 / 2 0 0 4
P l a n L a u n c h P r o j e c t s a n d P r e p a r e
W o r k s h o p s
6 1 3 . 2 0 w1 2 / 1 3 / 2 0 0 49 / 1 3 / 2 0 0 4
V S M W o r k s h o p a n d K a i z e n E v e n t s
P r o j e c t s 2 & 3
7 0 . 4 0 w1 2 / 1 6 / 2 0 0 41 2 / 1 5 / 2 0 0 4
R e v i e w R e s u l t s P i l o t a n d L a u n c h
P r o j e c t s
8 2 w1 2 / 3 1 / 2 0 0 41 2 / 2 0 / 2 0 0 4
P l a n N e x t P r o j e c t s a n d P r e p a r e
W o r k s h o p s
Transformation to a Lean Provider
Learning &
Launch
Goals
Commitment
Planning
Implementation
(Kaizen Plan)
Value Stream
Mapping
Workplace organization
Standard/balanced work
Built-in-quality
Pull systems/Load leveling
Proposal: Clinical Spheres and the Lean Learning Loop
Planning a Lean Project: Matrix of Value Streams and Spheres of Healthcare Events
One-third of healthcare cost is
non-reimbursed administrative
work. Administrative and
clinical work compartmentalized
in departmental silos, not Value
Streams. Resources do not meet
demand. Patient journey is
erratic, slow, complicated,
inefficient and ineffective.
Nurses and physicians burdened
with non-value added tasks.
Value Stream perspective to
reduce process and wait time and
build-in quality. Value Stream
enhances patient journey and
supports caregiver. Work is
standardized, balanced and
leveled to meet demand of
patient, nurse, physician, payer
and regulatory agencies.Lean
Systems reduce cost and align
patient, provider and payer.
XXXX
Post-clinical
XXXXXXXX
Clinical
XXXXPre-clinical
ComplianceLength
of stay
Med.
&
billing
records
Dx &
Rx.
reports
Mtl.
mgt.
PharmORE
D
Sphere
of Events
Value Streams: X identifies Lean Projects
↓ : supplier to customer connection
Agree on
• Project
• CSM
• FSM
• Plan
P r e - C l i n i c a l
C l i n i c a l
P o s t C l i n i c a l
P r o d u c t
D e v e l o p m e n t
O r d e r t o
D e l i v e r y
S e r v i c e
T h r o u g h
P r o d u c t L i f e
C y c l e
L e a n M a n u f a c t u r i n g L e a n H e a l t h c a r e
S u p p l i e r t o c u s t o m e l i n k
S u p p l i e r t o c u s t o m e r l i n k
S u p p l i e r t o c u s t o m e r l i n k S u p p l i e r t o c u s t o m e r l i n k
A C T
C H E C K
P L A N
D O
G R A S P t h e S I T U A T I O NG R A S P t h e S I T U A T I O N

10. Lean Concepts, LLC. All Rights Reserved
Matrix of Value Streams and Spheres of
Healthcare Events to plan a Lean Project
XXXXPost-
clinical
events
XXXXXXXX
Clinical
events
XXXX
Pre-
clinical
events
ComplianceLength of
stay
Medical
& billing
records
Diagnostic
&
Therapeutic
Reports
Material
management
PharmacyOREDClinical
Spheres
Value Streams: X identifies Lean Projects
↓ : supplier to customer connection

11. Lean Concepts, LLC. All Rights Reserved
Method to select Lean Projects:
Healthcare Value Streams that Support Clinical Events
ED: emergency department throughput, capacity and triage
OR: operating room scheduling and capacity
Pharmacy: from order (physician), assembly (pharmacists), delivery
(technician), to administer (nurse)
Material management: purchasing, inventory control, delivery systems, supply
chain management
Diagnostic and therapeutic reports: imaging, clinical and anatomic pathology,
diagnostic and therapeutic procedures (e.g., physical medicine, endoscopy,
cardiovascular, diabetes management, cardiac rehab).
Medical and billing records: medical summaries (discharge, operative, referral),
record room (chart retrieval, storage and delivery), billing (utilization review,
coding, invoicing and accounts receivable)
Length of Stay: appointment, procedure, admission, scheduling and discharge
(hospital, nursing home, office visit).
Compliance: hospital accreditation, federal regulations, residency training
requirements, HIPPA

12. Lean Concepts, LLC. All Rights Reserved
Consider a Project in the context of Suppliers who provide Inputs in the form of data,
knowledge or resources, and the Outputs for whom there are Customers who use the
output of the process.
Consider all elements of the system, and set clear boundaries for the overall scope of the
process, (decide where work starts and stops).
SUPPLIERS
PROCESS STEPS CUSTOMERS
Scoping a Project
OUTPUTS
INPUTS STOPSTART
STAKEHOLDER(S) DATA SYSTEM(S): ISSUES BENEFITS

13. Lean Concepts, LLC. All Rights Reserved
Criteria for a Successful Lean Project
Leadership endorsement, dedicated resources, and commitment to change a
process that:
• Has distinct business and clinical case.
• Has clear owners and stakeholders.
• Consumes too many resources and lacks quality.
• Can be mapped, with defined scope and performance metrics.
• Worth the time and effort to improve.
Plan a project and prepare a workshop to see and understand the process to
optimize patient journey at the system level:
• Understand work flow
• Measure performance: cost, delivery, and quality
• Use Lean tools to redesigned process
Leverage participation from other resources
Measure improvements, reflect on learning (PDCA), and establish standards

14. Goal: First Step to Transform Healthcare to a Lean Provider .
Background: Healthcare efficiency, effectiveness, quality and revenue.
Lean Project Phases
Implementation Plan:
Future StateCurrent State
I D T a s k N a m e S t a r t E n d D u r a t i o n
Q 3 0 4 Q 4 0 4
J u l A u g S e p O c t N o v D e c
1 2 6 . 4 0 w1 2 / 3 1 / 2 0 0 47 / 1 / 2 0 0 4
P l a n , P i l o t & L a u n c h T h r e e L e a n
P r o j e c t s
2 0 . 6 0 w7 / 5 / 2 0 0 47 / 1 / 2 0 0 4
P l a n P i l o t P r o j e c t a n d P r e p a r e
W o r k s h o p
3 1 3 . 4 0 w1 0 / 1 2 / 2 0 0 47 / 1 2 / 2 0 0 4V S M W o r k s h o p a n d K a i z e n E v e n t s
4 0 . 4 0 w9 / 3 / 2 0 0 49 / 2 / 2 0 0 4R e v i e w i n t e r i m r e s u l t s P i l o t P r o j e c t
5 0 . 4 0 w9 / 7 / 2 0 0 49 / 6 / 2 0 0 4
P l a n L a u n c h P r o j e c t s a n d P r e p a r e
W o r k s h o p s
6 1 3 . 2 0 w1 2 / 1 3 / 2 0 0 49 / 1 3 / 2 0 0 4
V S M W o r k s h o p a n d K a i z e n E v e n t s
P r o j e c t s 2 & 3
7 0 . 4 0 w1 2 / 1 6 / 2 0 0 41 2 / 1 5 / 2 0 0 4
R e v i e w R e s u l t s P i l o t a n d L a u n c h
P r o j e c t s
8 2 w1 2 / 3 1 / 2 0 0 41 2 / 2 0 / 2 0 0 4
P l a n N e x t P r o j e c t s a n d P r e p a r e
W o r k s h o p s
Transformation to a Lean Provider
Learning &
Launch
Goals
Commitment
Planning
Implementation
(Kaizen Plan)
Value Stream
Mapping
Workplace organization
Standard/balanced work
Built-in-quality
Pull systems/Load leveling
Proposal: Clinical Spheres and the Lean Learning Loop
Planning a Lean Project: Matrix of Value Streams and Spheres of Healthcare Events
One-third of healthcare cost is
non-reimbursed administrative
work. Administrative and
clinical work compartmentalized
in departmental silos, not Value
Streams. Resources do not meet
demand. Patient journey is
erratic, slow, complicated,
inefficient and ineffective.
Nurses and physicians burdened
with non-value added tasks.
Value Stream perspective to
reduce process and wait time and
build-in quality. Value Stream
enhances patient journey and
supports caregiver. Work is
standardized, balanced and
leveled to meet demand of
patient, nurse, physician, payer
and regulatory agencies.Lean
Systems reduce cost and align
patient, provider and payer.
XXXX
Post-clinical
XXXXXXXX
Clinical
XXXXPre-clinical
ComplianceLength
of stay
Med.
&
billing
records
Dx &
Rx.
reports
Mtl.
mgt.
PharmORE
D
Sphere
of Events
Value Streams: X identifies Lean Projects
↓ : supplier to customer connection
Agree on
• Project
• CSM
• FSM
• Plan
P r e - C l i n i c a l
C l i n i c a l
P o s t C l i n i c a l
P r o d u c t
D e v e l o p m e n t
O r d e r t o
D e l i v e r y
S e r v i c e
T h r o u g h
P r o d u c t L i f e
C y c l e
L e a n M a n u f a c t u r i n g L e a n H e a l t h c a r e
S u p p l i e r t o c u s t o m e l i n k
S u p p l i e r t o c u s t o m e r l i n k
S u p p l i e r t o c u s t o m e r l i n k S u p p l i e r t o c u s t o m e r l i n k
A C T
C H E C K
P L A N
D O
G R A S P t h e S I T U A T I O NG R A S P t h e S I T U A T I O N

15. Lean Concepts, LLC. All Rights Reserved
Management owns the Vision Operators own the Vision
Learning &
Launch
Goals
Commitment
Planning
Value Stream
Mapping
Current state map
Future state map
Implementation
(Kaizen Plan)
Objectives
Methods
Responsibilities
Timelines
Reviews/checks
Lean
Workshops
Workplace organization
Standard/balanced work
Built-in-quality
Pull systems/Load leveling
Lean Healthcare Transformation
Value Stream supports and enhances clinical care:
• Focus on patient journey as service model
• Create the most value while consuming the fewest resources
• Distinguish process steps that create value from those that do not
• Improve and track performance to reduce lead time (process, rework and
wait times) and build-in quality.

16. Lean Concepts, LLC. All Rights Reserved
Lean Project Phases
Preparation
Current State
Future State
Planning
Agreeing on what process to
study, how to map it, who will
participate, and logistics.
Agreeing on a well understood
map of the current situation.
Agreeing on a shared vision of a
Lean future state.
Agreeing on how to implement
the future state vision

17. Lean Concepts, LLC. All Rights Reserved
Value Stream Workshop Agenda
One
• Introduction to Healthcare Lean
• Draw Current State Map
• Identify Waste in Current State
Two
• Learn Future State Tools
• Draw Future State Value Stream Map
• Presentation to Decision Panel
Three
• Process Improvement Plan
• Presentation to Decision Panel

18. Lean Concepts, LLC. All Rights Reserved
Using the Value Stream Mapping Tool
Understanding how things
currently operate. This is the
foundation for the future
state.
Value StreamValue Stream
Designing a Lean flow through the
application of Lean principles
current state
drawing
future state drawing
Determine the Value Stream
to be improved
The goal of mapping!planning and
implementation

19. Lean Concepts, LLC. All Rights Reserved
Kaizen Plan
• Based on Value Stream Map
• Understand current situation and set objectives
• Analyze data to identify root causes
• Establish action items
• Implement action plan
• Confirm corrective effect
• Standardize
• Review the process and work on next steps

20. Goal: First Step to Transform Healthcare to a Lean Provider .
Background: Healthcare efficiency, effectiveness, quality and revenue.
Lean Project Phases
Implementation Plan:
Future StateCurrent State
I D T a s k N a m e S t a r t E n d D u r a t i o n
Q 3 0 4 Q 4 0 4
J u l A u g S e p O c t N o v D e c
1 2 6 . 4 0 w1 2 / 3 1 / 2 0 0 47 / 1 / 2 0 0 4
P l a n , P i l o t & L a u n c h T h r e e L e a n
P r o j e c t s
2 0 . 6 0 w7 / 5 / 2 0 0 47 / 1 / 2 0 0 4
P l a n P i l o t P r o j e c t a n d P r e p a r e
W o r k s h o p
3 1 3 . 4 0 w1 0 / 1 2 / 2 0 0 47 / 1 2 / 2 0 0 4V S M W o r k s h o p a n d K a i z e n E v e n t s
4 0 . 4 0 w9 / 3 / 2 0 0 49 / 2 / 2 0 0 4R e v i e w i n t e r i m r e s u l t s P i l o t P r o j e c t
5 0 . 4 0 w9 / 7 / 2 0 0 49 / 6 / 2 0 0 4
P l a n L a u n c h P r o j e c t s a n d P r e p a r e
W o r k s h o p s
6 1 3 . 2 0 w1 2 / 1 3 / 2 0 0 49 / 1 3 / 2 0 0 4
V S M W o r k s h o p a n d K a i z e n E v e n t s
P r o j e c t s 2 & 3
7 0 . 4 0 w1 2 / 1 6 / 2 0 0 41 2 / 1 5 / 2 0 0 4
R e v i e w R e s u l t s P i l o t a n d L a u n c h
P r o j e c t s
8 2 w1 2 / 3 1 / 2 0 0 41 2 / 2 0 / 2 0 0 4
P l a n N e x t P r o j e c t s a n d P r e p a r e
W o r k s h o p s
Transformation to a Lean Provider
Learning &
Launch
Goals
Commitment
Planning
Implementation
(Kaizen Plan)
Value Stream
Mapping
Workplace organization
Standard/balanced work
Built-in-quality
Pull systems/Load leveling
Proposal: Clinical Spheres and the Lean Learning Loop
Planning a Lean Project: Matrix of Value Streams and Spheres of Healthcare Events
One-third of healthcare cost is
non-reimbursed administrative
work. Administrative and
clinical work compartmentalized
in departmental silos, not Value
Streams. Resources do not meet
demand. Patient journey is
erratic, slow, complicated,
inefficient and ineffective.
Nurses and physicians burdened
with non-value added tasks.
Value Stream perspective to
reduce process and wait time and
build-in quality. Value Stream
enhances patient journey and
supports caregiver. Work is
standardized, balanced and
leveled to meet demand of
patient, nurse, physician, payer
and regulatory agencies.Lean
Systems reduce cost and align
patient, provider and payer.
XXXX
Post-clinical
XXXXXXXX
Clinical
XXXXPre-clinical
ComplianceLength
of stay
Med.
&
billing
records
Dx &
Rx.
reports
Mtl.
mgt.
PharmORE
D
Sphere
of Events
Value Streams: X identifies Lean Projects
↓ : supplier to customer connection
Agree on
• Project
• CSM
• FSM
• Plan
P r e - C l i n i c a l
C l i n i c a l
P o s t C l i n i c a l
P r o d u c t
D e v e l o p m e n t
O r d e r t o
D e l i v e r y
S e r v i c e
T h r o u g h
P r o d u c t L i f e
C y c l e
L e a n M a n u f a c t u r i n g L e a n H e a l t h c a r e
S u p p l i e r t o c u s t o m e l i n k
S u p p l i e r t o c u s t o m e r l i n k
S u p p l i e r t o c u s t o m e r l i n k S u p p l i e r t o c u s t o m e r l i n k
A C T
C H E C K
P L A N
D O
G R A S P t h e S I T U A T I O NG R A S P t h e S I T U A T I O N

21. Lean Concepts, LLC. All Rights Reserved
Implementation Plan
Phase One is three months. Provider commits resources and support for three
Lean Projects. A pilot is one Project, a launch is two Projects. Each Project is one
3 day VSM and three 1-day Kaizen Workshops. Results and learning from three
Projects are reviewed at 6 months to decide next steps.
ID Task Name Start End Duration
Q3 04 Q4 04
Jul AugSep Oct NovDec
1 26.40w12/31/20047/1/2004
Plan, Pilot &Launch Three Lean
Projects
2 0.60w7/5/20047/1/2004
Plan Pilot Project and Prepare
Workshop
3 13.40w10/12/20047/12/2004VSMWorkshop and Kaizen Events
4 0.40w9/3/20049/2/2004Reviewinterimresults Pilot Project
5 0.40w9/7/20049/6/2004
Plan Launch Projects and Prepare
Workshops
6 13.20w12/13/20049/13/2004
VSMWorkshop and Kaizen Events
Projects 2 &3
7 0.40w12/16/200412/15/2004
ReviewResults Pilot and Launch
Projects
8 2w12/31/200412/20/2004
Plan Next Projects and Prepare
Workshops

22. Lean Concepts, LLC. All Rights Reserved
If a Lean Value Stream supports and enhances the patient journey,
who is the customer?
Accounting, PhysicianMedical and
billing records
131 min
11 min
P/T= 178 min
Patient W/T: 81 min
Endoscopy
procedure
Accounting, payer, physicianMedical and
billing records
58 min
10 hrs
90 %
6
7
P/T= 129 min
L/T= 24 days
FTQ = 36 %
Process steps:16
Operators: 19
Physician
office visit
Resources (e.g., radiology,
endoscopy, cardiovascular)
Scheduled,
authorized
appointment
27 min
3 days
2 %
74 %
9
21
P/T: 69 min
L/T: 34 days
Scrap : 20 %
FTQ: 26 %
Process steps: 11
Operators: 83
Procedure
scheduling
Customer(s)OutputFuture StateCurrent StateProcess
Accounting, payer, hospital
administration, internal audit,
physician
Billing record97 min.
16 days
74 %
400/day
P/T= 330 min.
L/T= 70 days
FTQ = 2 %
Unbilled records: 867/day
Utilization
review
and coding

23. Lean Concepts, LLC. All Rights Reserved
Accounting, payer,
hospital administration,
internal audit, physician
Billing record97 min.
16 days
74 %
400/day
P/T= 330 min.
L/T= 70 days
FTQ = 2 %
Unbilled records: 867/day
Utilization
review and
coding
Radiology technician,
physician, scheduling
office
Scheduled procedure
with past
roentgenograms
7.5 hr.
24 hr.
75 %
13
P/T= 12.3 hr.
L/T= 107 hr.
FTQ = 10 %
Process steps: 27
Radiology
procedure
preparation
Customer(s)OutputFuture StateCurrent StateProcess
NurseDeliverable, findable
pharmaceuticals
222 hr.
187 hr.
20 %
70 %
20 %
10 %
Total P/T per day: 302 hr
Nurse P/T per day: 258 hr
Rework: 40 %
Wait time:
0-2 hr.: 0 %
2-12 hr.: 50 %
12-24 hr.: 50 %
Pharmaceutical
delivery and
distribution
If a Lean Value Stream supports and enhances the patient journey,
who is the customer?

24. Goal: First Step to Transform Healthcare to a Lean Provider .
Background: Healthcare efficiency, effectiveness, quality and revenue.
Lean Project Phases
Implementation Plan:
Future StateCurrent State
I D T a s k N a m e S t a r t E n d D u r a t i o n
Q 3 0 4 Q 4 0 4
J u l A u g S e p O c t N o v D e c
1 2 6 . 4 0 w1 2 / 3 1 / 2 0 0 47 / 1 / 2 0 0 4
P l a n , P i l o t & L a u n c h T h r e e L e a n
P r o j e c t s
2 0 . 6 0 w7 / 5 / 2 0 0 47 / 1 / 2 0 0 4
P l a n P i l o t P r o j e c t a n d P r e p a r e
W o r k s h o p
3 1 3 . 4 0 w1 0 / 1 2 / 2 0 0 47 / 1 2 / 2 0 0 4V S M W o r k s h o p a n d K a i z e n E v e n t s
4 0 . 4 0 w9 / 3 / 2 0 0 49 / 2 / 2 0 0 4R e v i e w i n t e r i m r e s u l t s P i l o t P r o j e c t
5 0 . 4 0 w9 / 7 / 2 0 0 49 / 6 / 2 0 0 4
P l a n L a u n c h P r o j e c t s a n d P r e p a r e
W o r k s h o p s
6 1 3 . 2 0 w1 2 / 1 3 / 2 0 0 49 / 1 3 / 2 0 0 4
V S M W o r k s h o p a n d K a i z e n E v e n t s
P r o j e c t s 2 & 3
7 0 . 4 0 w1 2 / 1 6 / 2 0 0 41 2 / 1 5 / 2 0 0 4
R e v i e w R e s u l t s P i l o t a n d L a u n c h
P r o j e c t s
8 2 w1 2 / 3 1 / 2 0 0 41 2 / 2 0 / 2 0 0 4
P l a n N e x t P r o j e c t s a n d P r e p a r e
W o r k s h o p s
Transformation to a Lean Provider
Learning &
Launch
Goals
Commitment
Planning
Implementation
(Kaizen Plan)
Value Stream
Mapping
Workplace organization
Standard/balanced work
Built-in-quality
Pull systems/Load leveling
Proposal: Clinical Spheres and the Lean Learning Loop
Planning a Lean Project: Matrix of Value Streams and Spheres of Healthcare Events
One-third of healthcare cost is
non-reimbursed administrative
work. Administrative and
clinical work compartmentalized
in departmental silos, not Value
Streams. Resources do not meet
demand. Patient journey is
erratic, slow, complicated,
inefficient and ineffective.
Nurses and physicians burdened
with non-value added tasks.
Value Stream perspective to
reduce process and wait time and
build-in quality. Value Stream
enhances patient journey and
supports caregiver. Work is
standardized, balanced and
leveled to meet demand of
patient, nurse, physician, payer
and regulatory agencies.Lean
Systems reduce cost and align
patient, provider and payer.
XXXX
Post-clinical
XXXXXXXX
Clinical
XXXXPre-clinical
ComplianceLength
of stay
Med.
&
billing
records
Dx &
Rx.
reports
Mtl.
mgt.
PharmORE
D
Sphere
of Events
Value Streams: X identifies Lean Projects
↓ : supplier to customer connection
Agree on
• Project
• CSM
• FSM
• Plan
P r e - C l i n i c a l
C l i n i c a l
P o s t C l i n i c a l
P r o d u c t
D e v e l o p m e n t
O r d e r t o
D e l i v e r y
S e r v i c e
T h r o u g h
P r o d u c t L i f e
C y c l e
L e a n M a n u f a c t u r i n g L e a n H e a l t h c a r e
S u p p l i e r t o c u s t o m e l i n k
S u p p l i e r t o c u s t o m e r l i n k
S u p p l i e r t o c u s t o m e r l i n k S u p p l i e r t o c u s t o m e r l i n k
A C T
C H E C K
P L A N
D O
G R A S P t h e S I T U A T I O NG R A S P t h e S I T U A T I O N