UI Helps Health Care Organizations Control Costs

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2009-09-21 09:10

A group of researchers at the University of Iowa's Tippie College of Business is using the principles of more efficient manufacturing processes in an effort to help contain ever-increasing health care costs.

"Whether you're talking about health care or manufacturing, 'Lean' manufacturing provides a framework to systematically improve service and lower costs," said Barrett Thomas, assistant professor of management sciences in the Tippie College and a Lean expert.

Barrett and other Lean experts on the Tippie faculty work with students to teach the principles of Lean operations so they can help their organizations operate more efficiently.

Lean manufacturing is a comprehensive process that involves everyone in the organization, from the CEO down to the people on the line, Thomas said. Changes could be as major as redesigning an entire assembly line, or as basic as simply moving a single piece of machinery or equipment storage area.

For years, manufacturers have been using the Lean manufacturing principle to streamline their factory operations, improve product quality and strengthen their bottom lines. Pioneered by Toyota, Lean is a process improvement system that offers simple tools to identify and eliminate waste in an organization's processes.

Health care is one of the Tippie researchers' focuses, and the students have hands-on opportunities to see how Lean principles are applied in the field at the University of Iowa Hospitals and Clinics and Mercy Hospital in Cedar Rapids. The two organizations already have extensive Lean systems in place.

"Lean is not just brainstorming, it's making things happen during an ongoing period of time," said Philip C. Jones, Sylvia and Clement T. Hanson professor of Management Sciences in the Tippie College and a Lean expert. "If something doesn't work, then you tweak it a little bit until it gets better one day at a time."

While the principles are the same, Lean health care and Lean manufacturing are different enough that there is no one-size-fits-all template. After all, the Lean goal in manufacturing differs significantly from the Lean goal in health care.

"In manufacturing, Lean principles are about adding value to a product," said Sabi Singh, who coordinates the Lean program at the University of Iowa Hospitals and Clinics as assistant vice president for operations excellence and quality/safety. "In health care, the focus is on improving the patient's experience, which leads to eliminating waste and non-value added steps, which in turn improves finances."

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