Operations Science for the Operating Room
Ross professors bring lessons from heavy industry to healthcare in their new book
ANN ARBOR, Mich. — While this year's big healthcare news came from the U.S.
Supreme Court, plenty of industry
issues command attention. By some estimates, the U.S. spends
$480 billion annually on costs that don't improve care. About
98,000 people a year die from preventable mistakes.
Let others debate the Affordable Care Act or other policy
changes, say operations professors Wally Hopp and Bill Lovejoy.
Their focus is on improving the industry regardless of which
regulatory scheme wins out.
Their prescription — the result of years of work with physicians
and hospitals — recognizes that the policies and planning that
garner so much press are mere preludes to the all-important
transaction between patient and healthcare provider. Hopp and
Lovejoy focus on this transaction within the hospital context
and show how to make it faster, more reliable, and higher quality.
By focusing at the hospital instead of industry level,
their solutions help make healthcare more efficient
regardless of policy regime.
Their new book, Hospital Operations: Principles
of High Efficiency Health Care (FT Press, 2012),
shows healthcare professionals how to apply
basic principles of physics, information, and
human behavior in a hospital context. Hopp and Lovejoy's
co-authors include physicians and nurses — people on the
front lines of delivering care.
"Other books either speak the medical language but aren't
deep analytically, or they are deep analytically but don't
speak the medical language," says Lovejoy, the Raymond
T. Perring Family Professor of Business Administration and
professor of technology and operations. "We fill that gap
by doing both."
Hopp and Lovejoy take a balanced
approach — quantitative when necessary, more behavioral when
appropriate — to present a science of operations for hospitals.
They first define general principles of management that have
been proven effective and stand the test of time. They then
identify several management challenges in hospitals and apply
the principles to generate potential solutions.
"The systems are broken in healthcare, not the people," says
Hopp, associate dean of faculty research, Herrick Professor of
Manufacturing, and professor of technology and operations.
"We focus on three recurrent problems in hospitals — congestion,
patient safety, and organizational learning. Operations science
says effective ways to improve those areas are as applicable
in a hospital as they are anywhere."
In systems that haven't yet been rationalized, just using basic
principles without making structural changes can result in a
10-percent efficiency improvement.
"Ten percent, if applied industrywide, adds up to around
$85 billion annually," Hopp says. "That's possible simply by
getting the basics right."
The book encourages medical professionals to view healthcare
delivery as a series of flows. Patients flow into and through
the system. Physicians and nurses have their own trajectories
through the system, as do materials and information. Any or all
of these can be held up by bottlenecks, which constrain output.
Many hospitals work on non-bottlenecks, which is why their
projects often yield little. For example, if a hospital has a great
admissions system but a poor discharge system, it negates the
efforts to improve admissions.
That breakdown occurs because some important principles
for managing flows are poorly understood.
"Few people understand the deteriorating effect variability
has on any processing system," Lovejoy says. "It's not like the
idea of an average or mean, something everybody has a gut feel
for. When you think in terms of average, you'll try to pack 10
hours' worth of operations into 10 hours of operating room
time. But when variability is present, as it always is, this can
be disastrous. It's the inevitable result of operational physics,
a theory of variability you can take to the bank. You can't argue
or motivate your way around it; you have to deal with it. But it's
not intuitive or easy to understand."
Great Brains Brainstorming
The good news is
medical professionals want to learn and apply this knowledge,
say Hopp and Lovejoy. No one they asked to help them write
the book said no.
"The field is full of smart people," Hopp says. "They're in a
complex system with many competing objectives. It's easier
to make local improvements than global changes, but they
need systemwide changes."
The book helps practitioners
achieve wider influence
by using a brainstorming
"We use principles that
generate a landscape of possible
options. Some will be
politically and economically
feasible, some will not,"
Lovejoy says. "It's a way to
problem solving based on
principles you can count
on. Our brainstorming approach
gives people so many
options to consider that it
broadens their minds about
what's possible. Over time,
they become accustomed to
thinking more creatively."
Disrupt or Be
gains and new ideas are
critical to big, full-service
hospitals because more
innovation is coming from
independent clinics that
threaten to pull away their
patients — mostly the well-insured ones.
For example, MinuteClinic can diagnose and
treat strep throat for $60 in under an hour.
A hospital ER would take longer and spend
more to do the same thing, Hopp says.
If spin-off competition uses focused
operations to take the easy, lucrative
business, full-service hospitals will be
left with underinsured, critical cases that
come with high costs.
"The idea is to create a hospital within a hospital,
instead of having everyone enter through the emergency department
and occupy expensive resources," Hopp says. "It hasn't been
very successful to date, but it's the kind of structural change that's
going to get them beyond the low-hanging fruit."
Hopp and Lovejoy wrote this book to help harried hospital
professionals step back and analyze their jobs differently.
"Their world is chaotic, and it's about fighting fires all the time,"
Lovejoy says. "We bring some perspective: Here's why you're
fighting fires, and here's what to do about it. It's a message
people want to hear."
— Terry Kosdrosky
For more information, contact:
Terry Kosdrosky, (734) 936-2502, email@example.com