LEAN Process

LEAN & Mean

Carving out waste within HME businesses with LEAN process.

• By Ty Bello
• Mar 01, 2010

LEAN Manufacturing has been changing the manufacturing environment for decades. That said, this proven methodology also will improve efficiency, reduce repetitive work, eliminate barriers,and improve process flow and eliminate fat and waste in every HME.

Essentially, LEAN Manufacturing is a manufacturing system and philosophy that was originally developed by Toyota, where it is referred to as the Toyota Production System.

The term “LEAN” is very apt, because in LEAN Manufacturing the emphasis is to cut out the “fat” or waste in the manufacturing process. Well that’s great but we really don’t manufacture anything at the provider level in the HME industry. While that’s true, we do have processes that produce an outcome for both the referral source and also the customer. In these processes we have fat and waste that needs to be eliminated.

Before we go much further we need to define our customers and how LEAN can apply to them. Peter Drucker, the proclaimed “the father of Management,” defined the customer as: “The person whose life is changed by the products or services we provide”

Key words for an HME provider would be: “life,” “changed,” and “services.”

We understand our services and how they directly impact the patient. The life that is changed is in two groups. The life of the patient and his or her caregivers, significant others, etc; and also the life of the referral source is changed. Think about it: If our process for intake, deliver, billing, and follow up are sound, then the referral source also benefits by not receiving complaints or added steps to the process to get what they ultimately desire. In a word, service.

The Low-Down on LEAN

To better understand LEAN, let’s start out by reviewing some of the basics, but also dive a little deeper into LEAN, specifically the fat and waste your business can lose, and give you some steps to begin to apply LEAN to your business.

Let’s begin by reviewing some of the terminology that is at the forefront of LEAN: Change Agent, Error Proofing, The 5 s’s, Paradigm Shift, Value Stream Mapping, and Waste. These embody the core essentials of LEAN as it will apply to your HME.

Change Agent. A Change Agent is the most valuable player within the LEAN Process. The Change Agent is the person who will lead the company from the traditional operational mentality to becoming a LEAN organization. This person is empowered to assist in the development and implementation of LEAN Processes throughout the organization. They have a command of LEAN and also a thorough knowledge of your business and HME.

The Change Agent should be one who possesses a passion for the business and can look outside of the box for solutions. A keen sense of flow of work will lend well to the Change Agent as they will certainly implement ways to improve efficiencies from the inside out. The Change Agent also must realize that LEAN is a top-down and bottom-up adoption. Every member of the team is a significant contributor when it comes to LEAN, because LEAN is an across the board process. There is not one area withinan HME that cannot be positively impacted by LEAN.

The selection and education of the Change Agent will be the first step in becoming LEAN.

Error Proofing. Also called Mistake Proofing, Error Proofing is a system that addresses both the product and the processes to detect errors before they become defects. These are critical measuring points within a process that will afford us to identify errors early.

A perfect example of Error Proofing in an HME is found in the intake or customer service Area. By strategically placing a quality assurance or quality control step in your intake process will drastically eliminate errors that cause increased DSO, problem accounts, errors in diagnosis, billing codes and the like. These all are elements of the intake and customer service process that must not go undetected.

The QA/QC component is the verification process that checks and measures these areas before they become a problem. Placed strategically before the billing process, customer service team members are held accountable for information received and inputted into the system. If defects are identified at this stage they are sent back to the customer service team member for correction. To have the QA/QC person correct these defects at this point does not serve our training and education component. Using this as a training tool for customer service is a valuable asset and will increase knowledge and awareness for all team members involved.

Some HME software programs allow you to run reports to track held orders or unconfirmed orders which is an excellent measuring tool at this point in the process.

Big Five

The Five s’s. This method of workplace organization and visual controls is a proven system that improves efficiency and structure of processes within the HME. The Five s’s are:

• Sort.
• Set in order.
• Shine.
• Standardize.
• Sustain.

Due to its simple nature, the “5S methodology” may be applied to nearly any workplace in a short period of time.

The first S, sort, calls for the elimination of unnecessary items in a work area. As debris and unused objects build up, productivity decreases. Cluttered workspaces can cause surmounting frustrations within the workforce. Three benefits of Sorting are: increased productivity, increased team member morale, and improved quality.

Once the workplace has been sorted, we can implement a more comprehensive system to organization. Sorting is an effective method, but is only a preliminary measure. Set in order focuses on effective storage and organization with a goal of developing an environment that increases long-term productivity. This is where identical workstations really begin to take shape.

The third S is shine. The work area needs to be maintained and kept LEAN. Dirty and cluttered work places tend to be a distraction and faults can be hidden or go unnoticed. A LEAN workplace will also improve teammember morale, health, and safety.

To standardize our process will assure procedures are followed and ultimately will be self perpetuating. The involvement of your team at this point is essential for the overall success of each process. This will increase buy in across the board.

There are numerous reports stating how long it takes to create a habit. Most that I have read say 21 days to create a habit and then an additional 30 days to move the habit to a behavior change and an additional 30 days to create a life style.

This is exactly what standardizing will create in your team and the processes that they take part in.

To sustain is by far the most difficult S to implement and achieve. Sustain begins at the end. With each process we must ask, what do we wish to achieve, how will we measure our progress, and what tools and resources are available to help measure this progress and sustain growth?

Sustain also speaks volumes to accountability. Not only where do you want this process to take you; better DSO, decreased held orders and unconfirmed orders, timely delivery and pick up, route efficiency, etc. but how will you actively measure this?

Value Stream Mapping. This represents a systematic method to identify all the activities (door-to-door) required to produce a product or product family. The “map” will include both the flow of the material and the flow of information.

Beyond the implementation of LEAN, Value Stream Mapping is one of the most exciting exercises in the LEAN Process. This is where you story board the current and the future processes. This is where you can dream anddream big.

Trimming the Fat

To see and eliminate fat and waste in the work environment will require us to change our understanding of these within our HME. Waste may be defined by us as rework. Let’s face it, if or when we rework anything it does waste time. But waste within LEAN practices is much more then rework, so we need to adopt a new definition. Therefore waste is anything that does not add value to the customer. LEAN identifies several types of waste within HME that
we will focus on.

Excess Inventory ties up a great deal of cash, which is wasteful. Stockpiling inventory between processes is wasteful. An HME with a clear re-order and par level process minimizes the overstocking of equipment and has a just in time inventory control that serves the customer and cash flow.

Conveyance is the unnecessarily moving of a part during the service process. This would be found most often in the delivery and service areas. Truly everything has a place from equipment to tools. We have LEAN a great deal from our accreditation process, but if you apply LEAN to your warehouse and delivery vehicles you will eliminate the shifting of equipment and parts within your warehouse and vehicles.

Correction or having to re-work paperwork is a large source of waste. This can be eliminated by error proofing (designing your processes so that the paperwork flows in the correct way every time). Go to any of your departments (intake, customer service, billing, delivery) and have them treat you like a piece of paper or a new set up or change order. Follow the process and you will be impressed with all of the areas that flow well and you will be shocked to find many points that are a waste of time and resources.

Motion is when our team makes unnecessary or awkward motions put undue stress on the body and cause waste. This is not limited to our warehouse, delivery, and service areas. We have motion issues within our office team as well and need to take a look at how we can improve the ergonomics of our processes and make them friendly to use. An improvement in this area should result in reduced injury and workman’s compensation
claims.

Processing is the root of most waste within an HME and this stems from the lack of or poor communication. When we are unclear of the customer needs, this will cause unnecessary processes, which add cost to the services we provide. We all know that the referral source (one of our customers) does not have much time when giving us a new or change to an order. We must communicate through our sales team the information we need, but remember be realistic and get what you need and look at the basics. Keep in mind that you have opportunity to get other information before completing the order through medical records, the patient, and family members; to name a few.

Waiting or idle time is a large waste within an HME. There are two major items that need to be addressed regarding waiting in an HME business. They are roles and responsibilities and daily schedule. It really does being with job descriptions and that we are actually going to keep our staff accountable to the tasks that surround their job. The daily schedule is something that must be adopted to eliminate waiting. We have very talented team members and they perform their job well. We need to coach them on their daily activities and help them schedule their time in accordance with the priority of tasks that must be complete. Working on this schedule will immediately improve idle time.

Utilizing LEAN will assist you in removing fat and waste. Performing a LEAN Due Diligence of your overall flow of work is the first step to becoming the Biggest Loser of fat and waste within your HME business.

This article originally appeared in the March 2010 issue of HME Business.