Labs stepping into the stream of
  Lean

August 2005
Feature Story

With more and more labs turning to Lean manufacturing principles to shore up the efficiency of their operations, the examples of Lean’s power to transform grow in number by the year. But where and how to start can stall even the most well intentioned.

Organizations should focus first on where 80 percent of the opportunity, volume, costs, or revenue exist, says Rick Malik, managing principal of ValuMetrix Services for Ortho-Clinical Diagnostics, which has guided multiple labs in implementing Lean. "Focusing there," he says, "will provide a meaningful project with a solid return on investment."

And going for the quick wins will help "carry your team through more difficult times or complex processes," says Kevin Wiersma, chief financial officer of MedTox Scientific, whose subsidiary MedTox Laboratories, a workplace drugs of abuse and clinical laboratory in St. Paul, Minn., launched its Lean project two years ago.

That’s because celebrating the small successes along the path to achieving larger goals will drive home to employees that "the organization is going to change and that change pays," says David Stowe, the Chicago-based partner in Strategic Manufacturing Consulting Group, the firm that helped MedTox with its Lean project. "Success breeds success, and success is what helps overcome resistance," Stowe says.

Yes, a number of labs have learned that and more about Lean and how to make it work. Take Miami’s Jackson Memorial Hospital, for example, which began its Lean work one year ago. Since then, it has achieved more than a 50 percent improvement in turnaround time for its core laboratory. "In some areas, we’re up 72 percent," says Leyda Napoles, MT (ASCP), MBAHA, administrator of pathology services.

Or Alegent Health, a large integrated health system in Omaha, Neb., which is implementing Lean principles at seven of its metropolitan laboratories. In the past two years Alegent decreased its overall turnaround times at its consolidated reference lab by 64 percent for 80 percent of its volume in the general laboratory area (which doesn’t include microbiology and histology), says Sheryl Wilson, MHA, MT, DLM(ASCP), senior executive at the Alegent Health laboratory. The consolidated laboratory also cut its error rate from three percent to 1.2 percent, its inventory by $35,000, and the general lab and storage room space by 50 percent, Wilson says.

And Fairview Health Services in Minneapolis, one of the Lean trailblazers, has improved its turnaround time in the core laboratory by 50 percent, productivity by more than 40 percent, and cost by 30 percent, says Rick Panning, administrative director of laboratory services.

Says Stowe, "There is a growing realization by hospitals and laboratories that they can use Lean to dramatically improve productivity and/or profitability."

Virginia Mason Medical Center, Seattle, a 336-bed hospital with nine satellite clinics and 400 physicians, has been implementing Lean in its laboratories and other settings since 2002. "You can start Lean in the lab, but considering that 70 percent of all clinical decisions are based on lab results, the lab interfaces with so many processes ... eventually you want to spread Lean throughout the organization so that everyone is on the same page," says Lee Darrow, MT(ASCP), SBB, administrative director of the laboratory.

One of Virginia Mason’s recent Lean projects reduced by 50 percent the lead time from when a patient in the emergency department enters an exam room until the person’s lab test results are in the treating physician’s hands, says Katherine Galagan, MD, chief of pathology and director of the clinical laboratory.

"Before the Lean project, the nurse might have to try a couple of times to draw a blood specimen, and if unsuccessful, call the phlebotomist who had to be paged," says Dr. Galagan. The process-improvement team found that if the nurse did the laboratory draw in the ED, the average lead time as defined by the project was 70 minutes. But if the nurse had to page the phlebotomist to help with a difficult draw, the lead time stretched to 95 minutes.

So the team decided to station a phlebotomist in the ED to help the RN with the initial venipuncture, which improves the RN’s success rate. "The phlebotomist labels tubes, helps check the patient’s ID, and takes the specimens and tubes them up to the lab," Dr. Galagan says. When the specimen arrives in the lab, the central processor takes it to the stat centrifuge and puts it on directly. The chemistry technologist takes it off as soon as it’s spun down and puts it on the analyzer. "We cut a ton of time off by following those steps ... and it’s single-piece flow, as they do one specimen at a time," Dr. Galagan says.

When the Lean team mapped out the steps in the processes to identify non-value-added work and waste, they found that the ED staff was spending a lot of time walking to and from the computer to check for laboratory results, which is waste, she says. "Then the ED staff would get frustrated and might not check the lab information system for 30 to 45 minutes when the lab results were actually there during that time period."

The remedy proved to be a simple one, as Lean solutions often do. "We turned the lab printer back on, which someone had turned off because they decided it was [using] too much paper," Dr. Galagan says. "Then we put in a simple flag system for the unit secretary to use to alert the doctor that the results were available." To save paper, the team decided to turn off the pending reports function so the printer would print fewer reports overall.

Virginia Mason has also leaned out its satellite clinics to reduce the lead time from patient check-in at the front desk to discharge. To do that, the process-improvement team decided to deploy a series of visual signals to expedite communication among health care providers and maintain supply inventory in a just-in-time manner.

"One of the nifty Lean tools is use of visual signals that allows staff to communicate [routine information] without having to talk," Dr. Galagan explains. "And the clinic had these little plastic colored flags over the doors that no one was using. So we used those flags to identify when the doctor or nurse was in with the patient and who needed to go in next so the health care providers could look up and down the hall and know where to go."

The Lean team also put a file on a central desk where the physician could put in a laboratory-related request without having to find a person—to ask the nurse for a biopsy kit, for example. The nurses and medical assistants retrieve the messages as they walk by the file.

The clinics also use what are known in the Toyota production system as "kanban" or visual cue cards just short of a depleted inventory, saying, for example, "We need 20 more Q-Tips." When the nurses or physicians reach the red card (usually three or four items before the supply runs out), they stick the card on the outside of the door. "The medical assistant sees it and knows to restock that room. That way, you have less storage and inventory and use a nonverbal system to keep things stocked and running smoothly," Dr. Galagan says.

Avera McKennan Hospital and University Health Center, Sioux Falls, SD, which has applied Lean to most of its laboratory operations, is extending Lean now to non-laboratory settings, including the ED and the OR.

The Lean project in the 400-bed hospital’s ED, which is a certified trauma center, aims to reduce the current two-hour, 12-minute lead time from patient check-in to release or admittance to 1.5 hours—and ultimately to one hour, says Leo Serrano, FACHE, CLSup(NCA), director of clinical laboratories at Avera McKennan. To facilitate patient flow, ED patients go directly to triage, where they are received, which generates an account number and patient identification band. A complete registration is done at bedside after care has begun. "The goal," Serrano says, "is to have the patient seen by a physician within 20 minutes of arrival."

Rather than having dedicated rooms to provide certain types of care, the ED is standardizing all of its rooms, which frees up room availability. The ED staff brings standardized carts to the rooms for specific patient problems, such as a suture cart, a gynecology cart, or cast cart, Serrano says.

The ED Lean project has triggered ideas for spinoff projects known in the Lean Toyota process as a Kaizen event. For example, the Lean team identified that the ED was having trouble admitting people to the hospital because rooms weren’t available. So in July, Avera McKennan kicked off a Lean project with housekeeping and nursing to look at the inpatient discharge process from the time the physician writes the discharge order until the hospital room is ready for a new admission.

But Serrano has a word of caution: "When you do something in one area, it has a downstream effect that can be significant. So if you don’t coordinate your Kaizen events sequentially, you can impact your functionality."

When MedTox Scientific decided to implement the "waste not, want not" Lean manufacturing philosophy in 2003, it had a burning platform for abandoning business as usual.

The laboratory was on a roller coaster of inconsistent annual earnings performance. Its workplace drugs of abuse lab, which produced more than 60 percent of MedTox Laboratories’ revenues, had been negatively affected by the post 9/11 recession, said Kevin Wiersma, the company’s chief financial officer, who shared MedTox’s Lean experience at this year’s Executive War College, sponsored by The Dark Report.

MedTox initially applied Lean principles espousing single-piece specimen flow where possible and eliminating wasted time and other resources throughout its workplace drugs of abuse lab, which has three areas: specimen receiving; processing, which includes drug screening; and an extraction area for confirmatory testing of positive screens.

The Lean project yielded impressive productivity gains. Output per employee climbed by 22 percent, "and the lab made huge strides in confirmatory testing turnaround time, improving the throughput in that area by 79 percent," Wiersma told War College attendees.

The lab’s test volume also skyrocketed, says Stowe of Strategic Manufacturing Consulting Group. "The lab could take in more samples, process them more efficiently, and meet market challenges," Stowe told CAP TODAY.

As part of its Lean overhaul, the workplace drugs of abuse lab created best-practice standardized work based on accumulated knowledge so everyone performs processes in the same way and knows how much time each step should take. The Lean team also implemented first-in-and-first-out linear flow of samples, reduced batch sizes, and implemented good visual management controls.

In the new Lean environment, workflow occurs at a balanced rate through all three areas of the lab. A gravity-feed-roller conveyor line moves specimens from the processor to the next station, eliminating transportation time, Wiersma said.

With newly designed processing benches, laboratory technicians can move the work smoothly from the left to the right of the bench with no unnecessary movements. A label under each bottle or item on the workbench tells the lab technician exactly what needs to be there, including quantity and optimal location. That way, the technicians can be sure they have everything they need at the start of a shift. The Lean team color coded materials in the extraction area to match the assay the technicians are working on, which reduces errors, Wiersma said.

MedTox also spread out how it managed receipt of test samples, which begin arriving in the lab’s receiving area at about 5:30 AM and continue to arrive over the next three to four hours. In the lab’s pre-Lean days, the morning influx of specimens created a backlog in specimen processing. Now the lab staggers shift start times, so people who process the specimens first start earlier to build up inventory for the next phase of testing. "The staff for the third phase of testing, extraction and confirmation, starts about two hours after receipt of the samples," Stowe says.

To maintain the gains from the Lean project, the lab posts hourly production rates in real time on the floor, a change that staff resisted a bit at first, Wiersma admitted. But they now like the feedback about how they’re performing, said Wiersma, who has found that "people want to know the standards and what’s expected." The hourly posting also gives supervisors a tool to detect and troubleshoot problems in real time and to praise technicians who are doing well—or coach those who need to pick up the pace.

Management also installed an idea board and asked employees to post their input on how to improve the standards and make their jobs easier.

MedTox didn’t restrict its Lean feats to its workplace drugs of abuse lab. The company is now tackling the lab sales area with a project aimed at eliminating waste by synchronizing the information flow and standardizing the sales process and performance metrics. "The objective is to reduce the time between [sales] prospects and when we are receiving payments for lab tests," Wiersma said.

To speed up sales, the laboratory sales department shifted some of what’s known in Lean speak as non-value-added work to customer service. "If you are a sales rep," Stowe says, "your value-added steps are talking to a prospect, convincing the prospect that the company’s services are value-added to their company—that is, something the prospect is willing to pay for—and completing the sale, including filling out information and the database." Yet the Lean team found that the MedTox sales force was fielding calls daily from existing customers. "The Lean project clarified how to resolve the hand-off issues to customer service, which is important because no lab wants a dissatisfied customer," Stowe says.

In the Lean scheme, "the customer’s concern or call is like a vial of blood sitting there" waiting for something to happen to it, Stowe adds. "You want to move that information to the right person who is prepared to process it quickly and accurately."

To produce an early, quick win, MedTox focused first on the receiving area where samples sat for a long time waiting to be processed. After an initial analysis of product flow and labor use, "the Lean team put together a prototype workstation to simulate the flow of material across the bench and throughout the receiving area," Stowe says. This prototype area allowed other associates and supervisors to offer input into developing a work area that is "physically easy to use and controls quality and productivity."

Eventually, the Lean team made physical changes and organized the flow of samples to prove things were moving more efficiently—first with one workstation, then one line, then the whole area. "We took baby steps to get us to the bigger goals," Stowe says.

Laboratories with Lean experience have distilled key learning points to help those considering or embarking on Lean projects to sidestep common misperceptions and stumbling blocks.

1. Lean is not a quick fix. In fact, before you can fix anything with Lean, you have to determine—in what can seem like excruciating detail—exactly how it’s broken.

For example, in its Lean projects, Virginia Mason Medical Center uses videotaping and other tools to map the workflow. The process improvement-team members "use forms where they watch the specimen and write down all the steps they see," says Dr. Galagan. "Then they use a stopwatch to time the steps and waiting time where nothing happens to the product." Another form helps the team track the flow of the specimen or the staff person. "Initially you get a spaghetti diagram with lines going everywhere," Dr. Galagan says. "Then you look for ways to decrease that disorder and lessen staff walking and product travel distance."

By using the Lean tools, you spot the waste in the identified process, she adds. "You take out seconds in some cases or minutes—or even hours or days sometimes. And that wasted time adds up to considerable gains in efficiency or shorter lead time;s."

2. Lean "lite" can make you back slide in efficiency. For example, "if you just clean up and move or change equipment in a cellular layout without doing the detailed analysis up front ... you won’t know what machines need to be in that cellular layout or how to arrange them to have single-piece flow and balance the work," says Malik of Ortho’s Valu Metrix Services. "And you won’t know how many people should be in each work cell" to manage the workload.

Part of Lean requires you "to do a deep dive and peel away the layers of a problem to get to the root cause," says Lee Darrow at Virginia Mason Medical Center. "It’s sort of like wound debridement. The wound isn’t going to heal until you get the dead tissue out."

3. Single-piece flow isn’t written in stone. The Lean principle of promoting single-piece flow of a product (blood tube, tissue sample, form, patient) through a process is important to maintain an evenly paced workflow and output. But in a limited number of cases, "batching" in a Lean environment may be required, though you must clearly justify the need for it, says Mark Jamrog, president and CEO of Strategic Manufacturing Consulting Group.

The goal of using single-piece flow is to shorten the lead time for a defined process, Darrow says. "Sometimes getting down to one-piece flow will work to shorten the lead time, and other times it may lengthen it."