Fisher prof’s pharma research highlighted in ‘U.S. News’ article

As pharmaceutical recalls continue to hit headlines, an ongoing focus of research for one Fisher College of Business professor is taking on a new urgency.

John Gray Fisher College of Business Ohio State
Prof. Gray, speaking at the Center for Operational Excellence’s April “Leading Through Excellence” summit.

Fisher Prof. John Gray and two co-authors of an unpublished paper recently wrote an article featured in the online edition of U.S. News & World Report that highlights the ongoing challenges pharmaceutical manufacturers face in maintaining quality, particularly when production has been outsourced or offshored. U.S. News published the article just days after GlaxoSmithKline announced a recall of asthma drug Ventolin and several months after dozens of people died because of quality issues at the New England Compounding Pharmacy in Massachusetts.

Gray, along with Prof. Aleda Roth of Clemson University and Associate Prof. Brian Tomlin of Dartmouth College, took a close look at the performance of pharmaceutical plants run by firms that own the brands, versus those run by contract manufacturers. There was not an overall difference, but their research did indicate less-experienced and less-regulated contract manufacturers had a higher risk of quality issues.

“Our research provides empirical evidence that drug manufacturers are hard-pressed to consistently maintain high quality operations even in their own domestic facilities,” Gray and his co-authors wrote, referring to multiple research papers. “This challenge is magnified when production is performed in offshore and outsourced plants.”

The challenging business of making and supplying safe pharmaceuticals has been a topic of interest in Gray’s research for years.  In 2011, he co-authored a study published in the Journal of Operations Management that found drugs produced in offshore manufacturing plants – even when run by an American company – pose a greater quality risk than those produced stateside. They attributed this result to differences in language and culture between the plant’s personnel and those at headquarters.

Gray told us then that “just one quality error that hurts customers or leads to a recall can be extremely costly to a company responsible.”

What makes Gray’s research with his co-authors so resonant these days is the underlying truth that goes beyond organizational borders and language barriers: Successful quality reforms come from far-reaching culture change across the entire supply chain, a feat that isn’t easy, cheap, or quick. For any industry, defeating a culture of silos, miscommunication, and blame is a hard-won battle.

It’s an urge in the pharmaceutical industry, and countless others, to turn to technology – buy Gray and his colleagues write in the U.S. News article that the solution, instead is in people and day-to-day processes.

“Absent such an organizational mindset,” they write, “quality failures will occur even with the best technology.”

‘You are a virus!’

When our Master of Business Operational Excellence health-care students spent some with Kathryn Correia, chief of Minnesota’s HealthEast Care System, she brought up a great point about the things that slow us down. Most of the interruptions that impede the flow of care, she said, aren’t surprises. If a machine breaks down, we know that somewhere we missed out on the preventive maintenance. If patients, providers or staffs are waiting for too long, we know that we have not really designed our processes to meet the demand. Defects occur because we have long been fixing symptoms but not the root causes.

This was one interesting insight in a busy week for the students, who heard from a number of instructors.

art byrne
Lean expert Art Byrne, speaking to our MBOE cohort.

Bill Boyd, director plan development at Wisconsin’s ThedaCare, spent some time with students explaining how the company has adopted the value stream approach to enhance the patient experience and quality and efficiency of care. He emphasized how important it is to stop working in silos and come together as a team to address the care needs of patients.

Post-lunch, the health-care and industry cohorts spent three hours with Gary Butler and yours truly in an emergency department simulation. They applied their learnings in understanding the wastes in the process and improving the efficiency and quality of care the patients received. The simulation is designed to help understand how lean principles apply to a non-manufacturing process.

The day came to an end with a visit from Art Byrne, an expert in lean strategy, and Tom Mooney, manager of Lean Transformations at Goodyear. Byrne has been implementing lean from the position of a President, CEO or Chairman of the organizations he worked with since the last 20 years. He shared his perspective on the role the leaders have to play to successfully implement lean and sustain the gains. He left the students with a thought his sensei Chihiro Nakao once said to him: “Byrne San, if you don’t try something, no knowledge will visit you.” Lean is all about trying out ideas. If you don’t try, how will you know about the process you are improving?

Mooney gave a different twist to the challenges of a lean practitioner. He said to the students, “You are a virus!” He emphasized that the change agents always get resistance from almost everyone. The resistors are like the antibodies who are trying to dissuade and destroy the change agents. He urged the students to keep going, coach others and multiply the lean knowledge rapidly to bring change in the organization.

Fisher students explore paths to speedier outpatient wait time in year-long project

A group of undergraduate Fisher College of Business students has undertaken the most ambitious project yet for the college’s Buckeye Operations Management Society – and one not far from home.

Students recently presented results of a year-long project within the gastrointestinal oncology unit of the James Cancer Hospital and Solove Research Institute at Ohio State University’s Wexner Medical Center. The goal was to make improvements in an area that has long dogged health care as a customer service concern: Patient wait time.

BOMS student Wexner Medical Center project
From left to right: Nick Caminiti, Ruizhi Wang, Spencer Shewbridge, Tanner Congleton, Tyler Kukurza, Molly Vlahakis

Out of the 70 students in BOMS, which the Center for Operational Excellence supports annually, seven took on the effort. Pictured, from left to right, are Nick Caminiti, Ruizhi Wang, Spencer Shewbridge, Tanner Congleton, project lead Tyler Kururza, and Molly Vlahakis. Not pictured is Junyi Xiong.

As in many hospitals and health-care providers’ offices, patients at the James were spending too long in the system from arrival to departure. Students not only targeted a decrease in total wait time but an increase in time spent with health-care providers. To accomplish this, they spent months gathering data at the James, feeding this information into simulations of the process, helped along the way by Dave Schilling, a professor of management sciences at Fisher.

In a hospital, even a manufacturing line, the solution is a lot more complex than “Faster!” The BOMS students in the process calculated the takt, or cycle, time of a patient through the system and pinpointed its true capacity, even determining when capacity levels would require new hires. These measures and the simulation were used to devise an alternative in patient routing.

The result: Students were able to create a new path that could boost the level of patients seen by as much as 25 percent, while increasing the amount of time a patient spent with a doctor or nurse practitioner by up to an impressive 75 percent. These recommendations were passed on to the James.

BOMS adviser Andrea Prud’homme, an assistant clinical professor of management sciences and an associate director of the Center for Operational Excellence, said the project marks a milestone for the student organization. BOMS students previously have tackled projects at Royal Building Products, Avon, the MidOhio Foodbank, and others – but none of this scale and with this level of research.

“These students took on this project for no class credit or compensation and learned new simulation software, which has never been done before in a BOMS project,” Prud’homme said. “This is very impressive work and I’m extremely proud of them.”

MBOE recap: Lean in the back office

Last week, we hosted our industry and health-care MBOE cohorts on campus, bringing together dozens of professionals in a range of different fields. The principles and leadership skills we teach in each program carry many similarities, but there remain some key differences between health care and the rest of the pack. Shingo prize-winning author Jean Cunningham highlighted one of those when she visited our health-care cohort last week.

jean cunningham consulting lean accounting
Jean Cunningham (courtesy jeancunninghamconsulting.com)

Health care might be the only industry, Cunningham said, where you put a charge on a bill but only end up collecting a partial amount. That amount is based on the contracts and agreements organizations make with public and private insurance companies. Cunningham, author of the book Real Numbers, said traditional cost accounting systems are designed for all the resources to be used fully all the time. You create capability to create demand, and gather all resources such as people, materials and equipment and then produce what the customer needs. Taiichi Ohno, father of the Toyota Production System, once said that costs don’t exist to be calculated – they exist to be reduced. Lean accounting, Cunningham’s area of expertise, helps do exactly that by identifying and eliminating non-value add waste in the accounting process and helping managers understand the numbers to make meaningful decisions.

When organizations bring in lean, the first place they apply it is the “shop floor,” where patient care is actually provided. As the changes are being implemented, Cunningham said, it’s important to indicate them on financial statements. How do you do that? Well, the most important thing to do is to get the financial folks to plunge into operations and lean activities. Make them a part of the improvement teams so they can understand the changes that are being implemented and how they impact the financials. Lean accounting is about applying lean tools to streamline accounting and finance processes and also accounting for lean transformations.

Explaining lean accounting isn’t possible in the space of a single blog, but the key takeaway here is knowing that people outside of accounting need fewer, and easier-to-understand transactions. When they make transformations the key is to provide information that takes the right calculations into accounting and reflect gains and losses.

Interested to hear more about lean accounting from Cunningham? Click here

The flow of the 411

Most of our MBOE students have now finished creating the value-stream maps that they can work with for their capstone projects, the culmination of our year-long program. The flow of information, one of the key components within a value stream, many times gets neglected. It is very important to indicate the flow on the map to highlight the intricacies and the challenges faced by the people who do work on a daily basis.

info flow symbols value stream map
A quick how-to on value-stream map symbols

In health care, the staff might be using the Electronic Medical Record for the most part to access or enter information. But if some staff members don’t have access to all modules, they might wind up making a phone call or writing an e-mail to someone who does. This adds a layer of complexity and non-value added activity to the work.

In manufacturing, lead time sometimes can be hidden when the customer places an order until the sales and operations group has made a decision to go into production.

In transactional processes, information flows through an online system, e-mail, fax, and phone or in-person conversation.

Regardless of your value stream, it’s important to show in detail how information flows. This highlights how long it takes to get to the receiver and what kind of decision he or she makes as a result. Does this information help provide a signal or authorization on whether to produce a product or advance an application – or does it just result in a need for more clarity or information? A value stream must expose all possible wastes that could be affecting lead time.

The key thing to remember here is that whether it’s a pull or a push system, information always flows from left to right in the value stream. You can use symbols in the picture to show manual and electronic information flow. Use symbols to indicate phone or fax or e-mail. Indicate rework, redundancies or breaks in information flow using angry clouds or starbursts.

In the end, any information flows in the value stream must have a purpose. Everything else is noise.

MBOE recap: Lessons from the pharmacy

Value stream mapping has been widely used in the manufacturing industry to understand flow. Our MBOE students learned how value stream mapping can be effectively used in a pharmacy setting using a case based on Giant Eagle’s pharmacy, authored by Gary Butler, pictured.

One of the many things that the case addresses is the question that commonly comes up when mapping a value stream in a service industry: Variation in how customers come in. There are peak periods and then there are low periods.

How do you then calculate the demand and takt time? When you draw the current state value stream map, it’s not surprising to see multiple takt times: Shorter during busy times of the day and longer during the slower periods.

In health-care settings it’s very common to have multiple people with varying skills performing various tasks in the process. A value stream can give you the metrics to calculate their utilization, which can help you understand how to allocate resources so that every resource can spend their time on only those activities based on their expertise that add value to their customers.

MBOE recap: Learning from observing

With the theory of value stream mapping internalized, our MBOE program’s health-care cohort traveled to Ohio State’s Wexner Medical Center while the industry cohort headed to Center for Operational Excellence member Tosoh USA Inc.  A key step before launching a value stream mapping exercise is to go to the gemba. You can’t really map a value stream unless you’ve seen the process and have the relevant data, and you can’t do it accurately without the people who are a part of the process.

MBOE students value-stream mapping following a visit to Wexner Medical Center

Legend has it that Taiichi Ohno, the father of the Toyota Production System, had his engineers stand inside a circle for eight hours to observe the process. There is a lot of learning that results from just observing. Once you understand how the process flows you go speak with the people who do the work. Share your findings with them. Ask them to validate the findings. Ask them why they do what you observed. Note the issues they point out and ask them what would make the process better and why.

On the hospital gemba, students went to three different areas: Outpatient endoscopy, inpatient endoscopy and Invasive Prep and Recovery (IPR). Ryan Haley, Peg Pennington, Jill Treece, Jason Swartz and Tim Nelson were key in assisting.

The biggest hurdle in getting started with the value stream map is selecting the correct group of product or services to represent on a single flow map. For example, in IPR, the manager was interested in understanding the flow of EP (Electrophysiology) patients. Within this group there were multiple procedures, such as ablation (that took the longest to perform and recover) and cardioversion (the shortest procedure to perform and recover). There are many more within that range. What procedure should one focus on? The answer: Select the family of procedures that if improved upon will have the most benefit to the patients and organization.

The students spent three hours on the gemba and mapping the process and later presented their findings to hospital leaders. As our students benefit from gemba partnerships, so do these organizations. In fact, many departments have implemented the recommendations made by the students and achieved positive results.

MBOE recap: Opening the toolbox

The MBOE program trains our students to be leading problem-solvers in their organization by providing the tools they need and, more importantly, teaching the behavior that creates lasting change. This week, we started handing out the tools.

Peg Pennington, a senior lecturer and Executive Director of the Center for Operational Excellence, kicked off MBOE’s second day of week one by walking students through the DMAIC methodology. This gets them ready for their journey toward green and black belts in the program, which uses the online Moresteam University modules. DMAIC (check out the breakdown in the image) helps students define, measure, analyze, improve and control the change they are working on in implementing at their organization. The modules will also help them prepare for the Six Sigma exam.

Another important tool is the A3 problem-solving method, which Executive-in-Residence Gary Butler introduced. Most of us are used to seeing a 100-slide PowerPoint describing a problem and all the steps that were taken to address it. With the A3 method, it’s all on an 11×17 sheet, and not just by writing in fine print but by being very specific about the problem.  It’s not only a good problem-solving tool but a great communication tool. An attention span, after all, does much better with one slide than 100!

We also wasted no time getting students to their first gemba. The assignment: Visit various areas in Wexner Medical Center at Ohio State and Riverside Methodist Hospital, speak with people there and develop a problem statement. The goal was to help students understand that what you hear from people the first time are mostly symptoms. Observing the process and getting data to support the problem really help in the end. On a short visit with no data, a situation you might find yourself in at some point like our students, it’s important to keep these things in mind:

  • Keep an open mind. What you think is a problem may not be the problem.
  • Don’t walk in with a solution. When you have a solution in mind, you tend to listen less and lose out on the information you could potentially receive from people/frontline staff.
  • Listen. Make a note of issues/symptoms. They might not be directly related to the problem, but you might find good ideas to help people understand what’s in it for them when you come back to implement countermeasures and gain their buy-in.

The waste in your walk

Hospital administrators do a lot of hang-wringing over long turnaround times for procedure and operation rooms. They not only can’t get enough procedures done, but they have surgeons waiting around, twiddling their thumbs while rooms are getting prepared for the next patient. If several procedures in a 12-hour shift are scheduled and each one takes 15 minutes to set up, hours are wasted each day. Such an organization might boast of patient-focused care, but metrics indicate quite the opposite. Not being in a position to meet customer needs can hurt all the way to the bottom line.

A spaghetti diagram can illuminate wasteful steps – actual steps – in process flow.

So how do you create the ideal flow? To start, I’ve written before about how it’s extremely important – this can’t be stressed enough – to go to the gemba and seek out the so-called motion waste. This can be done on an intricate level with what’s called a Spaghetti Diagram, a title that should be apparent by this picture.

A Spaghetti Diagram is a graphical tool that helps understand the activities involved in any process with details of the actual physical flow, or lack thereof, and the amount of traveling involved. It also highlights the flaws in the process, especially when you see how your staff is spending time in order to provide the best service or care to the customer. Unnecessary motion occurs when the operator doesn’t have everything he or she needs where needed and in the necessary amounts. This also occurs with poorly maintained equipment, a lack of standardized processes, the right metrics or no accountability. Many causes could exist, but the key is to use the diagram to work on those issues.

Here’s how to make one:

–          Before you do anything, explain to your staff why you’re there and what you’ll be doing. Address any apprehensions they might have.

–          Draw a layout of the work area you are trying study. Contact the facilities department if you want.

–          Note important landmarks where staff members move to retrieve materials or equipment and use numbers for each station or work area.

–          With a pencil, draw this movement as they go about their work from the start to the end of the process. Use different colors if more than one staff involved.

–          See patterns? Dig deeper, pull out a stopwatch and even get a measuring wheel from a hardware store to note the time and distance. Follow the worker around if need be.

–          Take those results and share your findings. Shared information helps with shared responsibility.

Now grab your pencils and get to work!

Make your mark with Fisher’s MBOE program

A friend of mine who’s a cardiothoracic surgeon at a renowned hospital in India emailed me with a problem. Here’s what he wrote: “The people at my hospital are motivated, hardworking and some are brilliant, too. But the processes are abysmal. It takes three days to discharge a patient after I actually decide to; an admission entails eight signatures across four buildings; and my wait list is 24 days to surgery after admission.”

Operation room hospital electrical wires
Systems in organizations – such as the wiring behind the scenes of an operating room pictured here – often are more complex than they need to be.

Digging into these problems and helping organizations eliminate “wastes” in their processes to improve efficiency happens to be what I do for work. A subsequent chat reminded me of how process inefficiency is pervasive globally in all occupations. If you’re looking to make lasting change in your organization, we have a one-of-a-kind program at the Fisher College of Business to get you there.

It’s called the Master of Business Operational Excellence, or MBOE, program, and it helps organizations address these inefficiencies and achieve operational excellence. Working with an industrial cohort and a health-care cohort, we are addressing the major challenge of working professionals of not having enough time outside of work to attend school. Some basics:

  • It’s a one-year degree program accredited by the Association to Advance Collegiate Schools of Business.
  • Students come on campus only eight times through the year, or every five to six weeks. When they are on campus, they spend four full days that week from Wednesday to Saturday.
  • Students work on a major capstone project, creating a positive impact on the organization where they work.
  • Each student’s supervisor is a “sponsor” who commits to support the student throughout the year and help remove any obstacles.
  • A coach, hand-picked by us and equipped with extensive experience, works with the student throughout the year

In short, it’s possible to get a master’s degree from THE Ohio State University and tackle a major work project all in one year!

Time’s ticking. Apply now.