Table of Contents
Preface xv
Part I Introduction to Healthcare Operations 1
1 The Challenge and the Opportunity 3
Overview 3
Purpose of This Book 4
The Challenge 5
The Opportunity 6
A Systems Look at Healthcare 8
An Integrating Framework for Operations Management in Healthcare 12
Conclusion 15
Discussion Questions 15
2 History of Performance Improvement 17
Operations Management in Action 17
Overview 18
Background 18
Knowledge-Based Management 19
History of Scientific Management 21
Quality 27
Service Typologies 38
Supply Chain Management 39
Conclusion 41
Discussion Questions 41
3 Evidence-Based Medicine and Value-Based Purchasing 43
Operations Management in Action 43
Overview 44
Evidence-Based Medicine 45
Tools to Expand the Use of EBM 52
Clinical Decision Support 58
The Future of Evidence-Based Medicine 60
Vincent Valley Hospital and Health System and P4P 61
Conclusion 62
Discussion Questions 62
Part II Setting Goals and Executing Strategy 63
4 Strategy and the Balanced Scorecard 65
Operations Management in Action 65
Overview 66
Moving Strategy to Execution 66
The Balanced Scorecard in Healthcare 70
Linking Balanced Scorecard Measures to Strategy 80
Implementation of the Balanced Scorecard 85
Ensuring That the Balanced Scorecard Works 86
Business Intelligence 89
Conclusion 90
Discussion Questions 90
Chapter Exercises 92
Case Study: St. Mary's/Duluth Clinic 92
Notes 94
Further Reading 94
5 Project Management 95
Operations Management in Action 95
Overview 95
Definition of a Project 97
Project Selection and Chartering 98
Project Scope and Work Breakdown 105
Scheduling 109
Project Control 114
Communications 118
Risk Management 119
Quality Management, Procurement, the Project Management Office, and Project Closure 121
Agile Project Management 124
The Project Manager and Project Team 125
Conclusion 128
Discussion Questions 128
Chapter Exercises 128
Further Reading 129
Part III Performance Improvement Tools, Techniques, and Programs 131
6 Tools for Problem Solving and Decision Making 133
Operations Management in Action 133
Overview 133
Decision-Making Framework 134
Mapping Techniques 137
Problem Identification Tools 143
Analytical Tools 151
Implementation: Force Field Analysis 160
Conclusion 162
Discussion Questions 162
Chapter Exercises 162
7 Statistical Thinking and Statistical Problem Solving 165
Operations Management in Action 165
Statistical Thinking in Healthcare 166
Foundations of Data Analysis 167
Graphic Tools 168
Mathematic Descriptions 173
Probability 176
Confidence Intervals and Hypothesis Testing 184
Simple Linear Regression 191
Conclusion 197
Discussion Questions 198
Chapter Exercises 198
8 Quality Management: Focus on Six Sigma 201
Operations Management in Action 201
Overview 202
Defining Quality 203
Cost of Quality 204
Quality Programs 206
Six Sigma 208
Additional Quality Tools 222
Riverview Clinic Six Sigma Generic Drug Project 227
Conclusion 230
Discussion Questions 230
Chapter Exercises 232
9 The Lean Enterprise 235
Operations Management in Action 235
Overview 236
What Is Lean? 236
Types of Waste 238
Kaizen 239
Value Stream Mapping 240
Measures and Tools 242
The Merger of Lean and Six Sigma Programs 255
Discussion Questions 257
Chapter Exercises 257
10 Simulation 259
Operations Management in Action 259
Overview 261
Uses of Simulation 261
The Simulation Process 262
Monte Carlo Simulation 264
Discrete Event Simulation 270
Conclusion 282
Discussion Questions 283
Chapter Exercises 283
Part IV Applications to Contemporary Healthcare Operations Issues 285
11 Process Improvement and Patient Flow 287
Operations Management in Action 287
Overview 288
Problem Types 289
Process Improvement Approaches 292
The Science of Operations Management 299
Process Improvement in Practice 300
Conclusion 312
Discussion Questions 315
Chapter Exercises 315
Further Reading 316
12 Scheduling and Capacity Management 317
Operations Management in Action 317
Overview 318
Hospital Census and Rough Cut Capacity Planning 319
Staff Scheduling 321
Job/Operation Scheduling and Sequencing Rules 324
Patient Appointment Scheduling Models 328
Advanced Access Patient Scheduling 329
Fears About Advanced Access and Their Practical Resolution 334
Conclusion 335
Discussion Questions 335
Chapter Exercises 335
13 Supply Chain Management 339
Operations Management in Action 339
Overview 341
Supply Chain Management 342
Tracking and Managing Inventory 343
Demand Forecasting 345
VVH Diaper Demand Forecasting 349
Order Amount and Timing 351
Inventory Systems 358
Procurement and Vendor Relationship Management 360
Strategic View 361
Conclusion 362
Discussion Questions 362
Chapter Exercises 362
14 Improving Financial Performance with Operations Management 365
Operations Management in Action 365
The Need for Better Tools for Improving Financial Performance 366
A Systems Approach to Financial Management 369
Overhead Expenses 376
Revenue 379
Linking All Cost and Revenue Models Together 379
Case Example: Floyd Hospital 381
Discussion Questions 382
Chapter Exercises 383
Part V Putting It All Together for Operational Excellence 385
15 Holding the Gains 387
Overview 387
Human Resources Planning 388
Managerial Accounting 390
Control 392
Which Tools to Use: A General Algorithm 393
Operational Excellence 401
VVH Strives for Operational Excellence 402
The Healthcare Organization of the Future 404
Conclusion 405
Discussion Questions 405
Case Study: VVH 405
Glossary 407
References 415
Index 433
About the Author 441
