optimizing the use of lean and six sigma tools

Optimizing the Use of Lean and Six Sigma Tools

March 4, 2005

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Any use, copying or distribution without written permission from UnitedHealth Group is prohibited.

UnitedHealth Group Mission and Values

UnitedHealth Group is a diversified health and well-being company dedicated to making the health care system work better. The company directs its resources into designing products, providing services and applying technologies that:

• improve access to health and well-being services;

• simplify the health care experience;

• promote quality; and,

• make health care more affordable.

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A Comprehensive Approach

UnitedHealth Group serves the entire spectrum of health care participants: individual consumers, employers, governments, commercial payers and intermediaries, care providers ranging from hospitals to physicians, and pharmaceutical and medical device manufacturers.

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Specialized Care Services Overview

Specialized Care Services is a portfolio of businesses that offers a diverse array of unique and specialized health and wellness benefits, services and resources:

• Specialty Health and Well-Being Services – Behavioral health services, employee assistance programs, chiropractic services, alternative and complementary care, and physical therapy services.

• Personal Health Services – Consumer health information, critical illness networks and support services, and health condition management capabilities.

• Consumer Care Services – Comprehensive dental and vision benefits and services.

• Group Insurance Services – Critical accident, short-term disability and life coverages, and cost management services for health plans, self-insured employers and individual consumers.

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Complementary customer needs, distribution channels, and operating assets

Specialized Care Services

Specialty Health and Well-Being

Consumer Care Services

Personal Health Services

Group Insurance Services

An Organized Portfolio Serving Distinct Markets

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The Way We Do

Business

Just Right Service: Timeline

Launch Vision into

Action

Executing w/Discipline

and Urgency

Business Integration

2002 2003 2004 2005 2006

Process Process ProcessImprovement Design Control

DMAIC / Kaizen DMADV BPMS

“At SCS “At SCS for “At the Customerfor SCS” the Customer” for the Customer”

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Just Right Service: Looking Back

Launch Vision into

Action

Executing w/Discipline

and Urgency

2002 2003 2004

Process Improvement

DMAIC

“At SCS for SCS”

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Selected DMAIC Project Overviews

Created a common platform by which all sites can track how they accommodate requests for non-network services. This approach for allows for increased service levels to members looking for accommodations, while also providing valuable input into the network development process.

Accommodation Standardization

Improved the entire process around member communications. Order accuracy was addressed by implementing guidelines that coincided with a streamlined process, while the internal costs associated with handling the materials were reduced through the addition of bar-coding procedures.

Member Communication Costs

Standardized the process by which nurses make outbound calls to members to follow-up on treatment recommendations and care delivery. Moved all assessments to an on-line format, allowing for improved reporting and a consistency in both the questions asked and the documented assessments. This resulted in increased quality and the opportunity for each nurse to reach more members per day.

On-line Clinical Assessments

Along with developing a standard operating procedure for the transplant referral process, associated tools were implemented specific to each component to help staff more easily identify referral opportunities. More members will now benefit from transplant clinical consulting services and access to the nation’s leading transplant programs through United Resource Networks’ Transplant Resource Services Centers of Excellence Network.

Transplant Referrals

FocusProject

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Just Right Service: Looking Forward

Business Integration

2005

Process ProcessImprovement Design

DMAIC / Kaizen DMADV

“At SCS “At SCS forfor SCS” the Customer”

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Kaizen Events and the Frontline Employee

Kaizen

Process Improvement

2005

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What is “Standardization”?

A consistent method of achieving efficient productionwithout waste , based on human action.

• Highest quality, most efficient, safest way you know today

• Only one standard at a time

• Documentation of know-how

• Objective, simple, observable

• Consistent with quality, cost, regulatory and customer delivery requirements

• Show relationship between cause and effect

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Standardization vs. Defect Reduction

Standardization

Improving productivity and quality by standardizing all human actions associated with a single process. Provides the foundation for further process improvement and defect reduction.

Defect Reduction

Reducing the defects of a single Critical-to-Quality characteristic by focusing on the key input variables of a process.

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“A philosophy of continuous improvement based on setting standards aimed at eliminating

waste through participation of all employees.”

What is “Lean?”

The goal of Lean is to accelerate the velocity of any process by reducing waste.

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Comprised of the Japanese words meaning “change” and “better”

A Kaizen Event is a 3 day workshop focused on rapid improvement

through the observation and analysis of a process. Process performers

learn and use Lean concepts to remove waste, reduce variability,

standardize work, and implement the improved process as the new

standard.

What is “Kaizen?”

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The Eight Deadly Wastes

• Motion / Walking

• Processing

• Correction

• Waiting

• Overproduction / Early Production

• Conveyance

• Inventory

• Not Utilizing the Talent and Knowledge of People

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Similarities Between Six Sigma and Lean

• Employ DMAIC methodology

• Utilize tools for process characterization and optimization

• Rely on cultural change

• Focus on variation and waste

• Approach making decisions on business processes in a structured way

No

No

Define

Process GoalStandardiztion?

Yes No

Measure

Analyze

Design

Verify

Measure

Analyze

Improve

Control

DMADV

4-6 months

DMAIC

------ Kaiz

en

Eve

nt ------

Is ProcessStandardization

Enough?

Does AProcess

Exist?

Control

1-2 months4-6 months

1 month

1 month

Measure1 day

Analyze1 day

Improve1 day

1 month

1 month

.5 - 1 month

1 month1 month

1 month

1 month

1 month

NoSTOP

STOP

STOP

IsIncrementalImprovement

Enough?

Yes

Yes

DMAICDMADV

Just Right Service

ProcessGoal DefectReduction?

Process inControl?

Yes

Yes

No

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Defect Reduction Tools

Project Charter

SIPOC

Process Map

Cause and Effect Diagram

FMEA

Gauge R&R

Pareto

Box Plot

Histogram

Hypothesis Testing

Correlation and Regression

Design of Experiments

Simulation

Optimization

Control Plans

Work Standards

Job Instruction

Standardized Work

SPC

Mistake Proofing

Audit

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Kaizen Tools

Project Charter

Value Stream Map


FMEA

Pareto

Box Plot

Histogram

Control Plans

Work Standards

Job Instruction

Standardized Work

Work Sequence

Standard Work in Process

SPC

Mistake Proofing

Audit

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Process Improvement Tools

Project Charter

SIPOC

Process Map

Value Stream Map


FMEA

Gauge R&R

Pareto

Box Plot

Histogram

Hypothesis Testing

Correlation and Regression

Design of Experiments

Simulation

Optimization

Control Plans

Work Standards

Job Instruction

Standardized Work

Work Sequence

Standard Work in Process

SPC

Mistake Proofing

Audit

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Kaizen Event: Project Candidates

• Single process focus

• Process performed by multiple staff members

• Process productivity and quality are currently measured or measurable

• Process lacks control or process is not standardized

• Process is repeatable and happens from start to finish every day

• Process capitalizes on process performer knowledge

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Kaizen Event: What to Expect

• Reduction in cycle time

• Waste elimination

• Improved quality

• Documented standardized process

• Employee involvement and subsequent ownership of the process

• Staff training in continuous improvement

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Kaizen Event: Process

1. Clarify the goal and target areas

2. Understand the current process as it really is

3. Identify best practices, waste, and opportunities for improvement

4. Generate improvement ideas and ways to eliminate waste

5. Discuss improvement ideas with internal customers

6. Try the new process

7. Verify process/refine ideas

8. Document the new process and training plan

9. Plan for followup

10. Report results

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Kaizen Event: Key Deliverables

• Process Map

• Process Observations

• Standardized Work Chart

• Recommendations to Management

• Requests to Business Partners

• Follow-up Tracking Sheet

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Kaizen Participant Feedback

• “The training helped me to realize how important the workflow is for each person’s job.”

• “Gives me a foundation and a way to come up with a plan on improving my productivity.”

• “New ways to think about what we do.”

• “I learned how to get an enormous project done quickly and efficiently”

• “Using structured processes guarantees both value to our customers and consistency for process performers”

• “How important a vision, a goal and an objective are in completing a major task”

• “Having the opportunity to find out our similarities and differences…beyond valuable!”

• “Bringing together like-minded people to address issues that impact all of us”

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Kaizen Lessons Learned

• Stay on schedule

• Be careful of selecting multiple processes or the wrong objective

• Select the right team – not only top performers

• Gain management’s approval at the initial report out

• Mitigate lack of supervisory support

• Hold the Control Plan to the same standards as DMAIC

• Follow-up at key intervals to ensure accountability

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DMADV and the Impact on Design

DMADV

ProcessDesign

2005

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A systematic methodology, with tools, training and measurements which enable us to design products and processes that meet customer expectations at a high quality level.

The Right Product AtThe Right Time With

The Right Quality

What is DMADV?

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Actual Resource

Level

Why Use DMADV?

Planned Resource Level

Expected Resource LevelWith DMADV

Time

Res

ou

rce

Lev

el

Post LaunchProblem Teams

Up-front investment is the most effective And efficient approach

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• New Process or Service Introduction

or

• Process Broken or Does Not Exist

• Process Has Reached Entitlement

When Would You Use DMADV?

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Just Right Service: Future State

The Way We Do

Business

2006

optimizing the use of lean and six sigma tools

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