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Lean manufacturing, referred to commonly as “lean,” comes from the Japanese manufacturing process management philosophy derived mostly from the Toyota Motor Company. Lean was popularized in the 1990s with the publication of the best seller The Machine That Changed the World, a book authored by Massachusetts Institute of Technology research scientists studying global manufacturing practices. This book by Womack, Jones, and Roos describes the manufacturing techniques behind Toyota's success and shows how, when implemented, these systems resulted in defect reduction, improved cost efficiency, higher productivity, and greater customer satisfaction. The results were remarkable: cars with one-third the defects, built in half the factory space, using half the man-hours. The Machine That Changed the World explained what lean production is, how it really works, and how it inevitably spread beyond the auto industry. It was not until 2001 that health care organizations began applying lean principles to processes outside of manufacturing.

In 1999, the Institute of Medicine Report, To Err is Human, challenged organizations to find better tools to effectively address cost and quality challenges. Those looking outside of health care for fresh approaches were impressed with the results seen in manufacturing companies using lean. The challenge would be to translate manufacturing tools into health care processes.

Like manufacturing, health care delivery systems are often large, complex organizations with widespread waste and inefficiencies. For this reason the Toyota production system methods are attractive to health care leaders. Lean methods place the customer first, are obsessed with highest quality, safety, and staff satisfaction while succeeding economically. Beyond broad management ideals, the comparison to health care becomes less obvious. How can manufacturing cars be like caring for patients? It turns out that every manufacturing element is a production process. Health care is a combination of complex production processes: admitting a patient, performing surgery, or sending out a bill. Each involves thousands of processes, many of them very complex. All involve the concepts of quality, safety, customer satisfaction, staff satisfaction, and cost effectiveness. In health care, failing to deliver in any area not only causes dissatisfaction, but may even lead to patient harm.

In a sequel book on lean, Womack and Jones provided 5 principles of lean production: defining value, value stream, flow, pull, and perfection. For simplification, this chapter will discuss value and value stream together. When improving any process using lean methods, it is important to study that process with respect to each of these five principles.

Defining Value

Defining value is the first step in “leaning” any process. Hence, one first identifies what is valuable within the process, as determined by the customer of the process. In identifying value, waste is automatically identified as that which is not valuable. Since the ultimate customer of any process in health care is the patient, it is important to ask “what would the patient be willing to pay for?” In auto manufacturing, car sales make ...

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