Management Engineering/ Process Improvement (ME/PI)

“Provide Value”

What is a Management Engineer or Process Improvement (ME/PI) Professional?

Process Improvement (PI) professionals address the design, installation, and improvement of integrated systems of people, material, facilities, information, equipment and energy.

They bring a wide variety of work experience and educational backgrounds to the job.

Education• BS, Industrial Engineering, Management Engineering or

Operations Research

• MBA, MHA, MSIE, MS Operations Research or Health Systems

• PhD, MBA, MHA, BSBA Business Management or initial clinical background such as RN, RHIA, RHIT

• PhD, MHA, Allied Health Professionals with Business/Engineering minors

• Six-Sigma, Lean, CPHIMS, CPHQ, and other certifications

Key Practice SkillsAnalytical - a solid knowledge and experience with:

– quantitative statistical techniques and tools

– process improvement programs (Lean, 6-Sigma, ….)

– demand and supply forecasting

– workload and schedule optimization

– engineering economics, financial analysis and decision support

– queuing theory

– workflow analysis

– simulation modeling

– the quality process Formal Education

Key Practice Skills (continued)

The ability to:– collaborative with people in complex organizations

– manage the design and implementation of processes and systems

– promote ideas and influence change in a organization

– teach others the quality management problem solving tools

– teach and deploy business improvement methods and tools

Informal Education

Key Practice Skills (continued)

Profound knowledge of:

– JCAHO and other licensing standards

– clinical protocols and clinical outcomes

– hospital organization structure and interrelationships

Healthcare Education

ME/PI PhilosophyTo provide value by:

• Advancing a win-win culture

• Promoting customer centric environment

• Improving the system of production, service, and planning – Constantly!

• Educating and transferring skills to departments to assist them to realize their full potential

• Breaking down barriers between departments and becoming a catalyst for lasting improvements

• Promoting continuous quality improvement

ME/PI Profession Current State

Current State• Responsibilities and accountabilities are not

universally defined – Sometimes we’re “Jacks of all trades”– Reporting structure depends on the institution

• Lack of direction– Skill set, education and training has not been

standardized leading a broad arrays of professionals – No set continual education or certification– Prevalence of soft skills in the profession

Current State (cont.)

• Career path is sometimes limited– In industry people with our skills are frequently

brought into senior management

• Seen as “cost” versus “revenue” departments– Savings multipliers not touted– Project benefits not advertised

Customer

IT Engagement

Resource M

anagement

Per

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ME/PI Concept

Performance Improvement Function

• Operational audits• Outcome measurements• Service quality audit and evaluations• Process identification, documentation and evaluation• Streamline or “tweak” existing processes• Design off current processes• Enhance value added activities• Modify existing systems• Conduct staff skill audits

Customer

ME/PI Concept

Performance Improvement (cont.)

• Identifying process and outcome measures• Performing quantitative and qualitative analysis• Aligning measures to meet organizational goals• Designing “Scorecards”• Evaluating system capacity• Establishing performance targets• Initiate DMAIC projects

Customer

ME/PI Concept

Performance Improvement Tools

• Department Functional Tree Structure

• Process mapping and analysis• Value stream mapping• Simulation (Modeling)• 5 Ss• Kaizen• Lean• Six Sigma DMAIC (Define, Measure, Analyze,

Improve, Control)

• Root cause analysis• FMECA• DOE• Kanban• SPC/SQC• Performance

Benchmarking• Poka-Yoka• Etc.

ME/PI Concept

Customer

• Internal and External Benchmarking– Develop opportunity matrices based on

current department performance

– Utilizing Action OI Reports for operational benchmarking

– Attending and facilitating departmental and interdepartmental meetings

Performance Improvement Tools (Cont.) Customer

ME/PI Concept

Performance Improvement Tools (Cont.)

• Operational Benchmark Indicators Paid FTEs/Adjusted Occupied Bed Paid Hours/Discharge Management FTEs/Total FTEs Department Paid Hours/Unit of Service Volume Square Feet/Adjusted Discharge Over Time as a % Percentage of Paid FTEs Agency, Temp, Contract FTEs as a % of Total Paid FTEs Adjusted Admission/Active Physician Percent Occupancy Surgery Suite Utilization

Customer

ME/PI Concept

Performance Improvement Tools (Cont.)

• Financial Benchmarks Indicators Salary & Benefits as a % of Net Revenue Labor Expense/Adjusted Discharge Non-Labor Expense (Supply, Drug, etc.)/ Adjusted Discharge Days in Accounts Receivable Bad Debt Percentage Revenue Per Adjusted Discharge

Customer

ME/PI Concept

Performance Improvement Tools (Cont.)

• Clinical Benchmarks Indicators Case Mix Adjusted Average Length of Stay Mortality Tests per case per physician

Customer

ME/PI Concept

InputInput

Staff HoursStaff Hours

SuppliesSupplies

EquipmentEquipment

ProcessProcess HappyHappy CustomerCustomer

Voice of Voice of

ProcessProcess

Voice of CustomerVoice of Customer

Patient Treatment Concept

Resource Management Function

• Service utilization evaluation• Supply standardization audit• Departmental staffing pattern audit and

evaluation• Supply chain Management evaluation• Service utilization benchmarking

Customer

ME/PI Concept

Resource Management Activities

• Clinical Process outcome analysis • Clinical Process Benchmarking• Productivity Analysis• In-Quality Staffing• Physician Profiling• Cost Per Case• Supply Chain Management (SCM)

Customer

ME/PI Concept

Productivity Measurement and Analysis• Measuring workload, identifying patterns and

trends• Identifying labor utilization, by type and cost

impact• Matching staffing to demand “In-Quality

Staffing”

Customer

ME/PI Concept

“In Quality” Staffing: Which customer(s) win?

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In Quality plus Process ImprovementIn Quality plus Process Improvement

USL

LSL

Customer

ME/PI Concept

Physician Practice Profiling

• Reduce cost through reduction of unnecessary variation of utilization

• Sharing information with providers (Value Added)• Select cost effective physicians • Improve patient outcomes

Customer

ME/PI Concept

IT Engagement Function

To ensure the success of IT ME/PI provides following support services;

• Strategic Planning and strategic analysis• Needs Assessment• Assess current and emerging technology• Feasibility Study• Project Management• Cost and Benefit Analysis• Selection Criteria• Request for Proposal and/or Information• Selection of System• Vendor viability analysis

Customer

ME/PI Concept

IT Engagement Tools

• Process mapping (“As Is” and “Should Be”)• Gap analysis• System performance analysis• System reporting capability analysis• Project planning• Project management• Team and meeting facilitation• ROI calculation

Customer

ME/PI Concept

ME/PI ProfessionIdeal Future State

Customer

ME/PI Concept

Future State• Well defined roles and responsibilities within

Healthcare• Operational guru• Starting point for all healthcare operational leaders• Training ground for healthcare COO, Department

Directors and other healthcare operational leaders• Defined skill set for the entering to the profession

Customer

ME/PI Concept

Future State (cont.)

• Structured on the job training and licensure for promotion• At least 50% to 70% of ME staff to be trained engineers• Well developed on the job training program• Defined minimum performance criteria related to cost

savings, revenue enhancement, and quality improvement (i.e. Minimum contribution factor to bottom line should be 3 to 5 times of ME department cost)

Customer

ME/PI Concept

Questions

?Customer

ME/PI Concept