Profit, Non-Profit

 Here's a quote from the Washington Post article,  "5 Myths about charitable giving" on 30 Dec: "Nonprofits are not profitable.  In 2010, US charities reported more than $2.7 trillion in assets.  . . . (in 2007) a large Midwest charity hospital chain reported reserves of $7.4 billion, more than twice the cash on hand at Walt Disney Co."  If you're not laughing yet, read the entire article. 

His basic premise is correct, non-profits do indeed make profits, so it's hard to poke fun at this slip.  But anyone who took accounting 101 knows the difference between profits (the difference between income and expenses) and assets (stuff you own or take to the bank).  The distinction between for-profit and not-for-profit healthcare institutions has long been a source of confusion.  It should not be.  On the one hand, there is no difference.  All companies make a profit, or they cease to exist.  You can spend assets to pay expenses for awhile, but ultimately, you must make a profit to persist.  I once worked for a company that was jointly owned by a for-profit medical group and a not-for-profit hospital.  We kept three sets of books:  One for reporting our business to the IRS each year.  One for reporting to our for-profit owner, and a final one for reporting to our not-for-profit owner.  Note that it was the same business--same income, same expenses, same profits.  Each of the owners treated the profits differently on their tax return.  So that's the rub, how you report profits to the IRS.

It also makes a difference in how you run the company.  Here's a list of goals and strategies for a not-for-profit healthcare organization:
1. Emphasize giving.   Message every patient about all the good work you do and make it easy for them to contribute to your endowment.
2. Call yourself a "Children's" hospital, rather than a "Women and Children's hospital, because Children's hospitals attract more donors.
3. Lobby CMS and Congress for higher reimbursements.
4. Appoint wealthy locals to your board, and hold charity events to raise money. .
5. Cultivate relations with the press to obtain favorable coverage of heartthrob cases.

By contrast, here's what the for-profit competitor might do:
1. Control costs by bargaining aggressively with suppliers.
2. Engage employees in eliminating waste in healthcare processes.  Award cash bonuses.
3. Cultivate surgeons who bring high profit margin cases.  Make it easy for them to work here.
4. Aggressively manage the processes of care to eliminate waste and unnecessary steps.

One more thing:  there is a difference between a charity and a not-for-profit, tho some institutions are both.  In principle, a charity receives income exclusively from donors and spends money on some worthy cause.  Generally, they do not send bills or provide services for a price.  The Girl Scouts of America is a charity.  They do sell cookies, but they don't send bills to those who receive their services.  Georgetown University Hospital is a not-for-profit.  They do send bills to those who receive their services.  The Shriner's hospital  is the closest thing to charity in the healthcare world.  Their web site is all about donating, and their mission is to provide care without regard for the "ability of a patient or family to pay." 

As one might expect, for-profit healthcare institutions tend to be more efficient.  Nothing like reporting to a board on where the money went to focus your attention on the cost of providing care. 

Oh, yes.  The answer to the question from last time is one.  Marriott owns one hotel, the Key Bridge Marriott in Washington.  It was the first hotel Marriott built.  All the others are franchises.  Marriott has a quality team that regularly visits each hotel with a checklist.  If there are deficiencies, you are given an appropriate time to make corrections.  If progress is not forthcoming, they take the sign off the door, and you are no longer a Marriott hotel.

Great Food

http://www.washingtonian.com/articles/food-dining/everywhere-at-once-chef-geoff-tracys-data-driven-empire/

Just finished reading a review of Chef Geoff's restaurant chain in the August issue of Washingtonian Magazine.  OK, I'm a little behind in my reading, but this caught my eye as demonstrating successful use of basic quality tools and techniques, including some principles from ISO 9001. 
Owner, Geoff Tracy opened a restaurant in DC and managed everything himself.  This was successful, so he opened another, and another, and another.  He soon realized, however, that he could no longer manage everything himself and that without effective management, things didn't always go well.  Enter brother Chris, a numbers guy.  Together, they established 800 standards that are measured at each restaurant.  (Wine by the glass dated to ensure freshness, dishwasher at correct temp, email to new employees before first day of work, etc.).  All this is part of a perhaps obsessive attention to detail that rolls up to weekly, monthly, and annual reports on each restaurant.  Tracey is quoted as saying, "Consistency is a lot harder than it looks.  It might just be the hardest thing of all to achieve."  There are 70 training courses for employees, with cash rewards for those doing well on the tests. 

All of this will sound familiar to quality professionals, but it's unusual in the restaurant business.  Marriott hotels has a similar but shorter list of quality metrics.  (Trivia question of the day:  How many hotels does Marriott own?  Answer next time.) 

Chef Geoff has a mission statement: "Great Food, Libation, and Merriment."  His 800 metrics describe in excruciating detail what that means for every employee.  Note that there is nothing about gourmet dining or cheap eats.  Just a promise of great food/wine, and that you'll have a good time eating there.  And they do that every time at every restaurant.  Geoff is also quoted as saying, "I don't think measuring is what differentiates us.  . . . we share that information with our managers in a way that is actionable."  Sounds like my kind of place.  They even have outside auditors, tho they're not registered to ISO.  At least not yet.

So what's this have to do with healthcare?  Healthcare as an industry needs this approach.  Here's what it might look like:
1. A clear mission statement, linked to identifiable customers and their needs.
2. Weekly metrics to the CEO from key processes, with actionable items for improvement.
3. Consistency in service everywhere.  How about 70 in-house training programs, with cash awards for effective learning by employees.
4. Call buttons answered within three minutes.  If this restaurant can serve a cocktail within three minutes of the order, surely we can answer the call button in that time, every time. 

In short, healthcare needs to define some standards, measure performance against those, and develop action plans for noted deficiencies.  Note that it's not enough to say that "we'll meet this goal 90% of the time."  The quality professional will ask what happened the other 10% and what are you doing about it.  Take a page from Lexus automobiles, "The relentless pursuit of perfection."

In defense of the healthcare industry today, there are too many metrics that are imposed externally and have little to do with the quality of care.  Even for some that are relevant, the task of measuring compliance is more expensive than providing the service.  (Think, giving an aspirin within 30 minutes of an ER visit for chest pain.)

Some hospitals are adopting ISO 9001 as a management system, and there are consulting companies to help them with that effort.  Still, dramatic change will require something that doesn't exist today--price competition for healthcare services.  There is just so much business in "eating out" in the DC area.  Chef Geoff is pursuing a subset of those diners and aggressively assessing the quality of his efforts with the aim of constant improvement.  He will do well.  Now, what about healthcare?

A Raise?

December is Salary Survey month for Quality Progress--your chance to see how you're doing relative to the industry at large.  And if the results are not to your liking, I guess you could always ask for a raise.  (That sound you hear is my muffled laughter.)  In an environment where most people are grateful just to have a job, where Federal workers (me) have't had a raise in three years, go on, make your case.  Just to set the record straight, the ban on raises for Federal workers doesn't apply to political appointees or to those at the high end of the pay scale (SES workers), only to rank and file workers at GS-15 and below.

 Paul Borawski offers some tips on asking for a raise, but this is not going to be easy. Remember, duration of employment doesn't sell.  Just bringing that up may remind me (your boss) that I could hire a new employee for less than I'm paying you.

Quality managers don't come with statistics, like baseball players, so I can't look at batting averages or stolen bases, etc.  Do certifications count?  Only if they're specified in your position description, and then they're a condition of employment, not a reason for a raise.  However, the knowledge gained from studying for the exam may serve you well in solving problems for your employer and thereby demonstrating your expertise/value.  There is a difference between knowing about quality tools and techniques and applying them to everyday problems. 

How much money have you saved the company in the past year?  Yes, you can count time saved, but I'd like to see some hard cash also.  In healthcare, I'd look at standard metrics, like central line infections or response time to call buttons. How about readmission  rates?  That's a big one now and destined to get bigger as hospitals are held responsible for those costs.  Furthermore, that's an area that should be amenable to the quality tools you know so well.  Show me that you have contributed to improvements in these areas.

Tired of hearing employees tell him how good they are, one manager put the following sign above his door: "You're not really good until someone else tells you you're good."  That speaks to the value of auditing, but also to objective evaluations--metrics.

My favorite metric in the healthcare world is time.  How long does it take?  How long for the whole process, and how long for each step?  Time is easy to measure, easily understood, and Excel does time arithmetic.  Time, of course, is money, but the translation isn't always easy.  If you saved employee time, what is that employee doing with the extra time? 

Time can also be a customer satisfaction issue.  I doubt many patients would ask to sit longer in your waiting room.  If you employ LEAN principles, you will be pulling the patient thru your process just in time, rather than pushing him to the next waiting area.   How about surgeons?  If you agree that patients don't like to wait, ask surgeons if they like waiting for the OR to change between cases.

Back to your raise:  Show me all the sections you have worked with to improve their times.  Put a $$ value on it.  Do more surgeons want to work in your OR's because things happen faster there? Have you gained market share because you run a LEAN machine?

Improvement requires change, but all change isn't improvement.  There is an effort now to encourage physician offices to use electronic records, but when our clinic adopted an electronic record, we had to hire another physician to make up for the extra time the new system required of providers.  One thing has always bothered me about this concept:  if electronic records are such a good idea, why do we have to pay offices to adopt them?   It may be impossible to make a business case for electronic records in a physician office.  Many systems are VERY expensive, and to get paid, you have to show you are using the system for some use that a Washington bureaucrat thinks is "meaningful."  Electronic prescriptions are wonderful, but I'm not sure about the rest.  When our office offered an optional electronic prescription module, there was over 99% acceptance within a month.  We don't have prescription pads anymore.  When we introduced an electronic record, productivity plummeted and several threatened to resign.  So be careful of becoming an advocate for electronic records.  They may have a negative effect on your financial resume.

Still, there is a lot to do.  Five years ago, there were two main problems with the US healthcare system:  access and cost.  The access problem was mostly solved with the Affordable Care Act.  The remaining issue, cost, provides a huge opportunity for quality managers.  Show me what you can do, and we'll talk about a raise next year. 

November is/was “World Quality Month.”  What is the healthcare world missing by not taking better advantage of quality professionals and their tools?  Paul Borawski talks about reducing waste and quotes figures on potential gains of 30% in service industries and 70% for healthcare.  Can this be true? 

There are anecdotal reports of savings in the 20% range from process improvements in various service industries, so a figure in this range for healthcare is easily believed.  But 70%?  As they say, “it’s complicated.”  Depends on your definition of waste.  For some, waste means waiting too long or taking to long to accomplish a task.  Spending more time or money than necessary in the performance of delivering healthcare.  If a surgery center can do a new tubal ligation every 30 minutes, why does it take a hospital 45 minutes?

For others, waste in healthcare means providing more healthcare than they think you need.  Waste is not so much in the care process but in the decision to provide the care at all.  The National Patient Safety Task Force is the embodiment of this approach in the US as is the NICE commission in England.  The recent article questioning the value of mammograms falls in this category as does the debate over a PSA blood test for prostate cancer.  These people are looking at the health of populations, not individuals.  If we cut back on mammograms, and the death rate from breast cancer goes up a bit, well, maybe that’s OK.  There is a legitimate question of how much money we should spend for a life saved?  We have become very accustomed to calling 911 in the event of a sudden medical emergency, but that system is not universal in the world outside the US.

Notice that the patient or customer does not appear in either of the above discussions.  In fact, there is considerable debate over where the patient fits in this equation.  He doesn’t make the purchase decision, and he doesn’t pay for the service. So, if the patient is unhappy, is that waste?  If a quality professional devised a way to prevent this unhappiness, would the hospital be interested?  Would solving this problem do anything positive for the provider’s bottom line?

A few weeks ago, I took my aging truck to the Toyota dealer to fix a rattle that I diagnosed as a rotting exhaust system.  They installed a clamp and declared the problem solved.  It wasn’t.  They had failed to notice that the exhaust system distal to the clamp was not really attached to anything.  Another visit (and $1,000) finally fixed the problem.  But was this waste?  The dealer got paid for everything he did, and spent little/no added time.  In fact, he denied there was a problem.
“You needed the clamp anyway.”
He lost a customer, but his process for fixing vehicles is unchanged.  For now, he’s busy enough to ignore my interests.   Just like healthcare.

If hospital A became more efficient, would anyone notice?  Would they gain market share at the expense of hospital B?  No.  For two reasons:

1. If they found a way to do, let’s say, total hips for half the cost, they’d still charge the same      amount.   That’s what insurance companies pay, so why charge less?
2. Chance are, there is no hospital B.  Hospitals in the US are micro-monopolies and don’t compete for patients--at least not on the basis of cost.

So what’s the poor quality professional to do in November?  Eat turkey. 

SMart Manufacturing

In his October posting, Paul Borawski talks about a “Smart Manufacturing” initiative to make the factory floor into a profit center (as opposed to a cost center).  In reality, the thoughts behind this approach means uniting innovation with production--locating the R&D shop physically close to the production line.  The idea, of course, is to capture ideas from those actually doing the work and translate those into new processes that are more efficient. 

Before you say “Yes, of course,” think about what has been happening in US manufacturing recently.  The primary approach to reducing production costs has been to move production to a cheaper labor environment or to a country without laws on environmental pollution.  R&D stays here, putting both a geographic and a cultural barrier in the way of innovation. 

So what about healthcare?  Much has been written about waste in healthcare, but the definition of waste has focused on “unnecessary” healthcare that could be eliminated with minimal harm to the population, not at improving the processes of providing care.  At present, these are focused nationally on reducing the amount of healthcare provided under Medicare.  The new Accountable Care Act (ACA) even provides a counterpart to the British NICE commission to decide what healthcare will be allowed.  (For more on how this works, see “My Drug Problem” which begins with “If I lived in New Zealand, I’d be dead.”)  Unnecessary care is thus defined as healthcare that the government doesn’t think you ought to have.  Of course, they may be right.  From a population or an economic perspective, they are probably right much of the time.  But not all the time.  This is the classic difference between populations and individuals.  Look at one example:  Every year, I have a PSA blood test to detect prostate cancer.  It’s not a very good test, and causes a lot of men to have additional tests or procedures when the PSA is abnormal.  Most of these are false alarms, but they cost money for Medicare.  Furthermore, some make the point that some prostate cancer is relatively benign and can be ignored.  So it’s not a slam dunk. The key question is who makes that decision.  The government already has.  They think the PSA is a bad idea and advise against it.  Some day, they will instruct my insurance company not to pay for it.  Eventually, they will not even allow me to pay for it myself.  Maybe I’ll be lucky, and that will be OK.

This approach stresses decreasing the products and services provided, not on gaining customers or market share.  There are very few examples of competition in healthcare.  No hospital goes out of business because their competitor provided appendectomies at a lower price. 

This is one situation where you can have it all.  There is a legitimate need to look at taking better care of patients with chronic diseases, so they don’t need so much care.  There are provisions in the ACA to do this.  There is also a need to look at the efficacy of drugs and procedures, but we must also recognize that there are differences of opinion about what works and what doesn’t.  Furthermore, some patients may want something done in spite of your advice to the contrary.  That’s got to be OK.

Some may remember the HMO era in US healthcare.  It was the only time that the annual cost of healthcare actually fell.  HMOs made their money by denying care.  They made access to care so difficult that only dedicated patients would persist.  Eventually the American people rebelled and HMOs have largely changed their strategy. 

There is a need for the “Smart Manufacturing” approach in the healthcare industry.  We could solve our need to reduce the cost of healthcare by making the processes of care more efficient.  Workers on the front lines of healthcare know how to do this.  It’s time to bring the R&D folks in to help capture those ideas and re-design the processes.  There are off-the-shelf techniques for accomplishing this task.  The only thing missing is the motivational threat of a serious competitor.

Better, Faster, Cheaper

Faster, Better, Cheaper

Remember Veruca Salt in the movie, Charlie and the Chocolate Factory?  Her famous quote is “I want it now, Daddy,” and, as I recall, the results were not good.  So much for spoiled brats and overindulgent parents.

But is that the mirror of us all?  Are we the NOW generation?  Do we want quality or whatever else “now!”  Look at the toys and technologies of the recent past. We all have cell phones, because we couldn’t wait to get home to call.  And what is the chief selling point of the new iPhone?  It’s faster.

Nothing wrong with faster, as long as there is economic advantage or people are willing to pay me to provide ever newer toys with ever shorter delivery times.  Paul Borawski also talked about the rate of change in products and the role of quality in that process.  It’s a real challenge to gather data on what customers liked/didn’t like about the last product and translate that into features for the next one.  Of course, people don’t always know what they want and may change their minds by the time it reaches the market.  (Remember the Edsel?) 

How does this relate to healthcare?  We’re beginning to see some interest in decreasing the cost of healthcare services.  The recent issue of Health Affairs devoted to cost didn’t mention that factor, but others have.  Most agree that there is considerable waste in healthcare as an industry, but there is wide disagreement on where that waste resides.  (It’s always in someone else’s process.)  Nevertheless, when we begin to get serious about taking waste out of healthcare processes, time will be an important metric.  No one likes to wait, and waiting costs money for the institution. I used to know how much it cost per minute to have a patient in my surgery center, whether or not anything was happening to them.  Obviously, the answer was to make things happen faster and get the patient out sooner.  All, of course, without having them feel rushed.  It is possible, and standard QI tools can help.  Every month, we looked at a histogram of time in the surgery center, and pulled the charts of everyone who stayed beyond 2 SD.  From the list of reasons for a prolonged stay, we constructed a Pareto chart and started on the longest bar. 

There were lots of examples—some of them small details, but the bottom line was a win for everyone: the patient went home faster, the surgeon finished his work sooner, and the center made more money. All it takes is a goal: make things happen faster.

The other role of quality in this environment of change is that of a governor—is this change really adding value?  Are we doing this faster just because we can, or does the patient or some other customer really value this change?  Certainly a primary driver of increased healthcare costs has been technology.  These new gee whiz tests and procedures that provide answers to questions not asked or do things we didn’t want done.  The US Preventive Services Task Force has been fighting this battle for years—don’t have mammograms, don’t get PSA tests, and now don’t have tests for ovarian cancer. Their thesis is always that some false positive tests will prompt patients to have further tests or procedures that are not necessary.  The alternative is that some patients will die from undiscovered cancer, but life’s full of choices.  And it is cheaper.

EMPLOYEES

The comment about Culture prompted me to think more about various experiences with employees and how those were colored by the prevailing culture.  Here are some anecdotes with notes on how they relate to the ambient culture.

SUGGESTION BOXES.  Do you have one?  Employees or customers can write a note and put it in the slot, but then what?  I have worked in two organizations where the suggestion boxes were never utilized.  When I asked employees about this, here are the answers:

1.      “Gee, Dr. Burney.  If I have an idea, I just tell my supervisor, and it’s done.  Why should I write it down?”

2.      “We’re afraid we’d be fired.”  (This was a government office where it’s really hard to fire someone, and impossible to do so on the basis of a comment.  Still, the prevailing culture was fear and intimidation.)

Which organization got more suggestions from employees?  One year later, which could demonstrate positive changes in the way things were done as a result of employee input?  Where would you like to work?

LISTENING.  The nurse was almost standing on my toes as she spoke earnestly about why a decision I had announced was wrong.  After listening for a bit, I decided she was right, and when she took a breath, I said, “OK.  You’re right.  We’ll do it your way, starting tomorrow.”  It was a small thing for the organization but a big thing for this nurse.  Next time, it may be important for everyone, and she will feel empowered to speak again.  Employees need to be heard; to feel that their opinions count. 

EMPOWERMENT.  This is where innovation begins.  It is the freedom to try something new and the permission to fail.  There are even companies that give awards for failure on the theory that if you’re afraid of failing, you’ll never try anything new.  Here’s a quote attributed to George Patton: “Tell them what you want done, but don’t tell them how to do it.  They will amaze you with their ingenuity.”  How much money can you spend without asking permission? 

HIRING. How do you hire “good” employees?  The answer, of course, is that you don’t. You hire competent individuals and make them good employees by the way you treat them.  Some argue that you should “hire attitude and teach aptitude.”  True for some positions.  You don’t want the shy, retiring wall flower to be your receptionist. I visited my alma mater a few years ago, shortly after they had installed a new president.  One of the professors told me, “No one would ever leave here to work somewhere else!”  That was probably an exaggeration, but did indicate his respect for the new president and his dedication to the new culture at the university.  New employees will come into that culture and acquire those same values. 

MAINTENANCE.  OK.  This employee has been working for you for a year.  How does s/he feel about the organization now?  Do you know?  Notice that I didn’t ask how you feel about her!  That would bring up the subject of annual evaluations.  Deming has written eloquently about why this is a bad idea.  Read his stuff.  Yes, employees need feedback, but they need it every day, not just once a year.  It needn’t be a formal process.  Here are some useful words and phrases:  “Nice job.  Well done.  Thanks for taking care of that.  I support Mary’s thoughts on this.  Yes!  Good.  Take care of this problem for me.  Put this on letterhead for the boss’s signature.”  You get the idea.  Constant and repetitive affirmation of your confidence and approval.  Awards are nice, but only if the award process is credible.  If awards are given for frivolous reasons or to people who don’t deserve them, it cheapens the whole process.  If you do an annual written assessment, nothing there should be a surprise.  (These are required in the Civil Service.)  As Deming has said, evaluations should never be linked to money.  One thing I like about the Civil Service system is that step increases come at predictable intervals, unrelated to evaluations.  (Unless Congress decrees there won’t be any!  By the way, read carefully.  All those bonuses you read about went to political appointees.  Rank and file Civil Service employees got nothing.)

FIRING. But what if it doesn’t work.  What if you make a mistake?  First, admit that this was a failure of your hiring process.  Fix it.  Then, see if there’s another position where this employee would flourish.  See if something in their personal life is coloring their attitude at work.  I once had a grumpy that no one wanted to work with.  We had a long talk, after which I gave her a substantial raise and added to her duties.  She became an outstanding performer and justified my confidence in her basic abilities. 

However, there are always those who just don’t fit.  Wish them well and bid farewell, but do it quickly.  Yes, it’s hard, but it’s even harder a year later.

IN SUM.  There you have it.  A new set of Robert’s Rules.  These are not new ideas and certainly not mine.  But they work.  The size and complexity of your organization will affect implementation, but the principles are valid everywhere.   

Creating a Quality Culture

Before you can do this, you’ll have to define both quality and culture. Quality is really a slang term in that it has many different definitions in different settings.  For any given organization, quality is what the CEO says it is, but there is plenty of evidence to suggest that his definition should reflect the opinions of his customers.  Of course, he also better have the board behind him on the direction he has defined for the company.  His next job is to convince his employees about his definition of quality.  We’re not talking about an intellectual discussion or mere aquiessence.  This is passion, dedication, & commitment.  The task for the CEO is to inspire a passion for his definition of quality among his employees.

Which brings us to culture.  My favorite definition of culture is “the shared beliefs of a defined group of people.”  We all belong to various groups and share different beliefs, depending on what group we’re with at the time.  Our surgery center had a picnic.  There was a young woman from our billing department who volunteered as leader of a volley ball team.  Nice person.  Good worker.  You would never suspect she would become take-no-prisoners aggressive on the volley ball court.  “I’m from California, and we take volleyball seriously out there.”  She had brought that ruthless competitive culture to our picnic.  I wanted her on my team!  

So what’s the poor CEO to do?  How does he instill this passion for quality?  First, is communication with employees, and you have to do that “every chance that you get; every way that you can.”  But that’s not enough.  You also have to demonstrate that you believe in your own definition—passionately.  Demonstrate this in little ways also, and do it every day.  That’s credibility.  After awhile, the employees will believe you, and they will share your passion, because it’s contagious but only from a credible source.

Part of our culture was for each employee to do their job better than anyone, anywhere.  The corollary was that the organization would provide them the tools and training to do so.  When a nurse identified a need for a rocking chair in the recovery room, the response was “Buy two.” 

When a nurse said, “I read an article about a better way of doing . . . .”  The response was “We’ll start tomorrow, and you’re in charge of making that happen.”

In the State Department, we are registered to ISO 9001.  It took two years to achieve registration but another 5 years to establish ISO as part of our culture.  We’re there now.  This is the way we do business.  Employees believe that it’s a good thing.  (We ask them, so I know.)  This took a lot of talking and training and visiting and celebrating success and public confirmations by the Medical Director.  Actually, we’re not there.  You’re never there.  Just like marriage, any culture requires daily tune ups and affirmations.

Paul Borawski mentioned “feelings,” and that triggered a memory of taking my Lexus in for repairs.  It was leaking a little oil, and I wanted it fixed.  The next day, I got a phone call from the service manager: “We found some other problems, and that $300 estimate I gave you is now up to $1,100,” he said.  “So, how do you feel about that?”  When your tagline is “The relentless pursuit of perfection,” you better include customer feelings in your definition of quality.  To a large extent, customers inherit the feelings of employees.  This Friday, I’m flying on Southwest Airlines, and I’m looking forward to it.  Their employees obviously enjoy their work, and I will enjoy flying with them.  Last month, I flew on United—a totally different culture, and it shows.  Feelings among employees are the result of the culture.  Customers can see through fake feelings.  How about the recorded message: “You call is important to us.”  Well, if it’s important, answer the phone.

The Business of Social Responsibility.

Business and social responsibility are frequently regarded as opposite poles in a decision spectrum.  This is unfortunate and may result from the way such questions are posed.  Sometimes, knowing the right questions or how to look at the decision can frame the decision in a way that makes sense to everyone. 

Several years ago, a Baldrige award winner recalled the day when his lawyer advised him that the state had issued a warrant for his arrest because of the environmental pollution from his factory.  His first thought was to close the factory.  Then, he thought of the employees who would be out of work if he closed, so he decided to stay open.  In looking at the sources of pollution, he realized that the material going into the local streams was waste from his processes and that he had paid for that waste.  Perhaps, if the processes were more efficient, he would be putting less money into the local water.  A few years later, he received an award from the state for environmental stewardship . . . and a Baldrige Award.  Socially responsible decisions made ultimate business sense.

About ten years ago, I installed solar photovoltaic panels on my roof at considerable expense.  The decision was motivated by a love of technology, a need for back-up power, and a desire to reduce the consumption of grid power by my home.  Friends and neighbors laughed and pointed to the long payback period.  However, “payback” is not the only way for a business to evaluate an investment.  My system makes enough electricity to return 6% per year on my investment—and that’s tax free.  (You never pay tax on savings.)  Another socially responsible decision that makes business sense, but only if you know how to evaluate the decision.  I’ll take a 6% tax free return any day.

I once visited a hospital in CA that sponsored a health fair that provided well-child exams and some immunizations without charge to a local indigent population.  I asked why his hospital would do this, and he replied: “My kids play with their kids.  When their kids are healthy, my kids are healthy.  Besides, when they do get a job and money, guess where they buy their healthcare!”  There was more.  He pointed to a pushcart in the hospital lobby.  “That guy used to be on a street corner in town.  Business was poor, and he had no health insurance for his family.  Now, my employees have ready access to good coffee, he has health insurance, and guess where he comes for care!” It’s still not clear that the health fair was a good business decision, but the CEO had evaluated it from social and business aspects and made his decision.  Even considering the donated time and medications, you’d probably have to include the enormous PR value to sell this to the board.  The CEO had done this, and the board had signed off on the health fair for several years. 

My point is that social responsibility and business decisions are not really such strange bedfellows.  Sometimes it means making the decision to “do the right thing,” and then finding a way to make money off that decision.  It’s all in asking the right questions and framing the answers in a way that business people understand.  Perhaps the quality professional is uniquely positioned to help with these decisions, given our emphasis on data collection, analysis, and presentation. 

DEFINITIONS AGAIN

In his 7 Jun posting, Paul Borawski asks whether “quality” is more related to the product/service or to the organization as a whole.  In his speculation, he references a report written by an ASQ Board member for The Conference Board.  The Quality Council of The Conference Board opines that Quality is not merely a set of tools, but they’re a little unsure about what the alternative is. 

The subject of the paper is ostensibly what CEOs are thinking about, but most of the discussion centers on how to achieve excellence in the areas under discussion.  How do you “create a culture of innovation?”  How do you achieve “Global expansion” without over extending.  Human Capital is a perennial problem—how do you get the best employees and then get the best out of the employees you have? 

 Is any of this relevant to healthcare?  Does anyone on the sharp end of healthcare care about innovation?  Global expansion?  Human capital?  Without any real competition—particularly price competition, there is little serious interest, and we even seem to be getting less competitive, as major players stake out spheres of influence.

Whither “quality” in healthcare?  If it’s not a set of tools or techniques, what does quality look like in healthcare?  Part of the answer comes in one of the strategies from the Conference Board under Innovation: “Create a culture of innovation . . . .”  In a comment on Paul Borawski’s original blog, Mike Alumbaugh refers to an “excellence centric culture.”  So what’s a culture anyway?  And how does it relate to quality (whatever that is!).  Think of culture as “a collection of beliefs shared by a defined population.”  Think for a moment, if everyone in your organization worked every day to do whatever they do better than anyone anywhere.  Congratulations.  Assuming you define “quality” as doing something really well, you have just created a quality culture.  Everyone in the organization shares the belief that quality is important.  They know the CEO believes it is important, so quality is now a culture, and employees will work to further that goal. 

Some years ago, I was standing on the deck of the Queen Mary 2.  Three senior officers came thru a door onto the deck near me, and as they did so, one of them bent over to scoop up a scrap of paper from the deck.  Why did she do that?  Cleaning the deck was not her job!  But, yes, it really was her job.  Keeping a neat ship was part of their culture, so of course she would pick up a stray scrap of paper, as would any other employee.

A patient’s family wrote me a thank you note after one of our employees changed a flat tire so the departing patient wouldn’t have to wait for the repair truck.  I knew nothing about this but I wasn’t surprised.  It was consistent with our culture of providing exemplary service—of course he would change the flat tire and not regard that as anything special.  That’s what culture does for you—shared beliefs.  Of course the nurse would make her intake visit in the parking lot, so mom wouldn’t have to awaken her sleeping child. That's what we do here.

You can define “quality” any way you want.  It can mean excellence in customer service.  It can mean cost effective care.  It can mean all of the above or other things.  The only trick is getting employees to share that definition.  That’s leadership. The end result is a culture of quality in the organization.  Tools may be useful and used, but it is the pervasive culture that defines quality in the organization.   A collection of beliefs in a defined population.  

Quality in Government

Is this an oxymoron?  Well, it kind of depends on how you define “quality” and who your customers are.  I work in the Office of Medical Services of the Department of State (DOS).  One customer group we deal with is DOS employees who want to serve overseas.  Our other customer group consists of job applicants with some medical condition that may prevent them from being hired. 

Those in the employee group have little clout as individuals, but as a group they are potent.  If enough of them become unhappy with our services, a directive comes down from above to “FIX THIS PROBLEM!!”  Once we understand what excites senior management, we fix that problem.  And then we fix it again, until it is so slick, we get kudos from customers. 

The applicant group is less powerful.  Some write their Congressman, and that gets attention tho not usually the desired result.  Some hire lawyers.  Again, attention but not usually the desired result. 

And then, a funny thing happened.  Five years ago, we adopted ISO 9001 as a management system.  Now, each of the 30+ sub-processes in MED has a written procedure about how they do what they do.  They know who their customers are and actively solicit input.  The most common metric is clock time, and “stuff happens faster now.” (A quote from an employee survey.)  One process in my office that routinely took 60 to 90 days now gets done routinely in 2 to 4 hours.  A few years ago, it took, on average, 11 months to hire a new employee.  Last month, we interviewed an applicant who applied only two months ago. 

If this still seems long to you, you’ve never dealt with OPM or applied for a Federal job.  If you do so, the person who wants to hire you may never see your application.  Some clerk in HR, who knows nothing about the job will decide how well qualified you are.  The office that has the opening will only see the top three names on her list.  For the rest, it’s a coin toss.

Are we truly worse that the civilian healthcare industry, as Paul Borawski suggests?  No.  We’re better, and I can prove it.  We collect HEDIS data every month from each of our 180 primary care offices around the world.  (Now there’s a challenge!)  Three times a year, we compare our data to the best US healthcare system results and discuss improvement strategies at the senior management level.  In general, we do well, although there are some special challenges in our system.  (Like getting a frozen vaccine to Ulaanbaatar.)  One thing we have that makes all this work is a culture of quality—the universal desire to do a good job coupled with the knowledge that senior management shares that goal.  Each quarter, we discuss errors, deaths, and complaints with those providers stationed in Washington.  I once received this email from a medical officer overseas: “Bob, we made the following mistake in our health unit this week.  Please discuss it at your next meeting.  I’d like to see what the group thinks.” 

How do you get there?  It takes leadership, consistency, and credibility.  It can be done in government. 

But Are we Happy?

Are software quality engineers really the happiest employees, as suggested by Forbes Magazine?

Is happiness related to occupation?  Or what does make us happy anyway. 

The country of Bhutan famously publishes a Gross National Happiness Index for the country and has a minister of happiness.  (Policies in Bhutan must pass a Gross National Happiness review.)  By definition, happiness in Bhutan includes the following goals:

1. Sustainable development
2. Preserve cultural values 
3. Conserve the natural environment
4. Good governance. 

I think good governance would not include prostitutes and parties in Las Vegas.  Mountain top mining in WVA would also probably fall out, so the US would probably not do well, but we are considering a measure of Gross National Happiness. 

But these are National goals, not individual, personal ones.  What makes individuals happy?  If it’s job related, I guess that would rule out wealthy wives who “never worked a day in her life.”  What about the money that allows some to live without working?  (Personal note:  Since my wife won’t read this, I can define “work” as an activity that someone else pays you to do.)  Numerous studies have concluded that a lack of money dissatisfies (makes you unhappy), but after a basic amount, more money doesn’t further enhance happiness. 

Health?  You would think so, but some sick people are also very happy.  Listened to an NPR interview  with a woman who sat at the bedside as her brother died of AIDS.  His last words were “I’m a happy man.”  Of course, you would then have to define what “health” means, and who is responsible for health.  Most would agree that air pollution (as a source of ill health) is the responsibility of the Federal government.  But the US life expectancy took a dip—first time ever—in 2011 due to obesity.  Now whose fault is that?  Health can certainly be a factor, but the correlation is missing.

Occupation and employment.  Some occupations are indeed happier than others.  Or maybe it’s just that happy people just gravitate to those occupations.  Employment is better than unemployment, and there are companies that are better places to work than others.  While we may be enjoy our job and be happy at work, these are factors on the fringes and probably not the defining factor for personal happiness.

It’s decision time!  Can I have the envelope please?  Happiness is . . . love.  It’s having someone to love and being loved in return.  In her poem, “The 5:32” Phyllis McGinley wrote:

“This hour best of all the hours I knew:” (while waiting at a suburban rail station)

“And a man coming toward me, smiling, the evening paper
Under his arm, and his hat pushed back on his head;
And wood smoke lying like haze on the quiet town,
And dinner waiting, and the sun not yet gone down.”

Q For Sale

What is this “quality” that we’re being asked to sell?  Using the word as a noun implies that it is concrete—a product that you can package and put on the shelf.  “I’ll have three pounds of quality, please.”  More frequently, it’s used as an adjective, as in “quality service” or “quality products.”  It’s common to see a mission statement profess to provide “The highest quality healthcare,” whatever that means. 

The term has become a slang expression, having no intrinsic meaning, and some organizations have dropped it.  “Quality” appears only once in a footnote on the Baldrige Award web site.  The American Society for Quality is now known as ASQ, and you won’t find a translation of those letters on their web site.  It is possible to go thru the ISO 9001 standards and remove the word “quality” entirely, without altering the meaning of any sentence. 

So then, what is it we’re being asked to sell?  What does “quality” look like, and why would anyone spend good money for it?  Perhaps it is an ethereal concept that we can sense or feel but cannot define.  More likely, it is an aspect of organizational culture, relating back to the concept of Total Quality Management.  Every employee has a compulsion to do whatever they do better than anyone else, anywhere.  But that’s not enough.  Employees must perform together to provide a service or product that is best in class.  But even that’s not enough.  They must do this reliably, every day, as a habit.  “This is how we do things here.” 

More than once, a Baldrige Award winner has been asked, “You just won this nice award, but what are you going to do on Monday, when you go home?”  Without exception, the astonished CEOs have replied, “We’ll do what we always do on Mondays. This is who we are.”

So, back to the original question: What is it that we’re selling? A concept?  Well no, it’s more like a culture.  Can you sell culture?  Can you impose a culture as an outside consultant?  No to both, but you can help senior management change the culture in their organization, assuming they see the benefits in doing so.  And that’s something we can sell.  AHRQ and others have demonstrated that you can create or improve a patient safety culture.  You can, of course have both—a safety culture and a quality culture.  They are not incompatible, but they are also not identical.  In either case, you have to work at it.  As Paul’s quote from Deming implies, “Success is not guaranteed.”  I like the quote from Paloma Herera (see last month), “First you must have a passion.  Then you must work very hard.”  That’s a formula for success in almost anything. 

STEM

Paul Borawski asks why students aren’t flocking to Science, Technology, Engineering, and Math (STEM) as career fields.  The responses and his analysis focus mainly on how to improve the educational process in these fields.  Maybe it’s time to do a root cause analysis and a contrarian analysis of why anyone studies STEM, or anything else.

First guess is money.  People study fields where they can make money.  Yes, some do.  And many are happy doing that, tho 2008 brought a sobering reappraisal of careers in banking and finance.  However, salary is not on every employee’s top five list, and not every medical student wants to be an orthopedic surgeon.  For most people, once you make enough money, more is not a sufficient attraction to do something you don’t like.

Family tradition figures prominently but again not an invariable indicator.  If you grow up in the industry and hear conversations at the dinner table, you will at least have an interest in the field.

Talent or genetic predisposition is important in music, art, acting, etc.  Math and engineering; perhaps.  I’ll put personality into this category:”I like doing things that this field requires.”

  

Passion.  An inspirational teacher or mentor may be enough to create a college major and perhaps launch a career.   Some months ago, a young girl asked ballerina Paloma Herera for the secret to becoming a good dancer.  “There is no secret,” she replied.  “You have to have a passion, and then you have to work very hard.” So passion is required, but it’s not enough.

To some extent, we need to differentiate between a career and a hobby.  I know many people who are good at music or art but don’t depend on those skills for their income.

All of the above factors may push a student toward STEM, but what about the attractive factors that attract him to those fields?  On a survey, State Department employees checked that they identified with our mission and felt that they were making a positive contribution.  Meaningful work that is appreciated—but not very much.  Anyone want to be a Federal employee today?  Maligned and attacked almost daily.  Salary stagnant, and future benefits in doubt. 

OK, what about the STEM fields.  Are Science and Technology respected and valued?  When science says the world is getting warmer because of the release of CO2 by humans, does Congress respond with a carbon tax and other measures to reduce the burning of fossil fuels?  Do we embrace the science of stem cell research to relieve the disease burden of man?  When engineers (including quality professionals) offer tools and techniques to improve the efficiency of  healthcare services and thereby reduce costs, do we implement their advice?  In short, are STEM fields valued and respected in our society?  If not, how can we expect to attract students to careers where their scholarship is denigrated and their advice ignored?

What can we do?  One easy answer is to appoint and elect individuals who do respect STEM to positions responsibility.  Make that a litmus test for politicians: “If science dictates a politically unpopular stance, how would you vote?”  Blind acceptance is not required, but the facts cannot be denied out of hand.  Decisions must be made by rational process that conveys a message of respect for the STEM fields.  Then, students with the requisite talents and inclination will be attracted to fields where they can make a meaningful contribution to society. 

An Outmoded Concept

Paul Borawski offers examples of the good and the bad of 2011 in his recent post .  His use of the word "quality" highlights the abstract nature of that word--something the world is no longer willing to accept.  You have to be more specific and tell us what you mean by "quality" before we're willing to agree with you that "quality works" or that it has a rightful place in society.  What good is it?  What has it done for me lately?  The Institute of Medicine assessed the impact of their publications, "To Err is Human" and " Crossing the Chasm."  These two works sharply criticized the US healthcare system for its many failings and prescribed broad approaches for improvement.  Ten years later, nothing has happened.  Various quality initiatives in healthcare have essentially failed to address either the incidence of errors or the cost of the services provided. One can point to various initiatives or projects that have demonstrated small improvements, but nothing has spurred the industry to emulate these successes everywhere.  The reason for this general failure is pretty clear--money.  It's not that there isn't money to implement change, but that there is no financial incentive to do so.  There is no financial incentive for improvement.

Following that negative note, what were the discrete disappointments of 2011?  Paul cites the discontinuance of funding for the Baldrige award.  ASQ has a financial interest in the Award, and it's always disappointing to lose a client, so he’s hardly an impartial observer.  Beyond that, Baldrige was a concept that came and went.  Applications have diminished in the last several years, and the whole system has degenerated into a commercial enterprise, with consultants and writers to enhance your application and improve your chance of success.  The original concept of identifying a few examples of excellence for others to model has become a competition.  The ideas and criteria are still valid and still provide an excellent guide to excellence in any industry.  We just don't need shining examples any more.

 Don Berwick/s departure from CMS should be on most people's list of disappointments.  A victim of Republican ideology, he brought credibility and stature to the position.  Not everyone agreed with all of his ideas, but then, not everyone agrees with me either.  I hope that's OK.

Paul cites the high point of his year as going to a meeting in China.  Maybe that's a sad commentary on the real absence of anything good.