Last Friday I taught a Lean Leadership class for my healthcare organization. The participants included all levels of support staff, physicians, nurses, anddepartment leaders. They grasped the concepts easily, and we had a lot of fun with the simulation exercise. In the first round, of course, no products made it to the customer. In the second round, after applying 5S and reducing batch size for better flow, a few products made it to the customer but with some defects.

In the third round, after applying takt time and level loading, more product unitsmade it to the customer but with even more defects. This prompted an interesting discussion, as we were reviewing the cost of defects (in our simulation, a delivered product brings revenue of $100 per unit, defects cost $20 and Work In Progress $5). One of the physicians brought up a great point – what is the “cost of defects” in healthcare?

In the most purely commercial aspect, the cost of poor quality is the cost of rework and so-called service recovery. In a risk-managed world, you might add in the cost of potential law-suits and malpractice insurance. You can even go so far as to put a value on the person’s life, for example the number of years remaining of potential employability,and possible value and/or contributions to family, employers, and community.

But the defect that the physician wastalking about was the defect ofan adverse outcome for a patient. And it was obvious that every single person in the room had a dedication to the safety of every one of the patients under their care. So we talked about the cost of a defect related to patient safety, and that the lives under their care were literally “priceless” regardless of what the risk-adjusters might say. And we can have a huge impact on that safety by using Lean concepts and tools, and integrating the check-do-check into our processes, while streamlining the work and empowering healthcare professionals to call “Stop!” when they see something that may not be right.

The rest of the exercise went very well -the fourth round was organized around a pull system adjusted to takt time, incorporating check-do-check. The customer had just the right number of units, WIP was minimal, they made money, and they had no defects.

But the memory that I will take from this class is theabsolute dedication that this group had to the welfare of their patients.