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Jim Jordan:
Welcome to the Chalk Talk Jim podcast, where we explore insights into healthcare that help uncover new opportunities for growth and success. I’m your host, Jim Jordan.
Jim Jordan:
Welcome back. In part one of our discussion with Al Da Silva, we provided an overview of Lean and Six Sigma and looked at various examples of their use in healthcare. Now in part two, we’re going to go a little deeper to actually implement these improvements and make them stick. We’ll also talk about critical roles in leadership, cultural change, and keeping the patient experience at the center of process design. So, Al, our listeners are very interested in learning more about how you developed your expertise in process improvement. Could you share where you first learned about Lean and Six Sigma, and what made you want to get trained and certified in these methodologies? I remember being at a large Fortune five company healthcare company, and we had a consulting arm in. One of the most interesting things was with physician practices, particularly physician-owned practices.
Al Da Silva:
That’s right.
Jim Jordan:
You would go in and do an analysis and say, if you hired one more nurse, you would increase your revenue by 25%. So I think these are the techniques that you’re talking about. So where did you go to learn this? As people hear you talk today and they say to themselves, I would like to learn more of this; how did you learn this? It’s a very atypical thing for someone. Was it a business school thing? Did you go to the what is it? The American Society for Quality Control, I think is has certification in some of these things.
Al Da Silva:
Absolutely. That’s a great question. I did get exposed to Lean Six Sigma in business school, but it was not until my first job, when I was a specimen processor, and the lab that I was working on had lost. It was a large lab, had lost two major accounts that caught their attention. And this lab then decided to bring these Six Sigma consultants. So I had the opportunity to work firsthand while I was in business school with the Six Sigma consultants in this lab operation, and I had the opportunity to design my own processes with their help in terms of lobotomy processes, how the blood was going to be collected in an efficient manner whilst the blood made it to the lab, how the blood was going to be processed in an efficient manner. And then I got to experience the change in the power of Six Sigma firsthand from having a CBC, complete metabolic account, going from over an hour in the hospital, from being reported to being recorded in less than 20 minutes, sometimes 30 minutes, and then having the change and seeing that firsthand, James, it was very impactful. Now, I did not get certified until I went to work for a hospital after my NHA, and then my first project I was telling you about that pharmacy project for Lean Six Sigma was a outpatient pharmacy operation.
Al Da Silva:
And then one day, I was talking with another healthcare professional in town and I said, yeah, that was one of my first projects. And he says, did you know, Al, that pharmacy now, because of that pharmacy, they are close to $100 million in bottom line revenue because of the changes that they were able to make in terms of signing patients to a program called 340 B program. And then the reason for that is because the outpatient pharmacy were now able to keep the patients from the hospital in the pharmacy, whereas, in the past, the patients would leave the hospital to go to their preferred pharmacies because the service was so poor, the service performance now the hospital was able to create a completely new vertical. And keeping all of that revenue inside the hospital, which for the safety net hospital basically saved them from going bankrupt.
Jim Jordan:
So you had mentioned a hospice. Is this going to be your first hospice that you’re going to?
Al Da Silva:
Yeah, that’ll be fun.
Jim Jordan:
Just share with us as you walk in the door. What is it that you’re looking for off the top of the head? Where are you? What are the signals of these are places to start? Because I think for our audience that are into actual care with patients, I think that thought process is very insightful.
Al Da Silva:
Oh, absolutely. So the first thing is to learn the process, James; you don’t want to make any assumptions. You want to do what I call you want to walk the process. So you want to make some observations, not no judgment. And then you create the safe environment. I’m not here to criticize. I’m here to learn, and I’m here to help. And I don’t even know what to do now. And now teach me like I’m a baby. I don’t know your process. And then, by doing that, you can understand from the patient vantage point you want to do the process. James, how does this process impact my patient or the patient? So if the patient is getting onboarded into the hospice program, how is that process happens? If the patient is receiving regular treatment from the nurse or from the staff, how does that process happen after the patient is discharged or the patient’s disease from hospice? What are some of the processes that needs to happen? The other thing that I’m doing is understanding some of the key performance indicators from the industry, or some quality measures from Medicare. What do they expect out of a hospice? And then I want to compare, are we doing these things? Not in a judgmental way, but okay. If we start doing these things, is there an opportunity to create additional revenue? Is there an opportunity to maybe be part of a quality program that gives us more payment, but that serves the patient because these are considered best practice? So the first thing to do that I recommend, and this is very simple that your audience could do tomorrow, is spend time observing the process and then take notes on what are some of those process steps.
Al Da Silva:
And don’t just observe one caregiver. Observe multiple opportunities multiple times multiple people. And now we give you the visibility to understand how is the process performing. And then you do it from the vantage point of the patient. You also want to hear the voice of the customer. In this instance, the customer is the patient. The customer is the family. The customer is the referring provider, that sends you that patient. And you want to understand what is their perspective on the service that they are receiving. And then you want to identify all the customers that they’re being impacted. And then you also want to gather the voice of the process itself. Do I have any data available to measure the process as it is today? Number of patients being discharged? How long it take us to admit a patient into the process? What are some relevant metrics that you can understand in order to and how do you compare to your peers? Then you can have a better understanding of the process. Only then you can start thinking about is there opportunities to improve this for the patient. You have to think for the patient because great patient care is great business decision, and it pays when you. Most people think it’s going to cost more, but you make it better for the patient. You separate yourself from the competition because most people are operating in that 3 to 4 sigma level, which is a lot of mistakes.
Jim Jordan:
So I think the process you went through just for folks who want to look it up, I think is called DMAIC, correct?
Al Da Silva:
That’s correct.
Jim Jordan:
And I believe the quality people DMAIC stands for define, measure, analyze, improve, help me, and control, right?
Al Da Silva:
And control. That’s right.
Jim Jordan:
And if memory serves me correctly, and I think the other piece you bring up, I just want to get your comment on, because when I did this, Non-hospital is where I grew up in with this. But the first thing you get from people is an objection is you can’t have quality and cost, you can’t have both. And that is absolutely not true.
Al Da Silva:
That’s correct. That is an assumption. That’s not true because you think about the pinnacle of some of health systems around the country. There are some health systems, James, right now they are guaranteeing the outcome. They’re saying, you come up and you are this patient. We are going to guarantee you outcome. They are selling that as a service. They’re actually selling across the nation where now it used to be your competitor. Think about this. Your competitor was the hospital in the same town. But for some of these very differentiated programs like cardiac programs or cancer programs, he has become a national competition. And the way that they are differentiating themselves, they’re differentiating themselves, forced understanding their customer, who is their customer? The customer is the large corporations that are self-funded insurance plans, right? They fund their own insurance and therefore they have the power of the purse to purchase healthcare on their own terms. So if they want to send, you know, advertisement here to Mayo Clinic or other very valuable healthcare organizations around the country, right here in Tennessee. Vanderbilt’s one of the reference centers around the country. These folks are competing at the national level. Now you’re talking about cost. They have to pay attention to cost, but they also pay attention to the highest quality of care, not only for the patient but also for the family, because, you know, in those organizations, they are do better than others. They see the patient and the family as the same unit. So taking care of the family just as much as you take care of the patient is good business. And those organizations are now being recognized, James, by programs such as Medicare programs that recognize high quality. So they rate them in numbers of stars. So they have a five-star organization. Those organizations are getting paid a higher reimbursement because they are able to manage their costs while providing extremely high-quality healthcare. And then on a set of measures, therefore, standardize for all of the hospitals.
Jim Jordan:
So not all of our audiences from the provider side. Can you explain the star system so people just have a sense of it?
Al Da Silva:
They the star system came from CMS, and Cms.gov has great information about hospital compare. So they created a way for the patient and their families to compare facilities in terms of the type of services that they are seeking. So let me give you an example. So somebody may need to have they are going to need to have a valve replaced. Okay. They’ve been told they need to have a valve replacement. Now that patient can go to hospital, compare and search for that type of service and see what type of rating in terms of quality cardiac care that hospital has. And that is based on a set of measures, James, that those hospitals have to report both on the cost side and also on patient clinical outcomes. How many patients have positive outcomes that come to your hospital. These are for Medicare patients, right? But private insurance, Blue Cross and Blue Shield, you name several other types of private Humana also have implemented quality measures. And they that impact the reimbursement to that those providers, not just hospitals but also medical professionals.
Jim Jordan:
One of the things I think you realize when you go through a process like this, so maybe we talked about taking little risk where we might delete something. But so we’ve talked about a lot of things here. And just to keep our audience in a mental structure, if you will, if you had an org chart looking thing on the top, you have the healthcare reform with some general legislation and security and now some quality measures that we haven’t had, right? And we’re trying to reduce cost in the whole system. And then when you look at a system, in this case, taking care of people, there’s what are you designing in the system. Then you have the processes to support it. And you were talking about doctors earlier to get a certain result and the processes. I think people don’t realize that your process is your brand. It’s something that having for me, coming inside and then moving out to sales and marketing, it’s hard for people to understand that. But we tend to start at the processes we have because they are what they are. And you take that DMAIC process to go through it and then go through your lean process where you get down to natural variability.
Jim Jordan:
Then you go into your Six Sigma and you try to reduce the variability. But then there’s this piece, once you’ve mastered that, to go back to the design of your system and say, what were we designed to do in the first place? And one of the things that strikes me as we go through that process is sometimes the things that we’re doing don’t meet the design, and sometimes there’s aspects that we don’t realize are important to patient satisfaction. The story I’d love to share, is stories of patients that feel like ease of parking. How clean are the bathrooms? How nice is the lobby, right? How quiet were they at night? Were they waking me up and poking me every five minutes from the time I was in the hospital? Didn’t get a stitch of sleep. Did they flip on the lights all the time? And so I think that we’re on this journey to discover these specifications, because our health system has come together as a history of just putting pieces on. And have you gotten down to the design part yet with all the people? Because it’s so. Yeah.
Al Da Silva:
So I’m going to shift the conversation a little bit, James, in addressing this, what you’re saying about design because we had a crucible part of our health system right now. And I’m going to tell you, even though I came from the hospital side as a nurse, as an administrator being in a medical group, I’m going to tell you what my true passion is. My true passion in terms of design is helping independent medical professionals become part of this conversation. And I’m talking about these are the people that I work with. I’m talking about the independent physician and then teaching them principles of Lean and Six Sigma to differentiate their service, differentiate their product, differentiate their brand. But not only do that from a financial standpoint, but how can they become part of the conversation to change healthcare for the better? And I’m talking about when we teach them the value chain. And I think you’re going to love this, James, because I think your audience healthcare, this is something that they can do tomorrow. And I’m going to teach you very quickly the value chain is really thinking for what you said. How does the pre-service for my patient either be a physician office patient or a pharmacy or a chiropractor, or a physical therapist, right, they’re independent. They’re competing, right? What chances do they have to compete with a large health system? The only chance they have is if they’re able to differentiate their service through the value chain they provide to that patient.
Al Da Silva:
So we teach them three things. They’re very simple to do and very easy to implement, right? But we want them to pick one service. We don’t want them to get through so they can learn the process. They can learn service you have. And I want you to think about the pre-service experience and that may be involved. How does my patient research my website about that one service? How does my patient schedule the appointment to how easy of scheduling it is? What kind of preparation should the appointment for that one service they need to have on the pre-service? What do I expect of them? Right? So I tell you what, give you a quick example. I went and saw my doctor on Tuesday. I had the opportunity to feel all of those crazy forms they give you before my service and it was a beautiful thing I came in. They had all of my information. I sat in the waiting room for maybe 5 to 10 minutes. They called me and then the doctor saw me and it was great. But then the next piece is what happens during the service process. What about the service? Point of service experience, James, what happens from the moment to where you train your staff? When? How you’re going to greet the patient, how are you going to greet the family, and whatever that experience you want them to have? How do you want them to feel when they experience your service?
Jim Jordan:
What a great program! Do you find that getting people to think about redesigning the system is a harder reach for them than improving the system they already have mentally? Is it an emotional thing?
Al Da Silva:
It is an emotional thing because they’re going to have to go through the change management process. And every time you disrupt the system, which you have to go through the grief process, right? There’s anger. There’s all the way to acceptance, right? There’s denial. Those things happen as you’re going through the change process. So what we teach, James, as their fractional COO is that we are very experienced in managing that change and understanding where they are in the change process and actually guide them to where when we make that change on the change curve, this is the form of stasis, right? This is where the status quo is. We make a change or system is going to get because your staff is learning the system and the bottom of the system. Most people go back, James, because they don’t have the support of somebody like a virtuoso, a fractional COO, or an experienced professional that’s done those things to encourage them to stay the course and that their performance is going to go to a new level of performance if they stay the course. Right? So the other piece that we teach is we teach business owners there in healthcare or any other business industry. That you. The most important thing you can do for your people is to learn to be a better leader and learn to execute.
Al Da Silva:
And what we teach them is this James, what do you lead, and what do you actually execute on? And I teach them that part of our high-performance framework. We teach them and part of our business assessment. We teach them. You lead your people. You lead your process. You lead your customer, which includes marketing, sales, and what have you. And you lead your own profitability. And then I teach them that there is no way you can separate the people from the process, nor can you separate the customer from the profitability. They are intertwined, nor you can separate leadership and execution. And I tell leaders that if you are a business owner, I agree with Michael Gerber that you are trying to balance this. Being the entrepreneur, managing, being the technician, doing the work yourself. You’re a physician, you’re a chiropractor, and actually managing the day-to-day operations, which can become a beast. Right? How do you manage the system? And that’s where we have developed a process to decrease the stress and put systems and processes in place so they can better serve their patients and get paid, right? No margin, no mission.
Jim Jordan:
That’s a great line, no margin, no mission. What’s the biggest lesson you’ve learned on this journey thus far? What are you taking into your future?
Al Da Silva:
I think the biggest lessons is that you cannot improve what you don’t measure. I think a lot of times we want to go set on a journey, but you don’t even have a plan or much less have a way to measure what success looks like. I had a mentor that used to tell us, tell me what is key to success? What does it look like? How are we going to measure? How are we going to know we got there? And James, I think that’s the biggest challenges myself. If I can be transparent, that’s a challenge. As an entrepreneur myself. Right now, looking what are some lead indicators that we need to have as a company myself and not be so worried about the lagging indicators, but be purposeful about what activities and behaviors we need to put in place that leads to the lagging indicators to increase revenue. Things that so I’m talking about behaviors lead to results.
Jim Jordan:
Very good. As you look at the broader healthcare system, what do you think is the biggest threat to our future right now?
Al Da Silva:
That’s a great question. I think it’s still variability. I think also the biggest threat to our future is not understanding the amount of data that we have been able to gather and leveraging that data to make decisions to improve healthcare. So think about this with me, James. 2008. We had President Obama passed a law and then forced a lot of the healthcare systems and medical practice to implement electronic medical records. But I can tell you of all of that data that’s being gathered today, very little is being leveraged to actually improve healthcare, to actually create a consistency. If we can go back to the original talk question that we were talking about, how do you leverage the data to change the way we do things? We create a system like the banking back to banking and experience that seamless for the patient, no matter where they go. And then cross state lines, cross organizational lines, and then start creating the data environment to actually make healthcare decisions that impact quality for the most important access and cost. Right? Those things should not be in competition with each other. There is. This country is so rich and there is so much opportunities. But I don’t think we are leveraging the data, which is the most important thing, most valuable thing. There are some organizations, there’s pockets of excellence across the country. But I call those just pockets. They are not impacting the larger conversation. How do we actually solve the data problem to actually make decisions for healthcare?
Jim Jordan:
And this is where I think the hope of the first phase of artificial intelligence will help healthcare. People ask me all the time regarding surgery and robotics, and we do have certainly some of those things and great examples of it. But I think the first component is how do we leverage this large amount of information to bring intelligence to us and know my audience is tired as this example, but think of the Whac-a-mole game at the carnival, right? You spending all that energy trying to whack down the intruder. And the fact of the matter is, if we could be told predictably when that would happen, we can save our energy. And I think that’s hopefully where we’re going. And it’s ironic that the data, which has artificial intelligence and the highest aspect of technology, the improvement will come though through people and it won’t be through an AI system. It will be the AI availing the variants of the opportunity, and it will be people getting together and going through these processes of lean and DMAIC and Six Sigma and coming up with a plan. And then I think we’ll also be learning that the Stephen Covey used to have this difference between leadership and management would be efficiently walking through a forest, and a leader will get up and say, wrong forest. And I think we’re going to find in our design of our system, our healthcare system really started with doctors went to our houses, and when our families couldn’t take care of our patients, they went to hospitals. And so the whole system has been designed in a very compartmentalized way, and it’s time to make it match. Oh, very good. Where could our audience find out more about you and be able to connect with you?
Al Da Silva:
Oh, absolutely. You can find us on our website James, at www.dsbusinessconsulting.com. And you can find more about our business x-ray assessment. We didn’t talk a whole lot about that, but you can find out about the assessment on how to obtain that operational efficiency score for your business.
Jim Jordan:
And what would be the one book that you would recommend for someone interested in this to start out with, or a couple of books?
Al Da Silva:
Oh, that’s a great question. I am reading right now and truly enjoying The Four Disciplines of Execution. I love that, and then another book that’s been very influential in helping me, and I wish, you know, they have a great program. And I tell people all the time that my passion for business literacy and respect for other folks that are doing great work in business literacy is Traction. It’s a great book, great the EOS system. We share a lot of the same similarities, James, on the way we guide small, mid-sized businesses, which tells me that we on the right track, and they’re on the right track. Because we are embracing that business literacy. So there, Four Disciplines of Execution and Traction. Two great books that I was just truly enjoying reading and Traction I’ve read multiple times, and it’s one of my favorites.
Jim Jordan:
And you’re reminding me too. It’s an older book for sure, but it tells a story about a manufacturing plant going through this change process, and it was called The Goal. So you could probably pick that one up. It’s an older book, but it does have a story to it, which is what sort of got me into this in the first time, because it was a story with the process in there associated with it, which won me up that way too. Very good. Anything else you’d like to share with our audience?
Al Da Silva:
Now, I just want to thank you for the opportunity to share our passion to help small, mid-sized businesses. And if you need any assistance, we are available to you. And a lot of times, the engagement does not even cost you on the front end. So I want to put that out there. We have programs that allow businesses afford their engagement without outlay of cash right away.
Jim Jordan:
So maybe to clarify that a little bit for our audience, because I’ve seen these models before. So what you do is there’s so much opportunity in there. You go in and you say, instead of you paying me up front and worrying about cash flow, let me deliver some results and we’ll share in the split of that. Is that how you do it?
Al Da Silva:
It’s similar to that, but the way we do it, we have opportunities to reduce costs right away. So we have a cost reduction program. We also have the insurance underpayment program so we can evaluate all of their claims for the past 12 months, James. And literally, find a lot of free up a lot of that cash flow to help put them in a better position as a business. We don’t charge anything for that doesn’t require for them to engage us.
Jim Jordan:
how does the model work for people who maybe don’t have the cash up front? And how do they work with you in a way that would be an opportunity to work off savings or something like that?
Al Da Silva:
We have a guarantee that we work with clients, that we also are open to complete performance-based contracts. We’re able to identify pockets of opportunity and pockets of improvements for them, deliver those improvements, and then have a shared savings model with them both on the revenue and on the expense.
Jim Jordan:
So that’s completely low-risk for people that want some professional guidance in taking this journey.
Al Da Silva:
Absolutely.
Jim Jordan:
Very good.
Al Da Silva:
With low-risk. And our virtual COO, James, I tell you what, our virtual COO with the guidance program, we’ve priced very affordably for businesses to have access to high-quality consulting. And we price in a way that understanding the challenges of cash flow for small and mid-sized businesses, so they have access to affordable, high-quality consulting and a fraction of the cost.
Jim Jordan:
Perfect. Thank you for being a guest. You’re my first Lean nurse. It’s very exciting. It’s it’s been a pleasure to have you.
Al Da Silva:
It’s been a pleasure to be here, James. Thanks for the invitation, and look forward to staying in touch.
Jim Jordan:
All right. Take care.
Jim Jordan:
That wraps up our two-part conversation about using Lean and Six Sigma to drive major improvements in healthcare organizations. A big thanks to Al for sharing his knowledge and his experience, and please remember to subscribe and leave a review if you enjoyed this podcast. We’ll see you next time! Thanks for tuning in to the Chalk Talk Jim Podcast for resources show notes, and ways to get in touch. Visit us at chalktalkjim.com.
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