Using Statistics to Reduce Process Variability and Costs in Radiology

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ean Cherry, M.S. FACHE and Sridhar Seshadri, M.B.A.

A higher sigma indicates a lower rate of defects and more efficient processes.

In many corners of the corporate world, Six Sigma has developed a reputation as the mother of all quality initiatives. Pioneered at Motorola Corporation in the 1980s, Six Sigma is a quality initiative based on rigorous statistical process control. It augments traditional quality tools with exacting statistical analysis and a systematic problem-solving approach, targeting the root cause of variations and redefining processes for long-term results.

The methodology has been used in a variety of settings to solve a broad array of issues: from improving manufacturing capabilities to customer service to aircraft design and everything in between. It has been used to transform organizations of all types and is now beginning to be applied in healthcare.

"Sigma" is the Greek letter used by statisticians to define standard deviation from the norm. A higher sigma indicates a lower rate of defects and more efficient processes. At Six Sigma, defects are roughly 3.4 per million opportunities, or nearly error-free. Consider this: Three Sigma translates into about 5,000 incorrect surgical procedures each week nationwide, a somewhat less than desirable ratio.

With excessive variability and medical error rates currently under the microscope, some healthcare administrators and department managers are looking for some additional guidance and reliability. The point of deploying Six Sigma in healthcare is not to diminish the authority of a radiologist, physician, nurse or other professional, but to enhance the predictability of positive outcomes, whether clinical or operational. And it's an approach that is flexible and scaleable. It can be used to improve a single process in a single department within a small, rural medical center, or it can be deployed throughout an entire multi-hospital system.

Executive Summary

Radiology Takes the Lead at CHC
Initially implemented in CHC's radiology department in early 1998, the program began to spread throughout the organization within the next two years. Results have been impressive across several areas: within 18 months, the culture had been transformed, productivity levels increased and patient experience improved while eliminating more than $800,000 in total costs. After this program was implemented, CHC's radiology cost per procedure went from $68.13 to $49.55. With over 100,000 procedures performed each year, the cumulative savings exceeded $1.65 million. And most notably, exemplifying the essential quality aspect of Six Sigma, errors in the MR ordering process were reduced by 90 percent.

Interestingly, hard times weren't the impetus for this Six Sigma project, since CHC was already financially sound and a leader in their market area. Of course, this comfort level can produce its own set of challenges, since motivating a team is sometimes more difficult when things are going well. Also, CHC recognized the need to maintain their competitive edge, cope with reimbursement and regulatory issues, and meet rising patient expectations. Internally, leaders recognized a genuine opportunity to build teamwork and transform the corporate culture.

Changing the Cultural Landscape
Six Sigma was seen as having the potential to drive quality to new heights and sharpen the competitive edge for both the radiology department and the system as a whole. Like most providers, CHC has had some form of quality initiative in place for years. The difference is that Six Sigma actually becomes ingrained in work and thought processes, and instead of simply solving short-term quality issues, creates a knowledge base to get it right the first time.

But Six Sigma can also be viewed as a catalyst for corporate-wide transformation of the existing culture. By collecting and analyzing relevant data, possibilities for improving even the most intransigent processes begin to emerge. Six Sigma relies on a foundation of methodically collected and analyzed data, rather than managerial experience or expertise. This evidence-based approach makes it somewhat easier to present the case for change and garner staff support.

How the Process Unfolded
As is customary when launching any major change initiative, the Six Sigma project began by assembling key players for a preliminary strategy session. During this meeting, the team set a goal to become a Six Sigma organization by the year 2004. With that target set, the first round of training began.

Six Sigma training involves several phases, reaches various levels of expertise, and can extend anywhere from one to 14 days. Training is always linked to particular projects impacting operations, giving participants a chance to learn the methodology while at the same time achieving results within their own work environment.

Through these educational sessions, leaders learn to better manage strategic change, cultivate support, mobilize constituencies, and establish systems for long-term results. Employees also learn to use a problem-solving approach designed to reduce organizational redundancies. Participants successfully planning and completing two Six Sigma projects attain what is commonly known as Green Belt status. The completion of additional projects and achieving higher levels of accomplishment lead to the attainment of Black Belt and Master Black Belt status.

CHC's radiology department was chosen as the launching pad for Six Sigma. Twelve participants within radiology used the various training processes to focus on learning team dynamics, identifying specific areas of opportunity within the department, and putting improvement and control mechanisms in place. Making sure that process changes are built-in and remain as guidance systems for the long haul differentiates Six Sigma from previous quality initiatives at CHC.

This radiology-focused phase significantly reduced wait times for patients, generated faster turnaround times for radiology reports and increased productivity. In fact, CHC's team managed to boost radiology through-put by 25% using fewer resources, while simultaneously decreasing cost per radiology procedure by 21.5%.

Six Sigma: A Sample Timeline

Keys to Making It Work
One of the primary keys to unlocking Six Sigma success is solid commitment from leadership. Since this initiative will invariably compete for capital and time resources, participants have to be able to count on unambiguous support from senior management. To be successful, Six Sigma has to be priority #1.

Far more than just a financial engineering effort, the process involves measuring all relevant criteria and making sure the job is done right the first time, which ultimately has a positive impact on patient care and satisfaction. The fact that Six Sigma offers a truly evidence-based approach to operational and clinical improvement gives the initiative greater credibility and makes it easier to get buy-in and results. Persistence and a clear definition of your objectives are also important factors. Everyone must understand that this is a philosophy for doing business and requires active participation. Communicating this vision clearly to the organization is mandatory.

Onward and Upward
As it has had an impact on other industries, Six Sigma could positively affect public perception of healthcare delivery. Society has struggled to find a workable methodology to measure quality. Looking beyond the obvious indicators of mortality and morbidity, it's tough to gauge. Using the methodology to carefully gather and analyze data can help providers accurately identify where problems exist and how best to correct them. Six Sigma provides a roadmap for process improvement, dashboards to let you know how well you're doing, and process "cruise control" to keep the improvements on track.

To carry this quality improvement forward at CHC will require ongoing training and the generation of approximately 120 trained staff within two years. Every CHC employee will receive a minimum of one full day's training.

Six Sigma is a sound philosophy of management and quality that gives companies a chance to reduce cost, increase productivity and improve quality. Effects are evident and long-term, and the approach can be adapt-ed and applied throughout the organization.

About The Authors
Jean Cherry is executive vice president at Commonwealth Health Corporation and is a fellow of the American College of Healthcare Executives. She holds a bachelor of science degree in business administration from Western Kentucky University and a master of science degree in healthcare administration from the Medical College of Virginia. Cherry has worked in healthcare administration for over 13 years. She oversees Commonwealth Health Corporation's support functions which include quality resource management, information technology and facilities management, and is a licensed nursing home administrator. Cherry may be contacted at 270/745-1527.

Sridhar Seshadri is vice president and general manager with the Healthcare Solutions Group of GE Medical Systems Information Technologies. He holds a bachelor of science degree in electrical engineering from Bangalore University in India, a master of science degree in electrical engineering from Drexel University, and a master of business administration degree from the University of Pennsylvania (Wharton) in 1993. He is widely published and has an extensive background including lead engineer with the University of Pennsylvania's Radiology Department, where he developed and evaluated Picture Archiving and Communication Systems (PACS). Since then, he has held the positions of manager, new business development and director, product management and strategic planning in the medical technologies industry.

Suggested Readings
Breyfogle, F.; Cupello, J.; and Meadows, B. 2000. Implementing Six Sigma: Smarter Solutions Using Statistical Methods. New York, NY: John Wiley & Sons.

Pande, P.; Neuman, R.; and Cavanagh R. 2000. The Six Sigma way: How GE, Motorola And Other Top Companies Are Honing Their Performance. New York, NY: McGraw-Hill Professional Publishing.

Rath & Strong's Six Sigma Pocket Guide. 2000. Lexington, MA: Rath & Strong, Inc.

Slater, Robert. 1999. Jack Welch and the GE Way: Management Insights and Leadership Secrets of the Legendary CEO. New York, NY: McGraw-Hill Professional Publishing.

Slater, Robert. 1999. The GE Way Fieldbook: Jack Welch's Battle Plan for Corporate Revolution. New York, NY: McGraw-Hill Professional Publishing.

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