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How Operational Excellence can impact Healthcare Industry

  • By faber
  • May 3, 2016

Healthcare sector is one, which is directly connected to lives of people, and there must not be any operational issues, everything must be well organized. Hence, it gets all the more important for healthcare providers to devote more management focus towards hospital operations improvements in order to boost patient centricity, quality treatment and productivity enhancement.

A multi-pronged approach that puts hospital and patient care at the heart of performance transformation efforts can help hospitals and health systems deliver more financially sustainable and patient oriented care.

Healthcare personnel should actively participate in performance improvement efforts and be open to changes. The continual improvement not only aids operational excellence but also quality patient care, patients’ satisfaction and staff satisfaction as well.

Hospital Operational Excellence deploys a variety of process improvement & change management concepts and approaches to increase operational efficiency and reduce clinical variability; ultimate objective is to drive the total medical care cost down while improving care quality.

The inefficiencies are the major barriers toward excellence. In hospital environment also the inefficiencies can be categorized into various types, which can be identified and addressed with ‘eye for inadequacies’ and ‘awareness of continual improvement’. Several tools & concepts of Operational Excellence (OE) like Value Stream Mapping (VSM), Inventory Management, Five S, Visual Management, Standardized Work, Poka Yoke – Error Proofing in hospitals can lead to dramatic results. Several hospitals across the world have adopted various operational excellence frameworks.

Implementation of Operational Excellence concepts have addressed several issues concerning patient care and management in hospitals such as:

• Time spent at OPD can be reduced by 40% approximately via concepts like work balancing and improving patient flow

• Distance covered by patients can be reduced 20% approximately by streamlining the layout and reorganizing

• Space utilization can be increased by 60%

• Inventory management modules based on scientific calculations can lead to improvement in medicine inventory management to avoid stock outs and over stocking (near to expiry scenarios), reduction in stock taking time, huge cost savings in inventory carrying costs, etc

• 95% reduction in the time nurses spend searching for supplies and equipment

• 77% reduction in door-to-bed time

• High standards of housekeeping and hygiene can be achieved through Physical workplace improvement tool Five S

• Other advanced operational excellence tools can further assist in reducing patient hospital stay duration, bed occupancy improvement, operations theatre utilization and others

The transformation projects have shown several tangible benefits and have wide scope for countless improvement avenues. These above mentioned tangible benefits shall pave the road for cultural change and will further improve the team morale, discipline and patient centric efforts.

Considering country like India or any developing nation, even today the healthcare is not affordable for the needy. Hospital Operational Excellence is a panacea to address these challenges. Further looking at accreditations from NABH and NABL, which shall be pre-requisite and not optional; operational excellence and continual improvement shall be part and parcel of the industry. These concepts are not only applicable for manufacturing industry but also equally applicable for hospital management. Concepts remain same, application changes!

It is a philosophy that can change the way hospitals and healthcare industries are managed and organized. Healthcare professionals are good at administering patient care, blending it further with operational excellence shall enhance life for all stakeholders!

Its time healthcare industry takes the leap, this leap year! If not now, when?

We shall delve upon various aspects (element by element) of Operational Excellence in Hospitals and Healthcare sector in coming posts.

Written By: Faber Aakash Borse is one of the founding members and Director of Faber Infinite Consulting (, with operations in Asia Pacific, Africa & Middle East. He holds a masters degree in Operations Management with his 1st degree being in MechanicalEngineering.

This article was originally published on Economic Times – as part of Operational Excellence in Healthcare Industry series. Original link available here.