Month: August 2011

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Focus-on-the-Flow

One of the foundations of Improvement Science is visualisation – presenting data in a visual format that we find easy to assimilate quickly – as pictures.

We derive deeper understanding from observing how things are changing over time – that is the reality of our everyday experience.

And we gain even deeper understanding of how the world behaves by acting on it and observing the effect of our actions. This is how we all learned-by-doing from day-one. Most of what we know about people, processes and systems we learned long before we went to school.

When I was at school the educational diet was dominated by rote learning of historical facts and tried-and-tested recipes for solving tame problems. It was all OK – but it did not teach me anything about how to improve – that was left to me.

More significantly it taught me more about how not to improve – it taught me that the delivered dogma was not to be questioned. Questions that challenged my older-and-better teachers’ understanding of the world were definitely not welcome.

Young children ask “why?” a lot – but as we get older we stop asking that question – not because we have had our questions answered but because we get the unhelpful answer “just because.”

When we stop asking ourselves “why?” then we stop learning, we close the door to improvement of our understanding, and we close the door to new wisdom.

So to open the door again let us leverage our inborn ability to gain understanding from interacting with the world and observing the effect using moving pictures.

Unfortunately our biology limits us to our immediate space-and-time, so to broaden our scope we need to have a way of projecting a bigger space-scale and longer time-scale into the constraints imposed by the caveman wetware between our ears.

Something like a video game that is realistic enough to teach us something about the real world.

If we want to understand better how a health care system behaves so that we can make wiser decisions of what to do (and what not to do) to improve it then a real-time, interactive, healthcare system video game might be a useful tool.

So, with this design specification I have created one.

The goal of the game is to defeat the enemy – and the enemy is intangible – it is the dark cloak of ignorance – literally “not knowing”.

Not knowing how to improve; not knowing how to ask the “why?” question in a respectful way.  A way that consolidates what we understand and challenges what we do not.

And there is an example of the Health Care System Flow Game being played here.

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Reality trumps Rhetoric

One of the biggest challenges posed by Improvement is the requirement for beliefs to change – because static beliefs imply stagnated learning and arrested change.  We all display our beliefs for all to hear and see through our language – word and deed – our spoken language and our body language – and what we do not say and do not do is as important as what we do say and what we do do.  Let us call the whole language thing our Rhetoric – the external manifestation of our internal mental model.

Disappointingly, exercising our mental model does not seem to have much impact on Reality – at least not directly. We do not seem to be able to perform acts of telepathy or telekinesis. We are not like the Jedi knights in the Star Wars films who have learned to master the Force – for good or bad. We are not like the wizards in the Harry Potter who have mastered magical powers – again for good or bad. We are weak-minded muggles and Reality is spectacularly indifferent to our feeble powers. No matter what we might prefer to believe – Reality trumps Rhetoric.

Of course we can side step this uncomfortable feeling by resorting to the belief of One Truth which is often another way of saying My Opinion – and we then assume that if everyone else changed their belief to our belief then we would have full alignment, no conflict, and improvement would automatically flow.  What we actually achieve is a common Rhetoric about which Reality is still completely indifferent.  We know that if we disagree then one of us must be wrong or rather un-real-istic; but we forget that even if we agree then we can still both be wrong. Agreement is not a good test of the validity of our Rhetoric. The only test of validity is Reality itself – and facing the unfeeling Reality risks bruising our rather fragile egos – so we shy away from doing so.

So one way to facilitate improvement is to employ Reality as our final arbiter and to do this respectfully.  This is why teachers of improvement science must be masters of improvement science. They must be able to demonstrate their Improvenent Science Rhetoric by using Reality and their apprentices need to see the IS Rhetoric applied to solving real problems. One way to do this is for the apprentices to do it themselves, for real, with guidance of an IS master and in a safe context where they can make errors and not damage their egos. When this is done what happens is almost magical – the Rhetoric changes – the spoken language and the body language changes – what is said and what is done changes – and what is not said and not done changess too. And very often the change is not noticed at least by those who change.  We only appear to have one mental model: only one view of Reality so when it changes we change.

It is also interesting to observe is that this evolution of Rhetoric does not happen immediately or in one blinding flash of complete insight. We take small steps rather than giant leaps. More often the initial emotional reaction is confusion because our experience of the Reality clashes with the expectation of our Rhetoric.  And very often the changes happen when we are asleep – it is almost as if our minds work on dissolving the confusion when it is not distracted with the demands of awake-work; almost like we are re-organising our mental model structure when it is offline. It is a very common to have a sleepless night after such an Reality Check and to wake with a feeling of greater clarity – our updated mental model declaring itself as our New Rhetoric. Experienced facilitators of Improvement Science understand this natural learning process and that it happens to everyone – including themselves. It is this feeling of increased clarity, deeper understanding, and released energy that is the buzz of Improvement Science – the addictive drug.  We learn that our memory plays tricks on us; and what was conflict yesterday becomes confusion today and clarity tomorrow. One behaviour that often emerges spontaneously is the desire to keep a journal – sometimes at the bedside – to capture the twists and turns of the story of our evolving Rhetoric.

This blog just such a journal.

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Design-for-Productivity

One tangible output of process or system design exercise is a blueprint.

This is the set of Policies that define how the design is built and how it is operated so that it delivers the specified performance.

These are just like the blueprints for an architectural design, the latter being the tangible structure, the former being the intangible function.

A computer system has the same two interdependent components that must be co-designed at the same time: the hardware and the software.

The functional design of a system is manifest as the Seven Flows and one of these is Cash Flow, because if the cash does not flow to the right place at the right time in the right amount then the whole system can fail to meet its design requirement. That is one reason why we need accountants – to manage the money flow – so a critical component of the system design is the Budget Policy.

We employ accountants to police the Cash Flow Policies because that is what they are trained to do and that is what they are good at doing – they are the Guardians of the Cash.

Providing flow-capacity requires providing resource-capacity, which requires providing resource-time; and because resource-time-costs-money then the flow-capacity design is intimately linked to the budget design.

This raises some important questions:
Q: Who designs the budget policy?
Q: Is the budget design done as part of the system design?
Q: Are our accountants trained in system design?

The challenge for all organisations is to find ways to improve productivity, to provide more for the same in a not-for-profit organisation, or to deliver a healthy return on investment in the for-profit arena (and remember our pensions are dependent on our future collective productivity).

To achieve the maximum cash flow (i.e. revenue) at the minimum cash cost (i.e. expense) then both the flow scheduling policy and the resource capacity policy must be co-designed to deliver the maximum productivity performance.

If we have a single-step process it is relatively easy to estimate both the costs and the budget to generate the required activity and revenue; but how do we scale this up to the more realistic situation when the flow of work crosses many departments – each of which does different work and has different skills, resources and budgets?

Q: Does it matter that these departments and budgets are managed independently?
Q: If we optimise the performance of each department separately will we get the optimum overall system performance?

Our intuition suggests that to maximise the productivity of the whole system we need to maximise the productivity of the parts.  Yes – that is clearly necessary – but is it sufficient?

To answer this question we will consider a process where the stream flows though several separate steps – separate in the sense that that they have separate budgets – but not separate in that they are linked by the same flow.

The separate budgets are allocated from the total revenue generated by the outflow of the process. For the purposes of this exercise we will assume the goal is zero profit and we just need to calculate the price that needs to be charged the “customer” for us to break even.

The internal reports produced for each of our departments for each time period are:
1. Activity – the amount of work completed in the period.
2. Expenses – the cost of the resources made available in the period – the budget.
3. Utilisation – the ratio of the time spent using resources to the total time the resources were available.

We know that the theoretical maximum utilisation of resources is 100% and this can only be achieved when there is zero-variation. This is impossible in the real world but we will assume it is achievable for the purpose of this example.

There are three questions we need answers to:
Q1: What is the lowest price we can achieve and meet the required demand?
Q2: Will optimising each step independently step give us this lowest price?
Q3: How do we design our budgets to deliver maximum productivity?

To explore these questions let us play with a real example.

Let us assume we have a single stream of work that crosses six separate departments labelled A-F in that sequence. The department budgets have been allocated based on historical activity and utilisation and our required activity of 50 jobs per time period. We have already worked hard to remove all the errors, variation and “waste” within each department and we have achieved 100% observed utilisation of all our resources. We are very proud of our high effectiveness and our high efficiency.

Our current not-for-profit price is £202,000/50 = £4,040 and because our observed utilisation of resources at each step is 100% we conclude this is the most efficient design and that this is the lowest possible price.

Unfortunately our celebration is short-lived because the market for our product is growing bigger and more competitive and our market research department reports that to retain our market share we need to deliver 20% more activity at 80% of the current price!

A quick calculation shows that our productivity must increase by 50% (New Activity/New Price = 120%/80% = 150%) but as we already have a utilisation of 100% then this challenge looks hopelessly impossible.  To increase activity by 20% will require increasing flow-capacity by 20% which will imply a 20% increase in costs so a 20% increase in budget – just to maintain the current price.  If we no longer have customers who want to pay our current price then we are in trouble.

Fortunately our conclusion is incorrect – and it is incorrect because we are not using the data available to co-design the system such that cash flow and work flow are aligned.  And we do not do that because we have not learned how to design-for-productivity.  We are not even aware that this is possible.  It is, and it is called Value Stream Accounting.

The blacked out boxes in the table above hid the data that we need to do this – an we do not know what they are. Yet.

But if we apply the theory, techniques and tools of system design, and we use the data that is already available then we get this result …

 We can see that the total budget is less, the budget allocations are different, the activity is 20% up and the zero-profit price is 34% less – which is a 83% increase in productivity!

More than enough to stay in business.

Yet the observed resource utilisation is still 100%  and that is counter-intuitive and is a very surprising discovery for many. It is however the reality.

And it is important to be reminded that the work itself has not changed – the ONLY change here is the budget policy design – in other words the resource capacity available at each stage.  A zero-cost policy change.

The example answers our first two questions:
A1. We now have a price that meets our customers needs, offers worthwhile work, and we stay in business.
A2. We have disproved our assumption that 100% utilisation at each step implies maximum productivity.

Our third question “How to do it?” requires learning the tools, techniques and theory of System Engineering and Design.  It is not difficult and it is not intuitively obvious – if it were we would all be doing it.

Want to satisfy your curiosity?
Want to see how this was done?
Want to learn how to do it yourself?

You can do that here.

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Harried to the Rescue!

We are social animals and we need social interaction with others of our kind – it is the way our caveman wetware works.

And we need it as much as we need air, water, food and sleep. Solitary confinement is an effective punishment – you don’t need to physically beat someone to psychologically hurt them – just actively excluding them or omitting to notice them is effective and has the advantage that it leaves no visible marks – and no trail of incriminating evidence.

This is the Dark Art of the Game Player and the act of social omission is called discounting – so once we know what to look for the signature of the Game Player is obvious – and we can choose to play along or not.

Some people have learned how to protect themselves from gamey behaviour – they have learned to maintain a healthy balance of confidence and humility. They ask for feedback, they know their strengths and their weaknesses, and they and strive to maintain and develop their capability through teaching and learning. Sticks and stones may break their bones but names can never hurt them.

Other people have not learned how to spot the signs and to avoid being sucked into games – they react to the discounting by trying harder, working harder, taking on more and more – all to gain morsels of recognition. Their strategy works but it has an unfortunate consequence – it becomes an unconscious habit and they become players of the game called “Harried”.  The start is signalled by a big sigh as they are hooked into their preferred Rescuer role – always there to pick up the pieces – always offering to talke on extra work – always on the look out for an opportunity to take on more burden. “Good Ol’ Harried” they hear “S/he works every hour God sends like a Trojan”. The unspoken ulterior motive of the instigator of the game is less admirable “Delegate the job to Harried – or better still – just mess it up a bit do nothing – just wait – Harried will parachute in and save the day – and save me having to do it myself.” The conspirators in the game are adopting different roles – Victim and Persecutor – and it is in their interest to have Rescuers around who will willingly join the game. The Persecutors are not easy to see because their behaviour is passive – discounting is passive aggressive behaviour – they discount others need for a work-life balance. The Victims are easier to spot – they claim not be able to solve their own problems by acting helpless and letting Harried take over. And the whole social construct is designed with one purpose – to create a rich opportunity for social interaction – because even though they are painful, games are better than solitary anonymity.

According to Eric Berne, founder of the school of Transactional Analysis, games are learned behaviour – and they spring from an injunction that we are all taught as children: that each of us is reliant on others for recognition – and those others are our parents. Sure, recognition from influential others is important BUT it is not our only source. We can give ourselves recognition. Each of us can learn to celebrate a job well done; a lesson learned; a challenge overcome – and through that route we can learn to recognise others genuinely, openly and without expectation of a return compliment. But to learn this we have to grasp the nettle and to unlearn our habit of playing the Persecutor-Rescuer-Victim games; and to do that we must first shine a light onto our blindspots.

Gamey behaviour is a potent yet invisible barrier to improvement. So if it is endemic in an organisation that wants to improve then it needs to be diagnosed and managed as an integral part of the improvement process. It is a critical human factor and in Improvement Science the human factors and the  process factors progress hand in hand.

Here is an paragraph from Games Nurses Play by Pamela Levin:

“Harried” is a game played when situations are complicated. The aim is to make the situation even more complicated so that a person feels justified in giving up. “Harried Midwife” is so named because I (P.L.) first observed the game on an obstetric floor, but it has its counterpart in other clinical settings. The game is aided by institutional needs, since it is a rare hospital unit that has the staff adequate in numbers these days. In the situation I observed, the harried nurse sent her only nurse’s aide to lunch when three deliveries were pending. Instead of using a methodical approach, she went running about checking a pulse here, a chart there, a dilatation here, and an I.V. there, so she never was caught up with the work. She lost her pen and couldn’t “chart” until she found it. She answered the telephone and lost the message. She was so busy setting up the delivery room, she forgot to notify the doctor of the impending delivery. The baby, which arrived in the labor room, was considered contaminated, and could not be discharged to the newborn nursery. After the chaos had died down, the nurse felt justified in doing almost no work for the rest of the day.

Click for the complete Games Nurses Play article here