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There is a large change in awareness of commercial concepts in Health Practice Management in its entirety, but particularly in Health Practices associated with the supply of products or medical devices. The Optical world has seen a seismic shift in the ongoing management of a Practice as is the Hearing Health World now. With this in mind, it is imperative that we consistently, honestly and constantly assess our business for ongoing health and the ability to compete.
With this in mind, I think we should consistently strive to maintain our knowledge in business and commercial matters as we do in Clinical and Technological matters. Whilst my posts are diverse on subject matter, the one vein that runs through them is the attainment of quality in a Health Practice. With this in mind, I would like to explore the roots of this commercial concept. I recently came across an article which in fact detailed the author of this concept which has now become an accepted business practice globally.
A Lot of the modern business thought on attainment and supply of quality across a business structure from the manner that a telephone is answered to the provision of quality products is in fact based on the concepts of one man. Dr W. Edwards Deming. Deming, who was in fact a Statistician was in Japan after WWII in order to assist with a census. He also taught Japanese business leaders statistical process control, his message was that by improving quality, companies can decrease expenses as well as increase productivity and Market Share. Deming contribution was in fact little known until he published a work in the 80s called “Out Of The Crisis” which detailed his concepts and their use. In the book he laid down his 14 points management philosophy. Much of the success of Japanese global leaders in manufacturing is now attributed to Deming, as is the progression of business thought globally.
His 14 points are as significant for service based industries as they are for manufacturing industries.
The 14 Points
- Create a constant purpose toward improvement.
- Plan for quality in the long term.
- Resist reacting with short-term solutions.
- Don’t just do the same things better – find better things to do.
- Predict and prepare for future challenges, and always have the goal of getting better.
- Adopt the new philosophy.
- Embrace quality throughout the organization.
- Put your customers’ needs first, rather than react to competitive pressure – and design products and services to meet those needs.
- Be prepared for a major change in the way business is done. It’s about leading, not simply managing.
- Create your quality vision, and implement it.
- Stop depending on inspections.
- Inspections are costly and unreliable – and they don’t improve quality, they merely find a lack of quality.
- Build quality into the process from start to finish.
- Don’t just find what you did wrong – eliminate the “wrongs” altogether.
- Use statistical control methods – not physical inspections alone – to prove that the process is working.
- Use a single supplier for any one item.
- Quality relies on consistency – the less variation you have in the input, the less variation you’ll have in the output.
- Look at suppliers as your partners in quality. Encourage them to spend time improving their own quality – they shouldn’t compete for your business based on price alone.
- Analyze the total cost to you, not just the initial cost of the product.
- Use quality statistics to ensure that suppliers meet your quality standards.
- Improve constantly and forever.
- Use training on the job.
- Train for consistency to help reduce variation.
- Build a foundation of common knowledge.
- Allow workers to understand their roles in the “big picture.”
- Encourage staff to learn from one another, and provide a culture and environment for effective teamwork.
- Implement leadership.
- Expect your supervisors and managers to understand their workers and the processes they use.
- Don’t simply supervise – provide support and resources so that each staff member can do his or her best. Be a coach instead of a policeman.
- Figure out what each person actually needs to do his or her best.
- Emphasize the importance of participative management and transformational leadership.
- Find ways to reach full potential, and don’t just focus on meeting targets and quotas.
- Eliminate fear.
- Allow people to perform at their best by ensuring that they’re not afraid to express ideas or concerns.
- Let everyone know that the goal is to achieve high quality by doing more things right – and that you’re not interested in blaming people when mistakes happen.
- Make workers feel valued, and encourage them to look for better ways to do things.
- Ensure that your leaders are approachable and that they work with teams to act in the company’s best interests.
- Use open and honest communication to remove fear from the organization.
- Break down barriers between departments.
- Build the “internal customer” concept – recognize that each department or function serves other departments that use their output.
- Build a shared vision.
- Use cross-functional teamwork to build understanding and reduce adversarial relationships.
- Focus on collaboration and consensus instead of compromise.
- Get rid of unclear slogans.
- Let people know exactly what you want – don’t make them guess. “Excellence in service” is short and memorable, but what does it mean? How is it achieved? The message is clearer in a slogan like “You can do better if you try.”
- Don’t let words and nice-sounding phrases replace effective leadership. Outline your expectations, and then praise people face-to-face for doing good work.
- Eliminate management by objectives.
- Look at how the process is carried out, not just numerical targets. Deming said that production targets encourage high output and low quality.
- Provide support and resources so that production levels and quality are high and achievable.
- Measure the process rather than the people behind the process.
There are situations in which approaches like Management By Objectives are appropriate, for example, in motivating sales-people. As Deming points out, however, there are many situations where a focus on objectives can lead people to cut corners with quality. You’ll need to decide for yourself whether or not to use these approaches. If you do, make sure that you think through the behaviours that your objectives will motivate.
- Remove barriers to pride of workmanship.
- Allow everyone to take pride in their work without being rated or compared.
- Treat workers the same, and don’t make them compete with other workers for monetary or other rewards. Over time, the quality system will naturally raise the level of everyone’s work to an equally high level.
- Implement education and self-improvement.
- Improve the current skills of workers.
- Encourage people to learn new skills to prepare for future changes and challenges.
- Build skills to make your workforce more adaptable to change, and better able to find and achieve improvements.
- Make “transformation” everyone’s job.
- Improve your overall organization by having each person take a step toward quality.
- Analyze each small step, and understand how it fits into the larger picture.
- Use effective change management principles to introduce the new philosophy and ideas in Deming’s 14 points.
The “Seven Deadly Diseases” of a business that he identifies include:
- Lack of constancy of purpose
- Emphasis on short-term profits
- Evaluation by performance, merit rating, or annual review of performance
- Mobility of management
- Running a company on visible figures alone
- Excessive medical costs
- Excessive costs of warranty, fuelled by lawyers who work for contingency fees
“A Lesser Category of Obstacles” he identified includes
- Neglecting long-range planning
- Relying on technology to solve problems
- Seeking examples to follow rather than developing solutions
- Excuses, such as “our problems are different”
- Obsolescence in school that management skill can be taught in classes
- Reliance on quality control departments rather than management, supervisors, managers of purchasing, and production workers
- Placing blame on workforces who are only responsible for 15% of mistakes where the system designed by management is responsible for 85% of the unintended consequences
- Relying on quality inspection rather than improving product quality
Deming’s 14 points have had far-reaching effects on the business world. The challenge for is to apply Deming’s points to your companies, departments, and teams. Taken as a whole, the 14 points and the Seven Deadly Diseases are a guide to the importance of building quality into company processes and customer loyalty that will bring, reducing variation, and fostering constant continuous change and improvement throughout organizations. The next time you take a look at your business, pull out Deming’s 14 points and think of it as a template or concept piece to identify issues and to spur change.
Through intelligent change and innovation, your business will not only survive but thrive.