Which is more profitable, to improve Quality or to cut Costs?

Look after the quality and the profit will take care of itself. A practical illustration of the management philosophy of Dr. W. Edwards Deming.

Look after the quality and the profit will take care of itself

Why is it more profitable to improve Quality than cut Costs?

Let me begin by saying that I am no more against looking for a reduction in costs than looking for "peace of mind".  But just as peace of mind cannot be pursued as an end in itself but is rather the by-product of a certain way of living with others in the world, so reduction in costs is the result of increased efficiency and effectiveness in the processes of production, i.e. a by-product. If you aim for an efficient and effective process for producing a quality product or service then you should get a certain reduction in cost as a by-product. If you simply look to cut costs in whatever way seems quickest and easiest then your aim will be off, and so will your focus. You thereby run the risk of a lot of "collateral damage", shooting whatever gets between you and your target.

In 1990 Rafael Aguayo wrote a book laying out the management philosophy and principles of Dr. W. Edwards Deming (Dr. Deming. The American Who Taught the Japanese About Quality). That was twenty-four years ago. Reading it today I am amazed at how relevant and apposite those principles still are. In that book (p. 33) Aguayo uses a simple example to illustrate one way that quality increases profit. In this example it is because of less rework.

If you run a plant with a defect rate of 5 per 100, your revenue is limited to 95 saleable items per hundred but your costs are still for 100 items. Let's say selling price is $1.00 per item; production cost is $90.00 per batch of 100 items.

Revenue: $1 x 95		$ 95
Less cost of production: $90 per 100		$ 90
Profit		$  5

If you improve production quality by about 5% such that there are zero defects, then…

Revenue: $1 x 100		$100
Less cost of production: $90 per 100		$ 90
Profit		$ 10

So, a quality improvement of 5% in the production process has resulted in a 100% increase in profits. Not too shabby. Ah, but you say that there is an additional cost for improving the quality and reliability of production. Even if we increase the cost of production by 5% to $94.50, that would still give us a 10% increase in profits:

Revenue: $1 x 100		$100.00
Less cost of production: $94.50 per 100		$  94.50
Profit		$    5.50

The other side of this coin is that a quality improvement in production can be expected to translate into an improvement in the reliability and other quality attributes of the finished product. That should have a knock-on effect on enhanced customer satisfaction which, in turn, creates returning customers out of once-off customers.

The moral of the story?

"Look after the quality and the profit will take care of itself" - W. E. Deming. These are not Deming's actual words but the philosophy is his. This is similar to…

“Look after the customer and the business will take care of itself” – attributed to Ray Kroc, founder of McDonald’s

ISO 9001 Training Videos

I have published three training videos to assist people become acquainted with the ISO 9001:2008 international standard.

The first is a very basic introduction to the ISO organization and the ISO 9001 standard. It tells the viewer what the ISO organization is and then goes on to give an outline of ISO 9001:2008 in an animated format using Moovly that is very easy to follow. Length, 5:43.

You can get it here:

What Is ISO 9001 ?

Then there is a pair of training videos covering the essentials of ISO 9001:2008 in a lot more detail. These are presented using a regular slide show format.

The first is about 9:30 if you skip the self-assessment slides, which I do not recommend. The self-assessment ensures that the viewer gets a grasp on most of the essential concepts and elements.

The second is longer, about 16 minutes if you skip the self-assessment.

Viewer feedback on these videos, positive or negative, will be welcomed.

You can access a FREE PDF version of the self-assessment questions here:
ISO 9001 Essentials Self-Assessment

ISO 9001 Essentials Part 1

Training on the essentials of ISO 9001:2008. Includes self-assessment quiz. Part 1 of 2, Clauses 0 - 6. 

ISO 9001 Essentials Part 2

Training on the essentials of ISO 9001. Includes self-assessment quiz. Part 2 of 2, Clauses 7 - 8 

You can access a FREE PDF version of the self-assessment questions here:
ISO 9001 Essentials Self-Assessment

What is ISO? What is ISO 9001?

What is ISO ?
What is ISO 9001?
What is a Quality Management System?

Here is a short, simple, high-level explanation in less than 6 minutes.

What frequency does ISO 9001 require for measuring customer satisfaction?

Actually, ISO 9001:2008 doesn't require a frequency. All the ISO 9001 Standard stipulates is, "The organization shall monitor information relating to customer perception as to whether the organization has met customer requirements. The methods for obtaining and using this information shall be determined. (8.2.1)." This is an interesting case where aiming to meet the letter of the standard can get in the way of meeting the Standard because you are shooting for the wrong target. It's a bit like the question, "What is the minimum level of quality necessary to satisfy the customer?"

Enhanced customer satisfaction

My suggestion is, put the Standard aside. Decide, and I mean seriously decide, whether you are or want to be an organization that continually enhances customer satisfaction through the way you meet customer requirements. Assuming the answer is yes, what measures or criteria of success or failure in meeting this aim are you using, and are you monitoring them with sufficient frequency to give you sufficient information to know what to improve? ISO 9001 (8.2.1) offers a list of example tools: customer satisfaction surveys, customer data on delivered product quality, user opinion surveys, repeat/lost business analysis, compliments, warranty claims and dealer reports. (Ultimately, the most important criteria are:
1) Have you done business with them more than once and would you do business with them again?
2) Have you ever recommended them and would you recommend them to a friend?)

Don't do this in order to meet a standard. Do it to be a more successful company and you will not only meet the ISO 9001 Standard but you will also be a more successful company.

Voila!

ISO 9001:2015 - Where will you document "Context of the Organization"?

Whether or not they have any kind of ISO certification, there cannot be many mature organizations with sustained success which have not taken the trouble to identify and document in some manner the external and internal issues relevant to their purpose prior to formulating or reviewing their strategies and objectives. How else can you develop a strategy? The same motivation applies to identifying "interested parties". For such organizations, meeting the requirements of 4.1 and 4.2 will be a piece of cake: they will already have the evidence documented somehow, somewhere - probably in their business plan.

Issues and Interests

For organizations with less mature strategic plans this will be an opportunity to develop their business strategy. The prior question to ask is, "What information do we need as input to develop a three or five year strategy?" It is up to the organization to decide who the parties are with an interest in their product or service and what the issues are that need to be taken into account. It doesn't matter where and how they retain the evidence that they weighed and decided these things, just so long as they can show the evidence when asked. The Standard does not stipulate. Do it in the most effective and efficient manner to the degree it has value for the organization, not because it is an ISO requirement. Then the requirement will be met. Voila!

Hospitals grinding to halt because of stranded seniors, CMA head says

In a press release put out today the head of the Canadian Medical Association, Dr. Christopher Simpson, a cardiologist at Kingston General Hospital, describes 'gridlocked' hospitals around Canada struggling to make room for incoming patients with acute medical problems because so many older patients needing chronic care and having no other place to go are taking up about 15% of the acute care beds.

"Thousands of older Canadians are taking up acute care beds at $1000 a day even though they are well enough to be discharged because they have no place to go."

"There either isn’t a long-term care bed available in their area or there aren’t the support services they need to live at home. About 15 per cent of acute care beds in Canada are taken up this way.

“We are warehousing them. We do the best we can. But it’s not anywhere near good enough.”

Video quotes from Dr. Christopher Simpson can be downloaded from this link:
http://www.skyflyproductions.com/CMA-AMC

Aging - the effect of stereotypes

Researchers have reported, in the journal Psychological Science, that an implicit intervention can work subliminally to strengthen older people’s positive age stereotypes that leads, in turn, to stronger physical functioning. Put simply, physical functioning in seniors can be improved by exposing them to positive age stereotypes. The less explicit this exposure the better.

Read the study in Psychological Science

Read the New York Times blog article about the study, The New Old Age

Read Dr. Mercola's take, When it comes to Aging Well, It's Mind Over Matter

Can Culture be the Root Cause of Noncompliance?

Actually, that was a trick question to get your attention. Right off the bat, let me say that the answer is "No." Although I am certain that the absence of an effective organizational culture of quality can be a cause of noncompliance, I do not believe that organizational culture can be a root cause of noncompliance because it still begs the question, "Why?" If you can still reasonably ask another 'why?' then you have not yet come to root cause.

All successful organizations have a vision, mission and goals that are pursued according to certain principles which are subscribed to as values within the organization. However, not every organization with a declared vision, mission, goals and set of values is successful. Compare Toyota, on the one hand, and the investment banker Goldman Sachs who was a major player in the 2007 subprime mortgage crisis.

The difference, very often, is between the formal, espoused value principles and the informal principles which form the basis of what actually happens in the organization. What actually happens, 'the way we do things', is what constitutes the 'culture' of the organization. For example, the Goldman Sachs business web site states: INTEGRITY AND HONESTY ARE AT THE HEART OF OUR BUSINESS. Jane or Joe Public can be excused for reading this with a degree of cynicism given the actual cultural history of that organization.

Is your culture rogue?

It is important, then, to establish where there may be significant gaps between identified, desired organizational behaviours that would support the espoused principles on the one hand and actual behaviours suggesting a different, rogue set of beliefs, organizational culture or 'way of doing things' on the other.

Peter Drucker is credited with saying, "Culture eats strategy for breakfast." You will not be able to successfully implement an organizational strategy aligned with the organization's vision and mission if the prevailing organizational culture, "the way we do things", does not have the same alignment. On the other hand, if the culture is properly aligned, the new strategy is half-way to success before you even start.

How does your organization 'do things'? How big is the gap between your organization's formal and informal principles? Which behaviours is your organization rewarding?

ISO 9001 Moves to Final Draft

New revision still on schedule for release Q4'15.
Main elements:

• Process based (not new)
• Plan Do Check Act (not new)
• Risk based (New emphasis)

The interviewer found this exciting. Really? You be the judge.

PSA testing for prostate cancer screening - Lies, damn lies and statistics

The Canadian Task Force on Preventive Health Care has urged doctors (and patients) to stop using the prostate-specific antigen test, or PSA, to detect cancer in its early stages and uses statistics to back up its guidelines published in the Canadian Medical Association Journal.

Dr. S. Larry Goldenberg, chair of the Canadian Men’s Health Foundation, a professor of urologic sciences at the University of British Columbia, and the author of An Intelligent Patient Guide to Prostate Cancer, provides a scathing retort in a short article, "Dropping PSA test for prostate cancer puts men’s health at risk", pointing out that the task force is comprised entirely of non-experts in the field.

Read why he says you should ignore the Task Force and why he says, "As a urologist, I’ll continue to urge my patients to check their PSA. As a man, I’ll continue to check mine, too. So should you."

Is there really a choice between profit and quality?

“Look after the customers and the business will take care of itself” is a famous quote from Ray Kroc. If anyone knows a way to look after customers without providing a quality product or service in a quality manner, I would be curious to hear about it.

I think that the origins of the conflict between costs and quality lie in the need to demonstrate to auditors or inspectors that due process is being followed for a safe product or service. Certainly, we have all come across blind and rigid adherence to doing things in a prescribed way and keeping prescribed records that do not have any obvious benefit to the customer - at least not to the casual observer, nor to the operator on the line or the staff member entering a record which demands laborious detail.

Challenging the value or benefit of a time-consuming activity is not being anti-quality; on the contrary, it is something necessary for effectiveness and efficiency and, therefore, good quality. It is everyone's job to come up with the most effective and efficient way to satisfy the customer, noting that regulatory authorities and standards bodies are also our customers.

You can try to cut costs by compromising on quality but sooner or later your customers will notice, at which point the business will have to play catch-up.

Tempted to cut quality to cut costs? Think again.

The name W. Edwards Deming looms huge in the history of quality management and the use of statistical sampling methods to control costs through controlling quality. He also made a huge contribution to the efficiency and quality improvement phenomenon in post-war Japan. Reading a Wikipedia article on Deming I was intrigued to find that Japanese disciples of Deming summarized his philosophy into a formula with an 'a' versus 'b' comparison:

(a) When people and organizations focus primarily on quality, defined by the following ratio,

quality tends to increase and costs fall over time.

(b) However, when people and organizations focus primarily on costs, costs tend to rise and quality declines over time.

From <http://en.wikipedia.org/wiki/W._Edwards_Deming>

In Deming's 1950 Lecture to Japanese Management he stressed to senior managers and owners how crucial it was for them to provide the leadership necessary for quality to reduce costs: "No matter how excellent your technicians, you who are leaders, must strive for advances in the improvement of product quality and uniformity if your technicians are to be able to make improvements. The first step, therefore, belongs with management. First, your company technicians and your factories must know that you have a fervor for advancing product quality and uniformity and a sense of responsibility for product quality."

Steps for Managers

Even if your organization (service or manufacturing) is not certified to an ISO standard, the ISO 9001 international standard provides helpful pointers for any organization's leadership to take control of quality in their organization. I like to use the catch phrase, "Measure, Monitor, Manage".

Measure frequently and monitor by regularly reviewing the following:

Audits, inspections or site visits: what was good and what can or should be improved?

Clients, customers, patients, residents: Are we soliciting feedback with surveys or other means? Are we getting complaints? Where are our "customers" on the unhappy-satisfied-delighted spectrum?

Product or Service: How satisfactorily are we meeting our own internal standards? Do we even have standards? Are they adequate?

Corrections, Corrective and Preventive Actions: Are these effective? Is there a backlog?

Action items: Have we followed through on decisions made in previous management reviews of quality?

Changes: Are there any recent changes, or impending changes, that could impact the good functioning of our organization?

Recommendations: Are there any good ideas or recommendations for improvement from any quarter, whether from within or from outside the organization? Are we actively encouraging creative input for improvement or are we fighting to maintain the status quo and suppressing 'heretical' ideas? (Consider this blog a source of recommendation for improvement.)

After diligent review of the above, manage by making decisions and assigning action items that will result in improved effectiveness and efficiency of organization processes and practices, happier clients/patients/residents or improved product with happier (and returning) customers. Consider whether you have the resources, human or material, to achieve this and what you can do if you don't.

By focusing on effective and efficient processes to ensure a quality outcome to delight customers, clients, patients or residents, costs should fall over time. Don't take my word for it. Sixty-four years ago Deming preached that message to Japanese businessmen. Organizations like Toyota still vouch for the validity of his message today.

Time to Care: Seniors' Long Term Care

Most of us have heard friends, acquaintances or people more remote from us tell horror stories about some or other events that have taken place in a long-term care home, or read something in the newspapers.

Someone I was speaking to recently was shocked to see how much disrespect was shown by family members of a home resident toward the personal support worker who was attending to their loved one in the home.

CUPE Ontario published this video on YouTube two weeks ago. It is a powerful statement providing a window from the point of view of nurses and personal support workers.

Qmentum Quarterly: Ethics in healthcare

The Summer 2014 issue of Qmentum Quarterly put out by Accreditation Canada has a very interesting article on ethics in healthcare by Robert Butcher titled, "Supporting Ethical Practice in Your Community".

The article starts with the following posers:

A homecare nurse calls you with concerns
about a client who has been discharged from
the hospital. She has questions about his home
environment and his ability to look after himself.
“The place is squalid,” she says. “He is unsteady
and forgetful, but adamant that he wants to be
at home. I’m worried.”

During flu season your staff’s vaccination rate
is at 70% and the local public health officer has
declared an outbreak in the community. Should
you require unvaccinated staff to get vaccinated,
take Tamiflu, or stay home?

The Executive Director of your hospital’s
foundation has just called. They have received a
very generous offer from a local businessperson
to fund and name a new wing. He is involved
in a bitter dispute in the community over the
development of large tracts of good agricultural
land. The donation is a clear attempt to court
public favour; to use your good name and
reputation to enhance his.

What should you do in any of these cases?
Better yet, what should your organization do?

The article goes on to lay out how an organization can develop an ethics framework within which ethical decisions can be made.

Read the rest of the article here.

Lead, Follow or Get Out of the Way

Canada Geese. Source: NatureFramingham

In a professional on-line discussion group in LinkedIn that I follow, somebody posed the following question. How would you package the edict, "Lead, follow, or get out of the way" to your employees and colleagues so that everyone buys into it and nobody becomes offended?

The way I see it, this is about organizational culture, the way we do things, our principles and values and how these align for individuals, as a team and as an organization.

I do not have military exposure other than reading books, watching movies and talking with friends who were in the military but, clearly, whether soldiers 'shoot their own wounded' or 'leave no on behind', they don't think about that decision for the first time when they are confronted with the situation. It's in the training and in the culture and, long before, they know how they are going to act even if they hope the situation never arises. If a leader has to say, "Lead, follow or duck" in a crisis then that is way too late and will probably precipitate a crisis of its own.

I believe it was Peter Drucker who said, "Culture eats strategy for breakfast." If your organization's new strategy is being torpedoed by the prevailing culture that has evolved over years, I would recommend introducing a culture shift with a broader, proactive initiative such as implementing a decision to become a Lean organization (very different to lean and mean) that can hold out opportunities for growth for all. It may appear to be slower to implement and you may need help and training, but without a culture shift your new strategy is going to have a long, uphill battle.

An essential element of the strategy for introducing a new strategy is to consider the people: the team and the individuals. As I read recently, they are not the most important asset of your organization, they ARE the organization.

Do LTC Homes in Ontario or Canada need a 'One Voice' organization?

In the Ontario Long Term Care Network discussion group of LinkedIn, Andréa Catizone posted a link to a blog post: What the Senior Living Industry Can Learn FromThe Evolution of The Hotel Industry. 

Following, are my comments after reading that blog post.

It's an interesting analogy, comparing senior living and nursing homes with hotels/motels but, like most analogies, it limps in some important respects apart from the obvious differences in populations.

1. The hotel/motel industry in the USA is highly competitive as operators try to fill beds that are often empty; every Ontario LTC Home has a rather long waiting list that is largely controlled by the local CCAC which affords special consideration for the most needy, driven in turn by the need for hospitals to vacate beds occupied by non-acute-care patients.

2. The Ontario Long-Term Care Act has resulted in a highly regulated licencing system and corresponding reporting (CIHI, HQO) and inspection systems that ensure, at least in intent, a minimum standard of care and quality of life for residents along with a Residents' Bill of Rights. I don't think that the US hotel system has anything close, does it?

3. The real or imagined need for most Ontario LTC home operators to have a good, strong public relations image has resulted in the quest for accreditation to a standard in certain operational aspects over and above the requirements for a licence from the Ministry. At least one LHIN, I am told, has made accreditation mandatory. Interestingly, a statistical analysis that I did showed no positive correlation between accreditation and regulatory compliance in the 82 homes making up the two LHINs of my study. See LTC Homes and Accreditation, parts 1 and 2 at tcmc Quality Management Serviceson YouTube.

The thing that drove the changes in the USA hotel industry is identified as the interstate highway system. Why? Because it channelled and redirected travellers. I would propose that the equivalent for Ontario seniors is the role played by the CCAC's; that, and the about-to-explode-with-boomers population of seniors. As a result, the change that I anticipate will be the creation of many more for-profit LTC homes as private enterprise sees long waiting lists and a booming senior population as a business opportunity.

The blog ends by asking the question (of US operators), who will step up and create a national "One Voice" organization for all Senior Living operators? The Ontario equivalent is, do seniors' organizations need something beyond OLTCA, OANHSS and the like? It's a good discussion, no doubt, but I don't see the evidence, nor do I hear the public saying that we have an urgent need for one unifying association for Long-Term Care Homes and seniors' care organizations. The pressing discussion in Canada seems to be reported in the latest CMA poll: Canadians want a national strategy for seniors health care:doctors report. 

Does a Speedometer Prevent You From Speeding?

When you drive your car you can avoid being given a ticket for speeding by checking your speedometer and taking your foot off the gas pedal if needed, maybe even touching the brake. You can also be distracted and not look at the speedometer. The mere presence of the speedometer will not guarantee that you do not get a ticket for speeding.

You could even have someone in the back seat (or passenger seat) watching the speedometer and nagging you that you are going too fast and still choose to ignore them.

You can have Required Organizations Practices (or ROPs), Accreditation or Certification Surveys, Quality Committees and regulatory reports, and an annually revised Quality Improvement Plan, but none of these will guarantee regulatory compliance any more than a speedometer because, ultimately, it’s up to the driver.

Who is the driver in your organization? That’s a trick question, isn’t it, because it is not usually one person but a team of key decision makers and influencers, some from the Board of Directors, others from the Board of Management, and probably others as well, like staff who have the respect of their peers when they speak. This group of people, if they are working together as a team, are the influencers with the power to create and nurture a culture of quality in an organization, but only PROVIDED they keep an eye on the dashboard and, as a team, respond appropriately with the pedals.

The question is, are the process owners and managers sufficiently mandated and empowered, trained and resourced, and held accountable to take the actions necessary to enhance the quality management system and foster a culture of quality to prevent the bad stuff happening?

Applying Lean Manufacturing Principles in Healthcare

The Spring 2014 issue of Healthcare Management Forum has an excellent article by Chattergoon, Darling, Devitt and Klassen on taking Lean Six Sigma principles developed by Toyota and others for the manufacturing industry and applying them with great success to Healthcare, in this case the Toronto East General Hospital (TEGH) and, especially, its Emergency Department (ED). From such a leap, it surely must be a relatively small step to applying these same Principles in other Healthcare arenas such as Long-Term Care Homes.

You can read or download the article here:
Creating and sustaining value: Building a culture of continuous improvement

The central message can be summed up in this quotation from the article's abstract: "enabling continuous improvement in an organization is about an entire cultural shift—not just a series of rapid improvement events."

A culture of continuous improvement evolved organically at TEGH in three key phases:

Phase 1: Setting the stage. 

The organization made a commitment to quality and value explicit in its vision and through its strategy, creating a department dedicated to improvement and innovation - the TEGH Improvement System (TIS).

Phase 2: Team-driven performance management. 

The leadership team promoted and modelled a "huddle philosophy",  which allowed units, departments, and programs to identify new improvement opportunities, monitor performance on improvement projects, and sustain gains. The voice of the patient, obtained through interviews and videos, was made a cornerstone of the huddle philosophy.

Phase 3: The daily management system and cross-appointment model.

A daily management system, called Management Made Easy (MME),  was created to allow units, programs, and portfolios to identify and proactively address improvement opportunities before they blew up into large-scale problems. A cross-appointment model was adopted where staff members outside of the TIS team were given weekly-portion appointments to the TIS team to be  coached and acquire experience with the TIS team through involvement on improvement projects. Conversely, TIS team members are also given 'portion' appointments to work on improvement projects in departments such as surgery or medicine, thereby giving coaching exposure to entire teams.

Successes.

TEGH can boast about a number of successes as a result of this culture of continuous improvement, most notably that of having the lowest Emergency Department wait times for admitted patients in Toronto Central LHIN (from being one of the worst) and reduced length of stay for patients with chronic obstructive pulmonary disease by 46% through improved quality-based procedures (QBPs); all this while seeing improved staff satisfaction ratings.

The organization has documented a list of telling "lessons learned". At the top of the list is the need to adapt and translate LEAN improvement principles from their original industrial and manufacturing context to the local situation at TEGH.

You can read or download the entire article here: 

Creating and sustaining value: Building a culture of continuous improvement

When is it a good idea to pursue ISO 9001 certification?

It' always a good idea to be ISO 9001 compliant, but when is it a good idea to take the next step and become certified?

• Are you sometimes excluded from submitting RFPs or RFQs because you are not an ISO 9001 company?
• Have you lost business to another company or service provider that is ISO 9001 certified?
• Are you subject to repeated or burdensome site visits by clients or their representatives in order to be qualified or re-qualified as a supplier?
• Have you lost business because you failed to qualify as a supplier?
• Does your company have the self-discipline to maintain and improve its Quality Management System effectively and beneficially without the external oversight that ISO 9001 requires?

The more yes answers you provide, the stronger your case for getting certification.

Cost of Quality or Return on Investment (ROI)?

Is there a cost to establishing and maintaining a Quality Management System?

In answering this question many people will readily recognize that we have to spend money on preventing 'bad' things from happening, such as defective parts in manufacturing or an avoidable critical incident in a nursing home. We also have to lay out money in what are known as 'appraisal costs' such as quality control on the production line or double-checking that the correct medication was given to the correct patient/resident at the correct time or covering the costs of auditors or accreditation surveyors.

But to be fair and accurate, whenever we have to calculate and report the cost of quality we should also identify and add in the Cost Of Poor Quality (COPQ) also called PONC - Price of Non-Compliance or Non-Conformance.

For example: time spent 'fixing' problems, retooling, speaking to unhappy family members in a Long-Term Care Home, covering staff absences because of stress and demotivation and, of course, time spent with inspectors for reported complaints or critical incidents should all be seen as “waste” and added to the cost of poor quality.

Of course, there is also the cost of lost reputation when our failures become public knowledge, which also adds to staff stress and demotivation. Inspection reports are really dirty laundry hanging on a very public clothes line.

To the extent that our preventive and appraisal efforts are reducing the incidence of poor quality and non-conformance and the associated costs, we are receiving a return on investment in our Quality Management System.

 There is a tax benefit to reporting money spent on quality as a cost of doing business, but in our minds and hearts we would do better to see that money as a capital investment that produces a return. Then we are more inclined to ask, How can we get the best ROI, Return On Investment? This question is not limited to for-profit organizations.

An efficient and effective QMS is really an asset, not a cost:

• Ask: How can we get a return on investment? (Note. This question applies equally to NFPs as For-Profits)
• It’s a shame and a waste to use accreditation or certification mainly for ‘window dressing’
• Time and resource spent on preventable complaints and inspections for reportable events should be cost out as ‘waste’ (COPQ, PONC). Any reduction is ROI.
• Other ROI: reduced staff turnover; reduced absenteeism; prevention of recurring non-compliance or defects; fewer follow-up and other inspections
• Intangible ROI includes: fewer preventable critical incidents and reportable events; increased satisfaction both for residents or patients and their families; happier Government regulators; Improved, reality based, public recognition and reputation

Long-Term Care Homes, Complaints and Critical Incidents

All Long-Term Care Homes have got the on-going challenges of heading off resident complaints at the pass and preventing avoidable critical incidents. Many have got these pain points satisfactorily under control. Many others are struggling with this challenge and finding that they are triggering unwanted inspections from the Ontario Ministry of Health and Long-Term Care.

The video is best viewed full-screen.

Concerned about the number of inspections for Critical Incidents and Complaints at your LTC Home?

As an Executive Director, or as Chairman of the Board, or Coordinator for Continuous Quality Improvement, or a member of the Quality Committee, or just a staff member with the good of our residents at heart - am I concerned with the number of Ministry of Health and Long-Term Care (MOHLTC ) inspections for complaintsand critical incidents? If this is an area for concern then one or more of three things is probably not happening as well as they should:

Firstly: Are we measuring all the right things? Of course, we are measuring for CIHI and HQO and our own Board meetings, but have we got the metrics in place to red flag the likelihood of an avoidable critical incident occurring, to red flag the future likelihood of one or more resident complaints that could trigger an inspection? In the field of quality management we call this type of metric KPIs, Key Performance Indicators. KPIs are the organization’s "vital signs", the vital few metrics that report on the health of the organization in living out its mandate from and to society. KPIs should not be confused with the kind of quality indicators that are reported to HQO such as falls, wounds and restraints, although KPIs might well incorporate some of those metrics.

Secondly: Are we monitoring effectively? Assuming that we actually do measure those KPIs, are we reporting them in an accountable manner to the right people who are best positioned to effect change – change in our processes and change in our culture? Managers and others in positions of responsibility who are not being fed the information they need to do their job need to report this as a concern up the management chain. Without KPIs you are flying blind.

Thirdly: Are we managing efficiently and effectively? Assuming that we are reliably measuring and monitoring KPIs, are the process owners and managers sufficiently trained, mandated, empowered, resourced and accountable to take the actions necessary to enhance the Quality Management System (QMS) and foster a culture of quality to prevent the bad stuff happening? If not, that is fodder for a KPI in itself and needs to be reported as a resourcing issue to senior management. Managers and others in positions of responsibility who feel they need training need to do whatever it takes to get it; if your department is at risk for non-compliance because you are lacking resources then that needs to be reported, repeatedly if necessary.

What do you think? Let's have a discussion.

What type of Corrective Action can you take when your root cause basically comes down to human error?

This question was asked in an interest group that I belong to on LinkedIn. The questioner asked: How do you go about correcting this, other than discipline or firing?

Now, if you are the manufacturer of a medical device (hardware or software) and a patient or operator is killed or injured because of a "reasonably foreseeable usage error", then the manufacturer of the medical device is held responsible by government regulators for not building into the design of the medical device a means of preventing that usage error. The reasoning is that operator (usage) error (other than wilful and malicious) should be preventable and, as such, treated as an effect, not a cause.

Non-volitional usage errors fall into 3 categories:
SLIPS are, typically, inadvertent finger problems such as accidentally punching a wrong number;
LAPSES are 'missed' actions typically due to forgetfulness or a lapse in attention;
MISTAKES happen when the operator does an action believing it to be the correct one but it produces an undesired outcome.

These point to 3 different types of root cause. Each should be able to be addressed in an appropriate and effective way. What applies to the operation of a medical device (or passenger airliner) can and should also be applied to the operator process in a manufacturing plant, or a Personal Support Worker providing a service in a long-term care home.

What is a Quality Management System

A quality management system, or QMS, is a set of documented policies, procedures, processes and responsibilities organized into a structured collection to facilitate a business or organization realizing its quality vision, goals and objectives.

Standards Council of Canada:
"A quality management system (QMS) defines and establishes an organization's quality policy and objectives. It also allows an organization to document and implement the procedures needed to attain these goals."

ASQ (formerly American Society for Quality): "Quality management system (QMS): A formalized system that documents the structure, responsibilities and procedures required to achieve effective quality management."