Seeing differently: applying the Theory of Constraints in health care
Alex Knight, MBA, CEng, and Ruth Vander Stelt, MD
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With increasing health care costs and growing demands, most countries are facing the challenge of providing high-quality, timely care that remains affordable. To improve productivity, a shift in perspective is required: from seeing complex systems as best managed by breaking them down into parts to seeing them as a chain of activities where system performance is determined by a few underlying constraints. This approach, based on the Theory of Constraints, focuses on ongoing improvement achieved through a rapid process of identifying and strengthening the weakest link in the chain.
Health care is a fundamental necessity in every society, but one that comes at a cost. Total expenditure on health care is rising year after year, and Canada has one of the highest levels of per capita spending (Figure 1). This growth means that health care often constitutes a significant and increasing percentage of a nation’s gross domestic product (GDP; Figure 2). The cause of this growth cannot simply be ascribed to the actions of the people running the system. However, the need for rapid and sustainable breakthroughs in productivity is becoming urgent in many territories, and the pressure to reduce costs is formidable, even in the most prosperous countries. Top
Front-line clinical workers’ salaries account for the largest category of expenditures in most health care budgets. Furthermore, the common experience of health professionals is that quality of care suffers and catastrophic incidents increase when front-line staff experience growing pressure.3
Unfortunately, many nations are between a rock and a hard place. Any successful health care system must simultaneously provide high-quality and timely care for patients and, at the same time, be affordable (Figure 3). As concerns about quality of care and waiting lists grow worldwide, the temptation to increase front-line resources or invest even more in productivity and innovation initiatives is understandable. However, there is equal pressure to reduce front-line resources in the drive for affordability and to question the speed and return on investment of many improvement efforts.
It is not enough to choose one side of the conflict over the other. Reducing front-line resources may improve financial stability in the short term, but this may damage quality of care or, worse still, cause a catastrophic failure. Top
On the other hand, adding more resources when budgets are tight attracts scrutiny and challenge. Trying to save a little bit here and there under the banner of “balancing capacity with demand” can lead to unintended negative outcomes, such as the creation of wandering bottlenecks across the system, which become a nightmare to manage and which jeopardize the quality, timeliness, and affordability of care. What is required is not balancing capacity but balancing flow.
The Theory of Constraints
The Theory of Constraints (TOC) was developed by physicist Dr. Eliyahu M. Goldratt in 1984.4 At its core, the TOC approach aims to identify those few areas that affect the performance of an entire system, what Goldratt calls constraints. Top
Our common reaction to the apparent complexity of the challenge involves breaking the system down into parts and attempting to maximize the performance of each part to improve the whole; but this does not work. Achieving local optima almost never leads to an overall optimum because local measurements do not take account of the importance of the constraints and their connections to the rest of the system. Top
Instead, to strengthen a chain, we need only identify and strengthen its weakest link. To achieve a breakthrough in performance, we must focus all our efforts on identifying and eradicating the underlying cause of a poorly performing situation, rather than spreading ourselves thinly across the multitude of its effects.
This shift in thinking — from seeing systems as complex and best managed by breaking them down into manageable parts to seeing them as a chain of activities where performance of the system is determined by a few underlying constraints — has profound implications for any improvement effort. Rather than embarking on a large-scale, organization-wide improvement of every part of the system, the TOC mindset focuses on ongoing improvement achieved through rapid cycles of identifying and strengthening the weakest link in the chain. Top
TOC has been applied in the health care environment and is explained in the business novel, Pride and Joy.5 It has delivered substantial results in terms of meeting three criteria:
For successful implementation of TOC in health care, the primary objective is to improve patient flow. Clinicians and staff need a robust mechanism to synchronize resources and provide an answer to the question: of all the patients I could treat next, which one should I treat first in order to improve the flow of all patients through the system? (that is, after urgent clinical care needs are attended to). Synchronization of resources dramatically improves the flow of patients through the system and patients receive their care more quickly. Top
Second, a focused process of ongoing improvement to balance flow is vital. Ask yourself: of all the areas I could try to improve, which will have the greatest impact on the performance of the whole system? This process is essential for identifying and removing the underlying causes of delay in the system, improving patient flow, and releasing clinical staff from the stress of managing disruption to their patients’ care. The release of this capacity opens the door to new strategic choices for the health care system. Top
Third, the removal of local performance measures will eradicate less-productive behaviour. “Tell me how you’ll measure me, and I’ll tell you how I’ll behave.” If you continue to measure someone only in relation to their part of the system, then do not be surprised when relations between the links of the chain erode. Replacing some performance measures with a few well-defined objectives based on patient flow enables management to understand and improve the performance of the system as a whole.Top
Implementing TOC: patient centred and doctor led
Any breakthrough in a health care system can be judged successful if it meets the criteria of presenting a patient-centred, clinically led approach, focused on improving both quality and timeliness of patient care. For each patient, a clinically based expectation of their recovery time is established — not based on national average or best practice, but on the expected clinical recovery time of that individual patient. This date can be used to synchronize the activities of all resources and eliminate local optimization. Any delays to a patient’s care are analyzed to reveal the task/resource combination most often causing the most delay for the most patients. It is this focus that ensures that substantial actions produce immediate and substantial benefits.
Leadership from our clinicians is vital in ensuring that the approach remains patient-centred and sustainable. The front-line clinicians deliver the care and, so, ensuring their role in leading the improvement is just common sense. Top
1.Health expenditure per capita (current US$). Washington: World Bank; 2014. http://data.worldbank.org/indicator/SH.XPD.PCAP
2.Health expenditure, total (% of GDP). Washington: World Bank; 2014. http://data.worldbank.org/indicator/SH.XPD.TOTL.ZS
3.Gawande A. The checklist manifesto: how to get things right. London: Profile Books; 2011.
4.Goldratt EM. The goal: a process of ongoing improvement. Great Barrington, Mass.: North River Press; 1984.
5.Knight A. Pride and joy. Aldbury: NSIK Partnership; 2014.
Alex Knight is an experienced management consultant, strategist, lecturer, and public speaker and is recognized as a leading authority on the Theory of Constraints. He is the author of Pride and Joy, a business novel based on 20 years of research into health and social care systems.
Ruth Vander Stelt is a full-practice rural family physician and the past-president of the Quebec Medical Association. She is currently enrolled in the international master’s program in health leadership at McGill University and is applying constraints theory in her practice environment in western Quebec.
Correspondence to: email@example.com
This article has been reviewed by a panel of physician leaders.