Lean management helps hospital save $20M without layoffs

Southcoast Health System--a three-hospital system based in New Bedford, Mass.--has saved $20 million since it began implementing Lean Six Sigma in January 2009, the New England Business Bulletin reports. The savings are "well over" the amount invested, Patrick Gannon, vice president and chief quality officer for Southcoast Hospitals Group, told the Bulletin.

The hospitals group first set a $3 million savings target for the process, but more than doubled the amount. By the end of four months, after improving management of equipment, information and supplies, they had slashed costs by $7.6 million without laying anyone off, according to Gannon.

Some of the changes were simple, such as using videoconferencing rather than traveling to other sites. In a more complex change, an inhouse supply store was created so departments with excess supplies could then sell them to those who needed them.

It probably didn't hurt that the in-house Lean champion, Director of Quality Outcomes Nidia Williams, is a certified master black belt in Lean Six Sigma. Nearly every employee has been affected by the Lean improvements.
About 260, including physician leaders, have taken part in a yellow belt trianing program.

To learn more:
- read the New England Business Bulletin article

Related Articles:
How lean management helped hospitals avoid layoffs
HIMSS10: Hospital discusses its 'methodical' approach to lean management
Lean, Six Sigma taking hold at hospitals

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