Sunday, March 19, 2017

Efficiency Adventures in My Doctor's Office

My trips to the doctor's office are typically a good time to observe and think about efficiency. Efficiency and scheduling in the context of our medical industry are always great topics as I wait in the waiting area and exam room.  Let's start with resource efficiency - - where resource in this context is the labor of my doctor.  She wants to utilize her time as efficiently as possible - - just like my employer in terms of my time.  Labor utilization is a key performance metric of the service sector - - from accounting to law to consulting. For more that 200 years, our form of capitalism has been built around the idea increasing the utilization of resources.

Let's make a guesstimate of my doctor's labor utilization.  Assume her office is open 10 hours per day and let's also assume she is in direct contact with her patients (i.e., the value adding portion of the medical process) for six hours per day.  Her labor utilization would be 60% - - 6/10.  This is her side of the efficiency coin.

Let's look at my efficiency story.  I don't care all that much about her labor efficiency - - my concern is what is known as flow efficiency.  Flow efficiency is the time it takes to process a "unit" through an organization.  In this case, I am the "unit" and the process is seeing my doctor.  In this particular case, my total process time was 60 minutes.  Most of this time is waiting and non-value adding activities. The time I spent with the doctor was 10 minutes.  So my flow efficiency was 17% - - 10/60.  We have one visit to the doctor, yet two different ways to examine efficiency and two very different results. One is an internal focus (i.e., resource efficiency) and the other is more about the customer experience (i.e., flow efficiency).  

In many respects, I cannot to be only one to think this, my visit to the doctor's office is a visit to the efficiency wasteland - - a process with low labor utilization and low flow efficiency.  If you look at the graph below, what the medical industry needs is movement upward and to the right.  Debates about medical insurance and drug prices are important, but let's also have a discussion about efficiency improvements.

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