Lean Production at Virginia Mason
Gary Kaplan, CEO of Virginia Mason Hospital, was responsible for integrating lean production that transformed the efficiency of the hospital. By 2012, Virginia Mason had transformed into a more efficient, customer-responsive organization where medical errors during treatment has been significantly reduced. Among other gains, lean processes reduced annual inventory costs by more than $1 million, reduced the time it took to report lab tests to a patient by more than 85%, freed up the equivalent of 77 full-time employee positions through more efficient processes, and reduced staff walking distance by 60 miles a day, giving both doctors and nurses more time to spend with patients. These, and many other similar changes, lowered costs, increased the organization’s customer responsiveness, improved patient outcomes, and increased the financial performance of the hospital.
Case Discussion Questions
- What do you think were the underlying reasons for the performance problems that Virginia Mason Hospital was encountering in the early 2000s?
- Which of the four building blocks of competitive advantage did lean production techniques help improve at Virginia Mason?
- What do you think was the key to the apparently successful implementation of lean production techniques at Virginia Mason?
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