The Ankota Healthcare Delivery Management Blog

A Simple Tool for Driving Big Change

Posted by Ken Accardi on Mar 26, 2010 1:34:00 PM

Whether you're trying to improve profitability for your organization, reduce your "cost of quality", or even reform the US Healthcare system, one of the best tools I've ever found is a simple one.  It's called "The Pareto Chart".  I was lucky enough to grow up in my career at GE when Jack Welch was the CEO and this was one of the key tools that we used.  A Pareto chart is simply a bar chart showing improvement opportunities where you put the biggest bar on the left and order the rest in order of decreasing height as you move to the right.  Here's an example of a Pareto chart, for determining why customers are unhappy with a company's call center:

Pareto Chart Example

Building a Pareto chart is simple and is also a great way to foster participation in an improvement process.  You empower your team to come back with their best ideas and to quantify the impact of the idea (in dollars saved, defects reduced, hospitalizations avoided or any other unambiguous metric).  When people bring their ideas, the team listens to the idea and agrees on its impact (for example, you might have to lower the impact of one suggestion because it has a higher cost or time to implement).  Then you build the chart with your biggest ideas on the left, and start executing them moving from left to right.

Although this is a simple tool, it can have a big impact because it gives everyone a chance to contribute and the group's course of action is based on data rather than other factors. 

Like most people I've spoken to, my views about the  Health Care Reform bill that was recently passed into law are that 1) I think it's good for all Americans to have Health Insurance, 2) I don't know enough about the bill to fully assess what will be good about it and what will be bad (but I'm sure that there will be plenty of both), and 3) It's very clear that it's going to cost more, not less, and I'm disappointed about that.

My view has always been that we should reform healthcare using the Pareto chart, doing it a piece at a time where each one improves the quality and coverage of care and lowers the cost.  The good news is that it's not too late for this approach and hopefully the new health care reform will be implemented a piece at a time and we'll see real results like addressing malpractice tort reform, or the mismatch in what America pays for prescriptions vs. the rest of the world first. 

The great thing about the Pareto chart is that you can get great ideas "on the radar screen".  For example, broader use of telehealth, home dialysis or home infusion can result in billions of dollars of reduced cost while also increasing patient satisfaction and reducing infection.  While these ideas are too small to make the big healthcare reform headlines, they are potentially huge ideas for home care agencies to implement in the short term, that can then be adopted more broadly on a national scale.

Ankota provides software to improve the quality and efficiency of health care delivered outside the hospital and to promote aging in place.  Learn more at www.ankota.com or contact Ankota.

Topics: Home Care Best Practices, Health Care Reform, thought leadership

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About Ankota

Ankota provides software to improve the delivery of care outside the hospital, focusing on efficiency and care coordination. Ankota's primary focus is on Care Transitions for Reeadmisison avoidance and on management of Private Duty non-medical home care. To learn more, please visit www.ankota.com or contact Ankota.

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