Article about Lean in Two Sioux Falls Health Systems


I recently saw an article about Avera Medical Group and Sanford Clinic in Sioux Falls, South Dakota: “Health systems learn to be lean.” Avera McKennan Hospital, in Sioux Falls, was featured in the 2nd edition of my book Lean Hospitals

A physician describes how, with Lean, they are spending MORE time with each patient AND get to go home earlier:

Without adding staff, the Avera Medical Group gynecologic oncologist spends 10 more minutes with each patient than he used to and leaves work two hours earlier.

“We were often stressed at our clinic and running late,” he said. “Patients sometimes had to wait, and I was always behind on documentation.”

How did they do this? A classic “level loading” (aka “heijunka“) practice of spreading out charting throughout the day, instead of leaving it all until the end of the day. There's not just a time savings – the quality of the charting improves, as well.

The doc was, like many people, skeptical at first:

“At first, I was skeptical about it (the lean analysis), but it works,” he said. “You have to think outside the box, but it yields great results.”

That example shows that while people often fear, before learning about Lean, that the concept is somehow about cutting corners or skimping on the amount of time spent with each patient. The opposite is true. Since we're reducing waste (and freeing up time) instead of saying “work faster” or “work harder,” doctors get more time with each patient. It's win/win.

As a reminder that Lean is not just about cost or efficiency:

“It's not just about cutting costs,” said Dr. Dan Blue, president of Sanford Clinic at Sanford Health. “We do have to cut per-unit costs, but we have to look at standardization, best practices. We have a very fragmented health care system, and that's where integration and coordination of care is so critical. It's not just for efficiencies. It's for best outcomes and eliminating errors and waste.”

Avera McKennan has long had a “no layoffs due to Lean” philosophy and Sanford is using Lean to avoid layoffs:

Sanford has gone after those types of operational savings as a defense in avoiding personnel cuts, Blue said.

“The last place we want to go is people. We're committed to our people,” he said. “We're committed to the concept of annual increases in pay, and our historic on average has been 3 percent and we want to continue to do that, so we'll look everywhere else to look for efficiency so we can maintain our people.”

Some staff reduction has occurred through attrition, executives said, including upper management positions that have not all been filled as retirements occur or people leave.

Choosing not to backfill when people leave… that's fine when waste has been reduced to the point where the remaining team members can get the work done properly.

I wish more hospitals were finding these creative alternatives to just slashing headcount, like this CEO has learned.

Sanford Health is doing a lot to solicit and implement staff improvement ideas:

Employees also are asked to contribute cost transformation ideas. More than 450 staff members have submitted ideas that have translated to $30 million in efficiency-driven projects, Harvieux said. Ideas go to employees' supervisors, who decide whether to refer them to a steering committee for consideration.

One employee identified that Sanford was paying a different price for a supply in the clinic compared with the hospital. Working with the supplier resulted in a $200,000 savings, Harvieux said.

“It was small enough to slide under the radar, but the employee was able to lift it up,” he said. “When you have 25,000 people looking at everything, it makes a huge difference because you can't centrally dream up everything and it's not the culture you want either.”

I'd suggest that an improvement to their improvement efforts would be to adopt more of a “Kaizen” approach. It's not necessary for most ideas to go to a “steering committee.” Most Kaizen ideas can be (and should be) addressed locally within teams. The big ideas or major projects should go to a committee, perhaps, if weeklong Rapid Improvement Events need to be sponsored for bigger changes.

Avera has long used Kaizen methods to engage employees in continuous improvement. As the article says, Avera started with Lean about a decade ago, which puts them in “early adopter” territory with ThedaCare and Virginia Mason. I've visited Avera before and they're doing great work with really engaged senior leadership… but they have been somewhat under the radar.

Their CEO says:

By analyzing the processes involved in health care, waste is revealed, he said. For example, supplies might be located on the other end of hallways from where they're needed.

“So there's wasted time, frustration, inability to have the right person in the right place at the right time just because of how we designed it,” Kapaska said.

The waste is often designed in, due to the space, or the processes were more likely what just happened to evolve… processes often are NOT designed intentionally in a hospital and Lean gives a framework for designing processes and value streams.

The days of throwing lots of talented people into space with the best equipment… and expecting them to just sort it all out are done. We have to DESIGN our healthcare process and workflows and we have to engage physicians and hospital staff in doing this.

There's much more detail about their successes and results in the article. Check it out.

What do you think? Please scroll down (or click) to post a comment. Or please share the post with your thoughts on LinkedIn – and follow me or connect with me there.

Did you like this post? Make sure you don't miss a post or podcast — Subscribe to get notified about posts via email daily or weekly.

Check out my latest book, The Mistakes That Make Us: Cultivating a Culture of Learning and Innovation:

Get New Posts Sent To You

Select list(s):
Previous articleOvercapacity and Overproduction in the Auto Industry (and Healthcare)
Next articlePodcast #199 – Jeff Gothelf, LeanUX (Lean User Experience) for Software and Lean Startup
Mark Graban
Mark Graban is an internationally-recognized consultant, author, and professional speaker, and podcaster with experience in healthcare, manufacturing, and startups. Mark's new book is The Mistakes That Make Us: Cultivating a Culture of Learning and Innovation. He is also the author of Measures of Success: React Less, Lead Better, Improve More, the Shingo Award-winning books Lean Hospitals and Healthcare Kaizen, and the anthology Practicing Lean. Mark is also a Senior Advisor to the technology company KaiNexus.


  1. Hey Mark,

    As a heads up, the title of your post says “Sioux City” when both Sanford and Avera are based in Sioux Falls.


Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.