Red beads and healthcare transformation

"It is not necessary to change. Survival is not mandatory."

How many of us know who said the above? How many of us are aware of the Deming red bead experiment?

William E. Deming was an engineer, statistician and academic scholar whose work focused on statistical variance and systems thinking. Importantly, he is considered by many the "father" of continuous improvement of quality, be that in product development, organizational processes and management. He was the one who led the post-WW II Japan into dominating the industrial world stage.

His philosophy and teachings centered on the idea that employee hard work in and of itself is not enough to bring success to a company/organization. The most important determinant of high quality performance, which will in turn translate into profitability and success, is the system itself. "98% of performance comes from the system, not the people".

What is it that makes a system successful? First of all, employees know very well what their task is, why they have to do it and how to do it. Well then, who is responsible for designing the system? The answer to this is management/leadership. If the system is designed poorly, then its output will be poor, no matter how hard the employees work!

One of the most famous experiments in the field of quality is Deming's red bead experiment. If you are not aware of it, here is a link showing Dr. Deming performing the experiment

This experiment beautifully showcases Deming's ideology that the success or failure of a process (and in broader of an organization) largely depends on its design; as managers or leaders, we cannot force results that our processes are not designed to generate. This principle makes total sense and it wasn't a surprise that a famous slogan back in the 1950s and 1960s when Deming was leading Japan's industrial transformation led to a documentary that was released in the US titled "If Japan can, why can't we"?


This brings us to today. Are Deming's principles applicable to the healthcare transformation already underway in the US today? Absolutely. Even the title of the documentary can be modified to reflect what we are facing today in healthcare: "If retail/online services/tech giants/(enter whichever other major industry here) can, why can't we?" and by "we" I mean healthcare. Under the umbrella of healthcare we can include from hospitals, private practices, nursing homes to insurance companies, pharma, med tech, biotech companies, big giants like Philips/Siemens/GE and last but not least the newest players like CVS/Aetna, Walmart, and even Amazon and Google.

So, what should we do?

(1) Systems design and systems thinking

It is critically important to learn from the mistakes and teachings of the past when designing the new face of our healthcare system. We have to prioritize value- and outcomes-based healthcare models and design our services and infrastructure accordingly. This will be the only way to meet the goal, otherwise, it won't matter how hard healthcare providers work or how resourceful we get in finding loopholes in the system (which will serve nothing but waste time and energy by the way...). We are in a uniquely advantaged position to harness big data and re-design our care delivery and care evaluation systems in a way that will allow for meeting the goals of value and outcomes over waste. Multidisciplinary teams comprising physicians and other types of providers along with IT experts, public health professionals and economists are key in developing these models.

(2) Practice DEI.

Diversity, equity and inclusion are critical components of this change. Diversity means nothing other than ensuring all (or as many as realistically possible) different traits, experiences and backgrounds have a seat at the table. In our case the table can take lots of different forms: it could mean representation of diverse patients in clinical trials (there are start-up's out there working on this; one of them is actually based in Birmingham, AL, my home base currently). It could also mean C-suite tables in big pharma, hospitals and insurance companies. Last but not least, the table could mean all sorts of smaller teams/departments/divisions within a hospital, like Department of Medicine/Surgery/Pediatrics or units like cardiac catheterization lab, intensive care units, endoscopy units (just to name a few).

Equity reflects the fact that all healthcare providers and workers have equal access to all the tools necessary to perform their tasks and care for their patients. It also means that patients also have equal access to healthcare, meaning they not only seek care in a timely manner, but also can get access to everything needed in order to ensure they get the most out of their treatments.

Inclusion is what allows individuals to feel welcome and have a sense of belonging in the workplace. Inclusion is what enables employees to speak freely and openly without fears of repercussions or retaliations. Inclusion ensures that all differing opinions will not only be heard but also appreciated. Collectively, DEI offers an organization the competitive advantage to outperform rivals, by connecting more effectively with customers (or in our case patients) and by dramatically increasing creativity and adaptability, which in our days are crucial for any company that wants to survive and thrive.

Attention needs to be paid, though, because as mentioned in one of my prior posts, DEI is not a panacea and can certainly turn into Pandora's box if not practiced smartly. The key differentiator is leadership: in the hands of strong leadership, DEI will deliver all its promises (and more!), but in the hands of weak leadership DEI is like a ticking bomb. To be clear, by "weak leadership", I mean a leader who is unable to swiftly handle argumentative conversations and maintain the cohesiveness of their group by having a clear vision, mission and strategic plan.


To return to Deming and his red bead experiment, are all of the above necessary for the healthcare industry in order to effectively transform? The answer is no and to paraphrase Deming's quote: we do not need to survive, but if we want to, then change is mandatory.

22 views0 comments