Information Processing and the Challenges Facing Lean Healthcare

• Date: 01 August 2013
• Published date: 01 August 2013
• DOI: http://doi.org/10.1111/faam.12016

Financial Accountability & Management, 29(3), August 2013, 0267-4424

Information Processing and the

Challenges Facing Lean Healthcare

TONY KINDER AND TRELAWNEY BURGOYNE*

Abstract: Radnor and Walley (2008) and others have identified a high failure rate

in NHS lean rapid improvement events. This paper explores one reason why these

failures occur: from the perspective of information processing (Galbraith, 1974), it

explores the difficulties facing lean healthcare projects. Using qualitative method

(pre-understanding and interviews) with analysis triangulating between data, general

theory and sense-making we investigate two lean projects currently running at a

Scottish hospital to identity how the absence of adequate information affects the

projects. We find that the projects are critically hampered by the absence of project-

level, inter-unit level and organisational level information. The practical implications

of our research are to suggest that before embarking upon lean projects, hospital

leaderships should explore the adequacy and integratedness of their information

systems, decision-taking structures and inter-unit coordination mechanisms.

Keywords: healthcare, lean, information processing

INTRODUCTION

For the NHS, in the age of austerity, the mantra of more from less is increasingly

found in a generalised rollout of lean projects. Yet perhaps as many as 50% lean

projects fail to deliver sustained savings. This paper argues that lean projects

require levels of information beyond the capability of many NHS organisations

and that Galbraith’s (1974) information processing theory helps explain why and

how many NHS lean healthcare projects fail. If our conclusion is generalisable,

it challenges the premise that the NHS can deliver sustainable cost reductions,

whilst at the same time improving quality of care, by using lean tools.

At a micro-level the failure of lean and other change projects in the

NHS may be explained by situation factors such as absence of clinician

support or a rejection of the ‘cuts’ ideology (Radnor and Walley, 2008):

*The authors are respectively, Director of Programmes at the University of Edinburgh

Business School; and a project manager and consultant, specialising in enterprise IT service

delivery, transformation and business change.

Address for correspondence: Tony Kinder, University of Edinburgh Business School, 29

Buccleuch Place, Edinburgh, EH8 9JS, UK.

e-mail: Tony.kinder@ed.ac.uk

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272 KINDER AND BURGOYNE

ungeneralisable subjective factors. Macro-level frameworks (such as Neely,

2007), whilst powerful, insufficiently capture change processes. Our aim is

to understand how the complexity and uncertainty characterising healthcare

affect the processes of using lean tools, looking through the lens of information

processing guided by Simon’s (1974) insight that performance in any type of

organisation limits the organisation’s ability to process information. In effect

we are synthesising lean thinking as developed by Womack and Jones (2003)

with Tushman and Nadler’s (1978) information-processing framework; both of

which seek to eliminate or reduce complexity by concentrating on information

flows.

The genesis of our argument is Lapsley’s (2009) paper arguing that some of

the proponents of new public management techniques fail to grasp the complexity

of public services, leading to the imposition of strategies making public services

less adaptive to a changing environment. As Perrow (1979) and Anderson (1999)

point out, high control and coordination are most difficult where complexity and

uncertainty are the norm. UK healthcare is noted for complexity and uncertainty

at both organisational and task levels (Dawson and Dargie, 1999; and Kollberg

et al., 2005) including environmental uncertainty, infinite demand, complex

patient diagnostics and care pathways, and high levels of tacit knowledge. Picking

up Lapsley’s (2009) point, we will argue that in general terms the complexity of

many NHS services, inadequacy of its lateral and vertical information systems

and functional structure doom many lean projects to failure.

We address two research questions. Firstly, how effectively do lean healthcare

projects (characterised by high instability, uncertainty and complexity), manage

information processing, and secondly, do the challenges of reintegrating lean

project information with information systems contribute to project failure?

The next section reviews literature on lean in healthcare and information

processing. Following an outline of method in the third section we present data

from original interviews and casework in two Scottish health boards, which we

then analyse.

LITERATURE

We show how lean thinking has developed into an important approach to

the management of change in healthcare and then explore the application of

information processing theory to organising projects arguing that since lean

seeks evidence from facts – its success depends upon information availability.

Lean Healthcare Services

Womack et al. (1990, p. 225) conclude their classic lean study saying:

Lean production is a superior way for humans to make things. It provides better

products in wider variety at lower cost . . . . It follows that the whole world should

adopt lean production, and as quickly as possible.

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