1. Continuous improvement recognizes that many small improvements add up to sizable benefits. Will continuous improvement take a company at the bottom of an industry to the top? Explain.
2. The Hydro-Electric Company (HEC) has three sources of power. A small amount of hydroelectric power is generated by damming wild and scenic rivers; a second source of power comes from burning coal, with emissions that create acid rain and contribute to global warming; the third source of power comes from nuclear fission. HEC’s coal-fired plants use obsolete pollution-control technology, and an investment of several hundred million dollars would be required to update it. Environmentalists urge HEC to promote conservation and purchase power from suppliers that use the cleanest fuels and technology. However, HEC is already suffering from declining sales, which have resulted in billions of dollars invested in idle equipment. Its large customers are taking advantage of laws that permit them to buy power from low-cost suppliers. HEC must cover the fixed costs of idle capacity by raising rates charged to its remaining customers or face defaulting on bonds (bankruptcy). The increased rates motivate even more customers to seek low-cost suppliers, the start of a death spiral for HEC. To prevent additional rate increases, HEC implements a cost-cutting program and puts its plans to update pollution controls on hold. Form sides and discuss the ethical, environmental, and political issues and trade-offs associated with HEC’s strategy.
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Paul O’Neill, former U.S. Treasury Secretary, estimated that arguably half of the $2 trillion a year that Americans spend on health care is needlessly wasted. Brainstorm up to 10 bluesky ideas to solve the following problems:
a. A typical retail pharmacy spends 20 percent of its time playing telephone tag with doctors trying to find out what the intent was for a given prescription.
b. After the person responsible for filling the prescription determines what they think they are supposed to do, errors can be made even in filling the prescription. For example, administering an adult dose (rather than the dose for a premature baby) of Heparin in a preemie ICU is fatal.
c. Drugs get distributed at a hospital on a batch basis. For example, carts can be filled on Monday, Wednesday, and Friday. A huge volume of drugs can come back on Monday because they are not consumed on the wards between Friday and Monday, patient conditions changed, or the doctor decided on a different intervention. A technician spends the rest of the day restocking the shelves with the returns and 40 percent of the intravenous materials prepared on Friday morning are poured down the drain.
d. Sometimes the administration of the drug was not done on the agreed schedule, because the nurses were busy doing something else.
e. For every bed in an acute care hospital system, someone falls during the year. Most falls occur after 11 p.m. and before 6 a.m. Sometimes a bone is fractured, leading to immobilization and then pneumonia.
f. One in every 14 people who goes to a U.S. hospital gets an infection they did not bring with them.
