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Article
Management Modeling
By
Don Himes
Senior Consultant
When we change or completely redesign how work is done, it is often
difficult to determine whether you’ve achieved an optimal set of
trade-offs among process time, elapsed time, and labor and support
costs. Also, it is difficult to predict in advance the unintended
consequences that may occur as you introduce change in the way work is
performed. To address these issues, management modeling can be used to
test the effectiveness of alternative changes before committing to a new
design, avoiding associated costs for technology change and training for
the involved staff.
Management modeling is the process of building a model, typically using
a process map, then experimenting with the model to improve the process.
The components of the management model, which are held in a common
repository, include the tasks performed, the organizational actors
(roles) and their associated costs, and other demographics associated
with the process. The components may be used for a variety of purposes,
such as staffing models, unit cost, and workflow analyses. Simulation of
the process lets you test and experiment in a risk-free way at minimal
cost and in a fraction of the time of other approaches.
The approach for one of our recent projects was as follows:
 | Document current processes in standardized workflow diagrams,
capturing the discrete tasks performed by each organizational area. |
| Populate components of the process diagrams with task duration
times, delay times, labor costs, and other relevant data. |
| Conduct simulations for five of the processes and analyze two
additional processes in depth. The simulation tool we used provided
calculations for:
 | Unit costing of each business process |
| Profit and loss for each process |
| Queuing times to illustrate bottlenecks and show how task
times affected key performance indicators |
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During the course of the project, a
simulation of the critically important initial-assessment
process demonstrated that improvements identified would yield a
31% productivity gain among a staff of 17 RNs working to reduce
a backlog; a related client project subsequently achieved the
improvement that Nolan had predicted. A second simulation
demonstrated that elimination of misrouted calls at the
front-end of the process could yield a 20% productivity gain.
At another client, analysis of the
workflow for admissions to a clinic yielded some surprisingly
simple but effective improvements, such as adding a scale in
exam rooms, saved approximately $117,000 per year.
For commercially available
simulation software, the investment to get started is a few
hundred dollars plus the time to learn, apply, and adopt the
concepts and techniques for use in your organization.
The results can be displayed in a
graphical format (process map) or tabular format (Excel
spreadsheet) tailored to client-defined preferences. Finally,
management modeling and simulation can be integrated with other
improvement approaches, such as Lean and Six Sigma.
We have helped our clients with all
of the above. If you would like to know more, please e-mail me. |
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