It is common knowledge that health care has improved remarkably over the centuries. We live longer and healthier lives than our forebears, mainly because of advances in the numerous subsystems of the health industry, such as medical research, professional training for personnel, nutrition, and sanitation. To be sure, other industries also have made remarkable advances during those same centuries. Nevertheless, if a public poll were taken, the health industry would be widely acclaimed for its record of responsiveness to human needs.
However, this industry also faces severe criticism for alleged shortcomings: the rising price of health care, with no end in sight; the long periods of waiting for service; the allegedly high error rate; and even evidence of greed and fraud in some sectors of the industry.
Such real and imagined shortcomings have long existed in all industries and institutions, and to those institutions Darwin's concept of the survival of the fittest has universally applied. Institutions that responded to customer needs survived. Those that did not respond became extinct —replaced by competitors that provided society with better service and lower prices. Such competition for survival is now beginning to take place in the health industry. A variety of organizational forms are all trying to expand their share of the market by providing superior service and lower prices.
The key to successful competition lies in the concept of fitness for survival. When we transfer that concept from biological species to human institutions, we are dealing mainly with the interrelated parameters of quality and cost. During the last few decades, a number of our industrial institutions have strengthened their fitness by completing hundreds and even thousands of projects that have improved quality while at the same time reducing costs. The demonstration projects described in the present book establish publicly what has long been known to pioneering investigators: It is equally feasible to carry out quality improvement and cost reduction projects in the health industry.
These same demonstration projects also establish that the health industry now has a major opportunity to increase the pace of its improvements. Such progress cannot be made through more and more demonstration projects. Instead, it must be achieved by providing hospitals and other local institutions with the means for carrying out quality improvements on their own.
As the health industry undertakes this change, it is well advised to take into account the experience of other industries in order to understand what has worked and what has not. Of course, in the minds of many, the health industry is "different." This is certainly true as to its history, technology, and culture. However, the decisive factors in what works and what does not are the managerial processes, which are alike for all industries.
We can easily identify the success factors for those institutions that have already dramatically improved quality and reduced quality-related costs:
• The upper managers personally directed a new approach
to managing for quality though creating and serving on a
guiding quality council.
• They applied quality improvement methods to business pro
cesses as well as to traditional operating processes, and they
attended to the needs of internal customers as well as to those
of external customers.
• They adopted the concept of mandated, annual quality im
provement. To this end they instituted an infrastructure to
identify needed improvements and to assign clear responsibility for making those improvements.
• They adopted the concept that planning for quality should
involve participation by those who will be impacted by the
• They adopted a modern quality-oriented methodology to
replace empiricism in quality planning.
• They attempted to train all members of the hierarchy in the
modern processes of managing for quality: quality planning,
quality control, and quality improvement.
• They provided the work force with opportunities to receive
training and to participate actively in the processes of manag
ing for quality.
• The enlarged their strategic business plans to include qual
ity goals and means for meeting those goals.
These are the most successful strategies to have evolved out of extensive experience in our industrial institutions. Institutions that have adopted these strategies have achieved enviable results. Other institutions that have opted for different strategies have far less to show for their effort and for the years that have elapsed.
The health industry faces similar options; it must choose its strategies carefully. Health industry managers are well advised to study carefully the lessons learned from the demonstration projects discussed in this book. Of these lessons, the most important involve the cause-and-effect relationships: Which managerial processes produced the results? Mastery of those managerial processes is the prerequisite for lasting success.
Wilton, Connecticut Joseph M. Juran
August 1990 Chairman Emeritus
Juran Institute, Inc.