Priceless

So the hospital’s senior leaders, also known as the “Executives MBAs” decided that the “Very Important Clinic” needed a few more exam rooms to accommodate an increase in patients. This was based on rumblings from the “Administrator MPH” and “Dr. Chief” (Very Important Clinic’s seasoned administrator and most influential doctor, respectively). They declare that they are busting at the seams and have been forced to turn away patients to the Lowly Competitors. But, before we move on to the solution, first let’s understand The Politics:

• Dr. Chief must be pleased in order to get some guarantee he won’t defect. He makes us all look good, gets the hospital’s name in the press, a great speaker, nationally respected and most importantly makes us all a lot of money.
• Administrator MPH is there to please Dr. Chief. Her career trajectory has a proportional relationship with Dr. Chief’s satisfaction. It is best to agree as much as possible in order to keep her star rising so that one day she can become an Executive MBA.
• The Executive MBAs trust in the opinions of Dr. Chief and Administrator MPH. No need to doubt or question their wise decisions, they are Executives and they have MBAs.
  

So, the only viable solution is to build the expansion and give Very Important Clinic and Dr. Chief more space.

Fast forward 6 months, I complete an analysis of space usage for Very Important Clinic as a part of a larger space project. Turns out that patient volume did not increase drastically and the expansion is only sparingly used. It appears that the entire expansion was primarily based on anecdotes from Dr. Chief that Administrator MPH supported and Executives MBAs never questioned. No one completed any type of thorough analysis of the daily patient schedule, capacity and the current use of space to measure Dr. Chief’s claims against the reality.

How can I be sure? Only because Very Important Clinic’s scheduling was still done on paper. Yes it was 2008, yes you would think it would be done on a computer…but I digress – that’s a story for another day. In order for me to do any analysis I had to manually collect a month’s worth of paper schedules, copy into Excel and then calculate the utilization over time based on the average visit length. Okay…that’s kind of complicated. Let’s break it down for the Executive and Administrator types:

Larry, Moe and Curly each have 2 hour appointments. Very Important Clinic has 3 rooms available and is open from 9am to 5pm (8 hours). You have one room for Larry, one room for Moe and the last room for Curly. Thus, 2 hours/room divided by 8 hours/room equals 25% utilized. Or if the word “utilized” is too cumbersome, you can say they “used 25% of their available space.”

Obviously this type of analysis was not completed prior to the decision making. Executives and Administrators don't due manual analysis. They most likely developed a business plan based on annual patient volume and observing that it was trending up – absent analysis to measure if the actual trend volume exceeded available space (capacity). Hey, I’m only speculating…there might not have even been a business plan to start with.

So, in conclusion:

• Building of expansion…say $100,000
• Physician influence over good business practices…say $50,000
• Poor space planning…say another $50,000
• Wasting of talent, time, energy and effort…why not another $50,000
• Dr. Chief’s happiness…Priceless