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      KEYZINE: An e-zine for LEADERS:
     ABOUT THE PEOPLE PART OF BUSINESS
                 Volume 49, April 2005
    Publisher: © Key Associates, 2005
              ISSN # 1545-8873
           http://www.mkkey.com

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This Issue: "Use of Measurement"

This is a monthly electronic magazine for anyone
who wants to be a better leader, coach, facilitator,
or simply, to tune up their people skills. It is a
complimentary publication, devoted to the next
evolution of Quality Thinking.

View Earlier Issues

Contents:

What's Hot in Leadership
Maintaining Yourself as a Leader
Frequently Asked Questions from Leaders
Educational Opportunities
Useful Websites
Articles/Publications

"In God we trust. All others bring data."
-- W. Edwards Deming, American Statistician

"All improvement will require change, but not all
change will result in improvement.“
-- Gerald Langley et al. (1996)

"There has never been a measure that would survive
the fear of those being measured."
-- Don Berwick, Institute for Healthcare Improvement

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WHAT'S HOT IN LEADERSHIP
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USING MEASUREMENT TO ACCELERATE
LEARNING AND IMPROVEMENT.

SEEKING INFORMATION NOT JUST DATA.

NOT REACTING TO SINGLE DATA POINTS
IN DECISION-MAKING.

DEVELOPING ADEQUATE RESOURCES FOR
DATA MANAGEMENT.

ASKING: WHAT COULD WE CHANGE? HOW
COULD WE MORE ACCURATELY PREDICT?

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MAINTAINING YOURSELF AS A LEADER
***************************************
Fire-fighting and quickly fixing problems is, for
some, the measure of leadership prowess. How
quickly can you react (i.e., knee jerk) to correct
a situation? The pressure is there to
Do-Do-Do-Do. Occasionally, you may have a
chance to Plan a bit before you Do.

But learning--for you and your organization--
is not possible without feedback. Having a theory
and data allows you to Study the value of a change.
This is the Plan-Do-Study-Act (PDSA) cycle
adopted by W. Edwards Deming from his mentor,
Walter Shewhart. It is a learning process, a
scientific method imposed to profit from experience.

Not to say that an experiment cannot be done quickly
or that some situations are not truly urgent,
but why sacrifice learning and improvement for speed?

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FREQUENTLY ASKED QUESTIONS
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"We make management decisions based on our quarterly
reports--which give current quarter compared to last year
same quarter and year-to-date. Isn't this sufficient?"

Unless you view data over time using Statistical
Process Control (SPC) methods, it's hard to determine
if a process is producing acceptable or unacceptable results.
Furthermore, quarterly comparisons have aggregated 3
months and 90 days worth of business into a single number.
Customers do not care about the average order time or
average cycle time for the quarter. They care about what
is happening right now! SPC methods are designed to
provide such an understanding.

To learn more, please see Quality Healthcare: A Guide
to Developing and Using Indicators by Robert Lloyd (2004).

"I've heard criticism of managing by numbers. Isn't
that what we are being urged to do here?"

Deming said that managers who did not understand
a process would manage by the numbers alone. This argues
for process knowledge, which includes how the process works,
what is normal variation, and what the process is capable
of producing. You can only know this by studying data
over time (SPC).

He was also against setting arbitrary numerical quotas
and goals, which have no regard for what is possible.
Then we exhort people to work harder, raise the bar,
ask for 10% more, when nothing is changed about the process.
The Red Bead game below elaborates on this idea.

It is well to remember that a number is an "indicator"
and not the real thing itself. In fact, Deming was well
known for saying, “There is no such thing as a fact.”
He was trying to get people to realize that all measurement
is fraught with error. Knowledge of variation is more
important than having THE number.

"How does measurement apply to people?"

For Deming, everything was an N of 1. However,
in management, we tend to confuse the system and
the person. Deming used the Red Bead experiment
to teach the errors of management. As the game goes,
the teacher picks a few people from the audience to be
"Workers" making widgets. They do their work by using
a perforated paddle to scoop tiny balls out of a sampling
bowl (a random process).   If they scoop up any red balls,
they get demerits from other members of the audience
that were picked as "Inspectors". The "Accountant"
keeps track of the quality of each "Worker's" results.
After a few rounds, the teacher (Manager) calls the Worker
who has the best score up and praises them and gives
them a raise. Then calls up the Worker with the poorest
score and scolds them and mentions firing them if they
don't improve. After a few more rounds the top performer
is offered a promotion and the poorest Worker is fired.
This can cause people in the class to break out in tears,
because they recognize that there is no basis for what
is going on, both in the class and on their jobs.

Too often, we blame people for the ill effects of the
system we helped create, and only we leaders can fix that.

"Financial data is fairly easy to come by, as is customer satisfaction.
It is outcomes data that we struggle with."

There are other measures to consider. Let me draw from healthcare,
as an example. Jim Handyside, at the Vermont Oxford Network NIC/Q
meeting (referenced below), made these useful distinctions in MEASURES:

OUTCOME measures relate directly to the aim or result of your study--
e.g., reduction in number of transfusions per patient days

INTERMEDIATE measures predict an outcome--e.g., fewer infections
(which leads to fewer deaths).

PROCESS measures assess the points in the sequence or flow
of the process that lead to an outcome--e.g, actual performance
compared to a guideline or percent compliance.

PROXY measures are indirect measures which coincide with
or approximate the outcome--e.g., rate of material usage when
the material is related to outcome (example- hand hygiene cleanser usage).

BALANCING measures are the unintended consequences or adverse
side effects that can occur when you make changes--e.g., when
reducing number of painful procedures, are you missing important care?

(By the way, here is a biblio. on health outcomes
http://ptmanager.com/outcomes.htm)

“I had statistics in school, isn’t this enough to understand measurement
and variation?”

Most professionals receive some training in “enumerative statistics,”
such as descriptive statistics, tests of significance and regression analysis.
SPC is a distinctive branch of statistics ( initially developed by Dr.
Walter Shewhart in the 1920's). According to Dr. Bob Lloyd, the key
distinction is that enumerative examines aggregate data at fixed points in
time, to determine if one group of data is statistically different from another.
SPC, or analytic statistics, seeks to understand the variation that occurs
with the data over time--through the use of run and control charts.
The question becomes whether the data reflect common or special causes
of variation and is prediction possible, not whether two data points are
different. This is applied science, not controlled research or experimentation.

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EDUCATIONAL OPPORTUNITIES
**************************************
Key Associates offers a course on Statistical
Thinking. Contact keyassocs@mindspring.com .

Web-based SPC Workout for basics on Control Charts
http://www.qualitycoach.net/webbased/webasedspc.htm.

Some more on-line instruction
http://www.qualityamerica.com/training/onlinespc.html.

On-site training or PowerPoint training modules
and free monthly e-zine
http://www.spcforexcel.com/training.htm.

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OTHER USEFUL WEBSITES
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See annual reviews on software products in Quality Progress
(http://www.asq.org/pub/qualityprogress/index.html)
and Quality Digest (http://www.qualitydigest.com/).

Free trial of ChartRunner by PQ Systems
http://www.pqsystems.com/products/SPC/CHARTrunner/CHARTrunner.php.

Statistical software for Windows, MINITAB
http://www.minitab.com/products/minitab/14/.

QI Analyst--an SPC product with more industrial
and real-time applications
http://www.wonderware.com/products/analytical/qianalyst/.

Charts, graphs, and diagrams as add-ons to EXCEL
http://www.qimacros.com/Macros.html (QI Macros).

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ARTICLES/PUBLICATIONS
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Books are linked to web descriptions:

Brassard, Michael & Ritter, Diane. The Memory Jogger II.
GOAL/QPC, 1994.

Carey, Raymond G. Improving Healthcare with Control Charts:
Basic and Advanced SPC Methods and Case Studies.
Milwaukee,WI: ASQ Quality Press, 2003.

Carey, Raymond G. & Lloyd, Robert C. Measuring Quality
Improvement in Healthcare: A Guide to Statistical Process
Control Applications. New York: Quality Resources, 1995.

Executive Learning, Inc. Handbook for Improvement:
A Reference Guide for Tools and Concepts. Nashville, TN:
Healthcare Management Directions, Inc., 2002.

Joiner, Brian L. & Gaudard, Marle A. "Variation,
Management, and W. Edwards Deming. Quality Progress
Dec. 1990.

Handyside, Jim & Ursprung, Robert. Measurement for Learning
and Improvement: Part II. Vermont Oxford's NIC/Q Annual
Meeting, Portland OR, April 17, 2005. (http://www.nicq.org)

Langley, Gerald L. et al. The Improvement Guide:
A Practical Approach to Enhancing Organizational
Performance. San Francisco: Jossey-Bass, 1996.

Lloyd, Robert C. Quality Health Care: A Guide
to Using and Developing Indicators. Sudbury MA:
Jones & Bartlett, 2004.

Nolan, Thomas W. & Provost, Lloyd P. "Understanding
Variation." In Quality Progress, May 1990.

W. Edwards Deming. Out of the Crisis. Boston: MIT Press,
2000.

W. Edwards Deming. The New Economics for Industry,
Government, Education. (2nd edition). Boston: MIT Press, 2000.