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Rethinking Resource Sharing. Edward D Rothman Professor of Statistics University of Michigan. W Edward Deming. 1900-1993 American Statistician Contributions included a transformation of the Japanese automobile industry from low quality to high quality

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Rethinking resource sharing

Rethinking Resource Sharing

Edward D Rothman

Professor of Statistics

University of Michigan

W edward deming
W Edward Deming

  • 1900-1993

  • American Statistician

  • Contributions included a transformation of the Japanese automobile industry from low quality to high quality

  • See the white paper “If Japan can why can’t we….” 1981 on NBC

System thinking
System Thinking

  • A collection of components that come together repeatedly for a purpose

  • Our job is the achieve the purpose

  • This requires an ability to plan to meet customers needs and wants and to act

  • The key is a useful theory and action based on the theory.

Why do we need this
Why do we need this?

  • Many standard approaches to management place emphasis on aspects of the system.

  • For instance, measurement, MBO, and work standards are designed to make us more efficient.

  • Principle: High efficiency may not be an effective way to move us forward.

For anne gregory w b yeats
For Anne Gregory-W.B. Yeats

  • Interrogator:

  • “Never shall a young man,

  • Thrown into despair

  • By those great honey-coloured

  • Ramparts at your ear,

  • Love you for yourself alone

  • And not your yellow hair.”

And anne gregory replies
And Anne Gregory replies,

  • “But I can get a hair-dye

  • And set such colour there,

  • Brown, or black, or carrot,

  • That young men in despair

  • May love me for myself alone

  • And not my yellow hair.”

Interrogator responds
Interrogator Responds:

  • “I heard an old religious man

  • But yesterday declare

  • That he had found a text to prove

  • That only God, my dear,

  • Could love you for yourself alone

  • And not your yellow hair.”

Optimization means achieve the purpose
Optimization Means Achieve the Purpose

  • In the last example, we want to have high throughput yet little work in process (W.I.P.)

  • Operate step 1 at 40% efficiency.

  • Look at the rate limiting step---move this to a higher level if the customer demands more.

  • Recognize that those steps that do not limit throughput, have excess capacity. What other uses can we make of step 1?


  • The purpose of the system is an assertion that represents a win for everyone.

  • By everyone we mean suppliers, people in the process and customers.

  • We measure success by looking at how we move towards achievement of the purpose.

  • Principle: Optimization of a measurement can be suboptimal for the system.

First steps
First Steps

  • Identify the participants

  • Learn the needs and wants of each party

  • For each participant, ask why again and again…

  • Find the purpose

  • Example: Your 14 year old daughter wants to attend a party at a friends house. Seeks permission to return at midnight. Dad wants her home at 10 PM.

Mission purpose

  • To (expand and promote---to provide information---) information accessibility to the …….community

The learning process
The Learning Process

  • The system design must recognize variation. Seek robust methods—those that work well under a wide variety of circumstances—but also understand the need to adapt and change.

  • Deming Learning Cycle-Plan-Do-Study-Act

  • Rothman-Rabkin: IPCAR—Imagine, Predict, Choose, Act, Review

Voice of the customer
Voice of the Customer

  • Many systems fail when we allow the least informed to move us from step to step.

  • The customer usually knows least about the process.

  • However, they can describe features of the ideal process. (e.g. wait time for service)

  • What features of the process can they help us understand?


  • In responding to the voice of the customer make sure we understand the implications.

  • Ex. A hospital clinic adds examining rooms to reduce patients wait time in the clinic entryway.

  • Use a Pareto chart to identify the most common issue or the most painful issue. Work on these priorities first.

Voice of the process
Voice of the Process

  • You define the process and should highlight features that are important to the customer

  • Language is a key element—

    • You need operational definitions of all measurements, there is no true value

    • The language you use internally may differ from the customers language

  • Measurements are used to focus attention on aspects of the process

Some principles
Some Principles

  • Attempt to move upstream in the process rather than focus on symptoms. (Ask why again and again…)

  • The solution is often at the interface of the units, people, departments…. and not within these areas.

  • Technology is nice but often opportunities are found that cost little and deliver much.

Measurement system
Measurement System

  • Must be aligned with the process purpose

    • Consider that a grade point average creates a distinct purpose –

  • The measurement is a model of the system—just as a photo is a reflection of only aspects of the subject.

    • It is possible to improve the measurement at the expense of the process.

    • When an improvement in the measure is observed ask “What was done?”


  • Outcomes such as time to deliver

  • Predictors—Outcomes are too late and too expensive to change—we need to move upstream to make improvements

  • Time –order-spatial data to learn about stability

  • Stratifying variables—related to outcomes and to the groups compared

Time order

  • Most systems are such that even when the inputs are fixed, the outputs vary. For instance, not every request will be met in exactly the same number of hours.

  • When the proportion of outcomes of a certain type remain the same from day to day—the process is said to be stable.

  • The question you ask depends on whether a system is stable!

Common cause
Common Cause

  • When a system is stable ask- What is the common cause of the variation?

  • When a system is unstable ask—What is the special cause of the event?

  • Example: A child spills milk…..

  • The way we decide whether a system is stable is by plotting the values against time or order.

Stratifying variables
Stratifying Variables

  • Average days to completion of request for two libraries:

  • A: 3 days

  • B: 4 days

  • Is it possible that B always provides faster service than A?


  • Stratum I

  • A: 2 days proportion 5 of 6

  • B: 1 day proportion 1 of 4

  • Stratum II

  • A: 8 days proportion 1 of 6

  • B: 5 days proportion 3 of 4

Learning culture
Learning Culture

  • Will Rodgers once said; “even if you’re on the right track, you’ll get run over if you just sit there.”

  • Beware of leaning disabilities –”I am my position”, “the enemy is out there”, “fixation on events”, “politics makes sameness an asset”

  • Don’t engage in wack-a-mole

  • Avoid benchmarking, numerical goals without a plan, and competition between units (people)..

Thanks you
Thanks You

  • Questions?