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Goldratt’s Theory Applied to the Problems Associated with an Emergency Department at a Hospital

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  • Lloyd J. Taylor

    () (School of Business, University of Texas of the Permian Basin, 4901 East University Boulevard Odessa, TX 79762, USA)

  • Soumya Nayak

    (School of Business, University of Texas of the Permian Basin, 4901 East University Boulevard Odessa, TX 79762, USA)

Abstract

Healthcare costs continue to increase dramatically, while quality remains a significant problem. Reform measures initiated by the government will drive expansion of these costs, further stressing taxpayers and employers, and forcing hospitals to adopt fundamental changes as they try to adjust to increased demands for services and to lessening reimbursements from all payers. This struggle is best seen at the point of entry for many at a hospital: the emergency department (ED). It is at the emergency department that patients’ expectations regarding staff communication with patients, wait times, the triage process, capacity and payment will determine a significant part of a hospital’s revenue. Using Dr. Eliyahu M. Goldratt’s Thinking Process, we will determine what core problem(s) are causing a 362-bed regional West Texas hospital emergency department to lose revenue. Evaluation of the current emergency department will determine the Undesirable Effects (UDE). Using that information will lead to the construction of the Current Reality Tree (CRT), which will bring focus to the core problem(s). To break the constraints, which are the core problem(s), an Evaporative Cloud (EC) is generated. And, the end result will be to construct a Future Reality Tree (FRT), which will validate the idea(s) generated in the EC. It was determined that there are ten major UDE’s that affected this hospital’s emergency department. They were focused around staff communication, wait times, triage process, information management, service provided and bill collections. A conclusion was made that the core problem dealt with triaging patients and utilization of the services provided by the hospital. Since the reimbursement rate is affected by the patient’s satisfaction, the areas to focus on would be: triage, education, communication and retention. Although it may be neither feasible nor desirable to meet all the patient’s expectations, increased focus on those areas may increase the emergency department’s efficiency and the hospital’s bottom line.

Suggested Citation

  • Lloyd J. Taylor & Soumya Nayak, 2012. "Goldratt’s Theory Applied to the Problems Associated with an Emergency Department at a Hospital," Administrative Sciences, MDPI, Open Access Journal, vol. 2(4), pages 1-15, October.
  • Handle: RePEc:gam:jadmsc:v:2:y:2012:i:4:p:235-249:d:20961
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    More about this item

    Keywords

    emergency room management; constraint management; theory of constraints; Goldratt’s thinking and problem solving process;

    JEL classification:

    • M - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics
    • M0 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - General
    • M1 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration
    • M10 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - General
    • M11 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Production Management
    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • M15 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - IT Management
    • M16 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - International Business Administration
    • L - Industrial Organization

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