Improvement Insights Blog

You don’t have to fix everything, just the one thing out of 25 that causes over half the waste, rework and lost profit.

“Hi, I’m Jay Arthur, author of “Lean Six Sigma Demystified” and QI Macros [software].

“I’ve talked to you about Pareto’s rule before, but I continue to come back to this time and time again: 20% of what you’re doing is producing 80% of the waste, rework, lost profit, [lost] productivity, patient harm… whatever it is. But within that 20% that Pareto rule still applies, which means that only 4% of what you’re doing is producing over half the mistakes and errors. I call that “Arthur’s 4-50 rule”: 4% of what you’re doing [causes] half the waste and rework. What’s four percent? Well, that’s four steps out of 100, or one step out of 25.

“So you don’t have to fix everything; you have to use some data, all right? Pledge allegiance to science and evidence: data. Drill down and find and pinpoint exactly what that one thing is. You know, I’ve found you can also take it down and you could actually get to a 1-50 is pretty close to reality, but I’ve never been able to get data that will take me that far. I can do the 80-20 and then drill down into the big bar and get down to the 4-50 but I usually can’t go deeper than that. There isn’t data deeper than that.

“So when you do that then you can fix the thing that’s really broken and everything [else] is pretty much fine except for four things out of a hundred. Go fix those. If you go fix those, magic will happen. Start with the worst first, because you have the best data about the worst things, right? Narrow it down, fix that one thing that’s causing half the mistakes, errors, waste, rework, lost profit, patient harm. Then do the next one and that’ll reduce the next 50%, and eventually you’ll get to a hassle-free America, hassle-free health care.

“Let’s go out and improve something this week.”