As you may or may not know, I volunteer as a Community Teaching Assistant for the Wharton School's offering of Introduction to Operations Management on the Coursera platform. In a recent assignment, students were asked to determine the Overall Equipment Efficiency (OEE) of an operating room at a knee replacement clinic. Without getting too technical, part of the solution requires them to determine how much time the operating room is used in comparison to how much time it could be used. A few students complained that that the answer was incorrect because it uses 7 days per week to calculate the available time while the problem states “Though the clinic aims to operate 7 days a week, holidays, vacation, and construction time lead to an average of one day a week that the OR cannot be used at all.” Their confusion inspired me to post the following response which I felt would also be a good blog post:

There is a very important operations improvement, and general business, concept involved in this problem. Never accept "it has to be done that way" or "it has always been done this way" as an answer to anything. In this problem, we are told that the clinic aims to operate 7 days a week but due to vacations, construction, and holidays it only ends up operating the equivalent of 6 days per week. Everyone else would stop right there. The clinic management stopped right there. This is the equivalent of accepting "it has always been done this way." Your job as the consultant is to push past that roadblock.

When I started at my current position, my firm was renting 5 specialty impact printers. I wanted to cut that cost. The yearly expenditure on these was insane. I was told I couldn't because we "need the printed tickets for billing" and "the guys need to hear the sound of the tickets printing to know their trade was filled." Basically they were saying, "It has to be done/has always been done this way." Long story short: I ended up automating the billing process which eliminated the need for the tickets and recorded the sound of a printer which would play when a trade was filled. The printers are gone. The moral of the story: You cannot stop when you find an "it has always been done this way" situation. 

In my experience, “It has always been done/has to be done this way.” is an almost fail proof indication that this is where you will find the most inefficiency and where real innovation can occur.  It is basically a big sign that says "Look here for gross inefficiency and inspiration for great ideas!"

Before 2007, cell phone manufacturers were trying to fit more keyboard buttons on their phones. Flip phones with 12 buttons made way to slide phones with almost full keyboards. Blackberry’s phones had full keyboards and every generation had more buttons. Why? Because "that is the way it has always been done" and "it has to be done this way." Then Apple came out with a phone that had 4 buttons and a switch. None of those buttons functioned as a keyboard. Why did Apple do this? Because they didn't accept the status quo. They realized that consumers didn't want more buttons, they wanted to be able to easily type. The number of buttons was irrelevant.

So what does all that have to do with the knee clinic? It is the same principle. The clinic only operates 6 days a week because that 7th day has never been properly addressed. Someone assumed that this is the best we can do. "It has to be done this way." Has anyone ever tried scheduling vacations so that the clinic can be open more often? Have we tried to offer services on holidays? Maybe the staff would like the overtime? Can we schedule construction to occur overnight so as to not interfere with the OR schedule? The point is there is no law preventing them from operating that 7th day they just don't. This question is asking you to show the clinic they don't need to build a new OR. They can drastically improve capacity by simply using the existing facility more efficiently. But, to do that they'll need to push past "It's always been done this way."

"It's always been done this way." is an excuse not an explanation.

Best Regards,