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Using analystical tools to make big decisions.

THERE'S CERTAINLY no shortage of problems and decisions in the clinical laboratory. We are confronted with them on a regular basis. What keeps us from becoming overwhelmed by the quantity is that we often handle them on automatic pilot, i.e., instinctively and without in-depth analysis.

* Serious thought. Big problems and major decisions are not as common and require pilot control. We have to give them serious thought because they have greater consequences. Examples of bigger decisions include:

* Choosing an expensive new piece of equipment.

* Choosing the right person for an important new staff position.

* Changing suppliers.

* Key terms. Certain key terms are important to a discussion on using analytical tools to help solve problems and make decisions:

End: The result or outcome.

Options: The means, tools, methods, or techniques used to achieve an end.

Need: The gap between current and desired ends.

Let's see how these definitions can work for us.

Laboratory management says, "We need to increase our work output."

The laboratory supervisors assert, "We can't handle the workload. We need to get more output from staff."

While the technologists reply, "We can't work any harder or longer. We need more people."

* No end without defined need. While this may appear to be a conflict, it may, in fact, not be. Perhaps each group has confused means and ends and jumped right to solutions without defining the need. If you don't know what you want to accomplish, you can't define appropriate ends.

Before you look to solutions, therefore, you must consider what results you are getting now and what results you want. Then you can turn your attention to the means, or options, that are available to close the gap between current and desired outcomes.

* Decision-making model. Let's develop a problem-solving and decision-making model and use it to solve a problem involving equipment acquisition. The model has six steps:

1. Breaking down the problem. Breaking down a problem enables you to explore and understand it. This step involves defining the problem accurately and specifically. You can argue forever about options if you don't know what ends, or outcomes, you want to accomplish.

The more specific the problem definition, the easier it is to develop the goals and the course of action necessary to resolve the problem and make a decision. One way to be more specific is to define the problem in simple terms. For example, assume that you don't have sufficient capacity to handle current workload (it may even be true). Then the problem definition is workload is greater than capacity.

2. Writing a mission statement. The mission statement is the opposite of the problem. Therefore, the mission statement for the above problem is to increase work capacity so that you can handle the current and projected workload, without costly overtime. In other words, the mission statement is capacity is greater than workload.

3. Developing alternative courses of action. Once the problem and mission are defined, consider your options. In this situation, you might add additional staff, change procedures, or purchase more efficient equipment. For the sake of argument, rule out staff additions (the laboratory has a hiring freeze) and any major change in procedures (you continually review them and are convinced that current procedures are efficient). Therefore, your only recourse is to search for equipment that can increase laboratory capacity. The next step is to decide what equipment to acquire.

4. Listing decision-making factors. Develop a list of factors to consider in choosing new equipment. Include on the list accuracy, output speed, acquisition cost, cost of supplies, equipment life, ease of operation, maintenance, and technical service.

5. Developing and ordering values. Values are things that matter. Values are simply ways of telling what is important and what is not. Some things are more important than others; you must order your values by weighting them.

6. Choosing a course of action. You can choose the best course of action by rating alternative options for each factor. The calculations can be done by hand, by a spreadsheet model, or by commercial software.

* Applying the model. The best way to learn how to use the decision-making model on the job is to follow the process in the subsequent example involving selection of new equipment (Figure 1).

Figure 1

Applying the decision model

* Problem: Workload greater than

capacity' * Mission: Capacity greater than

workload * Options: Super Analyzer, Magna

Analyzer, and Speedy

Analyzer Factors: Accuracy, output

speed, acquisition

cost, cost of supplies,

equipment life,

ease of operation,

maintenance, and

technical service

Step 1. Develop a value hierarchy. Use your judgment to decide the relative importance of each factor. Meet with colleagues to discuss key factors. Once you have done this and have reached a consensus on the value hierarchy, calculate the numbers, examples of which are shown in Figure 2.
Figure 2
Establishing the value
Factor Value Points
Accuracy 100 24
Output speed 85 20
Acquisition cost 70 17
Cost of supplies 60 14
Equipment life 45 11
Ease of operation 30 7
Maintenance cost 15 4
Technical service 10 2
Total 415 100

You must convert the value weights into 100 points. To do this, divide each value by the total for all the values, and round the resultant to the nearest whole number. For example:

100/415 = 24.096

Step 2. Choose an appropriate value scale. For some of the factors, you should set upper and lower limits. For others, you can use an ordinal scale very poor to very good). Figure 3 shows a possible value scale for each decision factor. Naturally, you must collect facts about the types of equipment available, their features, and their costs. Meet with prospective vendors to collect the information needed for an informed decision.
Figure 3
Possible value scales
Factor Scale
Accuracy 95%-100%
Output speed 500-1,000 tests per hour
Acquisition cost $100,000-$250,000
Cost of supplies 3-10 cents per test
Equipment life 5-10 years
Ease of operation Very poor-very good
Maintenance cost $100-$300 annual contract
Technical service Very poor-very good

Step 3. Assign points to each interval scale. Divide the points for each factor, calculated in Step 1, and round the resultant to the nearest whole number.

24 x 0.20 = 4.8

In developing the information for Figure 2, you calculated that accuracy is worth a maximum of 24 points. Assume that the minimum acceptable accuracy is 95%. Therefore, set up an ordinal scale of 95% to 100% (95% to 96%, 96% to 97%, 97% to 98%, 98% to 99%, and 99% to 100%.)

Similarly, in Figure 2, you calculated that output speed is worth 20 points. Therefore, set up an ordinal scale of from 500 to 1,000 tests per hour (500 to 600, 600 to 700, 700 to 800, 800 to 900, and 900 to 1,000). Follow the same procedure for all eight factors. Figure 4 shows this information, but only for accuracy and output speed.

Step 4. Rate each option. Assume there are three instruments you will choose from: the Super Analyzer, the Magna Analyzer, and the Speedy Analyzer. Rate each factor for the three analyzers as shown in Figure 5.
Figure 5
Evaluating the options
 Super Magna Speedy
Factor analyzer analyzer analyzer
Accuracy 98% 98% 98%
Output speed (tests/hr) 800 700 900
Acquisition cost $225,000 $250,000 $230,000
Cost of supplies/test 5 cents 7 cents 5 cents
Equipment life 10 years 10 years 5 years
Ease of operation Good Fair Good
Maintenance cost/yr $250 $250 $300
Technical service Good Very Good Good

Step 5. Evaluate each option. All claim 98% accuracy. Looking up 98% in Figure 4, all of the options receive 14 out of a maximum of 24 points. The Super claims an output speed of 800, the Magna an output speed of 700, and the Speedy a speed of 900. Looking up these values in Figure 4, the three options would receive 12, 8, and 16 points respectively out of a maximum of 20 points for each option.

Step 6. Complete the evaluation. Figure 6 shows a completed evaluation of all three options. It clearly shows that the Super Analyzer is the best choice even though the Speedy is the fastest piece of equipment.

Although I worked through this example manually, there is computer software that can help you to complete the analysis faster and easier. Called Optionist (HavenTree Software, Kingston, Ont.), the software also features a helpful "paired comparison" technique to determine value weights.

* Choosing an assistant. Now let's consider the key factors involved in another big decision you are likely to have to make at some point: choosing the right person for an important new staff position.

You are looking for an assistant who is capable of assuming a supervisor's position within 2 years. To select the right applicant, prepare a list of factors and values similar to those shown in Figure 7.
Figure 7
Hiring a new staff member
Factor value
Specific/special knowledge 100
General technical knowledge 90
Relevant experience (years) 80
Problem-solving skills, 60
Education years/type) 50
Leadership qualities 40
High work standards 40
High energy level 35
Listening ability 20
Oral and written communication skills 20

Once you have developed the information shown in that figure, interview applicants and rate them for each of the factors. Then follow the steps described previously in this article.

* Changing suppliers. Assume that you have become dissatisfied with a long-term supplier of multiple products to your laboratory. You plan to replace that supplier in the near future and are considering criteria for a new vendor. Your list might look like the one in Figure 8.
Figure 8
Changing suppliers
Factor value
Quality of products 100
Product range 80
Financial stability 75
Pricing policies 65
Technical service 60
Company reputation 30
Delivery time 30
Minimum order quantity 25
Packaging 25
Future developments, R&D 15
Current customer roster 15

Once you have developed the information, interview applicants and rate them for each of the factors. Then follow the aforementioned steps.

* Analytical tool. This article describes a systematic, logical tool that can be used by laboratorians to help them employ their customary analytical skills to make big decisions.

My approach contrasts with the methods of decision makers in many laboratories. In fact, as a consultant to the health care industry, I'm continually surprised at the ways different organizations and managers make important choices. All too often many of them don't consider key factors and their relative importance. Instead, they give unwarranted emphasis to a few factors, while ignoring other important ones.

The analytical tool I've described can help you to improve your decision-making skills by giving big decisions the quality of thought they deserve.
COPYRIGHT 1993 Nelson Publishing
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
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Author:Roseman, Ed
Publication:Medical Laboratory Observer
Date:Sep 1, 1993
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