Strategic Planning: It�s a Team Effort
Strategic Partners: It’s a Team Effort
To achieve success, everyone in the practicemust understand the strategic planning process.
By Bruce Maller, Co-Chief Editor
Most successful practices understand that strategic planning is a team effort. While a certain amount of strategic focus and direction must come from the top — investors, owners, physicians, administrators, and managers — the fact is that at some point during development, effective strategic plans involve practice staff members, either directly or indirectly.
When leaders actively involve staff in the strategic process — or at least explain the reasoning behind practice strategies — staff are more motivated to work together to accomplish goals. Most will agree: An informed staff is a happy, productive staff.
This article explains the elements and thought processes behind the creation of a strategic plan. Even for staff members not directly involved in planning, it is imperative to understand how their practice takes a strategic look at the future.
To what extent practice leadership involves staff in the strategic planning process is flexible. Some practices carve out a full day or two for strategic planning and involve all staff. Others schedule department-level meetings to discuss specific issues that are passed on to management for inclusion in the overall planning session. Sadly, some practices do not involve staff at all. That is a mistake.
While a comprehensive strategic plan may appear full of lofty statements, in reality workable plans contain many specific goals and objectives that directly relate to all staff levels and positions. Arguably, no one has more impact on the enduring success of a practice’s strategic plan than its staff, as the staff executes much of the plan.
Regardless of their positions in the practice, each staff member must understand the fundamental importance of strategic planning, in particular, as a response to the health-care environment, which is in a constant state of flux. Reimbursement and patient delivery systems, emerging technology, and competitive influences continually create new challenges.
The process of developing a business plan can serve to bring clarity and objectivity to the assessment of the impact of these and other market dynamics. At the same time, the business planning process will provide a greater assurance of more efficient utilization of a practice’s human and capital resources. Ultimately, the process will bring order, discipline, and focus to practice stakeholders and staff, increasing the likelihood of meeting or exceeding practice goals.
Developing a long-term business or strategic plan involves a process of examining and evaluating options for the future of the practice. The resulting document can be contrasted with an operating or marketing plan, which focuses on near term (i.e., one year) objectives instead of long-term goals. Although the plans will be different as to content, there should be linkage between the plans. Said differently, short-term initiatives should relate in some way or assist the practice in fulfilling its vision and meeting its longer-term goals.
The strategic plan should address the following questions:
■ What do we want the practice to be like in a few years?
■ What types of products or services do we want to emphasize?
■ How many and what mix of providers do we envision in the future?
■ What environmental changes are occurring that may affect the practice in the future?
■ What things need to be done now, i.e. skills acquisition, facility enhancement, staff development, etc. in order to be successful in the coming years?
|Staff Tip: Volunteer
|Show you want to be a part of the process. Be ready. Be enthusiastic. Jump at the opportunity to join any and all strategic planning activities. Approach the leadership team to let them know you care about the practice and its future. If leadership is putting together pre-planning teams or committees, see where you best fit and ask to be considered for that assignment.
Answering these questions will assist a practice in developing an awareness of the long-range implications of short-term events or emerging trends. For example, if one of a practice’s long-term goals is to provide a “state-of-the-art” experience for its patients, it would be consistent then, in the shortterm, to consider the acquisition of a new high-end piece of diagnostic or surgical equipment. This is the essence of thinking strategically. Most practices have a tendency of thinking too tactically, and, as such, oftentimes lack perspective on how short-term issues or opportunities fit within the context of the longer-term view.
Learning to think and manage strategically requires developing a “state of mind” characterized by continually evaluating events in terms of their longrange implications.
Some practices choose to make strategic planning an annual event. This can be useful since it ensures a certain amount of focus and discipline around the process. On the other hand, having a “designated” time may not be responsive enough to changes encountered by a practice.
In order to think strategically, practices must be able to create separation from the emotional aspects of the present. To accomplish this objective, a series of preparatory or planning tasks are suggested. These include:
■ Defining the mission of the practice.
■ Completing a competitive analysis for the market.
■ Completing an assessment of the current environment.
■ Completing an assessment of the financial health of the practice.
■ Preparation of a SWOT analysis. (This is a listing of the practice’s strengths, weaknesses, opportunities, and threats — see Exhibit 2).
■ Translating the mission statement into specific long-term goals and short-term performance objectives.
■ Identifying critical success factors.
■ Developing and/or refining specific strategic elements.
The outcome of completing these tasks should be an action plan that will serve as a guide or roadmap for the practice.
Defining the Mission
For many practices, composing the mission statement is seen as an unnecessary or trivial task. However, if done properly, a well-designed mission statement can be an effective tool to assist in dealing with daily operational issues. For example, a colleague has been acting in an inappropriate manner with a key referral source, or a staff member notices that when calling the practice, staff will place callers on hold without asking if they would mind being placed on hold. A mission statement can serve as a reminder that these behaviors cannot be tolerated. Exhibit 1 on page 20 provides an example of a mission statement.
The process of developing a mission statement requires honestly assessing and answering these two questions:
■ What are the reasons we are in practice?
■ What are our professional and personal goals and priorities?
Once the mission statement is developed, the practice is ready to translate this into a living plan with specific and relevant goals and objectives. However, this plan needs context and a reality check. This is done by completing an environmental assessment and competitive analysis, which will be discussed in the following two sections.
|Exhibit 1: Mission Statement
Our Mission: Our mission is to provide compassionate and personalized care to our patients while creating an environment that motivates and satisfies our employees, stimulates and rewards our physicians while ensuring financial stability for all stakeholders.
Our Patients: We will strive to consistently meet or exceed the service and patient care expectations of our patients. We will do so by investing in staff education and new treatment modalities. We will maintain a comfortable, warm, and pleasing environment for our patients. We will strive to be available and accessible and ensure we devote an appropriate amount of time to each patient.
Our Employees: We will invest in the continuing personal and professional development of staff members. We will provide them the tools necessary to most effectively and efficiently perform their jobs while reinforcing the basic tenet of providing customer service excellence. We will reward our employees with above-average compensation packages.
Our Services: We will strive to offer a comprehensive mix of eye care services through our practice and our referral network of providers. In addition, we will ensure the most compassionate and convenient surgical-care setting for our patients.
Practice Financial Health: We will plan and invest wisely in the future of our practice. We will diversify our service lines and invest in new technology. We will do so in a conservative manner. We will put in place financial controls and benchmark our operating results internally and with our peer group while striving to provide an above average return to the shareholders.
Environmental Assessment and Competitive Analysis
Both internal and external environmental factors affecting the practice will dictate whether it is feasible to accomplish what the practice desires. A typical environmental assessment model focuses on market competition and a thorough practice analysis. Often, these studies require preliminary work using industry benchmarks and other financial management tools specific to the practice specialty. The resulting data will allow a practice to evaluate strategic options and serve to guide the practice in a specific strategic direction.
Answer the following questions to assess your practice’s competitiveness in the market.
1. What are the demographic characteristics of our market?
2. What is the practice market share for our key service lines?
3. Who are our main competitors?
4. What is our competitors’ market share?
5. What market strategies do they employ?
6. What are their perceived strengths and weaknesses?
7. How are managed care trends affecting service delivery?
In planning the assessment of your practice, you should answer the following questions.
1. What are our strengths and weaknesses? (See SWOT analysis—Exhibit 2.)
2. What do we perceive to be potential opportunities and threats for the practice? (See SWOT analysis example in Exhibit 2 below.)
3. What is the state of our present financial health?
4. Are we practicing in an efficient and effective manner?
5. How do employees feel about their work environment?
6. Does our physical plant meet our current/future needs?
7. How do patients feel about their experience with the practice?
Note: As mentioned previously, SWOT is an acronym for strengths, weaknesses, opportunities, and threats. (See Exhibit 2 below.)
|Staff Tip: Conduct Research
Look for ways you can be better prepared when the planning really gets going. Read about strategic planning and its key components. It will help you understand the “lingo.” Try to get a feeling for how your practice specifically conducts its strategic planning.
Review prior strategic plans. Take a moment to analyze your mission statement. Can it be updated? Does your practice have a list of core values or beliefs? Do they need to be changed? All research and pre-planning you do will help when the actual meeting begins.
Developing a SWOT is a must in developing an effective strategy. At the end of the day, a practice’s strategy should build upon its strengths, compensate for its weaknesses, take advantage of opportunities, and provide a defense against perceived threats. (See “Staff Tip: Perform a SWOT Analysis” in the lefthand column of this page.)
|Staff Tip: Perform a SWOT Analysis
|Leadership will be thrilled you took the time to list what you think are the practice’s strengths, weaknesses, opportunities and threats. It shows you think strategically and consider all the internal and external forces that impact the practice. No matter your position, a fresh and unique perspective will always be welcomed by those who truly seek what is best for the practice.
Developing a Practice Strategy
Having completed its market competitive analysis and practice assessment, most major issues should be clear and the practice is now ready to identify or refine major strategy alternatives. Several questions should now be considered, the answers to which will provide the practice with these refinements:
1. Is our present strategy still appropriate given the new fact pattern?
2. Is our present strategy realistic given the critical success factors outlined?
3. What changes need to be considered to our strategy in order to deal most effectively with external threats and internal weaknesses?
4. What opportunities can be pursued to improve the competitive position of the practice?
For most practices, modifying a current strategy is generally preferred over going in an entirely new direction. The goal in developing a new or modified strategy is to determine how the practice can create a sustainable competitive advantage.
Exhibit 2: Sample SWOT Analysis
|Outstanding location of the practice
||Aging key providers
||Build out additional exam lanes
||Loss of key managed care contract
|Reputation of the providers
||Aging appearance of main location
||Add a new line of service
||New competitor in town
|Control of key managedcare contracts
||High leveraged balance sheet
||Set up rental contracts with subspecialists
||Recent merger of competitors
|Maturity of key staff members
||Above average overhead ratio
||Expand retail sales
||Loss of key provider(s)
|Dominant market share
||Underutilization of physical space
||Expand optical business
||Hospital plans eye care Institute with competitors
|Well-developed referral network
||Ineffective practice management system
||Open satellite location in neighboring community
||Multi-specialty group expands ophthal. dept.
|Staff Tip: Speak Up
|Don’t be afraid to share your thoughts and ideas. Based on your position and responsibilities, the information you are able to offer just might include insights nobody else can provide. No one really knows from where important pieces of information are going to originate. Remember, you are part of a team. No one is there to judge you. The goal is to plan a future that allows everyone to succeed by trying to ensure the enduring success of the practice. Make sure you contribute.
An Integrated Team
The more detailed knowledge everyone has about “their” practice, the better they will perform, both as individuals and as members of an integrated team. When each and every staff member understands how the practice’s strategic plan evolves and changes — and how it directly affects them — they develop important insights that inspire both professional growth and the motivatation to provide the best possible care to patients. OP
|Staff Tip: Follow Up
|When given assignments (either pre- or post-planning), complete your tasks accurately, thoroughly and in a timely manner. With the assignment, it is likely you will have a timeline and a person to whom you report. Demonstrate you were the right person for the assignment by keeping everyone informed of activity and progress.
||Mr. Maller is the president and founder of BSM Consulting, which offers a full range of health care consulting and practice management services. Contact Mr. Maller at bmaller@BSMCONSULTING.com.
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