Strategic planning for
health care organizations
Healthcare is a dynamic and changing industry.
Healthcare reform will signal significant impacts on many
organizations in terms of daily processes, clinical operations,
and financial sustainability.
Strategic planning in health
care organizations
Need
for SP:
Increasingly informed, demanding
and non loyal clients
Increasingly professional and skilled
competitors.
Limited resources for production.
Focus is shifted from the product or
service to the client
Size and complexity of the HO
Strategic planning in health
care organizations
There
should be a steering group within the HO to
lead the development and implementation of a
strategic plan
This group should represent all interests and
include people with leadership skills. Ideally, this
group should be led by its chief representative,
who will act as the driving force and display
strong commitment to the project and should
include someone who is familiar with SP
methodology.
The group must have real executive power to
avoid being perceived as a mere planning entity.
Strategic planning in health
care organizations
Applying
the Mission, Vision and Values
Mission This is a written statement that defines the final aim of
the HO, that is, its reason for being.
Vision: The vision statement is a written statement that presents
the future image of the HO after the transformation process.
Values are the set of principles, rules and cultural aspects
governing the HO and determining their institutional behavior.
They constitute the organization’s ethical code that gives it its
“soul” and “character”. These values predict a specific response
by the HO when a situation arises that must be immediately
resolved.
The values must be shared and widely disseminated.
The real values of an organization are those that actually govern
its behavior and decision-making processes, whether they are
formally stated or not.
Strategic planning in health
care organizations
Understanding
External environment :
Clients: it is essential that the HO
identify its clients and what they can
expect
Competitors to understand cost and
service efficiency
Providers: the HO should characterize
and differentiate their suppliers
Owners: ownership equity of the HO.
Strategic planning in health
care organizations
Analyzing
the Internal Environment
Resources: an analysis is made of the HO’s
available resources, including people, financial
budgets, structural resources (and their degree of
obsolescence, and organizational resources
The legal situation: an analysis is conducted of
the current regulations affecting performance,
particularly those limiting or guiding it.
Other power groups within the HO: trade unions,
professional associations, internal decisionmaking bodies, clinical commissions, informal
power groups
Strategic planning in health
care organizations
Analyzing
of internal environment (contd)
Analysis of clinical care, training and research activity:
without doubt, this is the part of the HO’s internal analysis
with the greatest scope.
It is important that the analysis is conducted over a long
enough period to detect trends that may motivate taking
strategic decisions. This analysis has to be addressed
from the perspective of the quantity, quality and cost of
production; comparing the HO’s data to standard data
and data from competitors is of maximum utility.
The analysis of activity should not simply produce an
avalanche of data but must be synthesized to highlight
what is relevant and bring out any need to take strategic
decisions.
Strategic planning in health
care organizations
strategic
plan steering group will now have a wealth of ideas about possible
strategic actions that could be addressed in the strategic plan.
Administrators have to perform the SWOT analysis, an acronym formed from
strengths (S), weaknesses (W), opportunities (O) and threats (T), which classifies
the results of the analysis.
This enables them to understand the kind of planning that has to be carried out
Strategic planning in health
care organizations
Strategic Alternatives :
Throughout the process
developed so far, the planning team has been able to
generate numerous alternative strategic actions. All these proposals are now
formally entered in a document, without judgment regarding their feasibility
or relevance, and where no idea is rejected without due consideration.
Armed with this set of proposals, the strategic plan steering group begins a
process which classifies and groups them into more or less defined areas of
action. These areas of action are also simultaneously identified and named
depending on the type of proposals they contain.
Based on the various discussions that have identified them, the strategic
action selection process is fine-tuned; some proposals are discarded whereas
some are linked to other proposals, thus better defining the fields of action
each time. At this stage, the wide range of options for action that were
originally suggested are narrowed down to some extent, leaving aside those
that clearly do not meet the minimum conditions of feasibility or do not have
the desired scope.
The strategic plan steering group concludes this stage with a set of no more
than 20 areas of action, which constitute the strategic optiions
Strategic planning in health
care organizations
Does
the formulation provide a strategic
proposal that will lead the HO to a genuinely
unique position compared to the previous
position and to that of the competitors?
Does it offer value in a different way?
Have any decisions been taken that involve
other actions being stopped? Will services be
cut?
When certain activities stop, does that change
the way operations are performed?
Are the strategic choices that have been made
valid in the long term?
Strategic planning in health
care organizations
Change management
Are leaders willing to lead
the way for
change initiatives
How are communication protocols within the
HO
Do the employees accept changes and what
are mechanisms to resistances in changes
How are conflicts handled
How does administration deal with
communication, team work and planning ?
Strategic planning in health
care organizations
The
e strategic plan should have the capacity to allow this
change to occur, although the need for change should be
compelling and the reason for change should be thoroughly
documented.
An SO should only be changed after deviations have been
regularly observed over 1 year, or when significant changes,
unforeseeable during the initial planning stage, have
occurred in the environment or in the HO.
Several SOs may undergo systematic failures in the same
SA, leading to the possibility that the SA itself is incorrect or
that it has been undermined by internal or environmental
changes.
Then and only then should the strategic plan steering group
change that particular SA. These changes should be made as
a last resort.
Strategic planning in health
care organizations
Balanced
score card
Strategic planning in health
care organizations
The
Balance scorecard will enable HO to
look at the four different perspectives
The financial perspective asks how the
organization should appear to shareholders
so that the company can succeed financially.
This perspective indicates if the business is
improving the bottom line, measuring items
such as profitability and shareholder value.
Financial objectives reflect economic
consequences of actions already taken in
the other perspectives.
Strategic planning in health
care organizations
Balance Scorecard (contd)
The customer perspective asks
how an
organization should appear to customers to
achieve the organization’s vision. Customer
objectives identify customer and market
segments where the business would
compete and what performance would be
expected for these targeted segments. The
scorecard focuses on customer concerns
primarily in four categories: time, quality,
performance and service, and cost.
Strategic planning in health
care organizations
Balanced Scorecard (contd)
The internal business perspective
asks what business
processes the organization should excel at to satisfy
shareholders and customers. This perspective measures
the internal business processes, core competencies, and
technologies that would satisfy customer needs.
The innovation and learning perspective asks how the
organization would sustain its ability to change and
improve to achieve the organization’s vision. The
learning and growth perspective identifies the
organization’s infrastructure needed to support the other
perspectives’ objectives. This perspective measures a
company’s ability to innovate, improve, and learn, such
as the ability to launch new products.
Strategic planning in health
care organizations
Effectiveness of strategy formulation:
Align external and internal
environment towards patient delivery
quality
Set standards of high quality
Put into practice meaningful use
Administrate the different functions
purposefully
Use the four quadrants of Strategic
focus to achieve objectives .
Strategic planning in health
care organizations
Involve
budgeting parameters with financial
implications into planning process
Ensure that Health care delivery brings in
patient revenues
Associate special standards to be
competitive
Select strategies that enable the HO to
remain sustainable and competitive
Use strategic planning reviews and audit
processes that are aligned towards vlauesof
the Health care organization .
Strategic planning in health
care organizations
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Strategic planning in Health
care organizations
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