Forgo strategic planning at your own peril

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There is broad agreement among healthcare leaders that planning is a critical component of good management and governance. Planning helps assure that a practice remains relevant and responsive to the needs of its patients, and contributes to practice stability and growth. It provides a basis for monitoring progress, and for assessing results and impact. It facilitates new program development and enables a practice to look into the future in an orderly and systematic way. From a governance perspective, it enables the physician owners to set policies and goals to guide the practice, and provides a clear focus to the practice administrator and staff for program implementation and management.

What is strategic planning?

Strategic planning is not the same as operational planning.The former is focused on broad and long lasting issues that ensure the medical practice’s long-term effectiveness and survival.The latter focuses on achieving objectives and carrying out short-term activities.Strategic plans and not rigid as they meet detours and obstacles that call for adapting and adjusting as the plan is implemented.The strategic plan, to be of long-term value, must be treated as an ongoing business process.It must evolve and change to reflect changing market and industry conditions.

Strategic planning is a process that brings to life the mission and vision of the medical practice; the process by which practice leaders determine what the practice intends to be in the future and how it will get there. To put it another way, they develop a vision for the practice's future and determine the necessary priorities, procedures, and operations (strategies) to achieve that vision. Included are measurable goals which are realistic and attainable, but also challenging; emphasis is on long-term goals and strategies, rather than short-term (such as annual) objectives. As the practice grows and the healthcare environment becomes more complex, the need for strategic planning becomes greater.A strategic plan, well crafted and of value, considers the internal and external environment around the business and is ultimately communicated to all staff members.Everyone in the practice should understand the direction and mission of the organization.

Medical practices which consistently apply a disciplined approach to strategic planning are better prepared to evolve as the local market changes and as the healthcare industry undergoes reform.The benefit of the discipline that develops from the process of strategic planning, leads to improved communication.It facilitates effective decision-making, better selection of tactical options, and leads to a higher probability of achieving the physician owners' goals and objectives.An important distinction in the process is to recognize the difference between strategic planning (the work being done) and strategic thinking (the creative, intuitive input).

Although there is no one formula for strategic planning, there are required steps that optimize the value.The strategic planning process must mirror the cultural values and goals of the medical practice; the process is very different for solo and small group practices than it is for large medical groups or hospitals.

Strategic planning can be a challenging process, particularly the first time it is undertaken in a medical practice.With patience and perseverance, as well as a strong team effort, the strategic plan can be the beginning of improved and predictable results for the business.At times when the practice gets off track, a strategic plan can help direct the recovery process.When strategic planning is treated as an ongoing process, it becomes a competitive advantage and an offensive assurance of improved day to day execution of the business practices.

Is strategic planning right for every practice?

There is an important caveat. Longer-range planning requires some level of practice stability. It is very difficult to plan in a crisis, and unrealistic to look five years ahead unless a practice has some confidence that it will exist next year, and that most of its key staff and its physicians will continue to be affiliated with the practice. Leadership also needs the time to plan, and with the daily challenges in a practice, it is extremely beneficial to engage a healthcare consultant to assist in that process. Moreover, while planning provides increased practice definition, a sound base for planning should include consensus around a well-defined mission statement and/or practice goals. These must often be developed as a foundation for longer-term planning. It is also difficult to plan if the practice is so young or its leadership so new that they do not have a good sense of the community and of the competition. Most new practices find that they do best by first attempting to reach consensus on a practice mission statement and then doing shorter-range planning, usually for a single year. Learning from that experience, they can begin a longer-term planning process.

What are the advantages of using a facilitator?

Use of a consultant can help in the process and in the development of a strategic plan.As an outsider, the consultant can provide objectivity and serve as the "devil's advocate," as well as a sounding board.In the end, however, the plan must have the authorship and ownership of the physicians and managers who must execute and follow the strategic plan.It must be their plan.

Strategic planning, when treated as a work in progress, rather than as a binder on a shelf, or a file in a computer, provides a medical practice with a real and lasting competitive advantage.A living strategic planning process will help direct the business to where you desire it to be.Strategic planning is your medical practice’s road map to your vision.

Nick Hernandez is the founder and CEO of ABISA, a company that specializes in strategic healthcare initiatives such as mergers and acquisitions, management services organizations, private equity, succession planning, physician partnerships, and strategic planning. He can be reached at nhernandez@abisallc.com.