Question

Discuss the purpose of strategic planning in a health care environment. Explain what factors affect future planning in an organization and what tools can be used for future planning.

Answer 1

Strategic planning in health care organizations involves outlining the actionable steps needed to reach specific goals. While there are different strategy types and levels, the purpose of all strategies is to bring an organization’s actions into alignment with its stated mission or values. Today, health care providers require more patient-centric, value-based approaches, whereas many of their current systems follow older, more traditional strategy models, according to Becker’s Hospital Review.

Increasingly, organizations are having to recalibrate their health care strategies to suit current market trends and changing approaches to patient care. Any professional looking to better understand the inner workings of health care institutions needs to know the different types of strategies used in health care, along with their importance for an organization’s success.

The Importance of Strategic Planning

As noted in a report published in the Journal of Oncology Practice, “You may not be able to control the future, but strategic planning can create a direction for your practice and maximize your options for influencing your environment.” Strategic planning in health care organizations entails taking proactive steps toward a goal, not just addressing immediate problems as they arise. Health care strategy is crucial to an organization’s future success by providing the framework for making day-to-day choices in alignment with its objectives.

Levels of Health Care Strategy

The American College of Healthcare Executives (ACHE) explains that health care strategies vary in type (prospective or emergent) and organizational level (corporate, business, or functional).

Strategy Types

No matter their size or mission, most organizations employ some form of strategy to make progress towards their long-term goals. There are two main strategy types that organizations employ: prospective and emergent.

Prospective Strategy

The majority of large health care organizations develop thorough plans to prepare for future issues that may affect their facilities and the health care field at large. These providers must focus on creating strategies that anticipate potential needs for additional resources, such as capital and personnel. This type of long-term planning is known as prospective strategy. Prospective strategies should also allow for flexibility in case unforeseen developments occur in the health care sector. For example, if providers develop a prospective strategy based on an expected nursing shortage in the years ahead, and that shortage is less severe than anticipated, a flexible strategy would include a plan for reallocating resources to other areas.

Emergent Strategy

Emergent strategies involve a retrospective analysis of events to make better decisions going forward. Developments such as the implementation of new health care policy, swings in prescription drug prices, and outbreaks of epidemic diseases can cause health care market fluctuations that require providers to continually experiment and adapt. Organizations that rely on emergent strategies must be extremely flexible to be able to re-evaluate internal strategies and quickly recalibrate to better suit current market trends. Many providers analyze competitors’ strategies and implement tactics that seem to be working for other leaders in the field.

Strategy Levels within Organizations

In addition to prospective and emergent strategy approaches, there are also different strategy levels within organizations. Organizational strategies are often subdivided into corporate, business, and functional levels.

Corporate-Level Strategy

This level of strategy often involves a board of directors, executive leaders, and stakeholders. As the top tier of the decision-making process, the corporate level oversees strategy for the entire organization, with a focus on defining mission and big-picture goals, such as fund allocation and business deals.

Business-Level Strategy

This strategy level prioritizes specific product lines. Business-level strategy focuses on projects in development, and managers have the authority to develop strategies based on the needs of their directives. Managers translate the directions and intent of those at the corporate level into actionable strategies for individual projects and employees.

Functional-Level Strategy

The third tier in an organization’s strategic approach is the functional level, which supports the corporate and business levels. The focus at this level is tied to the end products or services the company provides. Functional-level strategy integrates research, marketing, production, and distribution to better connect products and services with the company’s client base.

Managers involved in developing strategies at every level must consider how their plans will affect individuals throughout the organization. For example, a strategy aimed at increasing health care services during a facility’s expansion should consider the additional hours current staff members may need to work before new professionals can be hired. Similarly, if administrators plan to divert more resources to a specific department in a health care facility, the strategy needs to account for how decreases in resources will impact other departments. Ideally, information should cascade from corporate down to the functional level, with the final product meeting all goals and driving business success.

Developing Strategies with Advanced Education

Strategic planning in health care organizations helps medical institutions operate successfully with respect to business objectives and optimal standards of patient care. Professionals looking to gain a better understanding of health care strategies to help analyze, create, and implement them may need advanced education beyond a bachelor’s degree.

Heath care administrators or executives must have a comprehensive understanding of health care stratagems to effectively manage an entire facility, clinic, or department. A graduate degree, such as Regis College’s Master of Science in Health Administration, will help professionals add new skills into their already-existing foundation of experience, which can enable them to integrate strategy systems in the workplace.

Factors affect future planning in an organization:

there are many factors that affect the planning process in business and there are six steps to the planning process . The six steps in the planning process are situational analysis,alternative goal and plans ,goal and plan evaluation,goal and plan selection,implementation and monitor and control.This six steps are crucial to the planning process of business and it is important to be aware of the factors affecting these steps.

A factor that affect the situational analysis of the planning process is current economic conditions .This factor affects the planning process because if current economical conditions are good or bad this will be discovered during the first step , and the condition of the economy provides information that can make the plan successful or unsuccessful .Economic conditions will provide a business with information that will help determine the next steps in the planning process , and this factors in highly on plans.

Another factor that affects the planning process and is priorities and this factor comes into play highly inrelation to the third step of planning process .Priorities will have to be examined thoroughly during the goal and plan evaluation step.During tis step priorities are involved because they must be used to evaluvate and choose a plan. Priorities may alos be shifted , and some priorities will be given up for higher priorities .This factor affects the planning process because it will allow a business to make choices that will be beneficial.

A factor that influences the planning process is budget and any plan that does not have a budget to support it will not make it during the implementation stage .A budget is something that should be considered in many steps of the planning process because it has a tremendous effect on the plan .A budget is something that is and should be always considered during all steps of the planning process because it will affect it highly.Budget can make or break a plan,and realistic ideas about budgeting should always be taken during te planning process of a business.

Organizational reaponsibilities play a role in the planning process because an organization is responsible for providing stake holders with profit or values first and foremost.What will benefit the stake holders will always play a role in the decision of planning process the ultimate goal of most business is to provide value .

Ethics also play a role in the planning process because ethical beliefs can influence priorities and goals .Ethics will also influence budget decisions which are integral to the planning process .Ethics have an influence on the planning process because ethics will always play a part in the decision making of a business.

Strategic Planning Tools

1. SWOT Analysis
2. Porter's Five Forces
3. PESTLE Analysis
4. Visioning
5. VRIO Framework

1. SWOT Analysis

SWOT analysis is a strategic planning tool and acronym for strengths, weaknesses, opportunities, and threats. It's used to identify each of these elements in relation to your business.

This strategic planning tool allows you to determine new opportunities and which areas of your business need improvement. You'll also identify any factors or threats that might negatively impact your business or success.

2. Porter's Five Forces

Use Porter's Five Forces as a strategic planning tool to identify the economic forces that impact your industry and determine your business' competitive position. The five forces include:

1. Competition in the industry
2. Potential of new entrants into the industry
3. Power of suppliers
4. Power of customers
5. Threat of substitute products

To learn more, check out this comprehensive guide to using Porter's Five Forces.

3. PESTLE Analysis

The PESTLE analysis is another strategic planning tool you can use. It stands for:

• P: Political
• E: Economic
• S: Social
• T: Technological
• L: Legal
• E: Environmental

Each of these elements allow an organization to take stock of the business environment they're operating in, which helps them develop a strategy for success. Use a PESTLE Analysis template to help you get started.

4. Visioning

Visioning is a goal-setting strategy used in strategic planning. It helps your organization develop a vision for the future and the outcomes you'd like to achieve.

Once you reflect on the goals you'd like to reach within the next five years or more, you and your team can identify the steps you need to take to get where you'd like to be. From there, you can create your strategic plan.

5. VRIO Framework

The VRIO framework is another strategic planning tool that's used to identify the competitive advantages of your product or service. It's composed of four different elements:

• Value: Does it provide value to customers?
• Rarity: Do you have control over a rare resource or piece of technology?
• Imitability: Can it easily be copied by competitors?
• Organization: Does your business have the operations and systems in place to capitalize on its resources?

By analyzing each of these areas in your business, you'll be able to create a strategic plan that helps you cater to the needs of your customer