Final Project Paper + Preps

10/14/2018 HCM580 - Strategic Management in Healthcare (Capstone)

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HCM580

Strategic Management in Healthcare (Capstone) Module 6: Strategic Planning and Management for Healthcare Managers After reading Chapters 7 and 8 in your textbook and completing Module 6, you will be able to identify and explain the strategic responsibilities of the top management of Strategic Business Units (SBU). You will also gain a better understanding of the relationships between the corporation and the management team of the SBU. In addition, you will be able to develop methods to grow a business financially by utilizing growth, multiple levels of strategies, and explaining competitive advantages.

Learning Outcomes

1. Identify and relate the concepts of strategic planning and implementation in healthcare systems. 2. Apply the strategic planning concepts to the development of new health services. 3. Identify and summarize the long-term and short-term goals identified in an organization's strategic

plan. 4. Assess and explain strategies that can be used to improve weaknesses identified in a healthcare

setting. 5. Evaluate the use of corporate-level, divisional-level, organizational-level, and unit-level strategies.

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For Your Success & Readings

Healthcare leaders must operate in an uncertain environment, but strategic managers create plans to promote organizational development in spite of this uncertainty. In this module, you will explore how value-adding services can provide a market advantage to healthcare organizations.

This week, the development of your Capstone Project continues to move beyond information gathering toward specific recommendations, including evaluating alternatives and strategic choice, value-adding strategies, and initiatives. As you begin to develop this aspect in your Capstone Project, don't hesitate to be in touch with your instructor if you have any questions or need further clarification.

Required

Chapter 8 in Managing Health Care Business Strategy Rajasekar, J. (2013). A comparative analysis of mission statement content and readability (https://search-ebscohost-com.csuglobal.idm.oclc.org/login.aspx? direct=true&db=bth&AN=94460028&site=ehost-live). Journal of Management Policy & Practice, 14(6), 131-147. Srinivasan, R. (2014). Visioning: The method and process (https://search-ebscohost- com.csuglobal.idm.oclc.org/login.aspx?direct=true&db=bth&AN=93451713&site=ehost-live). OD Practitioner, 46(1), 34-41.

Recommended

Macloed, L. (2016). Mission, vision and values statements: The physician leader's role. (Health Care Organizations) (http://search.ebscohost.com.csuglobal.idm.oclc.org/login.aspx? direct=true&db=bth&AN=117613807&site=ehost-live). Physician Leadership Journal, 3(5), 18(6).

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1. Strategic Planning Process

An organization's process for developing a strategy and a decision-making for resource allocation is called strategic planning. Strategic planning addresses an organization's goals and how they will reach them. This process involves defining objectives, assessing existing resources and what resources will be needed in the future, formulating a strategy and outlining a plan for execution of that strategy. It also takes into account what roadblocks an organization may run into when implementing the strategy and plans for ways to overcome them. In short, a strategic plan says who an organization is, what it does, what it believes, and how it will work to execute its plans.

Much of the strategic planning process involves coming up with a variety of ideas and then selecting those which can be executed and which will move the organization forward in support of its mission and goals. Strategic thinking sets priorities to help strengthen an organization and determines the best way to focus efforts and resources—including employees and stakeholders—toward common goals. Solid strategic planning not only sets forth a plan of action, but also includes assessing the effectiveness of these plans, and adjusting to accommodate for changes in the organization and the field.

Watch the ways to approach business strategy and its influences on strategic planning in the following video.

Strategy is Making Choices

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Important information about competition, profitability, and industry structure.

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2. Value-Added Services

As a result of the abundance of services and providers available, consumers are in a position to make informed healthcare decisions. Regardless of the beliefs of staff or leaders, it is the consumer's beliefs which are paramount. Therefore, services provided must add value from the customer's perspective. If patients are unhappy with any aspect of their healthcare delivery, they will seek other options. Value- added services should be explored at the corporate level, divisional level, organizational level, and unit level. Each strategic decision should push the organization closer to achieving overall goals. The value chain can be divided into different sections. The first section is narrow in scope and the second is broader in scope.

Value-added support activities Value-added strategies

These strategies establish the process and context for accomplishing the mission, values, and goals. Their development requires matching organizational requirements with the results of an internal analysis.

Some examples of value-added services in healthcare include (Kober, 2008):

Adherence and disease management programs, Reimbursement assistance, Data products for payers and manufacturers, Infusion therapy, Physician education and support, Patient education and support, and Patient lifestyle management.

By addressing these types of value-added services, health care providers can improve patient outcomes, increase patient satisfaction, and save money over less-cost effective specialized treatment.

These activities impact the organization's culture, structure, and resources. They are the primary means of creating value for the organization and adding a competitive edge.

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This is a win for not only the organization, but also the consumer.

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3. The Busy Strategic Manager

It is important to recognize that a healthcare manager is more than a boss. A leader must be a politician, a counselor, an event planner, and a human resource specialist. A strategic manager must address a broad range of activities which include the management of long-term and short-term goals. Some examples of addressing aspects of a strategic plan include establishing a budget, determining where to open an office, working on production quotas, and developing staffing plans. In order to hold individuals accountable and gauge the success of employees, it is necessary to have measurable plans.

When a strategic plan is in place, the healthcare manager must be able to organize resources to achieve the best results. They affect organizational change development through the organization of individuals and resources. The following questions must be answered by healthcare managers every day:

What needs to be accomplished? What resources are needed to accomplish the goals? Who will do what?

It is impossible to perform management functions with making strategic decisions. Planning for a new business, new product lines, and budgets all require decision making regarding implementation. Ultimately, decisions made by strategic managers steer the organization toward meeting goals. Utilizing decision-making skills regarding resources, planning, and organizing allows healthcare managers to add value to the organization in a measurable and meaningful way.

You can explore the inevitability of change within organizations and how to focus the change on problem solving within the organization in the following video.

Leading Real Organizational Change

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Practical steps you can take to achieve organizational change.

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Strategic Planning Models

There are a variety of strategic planning models for strategic managers to use in the development of a strategic plan. Each model below provides a roadmap of the healthcare system to grow. Each one can also often be deeply entrenched in the organizational culture.

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This is the most basic model of all the models which can be implemented by a healthcare system. The components of this plan are: identifying the purpose, establishing a vision statement, and selecting the goals for the organization.

This model is utilized by healthcare organizations that may have several major problems and limited resources to address them all. The components of this plan are: identifying the major issues facing the organization and brainstorming ideas to address each one.

This model is used to ensure alignment with the organization's mission and its resources to operate the organization. This model is also used to fine tune established strategic plans.

This model can be used in conjunction with any of the other planning models to ensure that key strategic issues are identified and addressed.

This model is used to clarify and articulate the vision of the health system incorporating the common values and shared experiences around the healthcare organization.

This model is used to help identify, understand, and act on current challenges and opportunities that arise— addressing the issues of today, not the issues of down the road when the new plan has been completed.

Vision-Based Planning Model

Issues-Based Planning Model

Alignment Planning Model

Scenario Planning Model

Organic (Self-Organizing) Planning Model

Real-Time Planning Model

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4. Uncertainty in the Plan

Even the best strategic plans have an element of uncertainty. This uncertainty can lead to difficulty in evaluating and measuring the success of a plan, but it is that measurement that makes a plan and the planning process worth the investment of time and resources. Planning without the intention and ability to monitor outcome wastes time and resources. There is an important distinction one must make between the strategic plan and the results of the plan. The plan alone is not useful. It is simply a document or idea of how to accomplish an organization's objective. When the strategic plan is executed, it helps to guide future processes and actions.

A strategic plan that is never used to guide organizational development is useless. The process of planning must be active and ongoing. The objective of a strategic plan is to establish organizational goals and then develop strategies to achieve the desired outcomes.

Once goals have been established, the process of developing strategic plans begins. Constraints come in many forms and may include operational limitations, organizational limitations, financial limitations, relationship factors, legal and regulatory compliance, and resistance to change. Each of these constraints and others should be considered and integrated as a part of the plan. Failure to recognize the constraints an organization may have can lead to a strategic plan that is ineffective and unprepared to deal with realities that exist.

Check Your Understanding

Select the correct answer for each question.

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References

Kober, S. (2008). The value of value-added services. Biotechnology Healthcare, 5(3). Retrieved from https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2706180/

Moseley, III, G. B. (2018). Managing health care business strategy. Burlington, MA: Jones & Bartlett Learning, LLC, an Ascend Learning Company.