BIOLOGY

32 March • april 2008 the Physician ExEcutivE

in this article…

Strategic planning needs to be simple, time-limited, realistic and accurate. It cannot be the unending, purposeless exercise that many organizations experience.

By Daniel V. Schidlow, MD

Strategic Planning in Health Care: The Results Are Everything…Or Are They?

Management

If you just received an invitation by your current administrative leadership to participate in a series of strategic planning meetings and feel a sense of déjà vu, relax— maybe this is the one that actually gets done.

Without the hope and conviction that this is the one, don’t accept, or else, arm yourself with much patience and stoicism.

Many years ago, I was advised to go on complete bed rest to care for a herniated cervical disk (the wisdom of this treatment turned out to be very questionable, but we shall leave this issue for another time.)

Knowing that I would be on my back with not much else to do, the hospital CEO at the time asked me to “Think about the future and give him my thoughts.” Although the words “strategic plan,” “framework,” “mis- sion,” “vision,” “paradigm shift,” and “deliverables” were not in my vocabulary yet (perhaps I would be better off

if they disappeared from it now!), I essentially produced mission and vision state- ments, and a strategic plan of sorts.

After 30 years at my current place of employ-

ment, and having become a historian of sorts, I continue

to dance to more or less the same tunes and, as Brian Quinn of Dartmouth University pointed

out so poignantly, the “weather” has changed little, although the rain danc- ing is much improved.

Several CEOs, deans, faculty members, health systems and corpo-

rate owners later, the discussion seems to center on many of the same issues and problems

that confronted us all along.

Process and analyze…and process some more With the advent of strategists, health consultants

and all kinds of planning “intelligentsia” (and, of course, PowerPoint), the processes have become far more sophis- ticated and organized. The resulting documents and plans are much more extensive, accompanied by business plans and pro formas.

Much time and resources, especially people’s time (ergo, money), are expended in assembling constitu- ent groups to engage in a process of analysis, discussion

“A good deal of corporate planning is like a ritual rain dance…it has no effect on the weather that follows. Much of the advice related to corporate planning is directed at improving the dancing, not the weather”

—Professor Brian Quinn, Dartmouth University, 1991

the Physician ExEcutivE March • april 2008 33

It is very interesting that the word strategy itself has war-like and very personal leadership connota- tions (Greek stratēgia “generalship” stratēgos “general” - stratos “army” + agein “to lead”). Thus, strategic planning is the process by which executives (generals) lead their staff (army) though a process that will lead to achievement of organization- al success (win the war.)

I find it sobering (if not a bit alarming) that we would use such verbiage without much thought about it, but in essence, what health executives and leaders do is simply

Thinking vs. planning Planning must be an orderly,

managed, and long-term goal- oriented process. Strategic thinking and planning, however, which are commonly confused, are two differ- ent things:

• Thinking is an ongoing part and parcel of leadership, as leaders are called to make sudden and quick decisions, often based on incomplete information, in the best interest of a long-term goal.

• Planning is the process necessary to develop tactics and must be based an correct information.

and drawing of institutional future. These processes range in format from one extended meeting, i.e., “retreat” (note the use of a largely religious concept that describes a time of reflection and communion with the divine, away from the noisy world) to a series of meetings over weeks or months that bring together individuals in positions of leader- ship and others whose opinions are deemed valuable or representative.

Often, who “is in” and who “is out” becomes an issue of assigned or self-perceived importance; this can be, by itself, a source of conflict.

So what is it that drives the need for “recurrent” strategic planning?

First, new leaders have the legitimate need of making the insti- tutional vision, and the means to achieve it, their own. As a result, they must conduct a process that brings their (new) teams and (old) constituents together in an organic and integrated plan of action.

Second, environmental chang- es and repositioning of markets requires adjustment, even if the driv- ing principles do not change. Every health organization and academic medical center claims as its mission “to provide excellent care with up- to-date technology in a compassion- ate environment, outstanding educa- tion and commitment to the commu- nity” (or something of the kind).

Every medical center and physi- cian practice strives to gain market share. The means to accomplish these goals often change, however, as the health care environment evolves due to acquisitions, mergers and un-couplings of health systems and third-party payers.

Third, short of a dictatorial approach to management, the cre- ation of a common platform of action that can be embraced by the majority of an institution mandates a global and inclusive process. Thus, dear reader, whether you like or not, strategic planning is here to stay!

Characteristics of a Good Strategic Plan Here’s a mnemonic that will help you remember the salient aspects of a good strategic plan:

Simple

Time-limited

Realistic

Accurate

Tied to the mission

Enforceable

Gauged to institutional resources

Intuitively acceptable

Concise

Participatory

Logical

Applicable

Nimble

34 March • april 2008 the Physician ExEcutivE

examine its strengths and weakness- es, determine time lines in which to accomplish objectives, and contain realistic goals.

A good plan is concise, achiev- able and resonates intuitively with constituencies, and is eminently within reach.

Daniel V. Schidlow, MD, is profes- sor and chair of the department of pediatrics at Drexel University College of Medicine, and physician in chief and chief academic officer at St.Christopher’s Hospital for Children in Philadelphia, Pa. He can be reached at Daniel.Schidlow@ drexelmed.edu

Reference

Alexander B. 1. How Great Generals Win. W.W.Norton & Company, New York, 1993.

leaders. A good plan is a general framework with proposed avenues of implementation.

A strategic plan needs to be like a musical score: the notes are all there, but some interpretive creativity must be allowed in its final expression. There needs to be some flexibility to change course in response to untoward events or opportunities, without losing sight of the goals.

All too often, executives get dis- tracted by the crisis of the day and abandon carefully crafted plans to attend to it. Finally, to be successful, strategic plans must be time-limited, not perennial, and must undergo periodic reevaluation.

Greek mythology tells that Hercules, one of the Argonauts, was told to clean the Augean stables of bovine debris accumulated over many years, in a single day. King Augeas promised him one tenth of his cattle as a reward. Hercules quickly assessed the situation, devel- oped a strategy and executed his action plan, to reroute the rivers Alpheus and Peneus through the sta- bles, thus accomplishing his mission, and fulfilling his vision (no cow left behind in a dirty stable).

King Augeas refused to honor his word; Hercules resolved the issue by killing him and giving his kingdom to his son, who was sym- pathetic to Hercules. Admittedly, none of us is an Argonaut, neither can we divert rivers or feel entitled to resolving contractual issues in such a drastic manner, but certainly we can clean a lot of debris and effect change if we emulate Hercules’s decisiveness and swiftness.

Whether the time line is one day or 40 years, the proof is in the results.

So, how do we avoid turning into expert dancers and become, instead, expert rainmakers? By developing good strategic plans that identify the aims of the organization,

to follow the same principles that generals follow before going into bat- tle, including the use of similar tactics (from the Greek taktikos: a device for accomplishing an end, or, the maneuvering of forces in combat).

For instance, if Hospital X is building a new multispecialty cen- ter in a certain town, the competi- tion will look at the map and try to emulate the Napoleonic “manœuvre sur les derrières” (sending a strong column of men around the enemy’s rear and establish a barrier across its supply line)1 and place a competing operation within a service area that would siphon away patients.

Or, Hospital Z, witnessing the successful productivity of a physi- cian group, tries to recruit it away (move on the flank and weaken the competition—“enemy”—and gain market share—(“advance”).

One cause of strategic failure can be the quality of information upon which plans are based. Good and complete information is crucial to the generation of an adequate response that will not sink the orga- nization into chaos or low morale, or unexpected losses.

The SWOT analysis typical of a strategic planning process is as good as the information coming from the front lines and the honesty with which it is approached.

Another cause of failure can be disconnection between the stated goals (mission and vision) and the process designed to achieve it. Some organizations engage in regularly scheduled meetings to discuss strat- egy (a few years ago we had such meetings every week!). Chronic strategic planning belies weakness and lack of organizational focus, and an inability to effectively implement action plans.

Direct and guide To avoid failure, the level of

detail of a plan should direct and guide but not restrain institutional