Implementing a Strategic Plan

Conducting Environmental Analysis

Introduction

External environmental as well as internal environmental factors have continued to influence how most activities are managed in an organization (Baskind, 2012). In this case we look at these factors in relation to Bridge HealthCare which is a hospital that offers healthcare services in Tennessee. This organization is operating in health industry which is a very dynamic and diverse environment.

As a health care facility, Bridge is faced with several challenges and it is therefore very important for the management and staff to collaborate in order to meet the goals of the organization. It is important as an administrator to carry out an evaluation process that is important to identify the factors that affect the success of Bridge Healthcare. In this case we are going concentrate on those internal and external factors that are very influential when it comes to success of the organization.

Determine two (2) specific forces in the external environment that will have the most impact on your organization

There are several segments of the external environment that needs to be analyzed in order to determine the threats that an organization is faced with. There are five sectors that make up the external environment and they include social cultural forces, political forces, competitive forces and technological forces (Baskind, 2012).

i. Changes that are seen in the political or legal segment

In most cases, changes in political or legal segment can be reflected across the hospital through the payer mix. Payer mix is defined as that proportion of revenue which is realized from different payers. According to data in 2012 by Forster health care programs that are government funded made up 66% of the revenue that was acquired by most of health care providers.

The remaining amount of revenue was provided by the local government, private payment, insurance companies, and voluntary non-governmental organizations (Baskind, 2012). Looking at the fact that the government made up the biggest percentage of payer, it means that financial liability of most organizations is dependent on funding that is provided by the federal government, and the partnership that the government had with state through the Medicaid plan. In any case the federal government enacts legislations that would lead to changes in the sources of finance, Bridge and other health care providers will be at risk of financial strain.

Bridge hospital started to experience difficulty when there was turbulence in the legal and political sector when they created the TennCare program. The current model of reimbursement which is the TennCare started way back in 1994. Looking back since it was implemented funding per cover dropped to 57% from 65%. This was not the only instance where political factors in Tennessee affected the medical provision.

The Federal Balanced Act in 1997 did give another blow to facilities and it is understood that most cutbacks in most hospitals were due to this law. This was an act that reduced the amount of Medicare reimbursement that was given to healthcare providers. Such reductions have a great impact on how different events are run in Bridge as well as other medical service providing facilities.

ii. Competition

Bridge being a small hospital in Tennesse has found it difficult to compete against established health care providers such as Baptist Memorial Hospital (The medical fact book 2012). In order to be competitive in the health care industry, it is important that all service providers have important technological facilities that will ensure that services are offered effectively and efficiently. Bridge does not have adequate technological facilities which would give it the needed cutting edge in terms of competition against other service providers.

In such situation we find that most of the patients will register in other hospital and forget about Bridge Hospital. When a facility is not reporting a high number of patients, it also means that they will have less amount of money in terms of reimbursement from the payers. Bridge Hospital has struggled in order to meet its budgetary allocation since the amount of money that they receive in terms if reimbursement is not enough to provide for administration costs as well as to buy new facilities.

Determine two (2) specific internal factors that the organization’s leaders need to consider in preparing for the future of health care and the future of the organization

Internal factors are those factors that are within control of the company, most decisions that are made by the management of the hospital will influence the fact that the company succeeds or fails. When we look at the internal factors of Bridge Hospital as well as other players in the industry, there are several factors that come to mind.

We look at the purpose of Bridge Hospital and determine whether they are well equipped and staffed to meet the set goals. We throw a glance at the human resource of the organization to determine whether the organization is at a position to meet the needs of the clients. We also must be concerned with whether the employees are well trained in order to handle the cases that are brought before them by the patients.

i. Competence in terms of knowledge and Skills

When we talk about the quality of health care services, it is dependent on the knowledge as well as the technical skill of the practitioner. It is important to ensure that all health care practitioners in the facility have improved their competence in order to provide high quality services. Bridge has actually struggled in this regard as they have not been able to find the resources to ensure that they can give their practitioners specialized services. They are also not in a position to acquire the best people in the market due to the fact that they may not be able to pay them as other well established firms are paying.

ii. Resistance to Change and bureaucracy

Most health care providing facilities require high level of restructuring in their operations. There are several instances which indicate that there are several health care providers who are highly resistant to change (Tulchinsky et al., 2012). It has not been easy to find and recruit employees with the ability to transform the organization; this has worked against the efforts at Bridge Hospital to change the dwindling fate. Due to limited budget, Bridge has been forced to employ most of its employees on contractual basis and therefore it has become very difficult to bring most of the employees on board when it comes to important changes that are required by management.

Discuss the impact of both the identified internal and external forces on the organization’s ability to develop a competitive strategy

External factors

Political and Legal Factors

Political and legal factors in most cases have been on the nature of payer mix. We have realized that reduction in the amount allocated to health care facilities through Medicaid has influenced the type of services that are being offered by most health care facilities. Managed Care Act was introduced to improve quality of services that are offered in most health care facilities but what was not done by the state and federal authorities is to ensure that all hospitals are provided with the technology which would make them compete effectively. This is what Bridge has continued to face as a health care provider (The medical market fact book, 2012).

It is not easy for this organization to compete against well established firms and therefore it continues to get less in terms of state and federal reimbursement. Lower reimbursement means that Bridge has to do away with most of provisions in the budget and run on the little that they have. This is a catastrophe, the hospital is not able to reduce on the number of readmission and patients continue to lose faith in its services as day go by. The federal and state governments have to ensure that the legislations that they pass are able to meet the needs of both small hospitals as well as large hospitals. Facilities are very important when it comes to ensuring that any hospital is in a good competitive position

Stiff Competition

Since the introduction of Managed Care Act, it is evident that the level of competition has been taken a notch higher and that hospitals that do not have a huge capital outlay will continue to suffer in terms of competing with the so called big hospitals. Government will continue to reimburse on the basis of readmission rate, yet the small companies have no option due to less technical and technological application (Tulchinsky et al., 2012). It is difficult for smaller hospitals such as Bridge to buy sophisticated machines and hire the most qualified physicians in the market. This means that even as the government continues to advocate for quality and low cost health care service, low budget hospitals continue to suffer in the face of high costs of facilities and health care providers.

Internal factors

Competence and Skills

Bridge has not been able to invest in the best medical practitioners that can be found in the industry due to the financial constraints that the hospital is facing. It is important to have proper foundation in terms of primary care, but this is not possible due to the shortage in number of available primary care physicians. Data provided by Health Resources and Services Administration in 2012 indicated that there was a shortage of around 6000 healthcare providers (Frech, 2013).

In such a case the health care providers are a rear commodity that is very expensive to acquire meaning that Bridge has had to do with less skilled physicians. This has led to lower patient intake since most of the patients would prefer other hospitals with more competent care providers. The less skilled employees have also meant that the levels of returns by patients are high. The hospital has had to do with lower reimbursement due to the provisions of managed care which discourages high levels of patient return. When reimbursement is low, definitely most of the operations of the organization will be affected negatively

Bureaucracy and resistance to change

In most cases, implementing most of the changes that would give Bridge competitive edge would lead to significant level of disruption when it comes to the organization’s operation. One important example that can be used is the introduction of Electronic Medical Records (EMR) which did affect the flow of work pattern in the hospital and therefore affected the level of productivity (Frech, 2013).

The other element which is bureaucracy is understood to be a hindrance to implementation of several changes that are very necessary in the organization. There are certain times when lower level employees have come up with very important proposals that have the potential to change the fortune of the company, but they have been left hanging due to the protocol procedures which may be difficult to follow up.

Recommend one (1) strategy that involves the organization’s managers in implementing and maintaining the momentum of the strategic plan

There are strategies which have been used in order to develop most of health care providing facilities. These approaches in most cases are multifaceted and can be looked at from both the macro and micro point of view (Frech, 2013). The most important thing that should be used as recommended here is that any strategy created must address issues that are external, fix competitive disadvantages and keep the whole organization within the provisions of the mission as well as values and move the hospital towards achievement of its strategic goals.

This is the only means that can be used by Bridge since it is trying to align the long term strategic goals and at the same time managing the effects of changing environment in the industry. With the changes that are taking place, it is important for any health facility to come up with strategies that are long range, this can go up to around ten years before any significant changes can be required.

Before moving into the next face of expansion, it is important for management at Bridge to determine the strengths and weakness as well as the threats and opportunities. This will enable the company to see the resources that are available, evaluate implication to alternatives and access the risks and barriers. This will be important in understanding the strategic posture of the organization which is very vital when looking into long term future.

Conclusion

This research material has sought to put forward information on various factors that characterize the environment for most hospitals. It is a paper that has provided an overview of the health care industry, as well as the challenges that are faced in the industry and lastly the strategies that can be applied in order to ensure that these organizations meet the set goals and missions.

The key challenges and attributes which relates to external and internal environment have also been highlighted. It is right to state that health care providers and in particular hospitals have the potential to transform in the country, and this is only possible when there is better utilization of resources, and resources transfer across the health care industry. If most of the issues are addressed and management make use of the set strategies, it means that most of the organizations will be able to cut on costs and run on better competitive platform than they have done previously.

References

Baskind, P. (2012). Environment analysis: Requirements and monitoring procedures. Halway House.

Frech, H. E. (2013). Competition and monopoly in medical care. Washington, D.C.: AEI Press.

Livermore, M. A., & Revesz, R. L. (2013). The globalization of cost-benefit analysis in environmental policy. New York, NY: Oxford University Press.

The medical market fact book 2012. (2012). Chichester: Espicom.

Tulchinsky, T. H., Varavikova, E., Bickford, J. D., & Fielding, J. E. (2012). The new public health.