The ability to create and implement a viable strategic plan is essential to ensure a sustainable organization and to remain competitive in this demanding and changing health and human services environment. Today I want to discuss the importance of strategic planning and especially implementation. But first, a quick definition: “Strategic planning is your organization’s process of continually assessing its internal capabilities and the external environment in order to determine how best to use its limited resources to meet your strategic objectives.”
The value of strategic planning is that it helps to interpret the mission and vision, providing clear direction for the short-term and helping chart a path to the future. It serves as a formal process to allocate resources, and it helps to establish and bring to the forefront strategic priorities. Strategic planning also ensures an organization remains aligned with its objectives and establishes the basis for on-going performance reporting to ensure effective accomplishment of implementation.
Successful strategic planning and its implementation require leadership to have solid competencies, practices, and discipline. For a strategic plan and its implementation to be successful, it is essential that management engage in the following activities in order:
- Develop a vision of future competitive advantage and market positioning
- Create a plan that is scenario-based, incorporating alternate future options
- Craft detailed plans across areas of performance such as marketing, finance, operations, capital, and human resources
- Create and manage using key performance metrics to track strategy implementation and to allow for periodic implementation adjustments
- Optimize current operations while planning and implementing new programming and expansion
- Plan future models to support future vision and marketplace changes and realities
- Engage in collaborations, partnerships, and alliances when advantageous to strategy
Approach To Developing A Business Development Strategy
At OPEN MINDS, we use a three phase approach to help organizations create a business development strategy. Phase One is scenario-based strategy development. Phase Two is modification of business unit plans to support strategy implementation. Phase Three is development of an executive team performance dashboard.
During Phase One, organizations confirm short-term and longer term objectives. They analyze external and internal factors that affect strategy. Next, they identify environmental scenarios and related strategic issues and priorities. From this information, organizations develop strategic priorities and their accompanying tactics for accomplishment. Of great importance to this phase is the development of strategic action plans coupled with high level implementation plans.
Phase Two deals with an organization’s ability to make modifications of their various existing business unit plans to support strategy implementation. Modifications of existing plans cut across organizational departments, including: Marketing, Technology, Clinical, Human Resources, and Finance — including budgeting and financial management. From these modifications comes leadership decision making regarding organizational structure necessary to meet new strategies.
Phase Three consists of determining critical performance outcomes for successful implementation. This is accomplished by identifying leading indicators and metrics that track performance outcomes. Tracking outcomes is best achieved by the creation of a performance dashboard based upon the chosen key performance indicators. This dashboard must be available to all management staff and kept current. Dashboard results need analyzation and should inform management of needed changes and modification of course direction to achieve target objectives.
The Strategic Planning Steps
Many of our consultants at OPEN MINDS have worked with clients to create effective strategic plans. Through the years, a model has been developed that we use as a guide. This model was created to assure that organizations avoid the above mentioned obstacles. Here is a brief overview of the process we use:
- Review/Establish Mission, Vision, & Objectives: This helps to establish common ground with staff and insures an investment in the development of the strategic plan. It helps to clarify the past mission and future vision. This helps to identify mission drift and the need for mission expansion. It helps staff to make a full commitment to the process.
- Gather External Information/External Analysis — Trends & Competitors: Organizations do a scan of the external competition and the trends present in their marketplace (both locally and nationally). Knowing the external environment gives an organization the realities of the marketplace and helps leadership staff not ignore what their organization needs to do to meet these realities.
- Gather Internal Information/Internal Analysis — Service Line Portfolio Analysis: Conducting an internal analysis of an organization’s services assures that everyone becomes aware of which programs are important to the organization from a mission and a financial prospective. It gives an organization the information needed to compare its present and future services with what was found in the external analysis of the competition. This leads to finding the best strategic advantage in the present and future marketplace.
- Identify Options For Achieving Objectives — Strategies, Tactics, Markets, & Services: This process is necessary so leadership staff have an opportunity to look at the various options they have to reach their overall goals. This is intended to serve as a reality check so that the organization does not pursue unrealistic goals or tactics.
- Develop Operational Plans — Marketing & Business Development, Human Resources, & Technology: This step in the process is crucial, as it outlines specific operational plans in all significant areas of the organization. These “departmental” plans are brought together into a comprehensive overall plan for the organization. It takes into consideration all the information learned in the previous steps.
- Develop A Budget & Financing Plan: It is extremely important to attach a financial pro forma to the operational plan. This exercise assists leadership staff in understanding the realities of the plan and helps to prioritize the operational plans and the accompanying tactics.
- Develop A Detailed Implementation Action Plan: At this point in the process, leadership staff must create a detailed implementation action plan complete with timelines, tactics, responsible staff, dollars allocated, etc.
- Develop Key Performance Indicators: This helps hold everyone accountable to what is being accomplished. This step is often ignored or allowed to slip away. The organization needs to use benchmarks to measure its performance and to achieve the desired outcomes.
Implementation Is Where Strategic Plans Fail
Executives often believe that the effort of developing a strategic plan is not worth the time and financial investment, because strategic plans rarely work! My response is simply that there are many common reasons why strategic plans fail that can guide implementation to be successful. The top reasons implementation of strategic plans fail include:
- Going through the motions of developing a plan because that is what executives are supposed to do for their organizations
- Not understanding the national and state trends and the rapidly changing health and human services environment
- Not knowing the competition
- Not having the right professionals involved in the creation and implementation of the plan
- Unwillingness or inability to change with the marketplace/holding on to failing programs
- The strategic plan was not scenario based
- No accountability, timelines, or follow through built into the strategic plan
- Unrealistic goals or lack of financial resources to meet the plan’s implementation
Organizations can benefit greatly if their strategic plan is relevant to their vision and there is a deep commitment to its implementation. This plan must be informed by the trends in the marketplace at the local, state and national levels. Involving the right people in your organization is essential to helping staff to own the plan. Holding them accountable to the implementation is crucial to accomplishment of the objectives. Involving your Board of Directors in the planning from the beginning and reporting progress is best practice when it comes to these activities. Organizations can and should incorporate the goals of the strategic plan into their data dashboards. This will make it easier to continuously monitor progress and modify tactics and action plans when needed. If and when a marketplace shift is about to occur, moving from one scenario to a more appropriate scenario should be initiated to stay ahead of the change. I always recommend that if your organization has the funds to hire a consultant to facilitate the strategic planning process and monitor periodic progress, this is money well spent.