Healthcare Strategic Planning: Step-By-Step Advice [With Examples]

Yes, strategic planning in healthcare is tough! But with these six techniques and list of pitfalls to avoid, you’ll be on your way to strategic success.

Tricia, Senior Consultant at ClearPoint, leverages her 4+ years of performance management experience when working with customers to improve their reporting and strategy execution.

A healthcare organization's strategic plan is designed to identify the necessary actions needed to reach the objectives of the organization. Whether you’re creating a new strategic plan from scratch or you’re trying to breathe life into an old plan, I bet we can both agree that healthcare strategic planning is a tough process. But if you have the right tools at your disposal, it doesn’t have to be quite so painful.

Below, we’ll give you a quick look at six strategic planning techniques you may want to consider using during this process. Then, we’ll introduce the four phases necessary to execute said strategic plan (and the strategic planning pitfalls you should avoid making!).

6 Strategic Planning Techniques

  1. The Performance Prism Model: The Performance Prism is a performance management framework with five perspectives: stakeholder satisfaction, stakeholder contribution, strategies, processes, and capabilities.
  2. The EFQM Excellence Model: Like the majority of these six techniques, the EFQM model can be used in conjunction with other frameworks. It combines three elements—Fundamental Concepts of Excellence, Criteria, and RADAR—to help you understand cause-and-effect relationships in your organization.
  3. The Balanced Scorecard: The Balanced Scorecard (BSC) is a strategy management framework that helps you “balance” four perspectives in your organization: finances, customers, internal processes, and learning and growth. In conjunction with a strategy map, the BSC can help provide an excellent way to manage your strategy.
  4. Benchmarking: Benchmarking allows you to compare metrics in your organization to either an industry average or your competitors. This is a great targeted solution, but less of a full framework.

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  1. Capability analysis: Conducting this analysis helps you think of your organization as a set of capabilities so you can work on identifying gaps that may represent a competitive weakness (and highlight new capabilities that could be a competitive advantage!).
  2. Market analysis: Conducting market research will give you a good indication of industry size, growth, and trends to be aware of. This is very helpful input for your strategic plan, but it is not a plan in and of itself.

For strategic plans in healthcare organizations to work, you need to ensure you’re following a process instead of having a free-for-all. For example, if you don’t take time to analyze what needs to go into your strategic plan, you’ll end up with a handful of pointless (and frustrating) meetings.

Take a look at the following four planning phases—they’ll help you set a solid strategic plan in place.

4 Planning Phases For A Successful Strategic Plan

1. The Analysis & Assessment Phase

First, it’s critical to gain a basic understanding of what direction you’re trying to go in (while taking into account your internal organizational structure and any external factors you have to consider). You’ll want to hold the majority of your strategy meetings during this phase. In hospitals specifically, you’ll want to figure out where you need to increase performance and focus in on your plans. This is also a good time to look at areas where you are struggling and determine what direction the regulatory and competitive environment is moving in. This will be the area of the highest and most critical need.

2. The Strategy Formulation Phase

During this phase, you’ll focus on developing your high-level strategy and documenting your organization-level strategic plan. You’ll want to pick out the goals and metrics you want to track. For example, most hospitals track metrics that deal with operations, finances, communication, internal issues, public health, and care.

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Also, this is the time to look at your general organizational structure and how it links to the strategy. Do you have the right people in charge of the right aspects of your strategy. This helps create accountability and ensures things don’t fall through the cracks. For example, if you’re using the Balanced Scorecard, we encourage you to name owners and collaborators as well as what each person is responsible for therein.

3. The Strategy Execution Phase

During this phase, you’ll focus on translating your high-level plan into a more operational plan by honing in on projects and action items. At this point, we’d encourage you to look into software to help implement your strategy so you can keep all strategic elements in one place, track your progress, and keep an eye on potential improvements to be made.

4. The Plan Evaluation Phase

This final phase deals with the management process—which includes refining your plan, evaluating performance, and reporting on your data. For example, if you’re tracking all of your metrics and you see one that doesn’t align well, this is when you’d alter or enhance it to make it more applicable to your strategy. Keep in mind, this phase is ongoing and never-ending. You will always be evaluating and refreshing your plan!

4 Pitfalls To Avoid During Healthcare Strategic Planning

Part of strategic planning in healthcare involves dealing with any road bumps that come your way. While most companies go through some trials during their strategic planning process, a misstep could have major consequences. For one, it could derail your progress and cause you to waste months of time and energy. Additionally, it could create confusion—or even concern—across your organization. Keep in mind, some people in your organization will always be critical of your strategic plan, and those individuals will be the first to doubt it and wonder why you aren’t headed “full-steam ahead.” While there’s not much you can do to avoid critics, you can avoid putting yourself in a position to have your strategy (and your strategy office) criticized. Avoiding these four common pitfalls is an important step in that direction.

1. Be sure you select strategic, not operational KPIs.

It’s far too simple to fall into the trap of selecting metrics that are important for your operations, but have little to no impact on your strategy. For example, many healthcare centers track the percentage of beds that are occupied in order to get a closer look at ongoing patient capacity. This metric helps you understand where you stand on capacity, and is largely operational. However, if one of your strategic goals is to increase the number of patients who choose your hospital or increase your capacity, then this metric could be strategic. Always be sure your metrics truly tie back to and inform your goals.

2. Avoid having too many metrics.

The majority of healthcare providers come from either a business or a science background—which makes it quite easy for them to fall in love with measures. But the caution here is that some may get overzealous about metrics and try to track too many—which is a mistake.

If you have too many metrics—say, anywhere north of 35 at the enterprise level—you won’t be able to focus on the metrics that will actually make an impact on your strategy. The list of negatives goes on and on: Your reports will end up being too extensive and leadership will be less likely to read them; your meetings will end up being hours long; and you’ll simply never complete the meeting agenda, etc. All of these issues can be avoided simply by not selecting extra metrics that will distract from the conversations you need to be having.

3. Don’t pile too much on your strategy office.

I always recommend that you keep your strategy office as “clean” as possible. Here’s what I mean: It’s important to allow those working in the strategy office to do what they’re meant to do—plan and execute your strategy. We’ve seen many instances where others in the healthcare organization begin to tap the strategy office for little projects here and there that aren’t strategy related. The reason for this is typically that those in the strategy office are close to the leadership and are in-tune to what’s happening around the organization. While this makes them a tempting target for random projects, be sure everyone involved in your strategic planning knows their limits. The best way to ensure your strategic planning and strategy execution are successful is to keep the strategy office focused on its priorities, and nothing else. And if you need to, engage in workforce planning to ensure that the entire organization is efficiently and effectively staffed.

4. Clearly define roles and responsibilities of those involved in strategic planning.

In non-medical corporations, most measure and project owners are tasked with updating their own measure statuses and project reports. But in healthcare organizations, this isn’t always the case. Healthcare organizations can have an assistant-heavy culture, and department leaders and doctors often task those assistants with updating projects they aren’t involved in. Therefore, it’s particularly important for those in healthcare to clearly define roles and responsibilities when it comes to strategic planning and execution. Is it acceptable for assistants to make measure updates in an ongoing fashion? If so, do they know how to do this appropriately in your strategic planning software so your leadership is consistently made aware of updates? Simply communicating these details can save you a lot of grief in the long term.

Looking for a few more examples of strategic planning in healthcare?

Sometimes it takes seeing a few healthcare strategic plan examples to get things in motion! If you’re considering a Balanced Scorecard, check out this collection of healthcare strategy maps. These maps illustrate how other organizations have put the BSC to work for them. And, if you're looking for accreditation, find out if PHAB Accreditation or becoming a Federally Qualified Health Center are options for your organization.

Healthcare Strategic Planning: Step-By-Step Advice [With Examples]