UBC Phar400-18Jan2013 business-planning-long

UBC – Phar400 | Pharmacy Management
retailSOS.ca | Gerry Spitzner
January 18, 2013

 Thoughtstarter
 Planning In Its Larger Context
 Market Research
 The Business Plan
 Your Presentation
retailSOS.ca | Gerry Spitzner 2

 To guide and inspire a strategic process for your
clinical service Business Plan and presentation.
◦ Help you with a strategic framework to create and document
your clinical service Business Plan.
◦ First, a high level approach to planning with proven concepts.
◦ Then take these ideas to share a simple 3 step presentation
strategy of your Business Plan at “The Pharmacy Moguls Den”
to communicate and implement a new clinical service that
produces strong financial results.

 Why does it matter?
 Why should the business come to you rather than
someone else?
 What are you known for? What are you a solution for?
◦ Doesn’t make sense to dream up ideas without speaking with
customers.
◦ A need alone does not necessarily mean there is a market.
◦ Differentiate, differentiate, differentiate
4retailSOS.ca | Gerry Spitzner

 Ideas can come from many different sources...
◦ Complaints and feedback from customers.
◦ Requests for proposals (RFP’s) from large businesses,
government agencies (BC Bid), or LTC facilities.
◦ Modifications to current products; i.e. diabetic meters
◦ Suggestions from employees, doctors, inter-professional
healthcare, wholesalers and suppliers.
◦ Healthcare publications, magazines, media; i.e. Dr. Art Hister
◦ Competition

Understanding the overall context
for planning can greatly help you to
design and carry out the planning
process in almost any planning
application.

 Simply put, planning is setting the direction for
something -- some system -- and then working to
ensure the system follows that direction.
 Systems have inputs, processes, outputs and
outcomes.
◦ Inputs to the system include resources such as raw
materials, money, technologies and people.
◦ Inputs go through a process where they're aligned, moved
along and carefully coordinated, ultimately to achieve the
goals set for the system.

 Outputs are tangible results produced by processes in
the system, such as products or services for
consumers (patients/customers).
 Another kind of result is outcomes, for the business or
the benefits for consumers
◦ i.e. jobs for workers or enhanced quality of life for patients
and customers.
 Systems can be the entire organization, or its
departments, groups, or processes. Your project.

 Work Backwards Through Any "System“; begin with
the end in mind.
◦ Whether the system is an
organization, department, business, project, etc., the process
of planning includes planners working backwards through the
system.
◦ They start from the results (outcomes and outputs) they prefer
and work backwards through the system to identify the
processes needed to produce the results.
◦ Then they identify what inputs (or resources) are needed to
carry out the processes.

 Planning includes use of the following basic terms...
 Goals
◦ Goals are specific accomplishments that must be accomplished
in total, or in some combination, in order to achieve some larger,
overall result preferred from the system, for example, the
mission of an organization. (goals are outputs from the system.)
 Strategies or Activities
◦ These are the methods or processes required in total, or in some
combination, to achieve the goals. (strategies are processes in
the system.)

 Objectives
◦ Objectives are specific accomplishments that must be
accomplished in total, or in some combination, to achieve the goals
in the plan. Objectives are usually "milestones" along the way when
implementing the strategies.
 Tasks
◦ Particularly in small organizations, people are assigned various
tasks required to implement the plan. If the scope of the plan is very
small, tasks and activities are often essentially the same.
 Resources (and Budgets)
◦ Resources include the people, materials, technologies, money, etc.,
required to implement the strategies or processes. The costs of
these resources are often depicted in the form of a budget.
(resources are inputs to the system)

 Reference Some Overall Singular Purpose Such As The
Mission or Desired Result from System
◦ During planning, planners have in mind some overall purpose
or result that the plan is to achieve. It's critical to reference
the mission, or overall purpose, of the organization.
 Take Stock Outside and Inside the System
◦ This "taking stock" is always done to some extent. For
example, it's important to conduct an environmental scan.
This scan usually involves considering various driving forces,
or major influences, that might effect the organization.

 Analyze the Situation
◦ For example, conduct a "SWOT analysis". (SWOT is an acronym
for considering the organization's strengths, weaknesses,
opportunities and threats faced by the organization.)
 Establish Goals
◦ Based on the analysis and alignment to the overall mission of
the system, establish a set of goals that build on strengths to
take advantage of opportunities, while building up
weaknesses and warding off threats.

 Establish Strategies to Reach Goals
◦ The particular strategies (or methods to reach the goals)
chosen depend on matters of affordability, practicality and
efficiency.
 Establish Objectives Along the Way to Achieving Goals
◦ Objectives are selected to be timely and indicative of
progress toward goals.
◦ They are “signposts” to ensure implementation results are
cycled back so that adjustments can be made to stay on track.

 Assign Responsibilities and Time Lines With Each
Objective
◦ Responsibilities are assigned, including for implementation
of the plan, and for achievingvarious goals and objectives.
◦ Ideally, deadlines are set for meeting each responsibility.
 Write and Communicate a Plan Document
◦ The above information is organized and written in a document
which is distributed around the system or company.

 You need more than a good idea to verify and fund your
proposed product or service.
◦ Just because it seems like a great idea doesn't mean that it
can become a product or service.
◦ A viable product/service needs to be profitable and
sustainable, including being “producible” and marketable.
◦ Also, the product/service should be related to the purpose, or
mission, of the business.
◦ Businesses can go bankrupt by trying to be too many things to
too many customers, rather than doing a few things very well.

 At this point, you will benefit from understanding the
basics of marketing, particularly how to conduct
market research and a competitive analysis.
 If your idea still seems like a good one, then it's
important to know how you will position and identify
your new product/service to the market.
 You'll certainly want to know how much you might
charge for it , its price to the customer/consumer).

It is extremely difficult to develop
and provide a high-quality product
or service without conducting at
least some basic market research.

 Market research has a variety of purposes and a
variety of data collection methods might be used for
each purpose.
 The data collection method that you use during your
market research depends very much on the
information that you are seeking to understand.
 Businesses can learn a great deal about
customers, their needs, how to meet those needs and
how the business is doing to meet those needs.

 Market research usually involves doing a periodic
study of some sort.
 Market research generally probes a few topics;
however by itself doesn’t yield a deep understanding
of the customer.
 The periodic nature merely offers a snapshot of
customers at a moment in time.
 Adopt a customer learning approach to find out who
your customers are and what they want.

 As opposed to periodic studies, customer learning is a
continuous process of probing customers.
◦ It’s a process that fundamentally incorporates the fact that
every customer is truly unique and that their needs, wants and
expectations are never static.
◦ They change with the life forces affecting the individual or the
business and the environment in which they exist.
 Who is your ideal audience, where do they do
business, and why?
 Work your clinical service backwards from them.

 Identify opportunities to serve various groups of
patients/customers (your ideal customers).
◦ Verify and understand the unmet needs of a certain group (or
market) of customers. What do they say that they want? What
do they say that they need?
 Examine the size of the market – how many people
have the unmet need. (your ideal audience)
◦ Identify various subgroups, or market segments, in that
overall market along with each of their unique features and
preferences.

 Determine the best methods to meet the unmet needs
of your ideal audience.
◦ How can you develop a product or service with the features
and benefits to meet that unmet need? How can you ensure
that you have the capacity to continue to meet the demand?
 Investigate the competition.
◦ Examine their products, services, marketing
techniques, pricing, location, etc. One of the best ways to
understand your competitors is to use their services.

 Clarify your unique value proposition.
◦ Your proposition describes why customers should use your
organization and not the competition’s.
 Conclude if the product is effectively meeting the needs of
your ideal customers.
◦ One of the best ways to make this conclusion is to conduct an
evaluation. An evaluation often includes the use of various data
collection methods, usually several of them.
◦ I.e. observing clients, interviewing them, administrating
questionnaires with them, developing some case studies, and,
ideally, conducting a product field test, or pilot.

 Who are your competitors?
◦ What customer needs and preferences are you competing to
meet?
◦ What are the similarities and differences between their
products/services and yours?
◦ What are the strengths and weaknesses of each of their
products and services?
◦ How do their prices compare to yours?
◦ How are they doing overall?

 How do you plan to compete?
◦ Offer better quality services? (value)
◦ Lower prices?
◦ More support?
◦ Easier access to services?
◦ How are you uniquely suited to compete with them?
 Gather competitive intelligence from as many sources
as possible. Then do a SWOT analysis.

Initial considerations to address
about your idea for a new product or
service and preparation to
document the business plan.

 If you'll need funding to start your new clinical service,
investors or funders are much more likely to provide
money if they see that you've done some planning.
◦ How much money will you need?
◦ What will the return on investment (ROI) be?
◦ How long will it take to break even and make money?
◦ What are the barriers to entry? Us & our competition?
◦ What are your assumptions?
◦ Be clear about what you are selling.

 You’ll need to answer these questions...
◦ Is there a need for the service and is there a market?
◦ What type of new product or service will you be starting?
◦ What Are Your Initial Plans?
◦ What Planning and Financial Skills Do You Need?
◦ What Human Resources Will You Need?
◦ What Facilities and Equipment Will You Need?
◦ How Much Money Will You Need?

 What is the nature of your new product or service?
◦ Whether you're starting a new product or service, there needs
to be a strong market for it.
 How do you know there is a need?
◦ You'll have to have enough evidence to convince an investor
or funder -- and yourself.
 Who are your competitors?
◦ What makes your new product/service any different or more
needed by customers? Conduct a competitive analysis.

 What is the basic purpose of your product or service?
◦ This is your mission statement, or your value proposition.
◦ Basically, the mission statement describes the overall
purpose of the product or service.
◦ When wording the mission statement/value proposition,
consider the product or services’; markets, values, concern
for public image, and priorities of activities for survival.
◦ Use the value proposition worksheet provided in pre-reads.

 What are the major goals for your product or service
over the next 24 to 36 months?
 What do you need to do to reach those goals?
 What objectives do you need to reach along the way to
each goal?
 How will you know that the organization is efficiently
pursuing its goals?
◦ Knowledge of these goals will help you a great deal when
thinkingabout what resources/skills you will need right away.

 How will you manage your finances?
 How will you monitor and record your income and
expenses?
◦ What system will you use for bookkeeping and accounting?
◦ What system will you use to document patient counselling?
◦ How will you adjudicate with Pharmacare?
◦ How will you bill the patient? (if it’s not a covered benefit)

 What skills (and people) are needed by your
organization to deliver the product or service?
 How will you attract and retain the best people?
 How will you organize your staff?
◦ Workforce planning, Specifying Jobs and Roles and Selecting
Your Organizational Design (who will work for whom, etc.)

 What equipment needs will you have?
◦ These needs depend very much on the resources needed to
develop, distribute and support your product/service.
◦ Facilities Management includes, cleaning, floor washing,
ventilation(HVAC), lighting, receiving dock, delivery van etc.
 What computer equipment will you need?
◦ Hardware, Laptops, iPad’s, mobile phones, printers, Wi-Fi etc.

 What is the Cost of Needed Resources?
◦ Consider the costs to obtain the necessary skills, facilities
and equipment identified from addressing the questions from
all the previous.
 What are your start up costs?
◦ How much money will you need to get started before
generatingany revenue?
◦ Consider wages, licenses & fees, advertising, marketing &
promotion, leasehold improvements etc.

 1. Business summary
◦ Describes the organization, business venture or product
(service), summarizing its
purpose, management, operations, marketing and finances.
 2. Market opportunity
◦ Concisely describes what unmet need it will (or does)
fill, presents evidence that this need is genuine, and that the
patients or customers will pay for the costs to meet this need.
◦ Describes credible market research on target customers
(including perceived benefits and willingness to
pay), competitors and pricing.

 3. People
◦ Arguably the most important part of the plan, it describes who
will be responsible for developing, marketing and operating
this venture, and why their backgrounds and skills make them
the right people to make this successful.
◦ This section is also where you should include your advisors
(board of advisors) and other healthcare professionals such
as doctors, NP’s, nurses, LTC administrators etc.
◦ Also consider others you may need to make the plan a
success; suppliers, corporate sponsor, associations, advisors

 4. Implementation
◦ This is the how-to of the plan, where the action steps are
clearly described, usually in four areas: start-up, marketing,
operations and financial.
◦ Marketing builds on market research presented, include your
competitive niche. How will you be better than your
competitors in ways that matter to your ideal customers ?
◦ Financial plan includes, costs to launch, operate, market and
finance, along with conservative estimates of revenue,
typically for 2 to 3 years; a break-even analysis is often
included.

 5. Contingencies
◦ Outline the most likely things that could go wrong with
implementing this plan, and how management is prepared to
respond to those problems if they emerge.
◦ What will your recovery plan be when (not if) something goes
wrong.
◦ It’s not so much about trying to identify and avoid the things
that can take you off track or go wrong; it’s usually more about
how you will recover.

You have 5 minutes to communicate
your product/service strategy that must
result in action; so, keep it simple and
get to the core issues quickly.

 Prepare and answer just three questions and you have
your presentation strategy...
 HOW BIG do we want to be?
◦ Money, sales/cash flow
 WHO do we want to SERVE?
◦ Ideal audience and Customer awareness
 HOW will we COMPETE and WIN?
◦ Competitive advantage and Customer experience.

 HOW BIG do we want to be?
◦ Means the Financial plan for your Business Plan and product
or service idea.
◦ What are the financial goals to satisfy the owners of the
business?
 Financial goals determine the character of your strategy.
 Morph from a strategy-drives-financials paradigm to a
financials-drive-strategy one.
 Don’t try to squeeze better numbers out of a given strategy.

 WHO do we want to SERVE?
◦ Means the Marketing Plan of your Business Plan.
◦ Who are the ideal customers to whom you intend allocating
scarce resources because you believe they represent the
best economic opportunity?
◦ There is no such thing as a bad customer; it’s just that some
are better than others.
◦ If a customer segment (audience) can’t deliver your financial
goals why would you bother with it?
◦ Consider the Lifetime Value (LTV) of a customer as a way of
making a choice of who to serve.

 HOW will we COMPETE and WIN?
◦ Means your daily Operations Plan and how you will “deliver
the promise” in all the other parts of the Business Plan.
◦ How do you intend to compete with other companies available
to your ideal customers and win?
◦ The most critical aspect; as it puts words to why someone
should do business with you instead of with your competition.
◦ Too many objectives paralyzes progress; define the critical
few and outline them.
◦ Find the three things that will achieve 80% of the strategy.

 Step by step approach to create HOW to WIN...
◦ Select the customer needs and expectations you intend to
satisfy from the segment you have chosen to serve.
◦ Examine the internal opportunities; look broadly at the
competencies your organization currently has to deliver.
◦ Evaluate exactly where the competition is focusing their
efforts; Which segments? Their value proposition? Market
success? Vulnerabilities? (use the SWOT results)
◦ Decide on what basis you intend to compete/win and create a
HOW to WIN position statement to say how you will do it.

 Here’s an example...
 “Our basic competitive approach will be to develop intimate
one-to-one relationships with our diabetic patients
(customers) and be the only Pharmacy in our community that
delivers disease management, healthy living and nutrition
counselling offers to match each one’s unique needs and
preferences.”

 HOW BIG? WHO SERVE? HOW WIN? Once the answer to
each of these questions is clear the Strategic Game
Plan Statement needs to be created.
 It’s developed from the answers to the 3 questions
above and looks something like this...
 “We intend to (HOW BIG) by [desired time frame] by
focusing our scarce resources on (WHO to SERVE). We
will compete by (HOW to WIN).”

 We intend to grow Pharmacy revenue from the
rapidly increasing diabetic market segment from
500K to 750K by the end of 2013. We will focus our
resources on working with our local 1st Nations
Bands with a view to expand into other Lower
Mainland bands in the 1st Quarter of 2014.

 We will COMPETE and WIN by...
◦ Leveraging the intimate understanding we have of the
patient and their current situation with disease
management and medication adherence.
◦ Providing personalized holistic health & wellness based
solutions combined with nutritional solutions to improve
daily living and promote healthy outcomes.
◦ Matching our CDE Pharmacists specifically with each
patient, and delivering the services to our patients and
customers in their community.

 Overall, we help First Nations diabetic patients
improve their quality of life and manage their disease
by combing nutrition counselling with medication
review and adherence.
 Specifically, we want to develop strategies to identify
at risk women in their child bearing years and educate
them about healthy lifestyles.

 Want a copy an electronic copy of this of this
presentation with bonus slides?
◦ Email me; gerry@retailSOS.ca
 To your business and professional
success, thank you for your attention.
 Questions?
retailSOS.ca 52Gerry Spitzner

 Follow Twitter: @passion4retail
 Connect LinkedIn: Gerry Spitzner
 Web: retailSOS.ca
 Blog: gerryspitzner.com
 Email: gerry@retailsos.ca
 Online Biz Card: gerryspitzner.tel
 Online Biz Card: retailSOS.tel

 retailSOS.ca is a Vancouver-based retail consultancy guiding and
supporting Pharmacy owners to create, engage and keep great
customers by doing the right thing extraordinarily well.
 Gerry Spitzner works as a management consultant with community
Pharmacy owners to achieve results by aligning their vision and
implementing marketing strategy with operational execution.
 Drawing on 35+ years experience in drug store multi-site retail
operations, Pharmacy ownership and the Pharmaceutical wholesale
supply-chain; Gerry brings the leadership, knowledge and market
awareness of ownership and business development to Pharmacy
owners to achieve growth objectives.

UBC Phar400-18Jan2013 business-planning-long

Recommended

Recommended

More Related Content

Viewers also liked

Viewers also liked (20)

Similar to UBC Phar400-18Jan2013 business-planning-long

Similar to UBC Phar400-18Jan2013 business-planning-long (20)

More from Gerry Spitzner

More from Gerry Spitzner (12)

Recently uploaded

Recently uploaded (20)

UBC Phar400-18Jan2013 business-planning-long

Editor's Notes