Outside/In: Building a Community-Centric Strategic Plan
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This course will review the benefits of conducting a deep dive into the health and wellness needs of your community and identifying gaps. Leverage insights from this research to: > Drive community wellness > Shape business strategy by leveraging data-driven insights > Facilitate collaboration within your service area > Cultivate a loyal consumer base
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Outside/In: Building a Community-Centric Strategic Plan
- 1. Outside/In: Building a Community- Centric Strategic Plan Stephanie Randa, RN, MSA, MBA
- 2. • Why Now? • Current Strategic Planning Process • The Role of Data in Strategic Planning Process • The New Strategic Planning Model • Examples of Outcomes Objectives
- 5. Why Change Now? • Healthcare growth rate on the upswing • Mergers & acquisitions increase • Hospital beds numbers declining • Value-based purchasing • Physician income has remained static • Aging population
- 6. Power of a Community-Centric Hospital • Community centered • Less reimbursement • Greater rate of chronic disease • Disproportionate costs
- 7. • Problem: Strategic planning is important • Fact: 90% of strategies fail because of poor execution • Solution: Use tried-and-tested tools • Current Method Timeframe: Weeks and months Strategic Planning
- 8. Are You Stuck in the Strategic Planning Comfort Zone? • Large detailed strategy • Focused on cost • Capabilities-based • Plan is presented to board by executive team • Board members focus on risks • Plan is placed in binder and reviewed every 5 years
- 10. Previous Method
- 11. Step 1: Frame Your Choice Move from focusing on issues to possibilities Issue: “Declining profits or market share” Possibilities: Describe how the hospital might succeed Possibilities: 1. Improve reputation in the market 2. Build a new hospital
- 12. • Creativity • As long as you can imagine it, it is valid • Consider 3-5 possibilities • Status quo is a choice Step 2: Generate Strategies for the Possibilities
- 13. • What must be true for each possibility to be a great choice? • Use declarative statements rather than conditional • Weed out the list • Determine must-to-have vs. nice-to-have Step 3: Specify the Conditions for Success
- 14. Example: For-Profit Hospital in Ohio Specify Conditions for Success: Move from focusing on issues to possibilities Issue: “Declining profits or market share” Possibilities: 1. Improve reputation in the market 2. Build a new hospital Condition: Reputation—“Patients will come to our hospital if we improve quality of patient care; improve communication; reduce costs.” Condition: New hospital—“Patients will come to our hospital because it is new; clean, in a new location, and easy access.”
- 16. Assessing the Validity of a Strategic Option: Improve Hospital Reputation Industry Analysis Business Model Analysis Consumer-Value Analysis Segmentation Population largest age group: 45% over age 45; largest population centered in existing county Structure Population consist of aging baby boomers; needing healthcare & services Costs Costs lower than expected Channel Physicians leaving hospital due to poor quality outcomes Consumers Quality Outcomes Capabilities Large areas to improve but it is easily attainable Prediction If patient care improves, the one hospital will be challenged Competitor Analysis STRATGIC OPTION IN QUESTION
- 17. • For each choice: identify barrier Step 4: Identify the Barriers to Choice
- 18. Example: For-Profit Hospital in Ohio Specify Barriers of Choice: Conditions: Reputation—Patients will come to our hospital if we improve quality of patient care; improve communication; reduce costs. Conditions: New hospital—Patients will come to our hospital because it is new; clean, and easy to access. Condition: New Hospital Location—Patients will come to our hospital if it is in a new location. Barriers: Reputation—No brand recognition or long-term relationships with patients. Barriers: New Hospital—Cost; demographics still poor; aging population; physicians still would go to another hospital. Barrier: New Location—High cost; physicians would still go to another hospital.
- 19. • Speaking to the Customer • Focus Group • Survey • Data Analysis • Market information supporting barrier? • Demographics supporting barrier? Step 5: Design Tests for the Barrier Conditions
- 20. • Start with the least likely barrier to hold up • Next opportunity—Improve reputation • Goal to Improve HCAPPS • Quality measures required to be high priority Step 6: Conduct the Tests
- 21. • Segmentation of market data • Based on focus group of ten comprised of staff, patients, local city planner • Survey of current patient base • Physician focus group Outcome: Improvement in quality measures at hospital would be the best choice to improve revenues. Step 7: Make the Choice
- 22. Example: For-Profit Hospital in Ohio Final Outcome: Conditions: Reputation—“Patients will come to our hospital if we improve quality of patient care; improve communication; reduce costs.” Outcomes: 2-year plan • Improved quality indicators resulted in 10% improvement in net revenues • Healthgrade improved from worse than expected to either expected or better than expected within 6 months in 13 out of 26 categories • Re-facing of the front of hospital • Improved accessibility Sustainability: 15 out of 26 indicators have improved.
- 23. • Representation of diverse specialties, backgrounds, and experiences • Operations managers • Staff members • Community participants • Group size varies based on size of organization • If large, then use breakout groups to discuss possibilities • 8-10 ideal The Team
- 24. The New Model Pros and Cons • Pro • Quick and easy • Data-driven • Facilitation takes little training • Con • Unfamiliar method and concepts • Testing may take time and money
- 25. • Scientific Method • Creative • “What do I want to believe?” • Test Barriers New Model Summary Follow @YourCareU
Editor's Notes
- How here has participated in a strategic planning session at their hospital? I was working for a healthcare organization that hand multiple community hospitals across the country and work with them on their Strategic Planning. I had my flip charts; colored markers and sticky notes in hand. When I was entering the conference room; the intern pulled me aside and said, I though you would like to know that the CEO does not believe in strategy so you better not use the word”. As you can image what went through my mind: how can I rescript this entire meeting in two seconds and the second more rational thought was “what does this guy mean?” But I have to confess, I sort of knew what he meant. Strategy: a slightly old fashion word; archaic All executive know Strategy is important. Strategy congers up visons of old process;; something that takes up a large amount of time to do strategic planning in companies; lots of analysis, lots of planning before the planning session;. Al of this is done in the name of improving the competitive advantage. It is this latter idea of strategic planning that is called into question and not just by my CEO friend. We spend 3 months out of the year planning and in one month, it is outdated. Scary; The natural reaction is to turn it into a problem that can be solved with tried and true tools.
- Strategic planners pride themselves in the process. Strategies are suppose to be driven by the numbers and extensive analysis. It is a scientific process that is not contaminated by bias, judgment or opinion. The larger the spreadsheet, the more confident an organization is in its process. NEXT SLIDE: The other option is for everyone to gather in a room and have a “jam session” of thinking out of the box.
- Some of our new to country music, this is Marty Stuart and Dolly Parton. This method means a group of executives may of “off-site” and discuss the ideal. These jam sessions are to promote “out of the box thinking”.
- Thanks to the Affordable Care Act-with more insured patients- hospitals seeing an increase in spendable dollars Most hospitals and physician groups still have positive margins, but the pressure to consider a new strategic framework has increased dramatically. The economic increase has resulting in more confident consumers are visit doctors and number of people delaying care has declined. Hospitals that are merging are starting to reduce redundancies and reinforce common goals. Continues to be a movement from inpatient to outpatient. VBP More focuses on outcomes and reducing penalties. As healthcare moves away from fee for service model; coordinated care, hospitals need to adjust their strategy to adapt to this new business model. A consumer-centric strategic plan will not only help you survive, but also thrive
- All of these changes create a larger burden for smaller hospital than for the larger integrated systems. “They have to do more with less reimbursement”. Smaller rural hospital are subject to less-favorable payer mix but their communities have a greater rate of chronic disease than metropolitan hospitals. Medicare is become more complex. Technology costs, both are a disproportionate burden to a rural hospital. Current move of medical staff models which favor employment and other contractual agreements can become a strain on smaller hospitals. Community hospitals today are definitely in a challenging environment, but it is not all doom and gloom. With a forward thinking strategic plan and an understanding fo their hospital to the community, these hospitals can continue to service an important role in the healthcare delivery system.
- Early in my career, my boss asked that I represent her in a strategic planning session because she was unable to go. Strategic planning is scary because it is like looking into the future- and you know it is only a guessing game. We all know it is important so we use what we are comfortable with and what we have done in the past. But was it successful. We somehow think if we spend weeks and months on something it will make it work. So we look at: New assets Increase the share of the market Spreadsheets Future project costs Five years into the future 90 % of strategies fail due to poor execution Just as individuals need annual health check-ups to assess our health; so do hospitals. Hospital boards and executives must routinely perform a “physical” on their organization, assessing the hospital and
- An example of a hospital I was in was convinced that if they could hire the best staff; train the existing staff; their surgeons would come to the their hospital and bring the volumes they desperately needed. Hired educators; increased the pay of the staff. The physicians like the plan but wanted to be see the results. 32% of employees do not know their company has a plan at all
- We are really using the scientific method here. Move from Issues to Possibilities Possibilities is your hypothesis. It is essentially a happy story that describes how hospital might succeed Here is an example of using this method: Hospital-for profit hospital; Hospital was built in 1950’s. located in small town in Ohio; largely unionized. Framing helped manager internalize the magnitude of what was at stake. At this point the hospital turned from contemplating an issue to facing a serious choice.
- Characterize possibilities as stories that do not require proof helps people discuss may be viable but does not yet exist Refrain from possibility statements such as “Be number one”
- The purpose for this step is to specify what must be true for each possibility to be a terrific choice. Instead of arguing why each possibility is the best option; Again, using the scientific process; This removes the possibility of putting each person on the defensive. The dialogue should be “For me to be confident in this possibility, I would have to know that the customer will embrace the sort of offering”. Different statement then, “That will never work”. It also help the skeptic’s reservation and develop the proof to overcome them. It also keeps the boss’s idea from being the only correct on. Declarative statements: “Our physicians will support us” instead of The physicians would have to support us. After each member of the group has had a chance to add condition to the list, the facilitator should read the list allow and ask the group: If all these conditions are true, would you advocate for and support this choice?” If everyone says yes, it’s time to move to the next step. If any say “no”, What additional conditions would enable your answer to be yes?. You are looking for total buy in at this point. I recall, that someone basically asked if something could remain the same.
- Issue is your problem statement The administration had put in their strategic plan to build a new hospital; I was asked to come in a verify the need for a hospital and determine as action plan to improve the overall revenues of the hospital. Possibilities is your hypothesis. It is essentially a happy story that describes how hospital might succeed Here is an example of using this method: Hospital-for profit hospital; Hospital was built in 1950’s. located in small town in Ohio; largely unionized. Framing helped manager internalize the magnitude of what was at stake. At this point the hospital turned from contemplating an issue to facing a serious choice.
- Once you listed all of your options, specify what must be true for each to succeed. The diagram below provides a framework for surfacing the necessary conditions; in effect, your are reverse engineering your choice. An example of a Channel is a physician-they refer to our hospital or to other physicians within our channel Multiple areas of patient outcomes are Worse than Expected : CABG within 30 days; Heart Attack within 30 days; diabetic emergency; Pulmonary embolism; Sepsis better than expected
- Now it is time to place a critical eye on the conditions. You just need two to three barriers per possibility Which condition is least likely to hold true? This results in the barriers to choosing the possibility Create an ordered list of barriers to each possibility
- Specify Barriers of Choice: Hospital Reputation New Hospital New Location Here is an example of using this method: Hospital-for profit hospital; Hospital was built in 1950’s. located in small town in Ohio; largely unionized. Framing helped manager internalize the magnitude of what was at stake. At this point the hospital turned from contemplating an issue to facing a serious choice.
- Once you have identified and ordered the key barrier conditions, the group must test each on to see if whether it holds true. The test may be a community focus group or speaking to your physicians. It may be looking at data to see if there any validity to the barriers.
- Start with the test with the least likely barrier to hold up Cost-revenues could not support new facility or relocation of hospital; remodeling of facility is an option Next opportunity-Improve reputation Goal to Improve HCAPPS Quality measures required to be high priority
- Specify Barriers of Choice: Hospital Reputation New Hospital New Location Here is an example of using this method: Hospital-for profit hospital; Hospital was built in 1950’s. located in small town in Ohio; largely unionized. Framing helped manager internalize the magnitude of what was at stake. At this point the hospital turned from contemplating an issue to facing a serious choice.
- People: difficult to generate creative possibilities and to flesh out each one in detail. Managers and staff deepen practical wisdom and builds early commitment to and knowledge of the strategy that is chosen.
- Pro Quick and easy 3-5 days to develop the possibilities Data driven but later in the process Facilitation takes little training Con Unfamiliar method and concepts Testing may take time and money
- Scientific method to get to the most accurate and nimble strategy. Use creativity to open doors we may not necessarily think about. Avoid asking “What should we do?” but “What might we do?” Administration must shift from asking “What do I believe” to “What do I want to believe?” Concentration on testing the possibilities and barriers