November 2024
“The best way to predict the future is to create the future”….……..…Peter Drucker.
Strategic Planning may be simply described as “foresight”. Foresight is the art of envisioning the future and then planning to make it happen.
Many practices, including businesses in a variety of industries, often achieve growth:
-
- by aquisition (e.g. buying another practice),
- reactively, in response to increasing consumer demand,
- organically, or
- through structured planning.
The first two forms of expansion are healthy and usually increase patient/client numbers, including revenues, to cover additional expenses. However, not uncommonly, proprietors “hit the wall” as expenses catch up with income and ‘growth management’ becomes challenging enough to pose a serious distraction to the core objective of patient care.
In practices owned by multiple principals, differing views on management, and possible future growth, may become a source of undesirable friction. The key to avoiding this unpleasant situation is through a well thought out Strategic Plan. So, instead of allowing organic or natural growth to become the strategy, the Strategic Plan should guide development of the practice.
Of course, planning the future is not as easy as documenting “one’s wildest dreams “. The Plan must be realistic, achievable and measurable. Above all, it must be credible – the creator must believe in it and be determined to make it a reality.
When multiple principals are involved, it is vital that their (sometimes differing) aspirations are considered. For example, one may wish to acquire or develop additional practices, even consider franchising, while another may simply plan to retire shortly. Consequently, it is easy to foresee growing confusion or conflict if all interests are not somehow accommodated.
A useful tool employed in constructing a Strategic Plan is a fact-based S.W.O.T. (Strengths, Weaknesses, Opportunities, Threats) analysis of the business and key individuals involved. Building on Strengths and devising mitigants for Weaknesses are obvious actions, albeit tactical in nature. However, from a strategic perspective, Opportunities and Threats generally provide a more meaningful insight to growth prospects.
When exploring Opportunities, market research is essential in identifying growth prospects e.g. ageing population demands, emerging diseases, enhanced technologies and regulatory developments. Threats, on the other hand, represent barriers to entry or growth such as competitive activity or financial pressures. Both aspects have noteworthy influence over future plans.
With a clear vision of what the practice should look like in 3 – 5 years, it makes good sense to devise a supporting Business Plan for the upcoming year. Annual Business Plans are step-by-step actions by which the overall Strategic Plan will be achieved.
While the Strategic Plan represents the macro vision of the business, the Business Plan is the micro level, operational plan which ensures that both are constantly aligned.
Finally, given the volatility of modern times, even a mere 3 year plan is difficult to predict with certainty. Consequently, it is vital that business owners review, and if necessary revise, Strategic Plans at least annually to ensure relevance and practicality.
