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For other articles and previous issues click here. October 17, 2005
Look to the Future — Strategic
Planning Provides a Map to Your Facility’s Success Strategic planning is not something radiology directors usually do. Unless we’re appointed to a planning committee, most of us focus mainly on equipment acquisition and staffing. Many managers have risen through the ranks of their organizations without ever receiving intensive training on how to plan. In today’s ever-changing healthcare environment, managers need to arm themselves with the tools to plan for the future. Applying the strategic planning concept to a radiology department can be an extremely useful tool in a competitive marketplace. Face it, we all have competition. Nearly everyone lives near a hospital. Many are close to more than one, so our patients usually have a choice about where to go for imaging services. Why should they choose your imaging department over another? Defining Objectives Your strategic plan will help you identify what types of decisions are appropriate for your department. It is not a quick fix, or a yearly retreat for you and your supervisors to talk about the department, only to return to business as usual. It is not just a process for completing paperwork. Strategic planning is an attitude. It requires your commitment as the leader of your department. As the leader, you develop an atmosphere that cultivates an exciting vision for the future and motivates people to innovate and contribute to department accomplishments. A strategic plan begins with a mission statement. What is the mission of your radiology department? Is it to be the best imaging department in a certain geographic area? Is it to be the most innovative? The mission statement defines the department’s overall goal. A good example of a mission statement would be to “provide comprehensive, high-quality imaging services that ensure continued physician referral and continued growth of the department.” The statement is broad, yet it speaks specifically to what your goals are for your imaging center. That said, don’t just “cut and paste” someone else’s mission statement. Build your mission statement based on your facility’s unique needs and goals. SWOT In addition to identifying your department’s internal strengths, weaknesses, opportunities, and threats, learn what you can about your competitors. This external SWOT analysis helps you identify what your competitors are doing and what changes you may need to make to maintain your competitive edge. The origin of the English word strategy is strategeo, the Greek verb meaning to “plan the destruction of one’s enemies through effective use of resources,” according to Peter M. Ginter’s Managing in a Dynamic Environment. Many of the terms related to strategy, such as mission, strengths, and weaknesses, were developed by the military. The 1960s and 1970s saw major growth of strategic planning in business organizations. Because it provides a more systematic approach to managing business units and has no time limit, strategic planning has gained popularity as a useful business tool. Each department within a hospital can be viewed as a business unit. The changes in Medicare reimbursement levels have forced healthcare organizations to look at each department as a business and analyze the department’s contribution. The radiology department is usually a hospital cash cow. Inpatient nursing units do not contribute highly to a hospital’s bottom line, but radiology departments do. That makes it especially important for radiology managers to know how they can increase their department’s contribution margin. What procedures should you promote to increase productivity and revenue? A strategic plan can answer those questions. Look to the Future One clear example is the airline industry. No one could have predicted the events of September 11, 2001. Airline executive officers could not have known about the attack and how it would affect the industry, which incurred huge losses after the tragic event. Afterward, however, executives revamped their strategic plans. Facing a whole new set of threats, executives in the airline industry entirely reworked their strategic plans. External forces changed the situation dramatically and the plans required revision. Do not be afraid to speculate about change and how you would adapt to change. Strategic plans are meant to help you do just that. Trying to predict what may happen to your department or within your industry includes some level of speculation, but much of it will be based on educated guesses. To narrow the focus, define what type of future you are speculating. • A clear enough future is a single forecast of the future that is sure enough and precise enough for strategic development. One example would be adding a second CT unit to your department. Research should be able to project what sort of future you face by adding that equipment. • Alternate futures are futures described as having only a few discrete scenarios or outcomes. Perhaps it’s a slight gamble to add the second CT unit, and the outcome of this addition has just a few discrete scenarios. • A range of futures is a set of futures that vary by a limited number of factors, but no set of discrete scenarios or outcomes can be defined. A good example would be a start-up company competing in an established industry. If you were to open a stand-alone imaging center located within relatively short distance to a hospital, your range of futures would be limited by certain factors and there would be reasonably well-defined scenarios or outcomes to the success of the imaging center. • True ambiguity is a future filled with so many dimensions of uncertainty, creating an environment where predictions are nearly impossible. A good example would be the introduction of a new product into the marketplace. Initially it will be nearly impossible to predict its outcome. When strategically planning for my department, I try to stay away from projects with a range of futures or true ambiguity. Collecting data via the SWOT analysis will enable you to project either a clear enough future or alternate futures. I recently implemented the strategic planning process in my department. My research included both an internal and external SWOT analysis and found the following strengths within my department: • a commitment to advancement in technology; • a commitment to high-quality customer service; • highly skilled personnel; and • “first users” of many of the recent advancements in technology. Identified weaknesses included: • limitations in growth by physical plant space; • underutilization of certain equipment; • overutilization of skilled staff for nonskilled duties; and • no apparent marketing plan. Opportunities identified included: • the recent population growth in two surrounding counties; • the department’s current physical plant space
would support growth in cardiac imaging; • an extensive untapped target market. Threats included: • multimillion-dollar expansion efforts at three competitor hospitals; • increased utilization review by Medicare and commercial insurers; • shortages in the radiology profession; and • negative population migration from one of the surrounding counties. (You can obtain census information for your area at www.census.gov.) Planning Your Tactics If you decide to add strategic planning to the management of your imaging department, remember that the plans are not meant to be written and then placed on a shelf to gather dust. They must be visited often. Your plan will require revision. Besides impressing your boss and earning a few extra brownie points—managers know how important those brownie points can be—the planning process will help you identify your department’s mission and force you to think in terms of tomorrow, not just today. It will help you answer such questions as where am I today and where do I wish to be in the future? It will give you the map to your department’s future, which is well worth the effort. — Mindy Goldsmith, PhD, is administrative director of radiology at Wadsworth Rittman Hospital in Wadsworth, Ohio.
References Burgelman RA, et al. Integrating Technology and Strategy. 1996. Cergnul JJ, Russell PJ. Operational Efficiency In Imaging Centers: Benchmarking as a Strategic Tool. June 2004. Available at: http://www.imagingeconomics.com. Accessed October 24, 2004. Chan S. The importance of strategy for the evolving field of radiology. Radiology. 2002;224:639-648. U.S. Census Bureau, Statistical Abstract of the United States:
2003. Available at: http://www.census.gov/prod/2004pubs/03statab/health.pdf.
Accessed October 6, 2004 |
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