No, Strategic Planning is not dead!

Number III:2

It is probably not a good idea to take issue with an editor of a prestigious journal like Frontiers of Healthcare Management. Dr. Eric Ford’s recent editorial is entitled “Strategic Planning is Dead. Long Live Strategic Planning.”[1] ?Notwithstanding the provocative nature of the title, such a statement cannot be allowed to go unchallenged. Perhaps I have earned some right to do so as a previous winner of the Dean Conley Award,[2] thus I wish to dispute some of the points made. It happens that I have 40+ years of experience with strategic planning in healthcare, both as a professional consultant and a published author. More to follow, but the punch line is simple: what is critiqued in the article as traditional strategic planning is more accurately labeled as examples of poor planning, which remain generally valid criticisms.

The simple reality is that an organization devoid of strategy or a clear plan is entering the future at higher risk than otherwise would be the case. This is no less true for healthcare than other industries. That such efforts in the past have often failed is not a novel observation. Neither is the notion that new approaches have improved the discipline; it has evolved. The idea that new techniques outright replace more traditional approaches is a rather narrow perspective. After all, social science, unlike other so-called hard sciences includes the dynamic of cultural considerations—the human element. Being focused does not have to be antithetical to broad. Indeed, more enlightened views avoid binary characterizations. For example, the idea that focus groups and top-down planning are archaic is simply na?ve. As a career consultant, I also wish to take issue with the poor characterization of the outside consulting role in strategic planning. Where to start?

?Yes, strategic planning is complex. Few organizations approach it correctly because it involves significant investment of time and talent.[3] It is for this reason that planning cycles tend to be in the 3-5 year range. During this current post-pandemic crisis time horizons for healthcare organizations have been reduced and tended to focus more on operational versus strategic planning. Rarely is strategic planning zero-based, though this is often merited as healthcare is undergoing a significant transformation with one major buyer (government) dominating financial success like never before (think utility model). Contrary to the description from this article, data has always been the driver in strategic planning as have results. Data analysis is, by definition, incomplete (we don’t live in a perfect world) and can be manipulated where bias distorts more objective conclusions. The idea that data provide objective answers independent of interpretation is going too far. Yes, access to big data is important and was not always available in the past. But the process of distilling key insights from such data is no different now that more data are available[4]. It continues to be important to recognize that data analysis rarely determines cause and effect. Thus judgment is involved and may it ever be so.

Finally, consultants continue to play an important role, especially in strategic planning, for several reasons. Anyone with management experience will quickly understand that conflicts and biases arise in any attempt at any strategic planning process absent some outside help. I dare say that I know of numerous examples where internal planning resources have been tasked with conducting a strategic planning process only to be handed a pink slip at its conclusion. Internal politics are unavoidable; the risks are unmanageable. One cannot effectively occupy the C-Suite without developing opinions and judgments. These factors can and will cloud well-intended efforts at objective analysis. The professional consultant is less likely to have an axe to grind, or a dog in this fight. Experience does count. The typical executive may have seen 1-4 strategic plans in their career whereas a seasoned consultant will complete four in the span of a year or two. The success of a consultant is usually measured by client satisfaction, which includes creative insights and measurable outcomes. I acknowledge that virtually every consultant lists strategic planning as one of their services; it turns out this is rarely accurate. Having a consultant hired for such major work is rare without a clear track record of success. Truth is, there are a rather limited number of qualified consultants that possess such a track record. This leaves us but one additional item to address which is often missing—the definition of success.

What is a track record of success in strategic planning? I believe it has several components. First and foremost the organization has demonstrated the ability to identify key initiatives and implement them successfully. Part of defining success relates to the outcome—the subsequent performance of the organization versus other competitors as a result of successfully completing and implementing such a plan. The time lag from plan to implementation can make it challenging to track success. Some results (e.g., shifting market share) take years to develop. There is no strategy absent competition, and such success must be measurable using comparative indicators, some of which can be hard to come by. The simple reality is that such planning is justifiable to the extent that performance is improved as a result of this investment of time and resources. In other words, after such planning performance is dramatically improved over what was likely to be without it. Perhaps the most significant factor in such success is a result of the process of planning—where key people throughout the organization can identify and are comfortable with (have ownership in) the vision and the plan for the organization. This is a high bar to be sure, even in the hands of a skilled professional.

A common mistake in strategic planning is to remain stuck in a short-term operating mode versus a longer-term strategic realm. Very often such a plan deals with contemporary issues and avoids some of the consequential (chronic?) issues confronting an organization at any given time. Also missing is often the designation of key measures that help track and define success. There can be several reasons for this, not least of which is poor data, poor communication, avoidance of accountability, or lack of skill/insights. ?

Accountability is an interesting item. It takes true courage to embark upon a legitimate strategic planning process. The main reason for this is that it automatically sets up an accountability that many people can be uncomfortable with. During my career, my guess is that of the 100+ plans we were involved with, perhaps as high as 75% of these engagements turned out to be the first time that these client organizations had undertaken such a comprehensive planning process. This seemed to be the case regardless of size, including some notable regional health networks. Trust of the CEO that such a process could be successful was an essential factor in the ultimate success of such a process. They knew that their jobs/careers were vulnerable in such a consequential undertaking.

Another accountability factor that should be considered is that too often the success of a plan seems to be vested solely in financial terms. Just as high bed occupancy used to hide poor performance back in the day when occupancy seemed to be the sole measure of success, good financial performance can hide important performance issues that will tend to catch up over time. When organizations are failing, such a focus on financial results is certainly understandable, including short-term results. Under less urgent circumstances, key measures can involve market share, consumer preference, volume growth, quality, and health improvement to name a few. For newer regional health systems, I am an advocate of brand management techniques and measures.

The tangible product of a successful plan is mostly twofold. Clearly, having a written plan is the outcome that tends to get the most attention. Less clear is the importance of a participative process. Yes, leaders approve a plan, but solid results require both broad input and subsequent acceptance, as well as the ability of key people in an organization to internalize core directions to be pursued, as supported by the plan. There are many examples of a plan that, while clear and logical, have failed to gain acceptance, which will ultimately lead to poor implementation. I once had a plan that was only 30% implemented a few years later. Turns out the CEO did not agree with some key elements (they left shortly thereafter). Monitoring progress (pillars can help) becomes the next challenge along with transparently communicating these results on a regular and reliable basis. Done right, corrections will be made along the way and communicated as such.

True, there are different approaches to strategic planning as well documented in the literature. An opportunistic approach continues to hold some support, especially in times of tight resources. I favor a vision-driven approach. Vision is a powerful tool in the hands of a skilled facilitator. I find it more practical to gain acceptance of a clear vision than to get mired down in the details of a well-documented plan that has no clear destination. A valid concern of strategic planning is that it can become yet another SPOTS—a strategic plan on the shelf. Such an outcome is both common and to be avoided as it relegates the entire exercise to be nothing more than an academic pursuit. Avoiding this real prospect can best be managed with a vibrant vision for the future that is both inspiring and believable.

No, strategic planning is not dead. The suggestion, while clever to a reader, is tragic to a practicing executive. The absence of a solid plan that is forward-looking (i.e., anticipates key changes in the future) can result in a lack of focus or even chaos, which invites failure. As the revered football coach Vince Lombardi famously said, “Perfection is not attainable, but if we chase perfection we can catch excellence.” Long live strategic planning. Resist the temptation to cut corners and embrace accountability. The commitment of time and resources should not be taken lightly. Successful strategic planning only occurs where the burdens are well-understood and the process is well-executed, flaws and all.

[1]Eric W. Ford, PhD, Editor Journal of Healthcare Management?69(6):p 387-392, November/December 2024.?|?DOI:?10.1097/JHM-D-24-00229

[2] For best article of the year: Scott A. Mason, “Retail and Real Estate: The Changing Landscape of Care Delivery,” published in Frontiers of Health Services Management, 2016

[3] While there are significant variations in approach, the weekend retreat that one prominent health system takes from which a “strategic plan” emerges each year is hardly an adequate substitute for well-designed strategic planning process. Done right, it should take from 6-18 months to complete and have a planning horizon of at least three years.

[4] Not to mention advances in data processing capabilities