Strategy in Healthcare: Not One Size Fits All

https://www.ted.com/talks/martin_reeves_your_strategy_needs_a_strategy

I'm sharing my reflections for a recent MBA assignment as it got me thinking about healthcare strategy and the challenges specific to the healthcare sector.

Martin Reeves’ Ted Talk that really resonated with me. ?There is no “one size fits all” to strategy and that each individual problem requires a tailored strategy or solution, hence the “strategy for the strategy”. ?Compared to some industries I am struck that modern healthcare may fall into several of the strategic buckets-for example, healthcare is highly regulated, yet many aspects require building from scratch (such as in entrepreneurial endeavors or technology heavy areas) and not having the ability to truly forecast the future due to external factors including federal and local regulation, workforce capability and supply, and local and regional market forces.

Classical strategy consists of three parts: analysis, construction of a plan, and rigorous execution. It also tends to focus on building economies of scale to gain a competitive edge; however, this may no longer be a viable strategy particularly for the complexities of healthcare markets. Academic medical centers may have one set of services and goals of being a quaternary referral center versus a regional community hospital that serves mainly a local community.

One can see how in a dynamic environment this type of strategy might fail to provide adequate solutions. I think the other strategies presented apply to specific situations in healthcare marketing. For example, Reeves et al point out that a BCG survey of multiple industry executives in various sectors demonstrated awareness of the need to have flexible strategic approaches to the demands of the competitive environment, yet many in practice still use traditional approaches better suited to stable contexts (1).

Reeves et al suggest the specific strategy employed should be tailored to the specific industrial sector (2). The authors state that each style is associated with distinct planning practices and is best suited to one environment; however, I am not sure this is accurate for healthcare. There are aspects of healthcare that are highly stable and regulated (traditional office visits and billing for example), while others are much less predictable and innovative (the changing face of the digital front door, for example).

Although many recognize the importance of adaptive styles given the flexibility to pivot in today’s competitive healthcare landscape, traditional hierarchy and structure may be barriers to effective implementation. Classical strategies often value efficiency (e.g. increasing RVUs at the expense of clinician burnout) and eliminating variation (e.g. lean and six sigma initiatives). This narrow thinking runs counter to experimentation and the concept of the learning health system, which is essential for informing an adaptive strategy.

In summary, healthcare marketing necessitates the use of various strategic approaches tailored to health system needs. Taking advantage of digital health opportunities and technological innovation might require a more visionary strategy, while compliance with regulatory and licensing requirements may be amenable to a classic approach. Healthcare today is rapidly shifting. Taking advantage of new opportunities will require an understanding of new opportunities for external disruption, predicting future regulatory shifts and changes in consumer demand. Tailoring the strategic approach may require flexibility in using different styles for different organizational priorities, including marketing strategy.

References:

?1. https://www.bcg.com/publications/collections/your-strategy-needs-strategy/classical

2. https://hbr.org/2012/09/your-strategy-needs-a-strategy

3. https://leadership.ucdavis.edu/strategic-plan