Preparing for Strategic Planning & Business Planning

Presented by

Marsha J. Fountain, RN, MSNThe Oncology Group, LLC

“How can you get to where you are goingif you don’t know where you are?”

Learning Objectives• Know what information and data to collect • Know how and where to collect the information

and data • Collect necessary information and data for

strategic & business planning • Learn how to benchmark their information and

data • Understand key strategic planning and business

planning terminology • Learn how to write strategies, tactics and goals

for program growth• Know how to interface with the planning people

or consultants

Strategic PlanningYour Ticket to Your Destination

• Where you are now• Where you are

going• Mode of travel• Restrictions, if any• Departure time• Arrival time• Way-pointsVi

sion

Stra

tegi

esG

oals

Business/Operational Planning: The Map and the Travel Details

• The detailed travel map• Who is going with you• Short/long term goals• What you need along the

way• How to fly the plane • How to keep process on

track• Detailed financials• Contingency plans• Safety measures

What Information Do You Need for Strategic & Business Planning?• System Mission, Vision & Strategic

Plan• System Financial Projections• System Priorities• Past & Current Organization Plans• Past & Current Cancer Program Plans• Past & Current Radiation Therapy

Plans• National Trends Overview

Business Planning Terminology• Mission and Vision Statements• Strategies, Tactics and Goals• Action Plans• Implementation Plans• Budgets & Financial Projections• Organization Charts & Staffing Profiles • Equipment Inventories• Marketing Plans• Competitor Analyses

What Information Do You Need?• Market Share Analysis

– Yours– Your competitors– Regional Tertiary/Quaternary Magnet

Centers

Where Do Collect the Information? Market Share

• Determine current market for your services– Based on population based cancer

incidence from the State– Determine radiation therapy market

(usually 60 – 65% of all cancer patients) – Determine your incidence and market

share

Most Common Planning Errors• Looking at market share for inpatients

– Most available data by hospitals – Not appropriate for cancer care as most

care is outpatient• Assuming growing numbers mean

growth in program• Being unrealistic in plans…need to

base on hard decision points

Information Needed• Competitor Assessment

– Market Share– Future Plans– Types of Equipment and Staffing

Where to Collect Competitor Information• Hospital/cancer program published

annual reports• Web sites• City planning department• “jeans study”• Colleagues and friends

What to Collect about Competitors?

• Analytic Case Volume• Breadth of program• Current Market Position• Clinical Research Participation• Points of Differentiation (such as

stem cell program)

Is this your competitor or how your competitor sees you?

World Health Organization

NCI

Competitors• Equipment inventory• Inpatient care profile• Facility – profile, age, location, visibility• Mission / Vision / Goals• Patient volume statistics• Physicians – qualifications, reputation• Overall reputation, community good

will

What Information Do You Need and Where to Collect for Your Facility?• Treatment Volumes – From

department– By Site– By Procedure

• Visits per Day• Types of Treatments • Payor Mix – From Finance• Staffing Profile

What Information Do You Need?• Referral Sources and Related Volumes• Revenues Analysis

– By Procedure– By Site

• Cost analysis• Financial Resources Assumptions

– Capital Budgets– Philanthropy

Case Study A: Market Share Data

Cancer Patient

Pool

Hospital Cancer Patients

Market Share

Radiation Oncology Patient

Pool

Radiation Oncology Patients

Market Share

Primary Service Area

2,220 775 35% 1,333 261 20%

Secondary Service Area

469 69 15% 281 26 9%

Case Study B – Market Share

339

344

350

352

354

330

335

340

345

350

355

1999 2000 2002 2003 2004

Radiation Oncology New Patients

Case Study B - Market Share• Treatments increased by 4% over 5 years• Population increased by 2% over 5 years• Assumption – We are gaining market shareHOWEVER…• Population was aging significantly and

cancer cases actually grew by 7.7%

Case Study B – Market Share

2000 2005 Growth

Population 152,257 156,052 2.5%Cancer Cases 736 793 7.7%Hospital Radiation Therapy

Cases339 354 4.4%

Radiation Therapy Market 441.6 475.8 7.7%

Hospital Market Share 77% 74% -3.1%

Case Study C – Referral Patterns• Patient referrals continue to growHOWEVER…• With review, most cases come from 2

physicians – 1 surgeon & 1 medical oncologist

• Surgeon responsible for 22% of all patients• 1 Medical Oncologist responsible for 25%

of all patients

Problem?• Surgeon is being wooed by

competitor• Medical Oncologist is retiring

• How will you recover?

DOCTOR ON CALL

Typical referral patterns

Specialty Average Range

Medical Oncology

35% 25 – 40%

Surgery 16% 11 – 20% IM/FP 8% 6 – 15% Urology 21% 15 – 40%

Positioning• Need to understand where you want

to position yourself– Equal to other providers?– Community leader in oncology care?– Regional referral center?

• All affect strategies and tactics

PositioningReis and Trout stated in “Positioning: The Battle for your

Mind”• Minds are limited. To cope with the explosion

of information and choices, people have learned to rank products and brands in their mind.

• Minds hate confusion. People resist that which is confusing, and cherish that which is simple. They want to push a button and watch it work.

Positioning• Minds are insecure. Minds tend to be emotional,

not rational. People buy what others buy; people follow the herd; they will often look to others to help them decide how to act; heritage and culture sway buying decisions.

• Minds don’t change. People have attitudes on a wide range of issues. They seem to know what they like (and especially dislike) even regarding [issues] about which they know little. Perception is reality. Don’t get confused by the facts.

• Minds can lose focus. Specialist “brands” make a huge impression on the mind.

Benchmarking Your Data

• SROA• ASTRO• ACR• JCAHO• MGMA

• ASCO• ACE• ACCC• Consultants

Data without benchmarking is similar to spending without a budget.

Sources for national benchmarks

Areas for Benchmarking• Departmental volumes

– Treatments per machine– Treatments per patient– Types of cancers treated– Mix to treatments

• Financials– Collection Percentage– Margin– Payor Mix

• Staffing– Mix and numbers

• Referrals– By Specialty

• Research Patients• Technology

Strategic Planning Terminology• Mission• Vision• Strategies• Tactics• Goals• Action Plans• Implementation Plan

What is a Mission Statement?• Your purpose or reason for being• Usually a one-liner• Customer-focused• Tells the customer “What’s In It for

You!”• Begs the question, “How do you do

that?”• Answers the question, “Why are you

doing this or that?”• Easy to remember

Difference between Vision & Mission

• A vision is WHAT you want to become

while a

• A mission is WHY you want to become it

System & Service Line Missions• System Missions cover the waterfront

of what all programs combined are trying to accomplish

• Service Line Missions present what is their contribution to the System Mission

• Service Line Missions usually mirror System Mission language to emphasize the tie-in

Sample Mission Statements – The WHY• To improve the health of all people in the

communities we serve • To eliminate cancer. Achieving that goal begins

with integrated programs in cancer treatment, clinical trials, education programs and cancer prevention.

• Our mission -- the progressive control and cure of cancer through programs of patient care, research and education

• Our mission is to provide a confluence of groundbreaking biomedical and clinical research, high quality educational programs, outstanding patient care to the entire Metropolitan Washington area, and effective outreach for our community.

Sample Mission Statements• To meet the challenges of cancer and

associated treatments, enhancing the wellness and quality of life for the patient and the family.

• To provide quality care to our patients in a sensitive, respectful and compassionate manner.

• To provide Radiation Therapy Services to improve the wellness of our patients.

• The mission of the Cancer Center is to provide a comprehensive range of oncology services to the people we serve.

What is a Vision Statement?• Conditions that will exist at a defined point

in the future• Internally-focused• Usually several paragraphs to a page long• Usually denotes important/major changes • Tends to establish clear priorities for entity• Remember key words rather than the whole

Vision Statement

Vision Statements• Remember, a vision statement should be

bold. • And finally, a bit of Southern folk

wisdom, "There are only two things in the middle of the road, yellow lines, and dead possums."

V• “Be fruitful and multiply."• "We the people of the United States, in order to

form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defense, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.“

• "To explore strange new worlds, to seek out new life and new civilizations, to boldly go where no man has gone before." USS Enterprise, Federation Starship

System & Service Line Visions• Should show symmetry• Service line vision statements show clearly

tie into the system or organization vision • Service line vision statements often use much

of the same language but customize it to the oncology service line specifics

• Senior management should be able to immediately understand how the service line vision supports the overall organization vision

Corporate Visions – the WHAT• We will be the leading healthcare company by

– providing the best products and services for our customers around the world,

– consistently emphasizing innovation, – operational excellence and the highest quality in

everything we do. Baxter Healthcare Corporation.• To attain international leadership in the healthcare

field. To provide excellence in healthcare. To improve the standards of healthcare in communities in which we operate. To provide superior facilities and needed services to enable physicians to best serve the needs of their patients.

• Mayo will provide the best care to every patient every day through integrated clinical practice, education and research.

Sample Vision Statements – The WHAT• A team of dedicated healthcare professionals

reaching out to the West Oahu Community to care for its members with compassion, respect and medical excellence.

• A premier academic radiation oncology department committed to reducing the burden of human cancer.

• Leading Cancer Care through…– A comprehensive cancer control system, including:

prevention, early detection, diagnosis, treatment, and supportive care

– The delivery of high quality, accessible, multi-disciplinary care

– A network of partners – The recruitment and retention of a highly skilled &

compassionate cancer care team – An outstanding program of research and education

Sample Vision Statements• XYZ Cancer Program will:

– be recognized as the best cancer program in Southeast Wisconsin

– be the patients’ and physicians’ first choice for cancer care

– be a superb cancer program providing high quality, evidence-based care

– have effective integration of the oncology providers with all elements in the cancer care continuum

– foster pride in the caregivers who deliver services to our patients and their families

Reality Check for

Strategies and Tactics!

3 Criteria for Decision Making• We want to do it – more, we’re

passionate about it.• We can do it – we have the

competencies, capabilities and resources to do it, or we can get them in time.

• The market will support us – service level demand, financial support, etc.

Decision MakingIn order to achieve our goals:• At What Processes Must We Excel?• What People, Systems, Structures,

Technologies, Etc. Will Be Required?• What Actions Do We Need To Initiate

To Move Forward? When? Who’s Accountabilities?

What is a “Strategy”?• A major change to the current

conditions or projected conditions in the marketplace

• A major change in direction, resources, products or services

• A change that will improve current advantages or provide sustainable competitive advantage

Sample Strategies• Expand into new geographic markets• Add new services to fill out continuum• Build a new, larger, full service facility• Reposition/differentiate the service line• Reorganize with new admin/phys

leadership• Joint venture between hospital/physicians

What is a “Tactic”?• A refinement of a strategy• Provides clarity to the direction that a

strategy will take• Shows a stream of logic or intent in how a

strategy will work for a given organization• Provides one example of how the strategy

will be implemented – but it can easily be modified depending on the environment

What is a “Goal”?• It is a major step toward implementing the

mission, vision and strategies or tactics• States the end condition you want to exist• Give a measurable outcome or target• Tells you when it must be completed• Indicates who has primary accountability

2 Sample Strategy, Tactics and Goals

Strategies/Tactics Goals

Strategy 1: Develop Cancer Program Management and Organizational Structure

Appoint Interim Medical Director Finalize Job Description by Nov 2004Approval by Leadership Council by Dec 2004Identify and appoint Candidate By March 2005

Hire Administrative Director Finalize Job Description By Nov 2004Approval by Leadership Council by Dec 2004Finalize fit into the organization by Dec 2004Formal recruitment and hiring of Director by March 2005

Strategy 2: Improvements in existing services

Add IMRT to radiation therapy Obtain pricing for upgrade by March 2005Develop proforma to present to board by April 2005Order equipment by June 2005Training of staff complete by July 2005Begin treatments by August 2005

Sample Goal• The CEO and Medical Director will

hire a cancer program director by January 2006– End condition: director has been hired– Measure: person is on board– Time frame: January 2006– Accountability: CEO & Medical Director

The Planning ContinuumInformation Collection

Strategic Planning

Business Planning

Implementation

Adjust Direction & Goals with Experience

What is an “Action Plan”?• Take a “goal” to the next level of detail• Details all of the steps needed to achieve

the goals from start to finish, including:– what each step entails– who is responsible for each step– when each step must be done– how to measure & report progress

• Allows you to create an Implementation Plan

What is an Implementation Plan?• Each goal has an action plan• Action plans are usually created

independently of each other• The Implementation Plan puts all of the

actions plans together to assure adequate time and resources have been allocated

• Allows for a single monitoring of all goals

Sample Implementation Plan

ID Task Name1 Strategy 1: Develop Cancer Program Management and Organizational Structure2 Appoint Interim Medical Director3 Finalize Job Description

4 Review by Leadership Council

5 Identify and appoint Candidate

6 Hire Administrative Head7 Finalize Job Description

8 Review by Leadership Council

9 Finalize fit into the organization

10 Formal recruitment and hiring of Director

11 Finalize organizational chart and approve needed positions

12 Appoint Oncology Leadership Council13 Develop purpose statement, scope of responsibility and decision making authority, membership criteria, term limits, how appointed

14 Approval of Oncology Leadership Council by Leadership Council

15 Appoint Breast Centers Director 16 Develop revised job description

17 Recruit Director

18 Strategy 2: Develop model for effective integration of the oncology providers with all elements in the cancer care continuum19 Develop model for physician participation and integration in the cancer program20 Obtain agreement by medical oncology providers for their participation in the delivery model

21 Define Cancer Institute membership criteria and approve by Leadership Council

22 Develop Cancer Institute agreement

23 Obtain agreement by each medical oncology group/practitioner

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How to Work with Internal Planners

• They understand you are the subject expert• Find out how much help they need from you• Find out how much help they can give you• Find out what format they use for data• Tell them where to find select resources• Learn how your program fits with others• Find out their priorities

How to Work with Consultants• Ask lots of questions - they’re

experts• Ask for help with everything• Tell them what you need – all

of it• Tell them how good your

data is• Communicate often• Assume nothing• Understand what they will &

won’t do

Thank youQuestions?

The Oncology Group, LLC222 West Coleman BlvdMt. Pleasant, SC 29464

Tel: 254-752-6727Fax: 928-962-3537