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Strategy8 min read

Strategic planning for a physician practice, in five steps

Most practices know they should plan and never do. Here is the process, the reasons it gets postponed, and what a usable plan actually contains.

MBS Advisory

A strategic plan — designed to work in conjunction with your marketing plan, your financial plan and your operational plan — is a component of a comprehensive business plan. It lends stability and intentionality to the direction of the practice.

The pressure is structural, not cyclical

Physicians and their practices face new and complex challenges: the emphasis on reducing the cost of health care while increasing access, downward pressure on fees from third-party payors, increased competition among physicians, and the movement toward strategic alliances.

Where practising quality medicine once assured a practice's success, it no longer does. Building, or even maintaining, a medical practice has become a function of business acumen as much as clinical skill — and that trend is unlikely to reverse.

Why practices skip it

  • There are more pressing issues, so planning waits until a crisis forces it.
  • Many owners are reactive by nature and planning asks them to work against that instinct.
  • The process demands honest self-assessment and objectivity, which is uncomfortable.
  • Some believe planning is expensive or a waste of time — a view that misunderstands the benefit side of the equation.

The five steps

  • Physician and staff interviews.
  • Internal environmental analysis.
  • External environmental analysis.
  • The strategic planning retreat.
  • Creation of the action plan.

Each step produces a document, and each document is an input to the next. By the end you have a plan with named owners, dates and measures rather than a binder that goes on a shelf.

What a usable plan contains

Three years of direction, one year of actions, and one quarter of immediate commitments. Every action has a name against it, a date, and a measure that would tell you whether it happened. If an action cannot be measured, it is an aspiration, and aspirations belong in the narrative rather than the plan.

When achievements are the result of carefully developed plans, the plan tends to keep being used.

Written by

MBS Advisory

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