Strategic Planning and Strategy Execution: Where is the Disconnect?

Strategic Planning and Strategy Execution: Where is the Disconnect?

The use of Strategic Planning is common across the United States, having come a long way since Peter Drucker’s research and widely publicized management by objectives (MBO) in the 1950s. In the next six decades, leaders in every sector — private, nonprofit, and government — set strategic goals and objectives and then developed plans for how to carry them out. Historically, the results are mixed. In the medical practice, you know that having an operational strategy is important, but there is sometimes a “disconnect” in its implementation. It’s important to look at why your executive strategy may not get carried out by most or all employees in the practice.

The Background

Like most organizations, medical practices have become increasingly democratic, tending to get employees more involved at every level of the organization in developing a strategic plan. In a medical practice, this involves everyone from your receptionists and medical assistants to those doctors who own shares of the practice. Even with all levels of employees more involved and the presence of a strategic plan, something happens when the plan doesn’t get implemented the same way throughout the organization. One study from the Harvard Business Review found: “Only 9% of managers say they can rely on colleagues in other functions and units all the time, and just half say they can rely on them most of the time. Commitments from these colleagues are typically not much more reliable than promises made by external partners, such as distributors and suppliers.” In the medical practice, this could occur if there is a breakdown in commitments to strategy between different departments such as human resources, billing, and patient care. It can also occur when a practice has multiple offices and when there are multiple specialties serving a large number of patients in the same office.

Looking at Cross-Functional Relationships

In your medical practice, there must be some differentiation in the organization based on what people do. This includes the business functions and medical functions: HR, payroll, marketing, billing, reception, patient care, and laboratory. It includes the different jobs within the patient care department: doctors, nurses, techs, and medical assistants. It involves the medical specialties and the practice locations. All of these forms of organizational differentiation within the medical practice make it essential for someone at the executive level or the HR level to study the nature of the cross-functional relationships throughout the practice.

Sample Issues

When you analyze the relationships between different units, you want to keep a pulse on how managers and employees are collaborating between organizational units and between locations. You want to conduct executive driven activities that keep the personnel in these various operations on the same page and committed to the same central strategy. You want to have effective ways to deal with instances of breakdown in collaboration, especially where managers maintain a silo attitude and think they can just “do their own thing.”

Where to Begin

Once you have done some investigation and determined where the units or specific employees are not correctly implementing the strategic plan in your medical practice, you can begin to develop a plan for improving the level of commitment and the effectiveness of cross-functional relationships. One place where you can look for immediate improvement is how resources are being moved around the practice to satisfy the business strategy based on current market conditions. The same Harvard study found: “Only 11% of the managers we have surveyed believe that all their company’s strategic priorities have the financial and human resources needed for success.” They interpreted this as the result that nine out of 10 managers believe their organization’s major initiatives will not succeed due to a lack of resources.

The Survey

Survey research is a powerful tool for discovering perceived problems in your practice, everything from how employees feel about their individual jobs to how they feel about the level of collaboration between different organizational units. We like to think that creating a survey will give you some data that you can really build on. You can ask employees what the problems are, such as whether your managers feel that their units get access to the right resources when compared to other units. Or, you can ask how employees feel about the level of cooperation they get when they have to deal with employees in other units. The point is, you will be able to use survey research data to diagnose organizational problems and then begin to work towards solutions.

The opposite scenario is less desirable. If you don’t research the problems in the organization, especially breakdowns in commitment to executive strategy and cross-functional collaboration, you can’t improve them. You cannot identify where the failure to implement executive strategy occurs.

The Solution

Your employees are your biggest asset. They are the people charged with implementing your strategy. A strategic plan is simply a tool for communicating the organization’s priorities. It helps managers to make their budget allocations and to direct employees in various activities. If the plan is not working because people are not carrying it out according to your executive design, the strategic plan has a limited value to your organization. You want to maximize the use of the strategic plan by studying its implementation at every level.

We have more ideas on how to improve the value of your strategic planning efforts, even after the plan has been written and communicated to all personnel. To “brain-storm” this aspect of strategic management of your practice and other practice management issues, please contact us.