The Strategic Planning Process: Steps and Vision, Explained

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The Strategic Planning Process: Steps and Vision

Healthcare Organization and Management · Chapter 8: Strategic Planning and Decision-Making in HealthcareSection 8.1 · lesson 48 of 1059 min · free with a free account

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In this lesson

How hospitals make strategic choices and turn them into plans.

  • Explain why a real strategy excludes options
  • Outline the six steps of the strategic planning process
  • Test mission, vision, and value statements by whether they constrain decisions
  • Identify true strategic issues and internal inconsistencies in a plan

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Transcript

Everything said in the video, section by section (1,216 words). Read along, or search it.

Opening Case

A Surgeon's Suburban Proposal

Larkfield's leaders are at their planning retreat. Dr. Kwabena Osei, an orthopedic surgeon, has a proposal. A new joint-replacement center in Brookside, a wealthy suburb outside Larkfield's area. High margins, and money to fund everything else. Meanwhile, the draft strategic plan lists six priorities, each one called essential. Helen Wu, the chief executive, asks one question before anyone argues: what is Larkfield now committed to not doing?

Definition

Strategy Means Choosing What Not to Do

Strategy is the choice of where an organization will compete and how it will win there. The operative word is choice. A strategy that excludes nothing has chosen nothing. Six equal priorities leave scarce attention to whoever asks most persistently. The hard part isn't the direction. It's the services not expanded, the offers declined, the departments told it isn't their year. Health care feels this more. Declining a service means declining care to real people. That doesn't remove the choice. It means making it openly, and defending it.

Planning Process

Six Steps From Assessment to Review

Good strategy comes from a process with six steps. Environmental assessment: what's changing outside, and where we stand. It's the longest step, and the most often rushed. Mission and vision review: do our purpose and intended future still hold? Usually they do, but asking keeps them from drifting. Strategic issue identification decides whether anything useful comes out. Then strategy formulation: what we'll do about those issues. Implementation planning turns each choice into resourced commitments with owners and dates. That's where middle managers usually join, too late. And evaluation and review asks whether it's working, and feeds the next round's assessment.

Mission, Vision, Values

Statements That Constrain Real Decisions

Mission states present purpose: who we serve, with what, and where. Vision states the intended future. Values state the limits we accept on the way. The test for each is whether it constrains a real decision. Larkfield's mission says: meet the health needs of our area, especially those least well served. Brookside is outside the area, and well served. The mission doesn't forbid the center, but it makes the board explain why an exception is warranted. One value constrains sharply: we won't grow a service at the expense of one serving more vulnerable patients without saying so. Another doesn't constrain at all: we treat every patient with respect and strive for excellence. It fits this proposal, its opposite, and anything else.

Quick Check

Which Value Actually Constrains

Quick check. A partner clinic is drafting its values. Which of these statements would actually constrain a decision? Pause, and decide. We will not close a service without a public hearing. It rules out something the clinic might otherwise do quietly, so it can be cited against a proposal. Excellence and compassion is tempting, because it sounds the most heartfelt. But nobody would argue for the opposite, so it never stops anything.

Strategic Issues

Three Tests for a True Issue

Next, the six priorities. Issue selection is where most planning fails, and it fails by including too much. Twelve strategic issues are usually operational problems with a fancy label. Three tests separate them. Would resolving it change what Larkfield is or does, not just how well? Is it beyond any single department acting alone? And would Larkfield be materially different in five years depending on the answer? A long wait in one clinic fails all three. Whether to offer that service at all passes all three. Cutting to three or four issues is political as well as analytical, because each one cut has an advocate. So record the exclusions, with reasons, where everyone can see them.

Decision Levels

Directional, Adaptive, and Operational Choices

Tom Brennan, the chief financial officer, sorts strategic decisions into three levels. Directional decisions set what Larkfield is for: its scope and the populations it serves. Adaptive decisions set how it changes to get there: expand, shrink, partner, merge, or divest. Operational strategic decisions build the capabilities behind the first two: workforce, information systems, buildings, and which payment arrangements to accept. Taking them out of order is a recognizable failure. A hospital that debates its records system, before deciding which services it will run, is building for a direction it hasn't chosen.

Participation

Who Shapes the Plan and When

Who takes part changes both the content and the standing of a plan. The board supplies authority, including the authority to exclude. Clinicians know what's actually deliverable. A strategy clinical leaders didn't shape moves at the pace of their consent, not the pace of the plan. Community voices matter for a public mission. But consultation on a decision already made is worse than none. And middle managers are the group most often left out, and most needed. Helen invites Jamal Carter, the ED nurse manager, from the first session, because he knows what implementation will really cost.

Planning Horizon

Separate Horizons and Written Assumptions

Many health systems now plan three to five years ahead, because payment, regulation, technology, and workforce supply move fast. But separate the parts of a plan with different horizons. A new building is a fifteen-year commitment, whatever the plan's cover says. A service setup may be a three-year one. And write the assumptions down. A plan is valid only while its assumptions hold, and unwritten ones can't tell you when the plan has expired.

The Written Plan

What the Document Really Does

The written plan isn't the plan. The plan is what the organization actually acts on, and resources show it. A priority with no budget, post, or protected time is an aspiration. Still, the document does real work. It records what was decided and why, so later choices can be tested against it. It carries direction beyond the room. And it makes the exclusions visible, its most valuable and least popular job.

Internal Consistency

Four Ways a Plan Contradicts Itself

Last, internal consistency. A plan is inconsistent when its parts can't all be true at once, and four forms keep recurring. A growth goal and a cost-cutting goal, with no mechanism linking them. Priorities competing for the same scarce resource, with no stated order. An expansion alongside a workforce assumption that plainly can't staff it. And an objective that no position has the authority to deliver. None is always fatal. The defect is asserting both sides without facing the tension, which leaves the reconciliation to department managers with less information and no authority.

Quick Check

Beds the Workforce Can't Staff

Quick check. Another hospital's draft plan doubles its behavioral health beds within two years. Its workforce section assumes current hiring, which fills about two psychiatric nursing posts a year. Which inconsistency is this? Pause, and decide. An expansion the workforce can't staff. Doubling the beds needs far more nurses than two hires a year, and the plan never confronts that. Nobody can deliver is tempting, since the goal looks out of reach. But that form is about authority. Here someone may own it; the people just don't exist.

Case Resolved

The Board Says No in Writing

Back to Helen's question. The board answers it in writing. Larkfield will not build the Brookside center in this plan, and the minutes say why: it sits outside the area, and draws surgeons and capital from services for the least well served. The six priorities become three, each with an owner, a budget, and its key assumption written down. Dr. Osei leaves disappointed, but the decision is visible, and it can be revisited.

Key Takeaways

Choose, Exclude, and Record

To recap. Strategy is a choice, and a real choice excludes something. Six steps, from assessment to evaluation, with middle managers in from the start. Mission, vision, and values earn their place only if they constrain a real decision. Use three tests to find true strategic issues, and record what you exclude. Write down the assumptions, and face inconsistencies instead of passing them down.

About Healthcare Organization and Management at UPI Study

Healthcare Organization and Management (Health 302) is a self-paced online course of 105 video lessons in 18 chapters, from health systems and the law to ethics, leadership, teams, strategy, informatics, finance, quality, human resources, marketing and evidence-based practice. It carries a NCCRS credit recommendation for 3 semester credits.

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Why students take Healthcare Organization and Management with UPI Study

How hospitals and clinics are runHealthcare Organization and Management covers how care organizations are led and run: health law and ethics, leadership and teams, strategic planning, health informatics, budgets, quality improvement, staffing and marketing. It is a core course in healthcare administration and health management degrees.
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130,000+students helped with college creditsACE and NCCRS have over 2,100 cooperating colleges that will consider accepting credits; the final decision is with the universities.

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Universities that work with NCCRS

Healthcare Organization and Management carries a NCCRS credit recommendation. These universities work with NCCRS; some are UPI Study's signed partners. ACE and NCCRS have over 2,100 cooperating colleges that will consider accepting credits; the final decision is with the universities.

Thomas Edison State UniversityThomas Edison State UniversitySigned partnerUniversity of the PeopleUniversity of the PeopleSigned partnerCharter Oak State CollegeCharter Oak State CollegeSigned partnerStrayer UniversityStrayer UniversitySigned partnerColumbia Southern UniversityColumbia Southern UniversitySigned partnerIndiana TechIndiana TechSigned partnerPenn StatePenn StateWorks with NCCRSSouthern New Hampshire UniversitySouthern New Hampshire UniversityWorks with NCCRSSUNYSUNYWorks with NCCRS +many more cooperating universitiesFind my college →

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FAQ

Questions students ask us

About The Strategic Planning Process: Steps and Vision

What are the steps of the strategic planning process in healthcare?
A common six-step process runs from environmental assessment, to mission and vision review, to strategic issue identification, to strategy formulation, to implementation planning, and finally to evaluation and review, which feeds the next round. Environmental assessment is the longest step and the one most often rushed. Bringing middle managers in from the start helps, because they often join too late, at implementation planning.
How can you tell if a hospital's values statement is useful?
A useful values statement constrains a real decision. One test is whether anyone would argue for its opposite. A pledge such as not closing a service without a public hearing rules something out and can be cited against a proposal. A phrase like striving for excellence and compassion fits every option equally, so it never stops anything and adds little to planning.
How do you tell a strategic issue from an operational problem?
Three tests help. Would resolving it change what the organization is or does, not just how well it performs? Is it beyond any single department acting alone? Would the organization be materially different in five years depending on the answer? A long wait in one clinic fails all three, while whether to offer a service at all passes them. Recording excluded issues with reasons keeps the cut visible.
What makes a strategic plan internally inconsistent?
A plan is inconsistent when its parts cannot all be true at once. Four forms recur: growth and cost-cutting goals with no mechanism linking them, priorities competing for the same scarce resource with no stated order, an expansion the workforce assumptions cannot staff, and an objective no position has the authority to deliver. The defect is ignoring the tension and leaving department managers to reconcile it.

About the Healthcare Organization and Management course

How many college credits is Healthcare Organization and Management?
Healthcare Organization and Management (Health 302) carries a NCCRS credit recommendation for 3 semester credits. ACE and NCCRS have over 2,100 cooperating colleges that will consider accepting credits; the final decision is with the universities.
How much does Healthcare Organization and Management cost and what is included?
$250, paid once, with lifetime access: all 105 video lessons, a practice quiz after each, the graded work and final exam, and an official transcript when you finish. Students who want several courses choose UPI Study PRO instead.
Which universities accept UPI Study credits?
UPI Study has signed partner agreements with universities such as Thomas Edison State University, University of the People and Charter Oak State College, and works with universities such as Penn State, SNHU and SUNY. ACE and NCCRS have over 2,100 cooperating colleges that will consider accepting credits; the final decision is with the universities. Use "Find my college" on this page to check yours.
How long does Healthcare Organization and Management take?
It is self-paced with no deadlines. The 105 lessons total about 17 hours of video; most students add reading and practice time and finish in a few weeks to a few months, on their own schedule.
How are the exams done?
Quizzes and assignments are online in the course. The final exam is taken online with proctoring; a person on the UPI Study team checks assignments, usually within two days.
How do my credits reach my college?
When the course shows 100% complete, request the official transcript from your dashboard. It is sent to the college you name, and you can send it to more than one. Check your college first with "Find my college" on this page, or ask Athena.

Ready for the full course? Earn 3 credits in Healthcare Organization and Management.

105 video lessons, a quiz after each one, and the graded work that earns the credit. Recommended for credit by NCCRS.

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