Strategic Planning in Hospitals

The healthcare field is always changing and progressing at a rate unlike any other. Over the past few decades it has become more and more important to plan for the future in order for any healthcare practice to be successful for years to come. By planning for the unknown, hospitals, clinics, private practices and other organizations in the healthcare field can be better equipped for whatever may come along down the road.

From the financial side of running an organization , to structural decisions within the hospital or clinic, planning is a necessity. A hospital strategic plan allows for more efficiency in all aspects of the business of running a practice, no matter how big or small.

What is Strategic Planning in Healthcare?

Many people wonder what strategic planning is in healthcare and, fortunately, the answer is simple. Strategic health planning involves creating objectives and setting goals for where a company would like to go in the future, and then constructing a plan to achieve these objectives. In this industry especially, healthcare planning must take into account potential government policy changes, technological advancements and economic trends that could change an organization’s operations in a significant way.

The importance of strategic planning in healthcare should not go unnoticed by any hospital or health system looking to succeed not only in the short run, but long term as well.

One key factor that should be the basis to strategic planning in healthcare organizations is the organization of the institution. Understanding the organization of the institution and how this organization is necessary for the entire system to succeed is important in creating an effective plan with specific strategies.

Sometimes reevaluating who controls which aspects of the business, and the hierarchy that follows, can be beneficial.

Having a sound foundation in which the organization is built upon is important so that communication and ideas can flow freely while implementing strategic healthcare planning. Designing company goals and a path to achieve these objectives allows staff at every level, from administrators to physicians, to have a drive and passion that is extremely important in the medical field.

Benefits of Strategic Planning in Healthcare

The benefits of strategic planning in healthcare are numerous mainly because healthcare planning is composed of many components. Like most businesses, hospitals and healthcare institutions are operating at many levels. From patient care to financing, health systems need to plan for the future in more ways than one.

Unlike traditional plans, strategic planning takes into account what is to come for every sector of the organization, taking into account foreseeable changes for all departments.

The importance of strategic planning in healthcare is also seen when looking at an organization’s productivity. Most institutions believe that they are being as efficient as possible, however, taking a closer look at productivity can provide insight as to where improvements can be made and more specific plans can be set.

Some of the key areas that a hospital strategic plan can significantly improve include:

Questions At The Forefront Of All Healthcare Strategic Planning

Although every organization operates with a plan that is tailored to personal goals and objectives, hospitals and healthcare systems should ask themselves some crucial questions prior to strategic health planning.

What are the financial goals of the organization? Will the implemented changes have a positive impact on these goals?

Financial goals are different for every institution. Focusing on specific, attainable goals for the future of any organization’s finances is key in ensuring that the strategic plans that the organization makes will be beneficial in the long run.

Looking into the implications that the change that come with new plans for the future will have on finances is key in making strategic decisions.

Setting goals prior to strategic planning will help ensure these plans will positively impact the organization in the future.

Where can the organization grow?

Just because a hospital’s strategic plan is made does not necessarily mean that the plan is as effective as possible. Effective strategic plans take into account where an organization can grow. In some cases, growth is not possible in one area, but is in another. Healthcare institutions should look into the financial gains of growth through expansion in location, new access points, and services before beginning to plan.

What are the needs of the population that the organization serves? Will these needs change?

Healthcare systems and hospitals are designed to serve patients however they need. Although the demand for healthcare institutions will always be high, the way in which these institutions will be needed may change.

Understanding future market trends and industry directions is important in order to plan ahead for what patients will need.

How can the organization bridge the gap in achieving critical success factors?

Many times healthcare systems understand the success factors that are necessary to carry out the institution’s vision, but have difficulty implementing them in day to day functions. Strategic planning should incorporate a way to carry out these factors so that success can be achieved efficiently.

Understanding the Healthcare Market

The goals set by an organization cannot be carried out unless there are sound financial and organizational plans set in motion. Unfortunately, understanding the healthcare market is tricky when the system is so volatile. The cost of medical technology and other funds necessary to run a functional healthcare business is not steady.

Changes in policy and law occur periodically, increasing the need for strategic planning in healthcare. Without the proper knowledge it is not easy to know where prices are going, and in which areas to save. Evaluating which investments are more risky than others is important to ensure every decision made is one that will be beneficial down the road.

In order for any business, especially a hospital or medical practice, to stay afloat, long term goals must be determined and eventually met for the longevity of the business. To do so, an analysis of the local markets and the industry as a whole must be conducted to predict the future of these markets.

Being able to accurately predict forecasts is imperative when dealing with multi-million dollar funds. This is not an easy feat if data is not carefully considered, and strategic hospital and health planning has not been conducted thoroughly by those who fully know how to prepare for what is ahead.

healthcare professionals planning financial goals

The Strata Decision Solution: StrataJazz

At Strata Decision Technology, we have a knack for understanding medical markets and ensuring all future targets are seen through for our customers. We have created an all in one system, StrataJazz , which allows leaders in the healthcare industry to strategically plan for what is to come, increasing efficiency across the board.

In the United States, 1 in 5 hospitals have integrated our platform into their organization, resulting in maximum productivity at all levels. StrataJazz is the solution for all that encompasses strategic healthcare planning, like budgeting, tracking, equipment replacement, monthly variance, and productivity reporting.

StrataJazz incorporates our customers past and current data to better understand where  cost improvements  can be made and money can be saved. The Strata Decision experts take into account the organization’s goals, both financially and organizationally.

Through powerful analytics and tactful planning, StrataJazz provides operational budgeting and  capital planning strategies  that are guaranteed to improve how any healthcare organization functions from the ground up.

StrataJazz’s strategic hospital planning uses sophisticated models to determine a long term plan, by understanding operating margins. By incorporating investment goals and how they will likely impact the organization’s P&L, cash flow, and balance sheet, StrataJazz increases the predictability of how to save and where to invest. Short term impacts of market dynamics are analyzed, which can be helpful in understanding where the market may head.

We compare the company’s performance to the leaders in rating agency’s outlooks, including those of Moody’s, Fitch, and S&P. Organizational decisions will also be more accurate through case by case scenario analytics.

Key To Financial Stability

There is risk involved in any investing, but StrataJazz helps manage and assess risk to ensure a more stable financial future. Our system will predict what changes in reimbursements, salaries, and volume can do to performance.

Through analysis tools and scenario modeling, uncertainty in future markets can be minimized, allowing more strategic healthcare planning and decisions to be made. Rolling forecasting used by StrataJazz evaluates risk factors like discrepancies in bundled payments, mergers and acquisitions.

By providing timely and accurate monthly projections and key performance indicators, opportunities for improvements financially, in patient care, and in staff productivity are endless.

Strata Decision Technology has found the key to successful strategic healthcare planning. We have a passion for helping healthcare systems budget and create a long term hospital strategic plan to ensure a safe and successful future. Through detailed analytics and expert advice, StrataJazz will improve the financial status of any healthcare organization in the present and for the future.

We do the hard work for you, allowing you to focus on your number one priority: your patients.

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Strategic is planning for the hospital ed.

The Strategic Information Systems (IS) planning for the hospital Emergency Department (ED) is a very significant segment that should be taken into consideration. The aspect of IS planning in ED is a complex phenomenon that requires the active involvement of physicians. The emergency physicians should convince the hospital administration on the essentiality of IS in ED. Due to the national attention on the utilization of IT systems in healthcare, there is a necessity for nurses, hospital administrators, physicians, and IT experts to understand the basics of using the Information Systems in the emergency departments (Leonard, 2016). This discussion is therefore inclined to the analysis and understanding of various steps that are deemed necessary for developing and implementing the information systems for ED. Newcastle Hospital has been taken as the primary case study in this paper. Steps for initiating a Strategic Planning Process for Improvement of ED IS There are various developmental steps and plan of actions that will be undertaken so as to ensure the improvement on the use of information systems in the Emergency units. The first step is that of appointing a “clinician champion” for the emergency department so as to enhance the overall performance levels (Adenuga & Kekwaletswe, 2014). Secondly, a multidisciplinary group for ensuring the improvement of information systems will be created. This will be in line with the establishment of an ongoing review process for monitoring the patient-safety issues as regards to the ED information system.

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On the other hand, the management framework will be structured in such a manner that responses to the ED information systems-related concerns will be disseminated on time (Wager, Lee & Glaser, 2015). In addition to this, there will be a clear dissemination of the learned lessons from the performance enhancement efforts. After doing so, another step will be the aspect of distributing the product updates from ED IS vendors to the entire users promptly. The final step will thus encompass the aspect of getting rid of the “learned intermediary” and “hold harmless” clauses from the vendor software contracts to share the responsibility regarding patient safety (Husk & Waxman, 2014).

The most Challenging Factor to overcome so as to improve the state of ED in Newcastle Hospital To improve the state of Newcastle hospital’s emergency department unit, there is need of overcoming various challenges, with the main one being the aspect of IT system’s functionality. This department’s IT systems seems to be very outdated since it is missing critical elements such as radiology, case management, nursing documentation and order entry, among others (Wager, Lee & Glaser, 2015). Among many other challenges, this will be difficult to solve since it requires a greater sense of expertise, resources, and dedication. In this case, the management will be tasked with the act of subjecting the staff members to rigorous training, while at the same time outsourcing some expertise and IT facilities.

How the new CEO’s good Insights can influence the outcome of any ED IS Strategic Plan The new CEO identified two main challenges that should be dealt with so as to enhance the implementation and outcome of the ED IS plan. The first challenge is inclined to the aspect of inflexibility and unwillingness to change. On this basis, the CEO’s objective of putting up measures for enhancing greater flexibility and change in the entire hospital will improve the initiation of appropriate information system’s plan. Another significant challenge that a new CEO pinpointed is the aspect of limited data for defining, measuring, and improving the service performance in the emergency department (Husk & Waxman, 2014). Seeking appropriate measures for these challenges will greatly influence the outcome ED IS strategic plan.

The First Steps that should be undertaken if appointed by the CEO to spearhead the ED IS Strategic Plan: A general Plan of Action for the next 3 Months If appointed by the Hospital’s CEO to spearhead the strategic plan for improvement of the emergency department’s information systems, there are various action plans and steps that will be undertaken. These are the most significant steps responsible for enhancing the usability and functionality of subsequent information system. The most initial step is the aspect of developing adequate Usage Agreement for the physicians and clinicians (Leonard, 2016). This will encompass compliance issues, for instance, inappropriate web surfing, download policy, as well as data confidentiality. The aspect of visiting some platforms believed to be the den of viruses should be prohibited.

Another step will be the aspect of establishing a very comprehensive technological plan. On this basis, emergency department’s operating systems should be reloaded with the contemporary and most effective soft wares and other essential features. The main aim, in this case, is to enhance the usability and functionality of the information systems in the emergency departments. For instance, the hospital should be endowed with interconnected systems such that; a physician, nurse or a clinician is endowed with the capability of viewing what transpires in various rooms from a single segment (Rocha & Freixo, 2015).

On the other hand, the act of contacting the subsequent Internet Service Provider for the sake of investigating the bandwidth enhancement should be done. This is because, the bandwidths tends to ease the aspect of multitasking, while also and reducing the application hang-ups that are posed slow update structure (Rocha & Freixo, 2015). The final step and action plan that should also be accomplished within the first three months is to consult one of the firms providing off-site storage for the hospital’s key databases and documents. This service tends to provide an easy platform for disaster recovery in case of any technical problems. With all these steps and plans expected to be implemented in three months’ time, the ED IS will improve to a greater extent.

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Strategic Implications of the Pandemic

As the nation begins to emerge from the depths of the COVID-19 Pandemic, there is a high probability hospital business models will change. Review HSG’s observations on the six biggest strategic implications.


“…the strategic plan HSG worked with HMH on was approved in early 2012. We’ve seen a lot of gains from the strategies that were outlined in that plan, and we’ve just engaged HSG to do a refresh of our plan. HSG also assisted both Baptist and Hardin on a primary care strategy about three years ago to help identify those markets where we had an opportunity.”

Dennis Johnson – Chief Executive Officer of Hardin Memorial Hospital

“We were very pleased with the work of HSG on King’s Daughters strategic plan.  What differentiated them from other consultants was their engagement with the steering group.  They facilitated great discussions, members of the group felt they were heard, and that improved the quality of the plan and created greater ownership.  In addition, HSG’s analytics were very good and provided a lot of insights that helped us shape the plan. “

Sara Marks – Vice President, Chief Operating Officer of King’s Daughters Health

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Leveraging Strategic Planning at Your Healthcare System: How hospitals are planning for the future, even when the industry shifts

Healthcare is one of the fastest-changing industries in the U.S.—with new policies, technologies, and even competition shifting how providers plan for the future. In this whitepaper, learn about how healthcare organizations like yours can leverage a strategic plan to bring goal-setting to your financial planning for the present and the future. Read about how strategic planning can help your organization better determine expansion in new locations, access points, and services, to plan for growth and move forward with a more agile approach to planning.

From this whitepaper, readers will learn:

  • What strategic planning is and how best to integrate it with your financial plan
  • How to leverage each part of your organization to help ensure holistic success, today and in the future
  • How to create a strategic plan, using specific financial goals to optimize your growth

Please fill out the form to download the whitepaper

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Hospital Information Systems Planning: Strategic IT Alignment in Healthcare

Authors : Fotis Kitsios, Maria Kamariotou, Vicky Manthou

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The Leading 10% of Hospitals Leverage Dynamic Strategic Planning

Today’s healthcare industry has grown into a complex interconnected web of payers, physician groups, retail clinics, outpatient facilities, large health systems, and biotechnology and pharmaceutical companies, to name a few. The supply side of the health economy has also been influenced by the emergence of large, new market entrants (e.g., Walmart, Amazon) and an explosion of direct-to-consumer, virtual care platforms. As the health economy has evolved, so has the breadth and depth of available data.   

Past: Data poor in a predictable environment.   Present:  Data rich in an unpredictable environment.  

To remain competitive, traditional providers, notably hospitals and health systems, must advance their approach to strategic planning—the process through which leaders define their vision for the future and identify their organization’s objectives and goals—by leveraging this next generation of data to develop a comprehensive, evidence-based approach to decision-making.  

Surviving in an Unpredictable Environment   

In the past, hospitals were data poor, but the market was predictable. This allowed hospitals to rely on the status quo to remain viable. However, this approach is no longer sufficient. Today, hospitals are operating within a complex and competitive system that creates significant uncertainty. To grow within this kind of environment, hospitals must leverage data from across the entire healthcare market. Yet, we see that many hospitals still rely on the same data that was available to them when their environments were “predictable” and siloed.   

Traditionally, strategic plans are developed months or quarters before they are approved. But given the speed at which the health economy is changing, decisions based on “stale” data lead to poor outcomes. Aware of this, leading hospitals and health systems have designed and implemented a dynamic approach to strategic planning, which updates in real-time. Using the latest available data, ensures capital allocation and M&A decisions are accurate and reliable. Importantly, a dynamic strategic plan is not fixed; it is updated throughout the year to account for ongoing market changes and emerging opportunities.  

The Value of Dynamic Planning  

As strategic plans have evolved so have the datasets on which they are built. Beyond requiring current data, a successful strategic plan needs significant breadth and depth. For example, a traditional analysis might use annual state-level data on disease prevalence and volume to estimate year-over-year trends. However, a dynamic plan leverages nationally representative claims data with the ability to refine by payer, market, service line, and care setting. Importantly, this type of data allows for a hospital or health system to understand what is going on inside and outside of its walls. With complete data serving as the foundation, a dynamic plan is based on a full understanding of the market and can target a comprehensive (and measurable) set of goals and objectives.  

Finally, a dynamic strategic plan uses the best-available data to generate and incorporate predictive analytics. Rather than focusing on a singular datapoint, this approach reveals the full range of possible outcomes, based on variable market-specific conditions. Data-driven experimentation reduces uncertainty and allows for evidence-based decision making that maximizes desired outcomes.   

Screen Shot 2022-08-02 at 2.24.37 PM

Developing a dynamic strategic plan requires both theory and application. In working with many of the leading hospitals and health systems across the country, we have had the chance to study strategic planning in practice and examine the competitive advantage gained by moving from a traditional to a dynamic framework. Across 40 of the nation’s leading hospitals, we examined the data sources and analytics that underlie their strategic planning strategy and examined their market share, revenues, and overall performance. First, we find that only 10% of hospitals meet the criteria for using a dynamic strategic plan (Figure 1) . Despite the increasingly competitive healthcare market, most hospitals (60%) still use outdated data and a traditional approach to strategic planning. However, things are changing—approximately 30% of hospitals are in an active state of “transition” and improvement. Most importantly, we find that the 10% of hospitals that use a dynamic strategic plan outpace their peers in year-over-year market share growth by 14.3%.  

How To Calculate Your Organization's Maturity Using the Strategic Planning Scorecard:

Download a copy to calculate your score. For each row, determine whether your current strategy most closely aligns with the Traditional (0 points), Transitional (5 points), or Dynamic approach (10 points). Add your score for each row, then see how your total score compares to other hospitals.  


Have questions about how to interpret your score?

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