Deck 22: Strategy in Other Types of Organizations

Question 1

Explain the benefits of formal strategic planning and management to a not-for-profit (NFP) organization like the American Cancer Society, the Robert Wood Johnson Foundation, or a community health center.

Answer 1

$\bullet$ Enhances the efficient utilization of what are normally extremely limited resources, financial and otherwise.
$\bullet$ The professionalism expressed by a formal strategic planning process may impress prospective donors and encourage larger contributions.
$\bullet$ Strategic planning and management provides a framework for focusing the energies of a mission-directed organization that usually lacks a market or competitors to guide its activities.
$\bullet$ As a result of competent strategic management, a NFP organization is more likely to accomplish its charitable mission.
$\bullet$ A strategic planning and management process helps organization managers gain a more thorough understanding of the sometimes amorphous external environment in which it operates.

Question 2

Discuss the strategically significant differences between a not-for-profit organization and a for-profit corporation. What are the features of not-for-profit organizations that make it more difficult for them to carry out strategic planning?

Answer 2

$\bullet$ Most NFP organizations are not subject to competitive pressures that compel proficient strategic planning if they are to survive. An health care exception is NFP hospitals and health plans that often compete as though they were profit-driven, particularly if they face FP rivals.
$\bullet$ The funding sources for NFP organizations are generally not as demanding of high performance as the equity investors in FP businesses. On the other hand, FP shareholders are likely to be less interested in the specific mission of the organization as long as the returns on their investments are acceptable.
$\bullet$ In many cases, the funding for NFP organizations comes from sources that are not the direct beneficiaries of their services (e.g., individual donors, charitable foundations, and government grants), whose interests and demands can change unpredictably from one year to the next.
$\bullet$ Financial supporters of NFP organizations typically accept a longer-term perspective on their operations than do the shareholders in FP corporations. Such a perspective facilitates strategic thinking and planning.
$\bullet$ It is usually true that FP corporations have access to capital from more sources and in greater amounts than do NGP organizations.
$\bullet$ Due to their strong charitable mission orientation and comparatively lower salaries, NFP managers may have less experience and interest in the business aspects of their organizations, including the planning and management of strategies.
$\bullet$ It often is more difficult for mission-based NFP entities to define good objective criteria for demonstrating their performance and progress to their funding sources.

Question 3

Describe guidelines for a good strategic planning and management process in a not-for-profit organization.

Answer 3

$\bullet$ Get clear on the one or more good reasons why the organization is going to embark upon strategic planning.
$\bullet$ Establish that the executive director of the organization is firmly behind the strategic planning effort, and will use his authority and influence to see it through to implementation.
$\bullet$ Designate a leader for the strategic planning initiative, if that person is not already obvious.
$\bullet$ Define and agree upon a planning process, in all its steps, that is suited to the organization and its circumstances.
$\bullet$ Acknowledge from the beginning that the primary benefit from this process is likely to be in the process itself (information gathered, issues identified, dialogue among managers and staff) rather than whatever plan emerges.
$\bullet$ Because of the more modest size of many NFP organizations, seize the opportunity to involve literally the entire staff in the strategic planning process.
$\bullet$ Use the strategic planning process as an opportunity to consult with, if not actually involve, a wide range of stakeholders in charting the organization's future.
$\bullet$ Bring in a facilitator experienced in working with not-for-profit groups in conducting strategic planning.
$\bullet$ Have a staff member knowledgeable about the organization and its internal workings and external environment prepare a roughly 10-page draft of a SWOT (strengths, weaknesses, opportunities, threats) analysis. Circulate the draft among managers and staff and encourage them to freely add their comments and insights.
$\bullet$ Schedule a formal meeting of several hours for the purpose of carrying out the strategic planning process.

Question 4

Provide some examples of hypothetical strategies that a community hospital, a health care reform advocacy group, or a clinical research foundation might pursue.

Question 5

Explain the benefits of formal strategic planning and management to the federal-level Centers for Disease Control and Prevention (CDC), a state-level Department of Medical Assistance (Medicaid), or a city-level Public Health Commission.

Question 6

Discuss the strategically significant differences between a for-profit organization and one of those government agencies. What are the features of government agencies that make it more difficult for them to carry out strategic planning?

Question 7

Describe guidelines for a good strategic planning and management process in a government agency.

Question 8

Provide some examples of hypothetical strategies that one of the three above government agencies might pursue.

Question 9

What are three types of health care business activity that are commonly the focus of entrepreneurial startups or new ventures?

Question 10

Explain the benefits of formal strategic planning and management to entrepreneurial startups or new ventures in the health care industry.

Question 11

Discuss the differences between an entrepreneurial startup/new venture and a larger, more established corporation that make it more difficult for the former to carry out strategic planning.

Question 12

Describe guidelines for a good strategic planning and management process in an entrepreneurial startup or new venture.

Question 13

Provides some examples of hypothetical strategies that a biotechnology startup or new venture might pursue.