Deck 1: Basic Strategy Concepts

Question 1

Define the term "strategy" and list seven characteristics of a genuine strategy.

Answer 1

$\bullet$ A strategy is a coordinated set of organizational activities summarized in a sophisticated multi-step plan designed to move the organization toward a future vision that it has defined for itself.
$\bullet$ It is usually one of several strategies being implemented at one time, though rarely more than five or six.
$\bullet$ The effect of strategic initiatives is felt throughout the organization, not just within a single department or facility.
$\bullet$ The successful implementation of a strategy usually requires the commitment of a variety of resources from throughout the organization.
$\bullet$ The time required to implement a strategy is measured in years rather than weeks or months.
$\bullet$ A strategy is intended to produce results at a point several years in the future.
$\bullet$ A strategy utilizes and takes fullest advantage of the organization's current resources and competencies.
$\bullet$ A strategy takes fully into account the external environment in which the organization operates, with particular attention to any competitors that it faces.
$\bullet$ A strategy is not easily or quickly changed, but also is cast in stone. It is not carried through to implementation if changed circumstances make it irrelevant or inappropriate.
$\bullet$ A strategy is not guaranteed of success. Because it takes effect in the unpredictable future, it is marked by risk and uncertainty. It may fail partially or completely.
$\bullet$ A strategy requires the organization to change some of the activities it is performing now, sometimes in profound ways. Change sometimes presents difficulties and is not always successful.

Question 2

Distinguish between a strategic plan, an operational plan, and a tactical plan.

Answer 2

These three traditional plan types differ in terms of several variables:
$\bullet$ Length of time to implement
$\bullet$ Future time at which strategy takes effect
$\bullet$ Significance of change in operations as a result of the strategy
$\bullet$ Scope of the strategy's impact on the organization's activities
$\bullet$ Number of employees affected by the strategy
$\bullet$ Amount of money and other resources required to implement the strategy
Specifically, a strategic plan takes the longest to implement (2-5 years or longer), produces effects the furthest into the future (2-5 years or more), produces the most significant levels of change, has the broadest impact on the organization's activities (throughout the entire organization), affects the largest number of employees, and costs the largest amount of money and other resources (sometimes many millions of dollars). On the other hand, a tactical plan takes the least time to implement (weeks or a few months), produces effects more quickly (noticeable within weeks or a few months), results in a lower level of change, affects a much narrower range of organizational activities (within a single department), affects a smaller number of employees, and costs much less money and resources (a few thousands of dollars).

Question 3

The health care industry is composed of a variety of types of organization. Give the name of a real-life health care-related example of each of the following types of organizations:

Answer 3

$\bullet$ Large for-profit (FP) corporation
$\bullet$ Large FP health plans (Aetna, United HealthCare, Cigna Healthcare)
$\bullet$ Large pharmaceutical companies (Merck, Lilly, Novartis, AstraZeneca)
$\bullet$ Large FP hospital chains (Hospital Corporation of America, Tenet Health System)
$\bullet$ National drug store chains (Rite-Aid, CVS)
$\bullet$ Small for-profit corporation
$\bullet$ Hospital laundry company
$\bullet$ Medical supply houses
$\bullet$ EMR/EHR system vendors
$\bullet$ Durable medical equipment manufacturers
$\bullet$ Mom-and-pop small business
$\bullet$ Medical transcription business
$\bullet$ Solo or small group physician practice
$\bullet$ Entrepreneurial startup or new venture
$\bullet$ New single-product biotechnology/biomedical company
$\bullet$ Specialty hospital
$\bullet$ Retail mall health clinic
$\bullet$ Large not-for-profit (NFP) corporation
$\bullet$ Large NFP health plans (Kaiser Foundation Health Plans, Blue Cross/Blue Shield Plans)
$\bullet$ Health-oriented think tanks and charitable organizations (RWJ Foundation, Commonwealth Foundation, Kaiser Family Foundation)
$\bullet$ Disease-specific advocacy organizations (American Lung Association, American Cancer Society)
$\bullet$ Large NFP hospital chains (Ascension Health, Adventist Health System)
$\bullet$ Small not-for-profit corporation
$\bullet$ Accreditation entities (Joint Commission on Accreditation of Healthcare Organizations, National Committee for Quality Assurance)
$\bullet$ Neighborhood health centers
$\bullet$ Patient advocacy (Health Care for All)
$\bullet$ Federal government agency
$\bullet$ Centers for Medicare and Medicaid Services (CMS)
$\bullet$ National Institutes of Health (NIH)
$\bullet$ Veterans Health Administration (VHA) health facilities
$\bullet$ State government agency
$\bullet$ State-level Department of Public Health
$\bullet$ State Medicaid agency
$\bullet$ Municipal government agency
$\bullet$ City-level public health
$\bullet$ Health and sanitation inspection services
$\bullet$ Municipal hospitals (New York City Health and Hospitals Corporation)

Question 4

What is a "strategic business unit" and what are its distinguishing features?

Question 5

If you were the CEO of a health care organization that was looking for a high-level manager to assume significant responsibility for strategic planning, how would you assess the "strategic mindset" or ability to think "strategically" of the candidates for the job?

Question 6

List at least seven steps in a generic strategic planning and management process.

Question 7

List at least seven benefits to organizations that practice strategic planning and management.

Question 8

Describe at least five reasons why a not-for-profit health advocacy organization like the American Lung Association or Health Care for All should engage in strategic planning and management.

Question 9

Describe at least five reasons why a health-related government agency like a state Medicaid agency or a city Department of Public Health should practice strategic planning and management.

Question 10

There are several ways in which strategic planning and management can fail to achieve their purposes. Describe five possible problem areas and recommend steps that could be taken to avoid them.