Strategic Plan

PLANNING IN GENERAL

In the broadest sense, planning represents the purposeful

efforts taken by an organization (for our purposes, apharmacy organization) to maximize its future success.

Planning, as it is referred to here, is sometimes calledmanagement planning because it is typically part of theduties of managers.

Planning has been described as one of the four key functions of managers (along with organizing, leading, and controlling)

Types of Planning

Strategic planningOperational planningBusiness PlanningResource PlanningOrganizational PlanningContingency planning

Strategic Planning

Purpose To ensure that the organization is doing the right

things. Addresses what business the organization is in, or ought to be in, provides a framework for more detailed planning and day-to-day decisions.

CharacteristicsLong term (5-20 years); scope includes all aspects of

the organization; viewpoint is external- how the organization interacts with or controls its environment.

Operational planning

Purpose To ensure that the organization is prepared perform

the immediate tasks and objectives to meet the goals and strategy of the organization. To ensure that the organization is doing things right.

CharacteristicsShort term (1-5 years); scope is specific to the

immediate actions that need to be taken to move the organization forward; viewpoint is Internal-day-to-day accomplishment of tasks.

Business planning

Purpose To determine the feasibility of a specific business or

program. Business planning is used to make a decision about investing in and moving forward with a program.

CharacteristicsShort term (1-5 years); can be used to make

decisions to start a new business, expand a business, or terminate a business.

Resource planning

Purpose To ensure the resources necessary to achieve the

goals and strategy of the organization.

Resource planning can be comprehensive (all resources needed to achieve goals and strategic plan of the organization) or can focus on a specific type of resource.

CharacteristicsMidterm (1-10 years); scope is specific to the

resource or resources defined in the plan-specific resources may include human resources,information/technology resources, financial resources, capital and facilities, and others; viewpoint is Internal-the resource needs of the organization.

Organizational planning

PurposeTo ensure that an organization is organized

appropriately to meet the challenges of the future. Key elements include reporting relationships, definition of responsibilities, and definition of authorities.

CharacteristicsMidterm (1-10 years); scope specific to the structural

aspects of the organization including divisions, reporting relationships, coordination, control; viewpoint is internal-how the company organizes itself.

Contingency planning

PurposeTo provide a fallback option or direction should the

original strategy of the organization fail or should something unexpected occur.

Contingency planning can occur for a specific anticipated situation, the most common of which are business-related crises (such as a labor strike), natural disasters, and changes in management personnel.

CharacteristicsShort to long term (1-10 years); scope is specific to

the particular situation that may occur; viewpoint is both external (if the situation is created in the environment) and internal.

Steps in the Planning Process

1. Define or orient the planning process to a singular purpose or a desired result (vision/ mission).

2. Assess the current situation.3. Establish goals.4. Identify strategies to reach those goals.5. Establish objectives that support progresstoward those goals.6. Define responsibilities and timelines for eachobjective.7. Write and communicate the plan.8. Monitor progress toward meeting goals andobjectives.

STRATEGIC PLANNING

The purpose of strategic planning is to ensure that the organization is doing the right things now and in the future. Strategic planning addresses what business the organization is in or ought to be in and helps to determine long-term goals for the organization.

Strategic planning has been defined as the process of selecting an organization’s goals, determining the policies and programs (strategies) necessary to achieve specific objectives en route to those goals, and establishing methods necessary to ensure that the policies and strategic programs are implemented

Vision and Mission

The vision is what the pharmacy organization wants to be at some future time point.

The vision may be complex and multidimensional, but the vision statement should be short.

The vision statement should make people think and should motivate people to strive for something greater.

A company vision statement should inspire employees to create a different future for the organization.

The mission is the purpose of the company.

The mission statement defines what the company does or is.

It is a statement of the present going ahead into the near future.

It is a document written to create a sense of purpose for customers and employees.

The mission statement should be short—usually no more than two sentences.

In addition to the mission statement, some businesses use a company slogan to convey a message to customers about the organization. The company slogan generally is more marketing-driven than is the mission statement, but in some cases the company slogan serves a similar role.

The vision, mission, and other statements that form the company story are critical elements in strategic planning.

Process of Strategic Planning

Preplanning PhasePreplanning can be defined as the steps necessary to

organize the strategic planning effort—or “planning for the planning.”

Planning PhaseIn the planning phase of strategic planning, ideas are

actively generated for the pharmacy organization. This may be referred to as strategizing.

In strategic planning, the “destination” is the vision of the organization in the future. However, it is also necessary to identify where, what, and how the organization is in the present. This is called situation analysis, and it should consider both the past performance and the current situation. This is the starting point on the journey.

Based on the vision (destination), along with the present situation (starting point), planners next should identify the goals for the organization.

The relationship between vision, goals, strategy, and objectives

Fig. 3-1

SMART Objective Criteria

Specific•State exactly what is to be achieved

Measurable•Capable of measurement. Can determine if it

is achieved

Achievable•Realistic given the circumstances in which it is

set and the resources available to the business

Relevant•Relevant to the people responsible for

achieving them

Time Bound•Set with a time frame in mind. These

deadlines also need to be realistic

A common method for conducting the situation analysis is to evaluate the internal strengths and weakness of the organization and the external opportunities and threats to the organization. This is known as a SWOT (Strength, Weaknesses, Opportunities, Threats) analysis.

Categories of internal strengths and weaknesses to consider may include profitability, quality of pharmacy service, customer service, competence and ability of pharmacy staff, and the efficiency of the pharmacy operations.

Categories of external opportunities and threats to consider may include the extent of competition from other pharmacy organizations, the availability of technology, regulations that may help or hinder the business, availability of reimbursement for services provided (i.e., clinical or cognitive pharmacy services), costs incurred by the pharmacy organization, political issues having an impact on health delivery, and changes in the market and types of customers served by the organization.

There is no common or standard way to organizethe written strategic plan. However, most contain thefollowing key elements: (1) the organization’s vision(2) Strategies(3) goals for each strategy(4) Objectives required to meet those goals(5) tasks or action plans to compete the objectives.

Example Strategic Plan

Table 3-3

Steps in the Strategic & Operational Planning Cycle

The Planning Phase1 •Customer Identification

2 •Mission•Vision

3 •SWOT Analysis

4 •Prioritize Issues•Establish Goals and Strategies

5 •Define metrics•Identify accountability

Postplanning PhaseOnce the major pieces of the planning phase have

beendeveloped, the postplanning phase begins.

This phase includes three vitally important steps: (1) Communicating the plan(2) implementing the plan(3) monitoring progress once the plan is

implemented.

Barriers to Effective Planning

1. Failure to commit sufficient time to the planning effort2. Interpersonal issues such as struggles over power or

politics and individual or group resistance to change3. Lack of planning skills4. Failure to plan far enough into the future5. Constantly changing environment6. Failure to implement owing to lack of time orlack of resources7. Failure to monitor progress8. Lack of support of top executive and/or board ofdirectors

Limitations

First, planning is, to some degree, guesswork (but educated and experienced guesswork, hopefully).

While decisions are based on evidence available about the past and the likelihood of events in the future, risk is still involved. Nothing is certain. Even with good data and good strategy, negative things may happen that were unpredictable and thus unavoidable.

Second, plans and predictions are only as good as the data and information that go into them. Poor data will result in poor strategy. What pharmacy organizations get out of the planning activity will be correlated directly with the degree of effort, creativity, time, and resources they put into it.

Two additional limitations of planning deal withhow an organization implements the plan.

Planning is not a substitute for action. Organizations that are all about planning but neglect to take the actions dictated will not be successful.

To the opposite extreme, the plan should not be considered as static or unyielding. Planning should be a continuous process, and plans should change as the environment dictates. To follow a plan blindly without consideration of changes in the environment that may make the plan obsolete is foolhardy.

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