5 chapter 420 PHCL Strategic Planning in Pharmacy Operations

Learning Objectives A.Provide an overview of planning activities conducted by pharmacy and health care organizations. B.Describe the general process common to all types of planning. C.Describe the purpose of strategic planning, and illustrate the specific steps to develop a strategic plan. D.Differentiate a vision statement from a mission statement. E.Identify barriers and limitations to planning.

Planning in General  Planning is purposeful efforts taken by an organization to maximize its future success.  It has been described as one of the four key functions of managers.

Planning  Pharmacies and health care organizations, like many businesses, are involved in or should be involved in, many different types of planning for different purposes within the organization.  Because of the importance of effective planning, many organizations invest significant time and resources in these efforts.

Types of Planning Business planning Financial planning Operational planning Organizational planning Resource planning Strategic planning

Types of Planning TypePurpose Strategic planning To ensure that the organization is doing the right things for long term. Operational planning To ensure that the organization is prepared, perform the immediate tasks and objectives to meet the goals and strategy of the organization. Business planning To determine the feasibility of a specific business or program. Resource planning To ensure the resources necessary to achieve the goals and strategy of the organization. Organizational planning To ensure that an organization is organized appropriately to meet the challenges of the future. Contingency planning To provide a fallback option or direction should the original strategy of the organization fail or something unexpected occur.

Strategic Planning: Timeline  The time horizon of strategic planning helps to distinguish it from other types of planning.  A key component of strategic planning is to identify time periods within which goals are to be reached.  It may be as long as 10 to 20 years or as short as 2 years.

Planning  Planning varies in terms of sophistication. It can be relatively simple and straightforward. In other cases, it may involve extensive analyses of data with decision-making models.  In general, all planning processes share a few basic characteristics and steps:  understanding the purpose, assessing the situation, establishing goals, and devising a method to accomplish those goals.

Strategic Planning  Reactive vs. proactive strategic planning.

Steps in the Planning Process Define the vision and mission Assess the current situation Establish goals Identify strategies to reach those goals Establish objectives that support progress toward those goals Define responsibilities and timelines for each objective Write and communicate the plan Monitor progress toward meeting goals and objectives

Planning: Terms A.Vision B.Mission C.Goal D.Objective E.Task

The Vision Statement  The vision is what the pharmacy organization wants to be at some future time point.  It should make people think and motivate them to create a better future for the organization.  It is used in the planning process as both the beginning point and the end point.  Once the vision is set, then strategic planning is about how to reach that end point.

The Mission Statement  The mission is the purpose of the company.  The mission statement defines what the company does or is.  It focuses on the common purpose of the organization and may draw from the values or beliefs held by the organization.  It should help to differentiate the company from others that provide the same products or services.  Some organizations include in the mission statement not only what the company does but also how it does it.

The Mission Statement  The following elements suggested in developing a mission statement for a community pharmacy:  Intended customers  Core values of the pharmacy (such as compassion, respect, and confidentiality),  Key services and products provided by the pharmacy  Benefits incurred by customers (such as improved health and improved safety),  Desired public image of the pharmacy

Vision and Mission A.Company slogan vs. mission statement.

Vision and Mission  The vision, mission, and other statements that form the company story are critical elements in strategic planning.  If these elements already exist in the organization, then the process of strategic planning starts with these as its foundation or modifies them as necessary.  If these elements do not already exist, then the process of strategic planning must include their conception.

Process of Strategic Planning Pre- planning Phase Planning Phase Post- planning Phase

Preplanning Phase  Planning for the planning  Preplanning will define:  the objectives of the planning  who should be involved  where the planning process will occur  how much time will be allotted to the effort.

Process of Strategic Planning Pre- planning Phase Planning Phase Post- planning Phase

Planning Phase  Start with the destination in mind: ▫ The "destination" is the vision of the organization in the future  Perform situation analysis ▫ Identify where, what, and how the organization is in the present. ▫ It should consider both the past performance and the current situation.

Planning Phase: Situation Analysis  SWOT analysis  A common method for conducting the situation analysis, identify using Brainstorming process Internal Factors  Strengths  Strengths – what do we do well?  Weaknesses  Weaknesses – where would we like to improve? External Factors  Opportunities  Opportunities – what is occurring in our “external” environment that may create opportunity.  Threats  Threats – what is occurring in our “external” environment that we should be prepared for?

Planning Phase: Situation Analysis StrengthWeakness Opportunities Threats

Strategic Planning: SWOT analysis PositiveNegative InternalSW ExternalOT Examples?

Planning Phase: Situation Analysis Examples of internal strengths and weaknesses Profitability Quality of pharmacy service Customer service Competence and ability of pharmacy staff. Example of external opportunities and threats Competition from other pharmacy organizations Availability of technology Regulations that may help or hinder the business, Changes in the market Types of customers served by the organization.

Planning Phase  Bridge that gap  By comparing the results of the situation analysis with the desired future state (vision), the extent and nature of the gap between the two begins to become clear.

Planning Phase  Based on the vision and the present situation, planners next should identify the goals for the organization.  Once the goals are identified, the strategy is plotted to get from the present to the future.  Last, determine objectives that will help to reach the goals.

Planning Phase  Goals and Objectives Should Be SMART Specific  the objective should state exactly what is to be achieved Measurable  an objective should be capable of measurement – so that it is possible to determine whether it has been achieved Achievable  the objective should be realistic given the circumstances in which it is set and the resources available to the business Relivant  objectives should be relevant to the people responsible for achieving them Timeframe  objectives should be set with a time frame in mind. These deadlines also need to be realistic

The relationship between vision, goals, strategy, and objectives PresentPresent VisionVision Goal 1 Goal 2 Goal 3 Strategy #1 Objective 1C Objective 1B Objective 1A: Tasks Time

Planning Phase  Write the Plan The document must contain the following 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.

Process of Strategic Planning Pre- planning Phase Planning Phase Post- planning Phase

 This phase includes three vitally important steps: 1.Communicating the plan: the strategic plan document 2.Implementing the plan: operational planning (tactics) 3.Monitoring progress and assessing results once the plan is implemented.

Barriers to Planning  Failure to commit sufficient time to planning  Interpersonal issues such as struggles for power or politics and individual or group resistance to change  Lack of planning skills  Failure to plan far enough into the future

Barriers to Planning  Constantly changing environment  Lack of support by top corporate executives and the board of directors  Failure to implement owing to: lack of time or resources, or failure to monitor progress  Management by crisis?

Limitations to Planning  Planning is to some degree guesswork, risk is still involved.  Plans and predictions are only as good as the data and information that go into them. Poor data will result in poor strategy.  How an organization implements the plan:  Planning is not a substitute for action  The plan should not be considered as static or unyielding

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