Capella University
BHA-FPX4104: Strategic Leadership and Workforce Planning in Health Care
Prof.
December 4, 2023
Assessment 2-Strategic Analysis and Operational Considerations
In this paper, I shall analyze the influence and significance of competition in the healthcare industry regarding strategic planning. I will also identify and analyze healthcare organizations’ strategic frameworks. Then, I will examine a healthcare organization’s internal, general, and external environments and how they influence its operations. Finally, I will consider the consequences of the organization’s future if strategic frameworks are not used.
Part 1: Understanding the Environment
Competition in the healthcare industry has been a topic of discussion for a long while. The perspectives of health activists and specialists have aroused some worries in the healthcare system. According to experts, competition is inappropriate within a service industry whose objective is to give restorative treatment to individuals in need of assistance or who are unwell. On the flip side, proponents feel that competition is indeed the solution to lowering inflated healthcare prices and insurance rates and enhancing patient service alternatives within the sector (Pauly, 2019). External healthcare competition initiatives may impact the mission of St. Anthony Medical Center; hence, strategic planning ought to incorporate careful thoughts on planning for and counteracting these attempts while evaluating organizational objectives.
As the healthcare sector continues to develop and the environment of care shifts to private medical and outpatient surgery from hospital-based practices, facilities such as St. Anthony Medical Center should be equipped before growing competition disrupts revenue and reduces the patient population. Each financial year, stakeholders should be aware of the continual demand for health facilities to deliver optimum service and implement new initiatives while maintaining within budget (Haas et al., 2018).
To execute strategic planning effectively, external and internal variables must be examined and planned for. When doing strategic planning, executives within the healthcare industry can consider using competitive awareness strategies. Although competition decreases healthcare costs, enhances patient service quality, and promotes health technologies, the drawbacks remain unclear (Ginter et al., 2018). However, strategic planning should maintain a balance between the internal components of an institution and the external environment in which it operates (Bryson & George, 2020) An equilibrium between these viewpoints is not enough to suffice. Interference from outside competitors is a crucial external aspect that must be included in the strategy plan (Bryson & George, 2020).
Ginter et al. (2018) emphasize that external competitors should be closely monitored, including outpatient surgical facilities, clinics, and individuals who use these facilities instead of hospitals. For instance, small discrete surgical clinics in the metropolitan region have lower operational expenses than hospitals; as a result, they attract hospitals’ less sophisticated, but often more profitable, surgery situations. In addition, to counteract these attempts, it is prudent to include competitive bids in strategic planning to be a backup if an unforeseen event badly impacts a hospital (Ginter et al., 2018).
Part 2: Organizational Analysis
Strategic planning highlights the actions an organization will take to attain its objectives. Strategic planning is facilitated by a strategic framework (Wright, 2018). Yet, strategic frameworks incorporate the hospital’s vision, mission, and objectives, which are the fundamentals of strategic planning. Adopted properly, a strategic plan will identify the organization’s challenges, facilitate the creation of initiatives, and include a roadmap to track the development of the applied solutions. A strategic framework includes many planning strategies that contribute to the prosperity of an organization. Balanced Scorecard Framework and Porter’s Five Forces model are two key frameworks utilized within the healthcare industry to ensure the success of a business (Wright, 2018).
Balance Scorecard Framework
The Balance Scorecard is a commonly used strategic model that serves as a strategic planning and systems management method. A balanced scorecard offers a structure for an organization to articulate its approach consistently. The balanced scorecard model seeks to evaluate the variables that create worth for a healthcare institution and how the created worth directly affects a hospital’s capacity to thrive (Wright, 2018). The benefits of the Balance scorecard model are that it gives a visual representation of how an organization’s goals are being realized and the implementation plan required to attain these goals. The price and time needed for effective deployment are disadvantages of this model. Consequently, requesting advice from a competent outside consultant may incur costs that may be allocated elsewhere. Wright (2018) asserts that to successfully implement the balanced scorecard framework successfully, the company must have a comprehensive grasp of the approach.
Porter’s Five Forces
Porter’s Five Forces is a model for evaluating and assessing the competitive capabilities and the organization’s position. It was developed in 1979 by Michael Porter, a Harvard professor (Martin, 2018). The Five Forces Porter’s sector research goes beyond a firm’s direct competitors when put into effect. The model emphasizes several components of the business’s economic environment and competitive structure. These include customer and seller negotiating power, the threat of newcomers, and the danger of replacement goods (Martin, 2018). Wright (2018) states that the goal of the model is to assess the extent to which every one of these elements increases industry rivalry. If the factors are robust, competition will intensify. Nevertheless, if the impacts are weak, they diminish competition. The structure of Porter’s Five Forces model may be adapted and applied by several organizations and sectors.
Internal, General, and External Environment
Every company, whether in the healthcare or commercial sectors, operates within a certain business environment. The hospital’s environment comprises its surroundings and how they impact everyday activities, positively or negatively, and the environment of St. Antony Main Medical Center is constantly dynamic, ever-changing, and fluid. Currently, there are so many adjustments, and the managers of these companies must be watchful towards each of them.
Internal Environments
There are different types of operating environments for organizations. Internal, general, and external environments are the three typical environments that influence activities (Quain, 2018). The forces and situations inside a business that impact its behavior comprise its internal environment. These factors include a company’s culture, workers, hospital administrators, and shareholders (Quain, 2018).
General and External Environments
General and external environments are the other environments that determine how a company runs. External environments are uncontrolled factors and situations that directly and indirectly impact an institution’s operations (Quain, 2018). Patients, rival hospitals, natural calamities, the economy, and advances in healthcare technology are examples of such factors. Indirectly affecting environments, general variables that impact surroundings affect the organization concerning common or general variables (Quain, 2018).
The Need for Using a Strategic Framework
The performance of St. Antony Main Medical Center is directly proportional to how well the facility manages the external and internal forces that it faces. Currently, their external environment, most notably their competitors, comes from the Benedictine Health Center, the Redeemer Health and Rehab, the Greenway Surgery Center, and a future acute care hospital with 50 beds that will be run for business. A shortage of accessible patient beds requiring medical and surgical treatment, a reduction in the amount of space sufficient in the emergency department, and a failure to find a healthcare professional for a third shift are all internal factors that have played a role.
Even though Director of Clinical Operations George Fink and Chief Medical Officer Harold Liss emphasized, in the interviews, that St. Antony Main Medical Center is now performing well, leadership should not allow themselves to get complacent in this situation. As forthcoming medical services keep expanding, the executive management of St. Antony Main Medical Center has to seriously consider the constructive efforts that may be made to ensure that the facility continues to serve as an essential and crucial healthcare facility within the region. Strategies encompass long-term advancements in lowering emergency room congestion and expanding bed capacity for medical and surgical patients waiting to be transferred must be incorporated into strategic planning for those strategies to be considered strategic plans. Additionally, reducing the duration patients need to queue to schedule rehabilitation and radiology appointments and raising the salary benefits would make the hospital more appealing to prospective employees who are just entering the workforce.
However, suppose the management at St. Antony Main Medical Center continues to be content with their position and does not implement the suggestions that have been recommended. In that case, the level of patient experience will reduce, and the number of patients visiting the emergency room will significantly decrease. In addition, the facility’s annual statement sheet will show a decline in the total earnings it has brought in. The patient’s deterioration would be an advantage to competitive health facilities, which would gain the advantages the hospital has not advanced upon.
References
Bryson, J., & George, B. (2020). Strategic management in public administration. Oxford Research Encyclopedia of Politics.
Ginter, P. M., Duncan, W. J., & Swayne, L. E. (2018). The strategic management of health care organizations. John Wiley & Sons.
Haas, D., Jellinek, M., & Kaplan, R. (2018). Hospital budget systems are holding back innovation. Harvard Business Review. https://hbr.org/2018/03/hospital-budget-systemsare-holding-back-innovation
Martin, M. (2018). Porter’s five forces: Analyzing the competition. Business News Daily. https://www.businessnewsdaily.com/5446-porters-five-forces.html
Pauly, M. V. (2019). Giving Competition in Medical Care and Health Insurance a Chance. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3338098
Quain, S. (2018). Internal & external factors that affect an organization. Azcentral. https://yourbusiness.azcentral.com/internal-external-factors-affect-organization11641.html
Roy, A. (2020). Improving hospital competition: A key to affordable health care. Medium https://freopp.org/improving-hospital-competition-a-key-to-affordable-medicine343e9b5c70f
Wright, T. (2018). Choosing the strategy frameworks for your organization. Cascade Execute Strategies. https://www.executestrategy.net/blog/best-strategyframeworks