1. Str ate gic
Mana gement
Prof E. B. Rillon
CPH 2011 BG AFP (Ret)

2. Objectives
 After the session, participants will be able to;
1. Provide a rationale for the importance of
strategic management in healthcare
organizations.
2. Explain the concepts of strategic
management , strategic planning, strategic
issues and concerns, strategy.
3. Discuss the strategic mgt/planning process
(Ginter et al.)
4. Analyze strategic issues both external and
internal environment.
5. Understand how directional strategies are
formulated.

3. White Water Change

4. Definition of Terms
 Strategic Management
 Management process with the objective of
making the organization compatible with and
successful in its external environment.
(Duncan, Ginter & Swayne.)
 Attempts to achieve a productive and
creative fit between the organization’s
external environment and its internal
environment.

6. Definition of Terms
cont.
 Strategic Planning
 Is the set of processes used in an organization to
understand the situation and develop decision
making guidelines (the strategy) for the
organization.
 Strategy
 A pattern in a stream of decisions positioning an
organization within its environment and resulting in
the “behavior” of the organization. It is a future-
oriented plan that provides decisions-making
guidelines for managers.

7. Definition of Terms
cont.
 Key Performance/Result Area (KRA)
 Identifies activities that must be accomplished to
achieve the mission e.g. adequacy in HR.
 Strategic Issues
 Fundamental policy questions or critical
challenges that affect an organization's
mandates, missions and values, products,
clients, cost, organization and management

8. 4 Major Stages of
Strategic Planning
1. Analysis of the situation
 External environment (opportunities
and threats)
 Internal Environment ( Strength and
weaknesses)
2. Strategy Formulation
3. Strategy Implementation
4. Strategic control and Evaluation

9. Planning Journey
Where Are We Now
How Shall We Get There? How Do We Know That
We Are There?
Where Do We Want To Go?

10. Elements of Strategic
Issue Statement (Bryson:
1995)
 Describe succinctly
 Be framed as question that the org. can do
something about it.
 Factors that make the issue a challenge
be listed
 What in the mandates, mission, values,
SWOT make it strategic
 Statement of the consequences of failing
to address the issue.

11. Examples of Strategic Issues
Issue Strategic Issue
Inflation How can we caution
the effect of inflation
in hospital
organization?
Failure to address
the issue will lead
increased cost of
operations

12. External Environmental Scan
1. External Environmental Opportunities/Threats
List of Issues/Trends Evidence Impact to Probability of
(Provide information Organization continuing in next
regarding existence of (1-10) 3-5 years
issue/trend) (1-10)

13. Internal Environment
Framework

14. Internal Environmental Scan
3. Internal Environment Strengths/Weaknesses
Subsystem Issues/ Evidence Impact to Probability of
Strengths Weaknesses Organization continuing in
(1-10) next 3-5 years
(1-10)
1.Organizational
Culture
2. General
Management
3. Admin
4. Marketing
5. Clinical
6. Physical
Facilities
7. Financial
8. Information

15. Stakeholder Analysis

17. Strat Mgt Process Con’t
Directional

18. Strategy Types and
Roles
Strategy Role
Directional Who we are?
What should we be?
Adaptive How the organization will expand,
contract or stabilize operations.
Market Entry Provide methods for access to the
market. Not necessary for
contraction strategies.
Positioning Positioning the organization
vis-à-vis other organizations within
a market
Operational Developed for the functional areas
(marketing, finance, information
system, HRM, etc.)

19. Vision: a compelling,
conceptual image of the
desired future
Components Descriptions
2. A Clear Hope For the 1. A future where communities, health agencies,
Future and private sector cooperate to increase healthy
life for all.
4. Challenging and 2. Strive for excellence, display initiative and
Excellence Concerns demonstrate achievement.
5. Inspirational and 3. Forging alliances with public and private
Emotional sectors to ensure timely, cost-effective public
health interventions.
4. Value employees.
7. Empowers Employees
First and Clients
Second
8. Prepares for the Future 5. Catalyst for progress
6. Memorable and 6. Memorable terms – catalyst, public health
Provides Guidance leader, innovation, core values, etc.

20. Vision Statement
Checklist
Yes No
Does the Vision statement provide a clear picture of the
organization’s ideal future with respect to quality
management?
Is the vision statement inspiring and challenging?
Is the vision statement brief enough to be memorable?

21. ISDH Health Vision
Statement
 The Indiana State Dept. of Health is
committed to act as a catalyst for
progress that will resolve in healthier
people in a healthful environment.

22. Mission: the reason for
being
 Components
2. Target customers and markets
3. Indicates principal services delivered
4. Geographical areas which the
organization concentrates
5. Identifies organization philosophy
6. Confirms organizations preferred self
image

23. Mission Statement
Guide at VMMC are committed to provide
Who: We
What: Comprehensive, quality, tertiary level of health care
services
To Whom: To our veterans and their authorized dependents
Where: All over the country
How: To improve the quality of care given, we embark in the
provision of continuous education and training to all our staff
and would be providers of care and research both clinical and
operational.
We strive to provide quality of life by giving our clients a
variety of supportive services to meet their physical,
psychological and spiritual needs.
We also contribute to the promotion of health and welfare to
the community through periodic outreach programs.
Affirmation We are a caring community that values integrity and dignity of
of Value: those who are served as well as those who serve.

24. Mission Statement Checklist
YES NO
Does it clearly state what you do and who you serve, that is,
what business you are in?
Does it describe your setting (e.g. urban/rural/teaching/non-
teaching)?
Is it broad enough so that all staff in the organization ca see
how they contribute?
Will it make sense to average citizens of they see it on the
hospital/clinic wall?
Will you be embarrassed if you see it on the front page of
the newspaper?

26. Hierarchy of
Objectives
Goals:
-long term, positive statements that express an idealized vision o
a quality of life that is almost universally accepted. Purposely stated in a
general and abstract form so that they remain constant throughout rapid
social change.
EG
Strategic Concern
How can we continue giving quality and affordable healthcare at
RMC in the midst of rising cost of operations?
Goal: Strengthen financial viability.

27. Hierarchy of
Objectives
Objective:
-specific, measurable, accurate, realistic, time bound statement
of how the goal can be achieved.
Objective 1. After 2 years, increase income by 100% from 1M to
2M.
(Can be policy/purpose, service/result; resource;
implementation)
Objective 2. Establish streamlined billing and collection system
after 2 years.
Activities:
-demonstrate how project will be accomplished.

28. Strategic Implementation:
Operational Strategies
Deals with putting strategies to work
Requires coordinated efforts of the Organizational
Functions of:
• Marketing
• Information Systems
• Human Resources
• Finance, and
Organization-wide Efforts to Attain Visions
• Organization Culture
• Organization Structure
• Facilities and Equipment
• Ethics and Social Responsibility

29. Strategic Control
A system to support managers in
accessing how well the organization’s
strategy compare to its progress and in
the accomplishment of goals and how
well discrepancies are detected. It
monitors, evaluates, and adjusts the
strategic implementation, the strategy
and the situational analysis.

30. Fundamental Elements of
Strategic Control
1. Setting objectives and pre-determined
standards
2. Measuring performance
3. Comparing the objectives and
standards with actual performance
4. Determining the reasons for deviations
5. Taking corrective actions if necessary

33. Synergy Formulation
Strategic Strategic Adaptive Market- Positioning Implementation Control
Issues Goals Strategy Entry Strategies Strategies Strategies
Strategies
1. Lack of Proper Recruitment Intensive Added Human Resource Performance
competent training and standards recruitment fringe Evaluation
and proper and efforts - benefits
committed recruitment continuous nationwide
personnel training
2.
3.
4.
6.

34. STRATEGIC SCORE CARD
Goals & KRA Indicator Base Year Year Year Activity Milestone
Objectives line (2010) (2011) (2012)
Goal #1. Achieve Increased Rate of 10M 13M 15M 20M Intensify
financial viability income increase: collections
by 2012 (20M) Annual Increase pay
Income clients

35. Operational Planning

36. Problem Tree Increased cost for
Health Services
Effects:
Decreased
confidence in Increased demand for
Health Services curative services
Increase of
Core Problem: Infectious diseases
Causes: Low coverage vaccination
Poor service delivery Low demand
of services
Insufficient supply Poor motivation
Of vaccines Of staff Poor Poor
knowledge of acceptance
the program of program
Poor incentives
Afraid of side
Poor promotion effects

37. Objectives Tree Decreased cost for
Health Services
Ends:
Increased
confidence in Decreased demand for
Health Services curative services
Decrease of
Core Objective: Infectious diseases
Means: Increased coverage vaccination
High quality service delivery Inc. demand
of services
Adequate supply Increased
Of vaccines motivation Good Acceptance
of staff knowledge of of program
the program
Good working Information
atmosphere
Increased About
promotion vaccination
effects

38. PROJECT PLANNING
MATRIX 1
Summary Objectively Means/Sources Assumptions
of verifiable of verification
Objectives indicators
& Activities
Overall goal
Project
purpose
Results 1.
/outputs 2.
3.

39. PPM 2
Main Activities Specification of Costs for
Inputs each
activity
1.1
1.2
1.3
2.1
2.2
…

40. Ghant Chart
Activities Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
A-1
A-2
A-3
A-4
A-5

41. Schedule of
Activities
No. Activity Indicator Time Responsib HR Material Cost Remark
Frame ility Needs Needs
1.1
1.2
1.3

42. MONITORING AND
EVALUATION
Monitoring
- An ongoing activity accompanying the process of
implementation of a project
Supervision
-Control of the performance of the human
resources during the process
Corrective and thus implies training
Related to how the human resources
work.

43. INDICATORS
 Measures that can be used to help
describe a situation that exists and to
measure changes or trends over a period
of time. Enables one to assess degree to
which project inputs activities, outputs,
effects and impacts have been achieved.

44. Indicators ( con’t)
 Purpose:
1. analyze/interpret present situation
2. make comparisons
3. measure changes over time
Types:
Input indicators- what is available( what we have). E.g. no of
staff, availability, access.
Process indicators- informs how project is doing.( source:
prog. Planning matrix, operational plan. Activities needed to
achieve results are process indicators. E.g. TNA etc.
Process indicators allow periodic check if on time.

45. Types of indicators
(con’t)
 Output Indicators- describe goods, svcs
produced by project activities. E.g.
immunization
 Outcome/Impact- refer to the overall
objective/goal of the project. Measures
actual changes in conditions of core
problem.

46. Good Indicator
 Relevant
 Valid- sensitive and specific
 Reliable
 Easily available

47. Monitoring Template
What ? To monitor (Focus) OVI
Is going to monitor?
Who
To get data (source
Where of verification)
Reports, observation
How tool Check list
to collect
Often Dummy table
analyze

48. Evaluation
 A punctual activity at any time of the
planning or implementing or project.
 Related with the structure/input, process,
and output/outcome.

49. EVALUATION
 Input- staff, logistics required
 Process- how activities are carried out
within time allowed, resources specified
at the volume and quality agreed upon
 Output- objectives attained?
achievement of obj. reduced
constraints to program

50.  Evaluation is a critical analysis of the
project that leads to certain conclusions
about the program.
lagging behind
inefficient
ineffective
proceeding as planned
doubtful impact

51.  Based on conclusion it leads to
recommendations or proposal such as:
discontinue
rectify difficulties and proceed
give it one more try
replicate in other areas
can still be improved

52. Good Ethical and Social
Guiding Principles of HCO
Robert Goldman:
1. Put patient welfare first.
2. Avoid unnecessary services/
3. Maintain high standards of honesty and
accuracy.
4. Be accountable to the public.
“Patients must come before profits if the hospital
is to profit.”

53. Thank You!