Strategic Analysis and Planning Series I: Make a Plan for Your Practice’s Future - Business Solutions for Equine Practitioners | EquiManagement

Strategic Analysis and Planning Series I: Make a Plan for Your Practice’s Future

This introduction to strategic planning can help you gain a foothold when mapping out the future of your business.
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This introduction to strategic planning can help you gain a foothold when mapping out the future of your business.

The words “strategic planning” might sound complicated and far removed from veterinary medicine. But “strategic” simply means having a strategy: a careful plan or method for achieving a particular goal, usually over a long period of time. “Planning” is defined as the act or process of making a plan to achieve or do something. A plan is a detailed proposal for doing or achieving something, or an intention or decision about what one is going to do.

Therefore, strategic planning is just a systematic process of envisioning a desired future and translating that vision into broadly defined objectives, as well as a sequence of steps with which to accomplish them.

The purpose of strategic planning is to set overall goals for your business and to develop a plan to achieve those goals. It involves stepping back from your day-to-day operations and asking where your business is headed and what its priorities should be.

Strategic planning is a way to define what it is you truly want for your practice. A strategic plan looks at all the things your small business could do, then narrows that list down to the things you are actually good at doing in your practice. A strategic plan also helps practice owners decide where to spend time and money.

Creating a strategic plan for your practice is a process that requires a time commitment, but it will yield handsomely. Solo practitioners, who make up about 40% of all AAEP members, have the luxury of not needing to reach consensus with partners—but the handicap of having only their own ideas upon which to draw, rather than the thoughts of a larger group.

Veterinary practices with multiple owners must deal with the difficulty of scheduling time with each other “off the road” and the complexity of reaching shared goals. However, the number of innovative ideas that are generated by groups far exceeds the number generated by single thinkers. Creating a strategic plan is not an activity that will occur in a single meeting, and practice owners must commit to not only thinking in a different way, but directing energy toward working on their practices, not just in them.

The Importance of Strategic Planning

Why would a practice owner want to do this? You might think that everything is going fine, and you’re much too busy for this. So why invest in strategic planning?

It is clear that the equine veterinary industry is changing. The demographics of the veterinary workforce are changing. Females are now the majority of AVMA members and will soon be the majority of AAEP members. There are estimated to be 50% fewer horses in the United States than 10 years ago. Diagnostic technology is increasingly demanded by clients, and it is both expensive and quickly becomes archaic. There are fewer young people interested in equine sports, and our horse population is aging. A strategic plan takes into account these changes in the business climate and creates a path toward future success.

Because of these realities, you need a strategy for the future. It will set the direction and establish priorities for your practice. It defines your business’ view of future success and establishes the activities that should be priorities to make this view your reality. The strategy will help you and your team members understand where the practice is heading, what everyone should be working on, and what everyone should be working on first. Without a clearly defined and articulated strategy, you might very well find that your practice does not change with the changing times.

Even if you are a solo practitioner with no staff, you will still benefit from having a strategic plan. If you communicate your practice goals to your clients, some will champion your cause and help you achieve success, and some will drift away because they don’t share that vision—thus, they don’t belong with you. The result is that you will become known for your distinct value and identity.

In larger practices, getting everyone on the same page is critical. This includes your associates, your staff members and your clients. Your practice’s distinction in the marketplace should be known. Members of the horse community should have a clear idea of why they should call your practice instead of another. Once you define your strategic direction, you can get your entire team moving together to achieve the organization’s goals.

Strategic planning also simplifies decision-making. Do your practice owners ever have trouble saying “no” to new ideas or potential purchases? Or do they exhibit very conservative habits and have trouble ever saying “yes”? A strategic plan will have already prioritized the activities necessary for success. These written priorities make it easier to say “no” to distracting initiatives and “yes” to appropriate investments. Having a clear future goal can help solo practitioners take a leap toward investing in their practices, whether in equipment or in manpower. There is less uncertainty and anxiety when there is a plan and steps for carrying it out.

In group practices, it is not at all uncommon for the veterinarians to function like silos within an organization that basically just provides support functions. These practices have no identities as entities, nor any value as entities. The value rests solely in the individual doctors, who are building personal goodwill. Because personal goodwill cannot be sold, these practices cannot provide any retirement funding to retiring owners. A strategic plan can help drive alignment of owners toward a common goal.

Many hard-working veterinarians put effort into areas that have little effect on the success of their practices. For example, they might spend time administering rabies vaccines and drawing Coggins tests at commodity prices for clients who purchase no other services all year. A practice that plans to be the regional leader in diagnostic imaging in three years will ensure that its veterinarians are not utilizing their energies in directions that are not aligned with the vision.

By creating a strategic plan and committing it to writing, practice leaders can communicate much more effectively where they want their practice (or practices) to be, and the key activities that will get it (or them) there. Unfortunately, if the strategy isn’t down on paper and hasn’t been communicated clearly, it is unlikely that the desired result will be achieved. But when your staff members, your suppliers and even your clients know where you’re going, there are greater opportunities to maximize your success in getting there.

Define Your Business

The process of performing a strategic analysis and creating a strategic plan begins by reviewing the practice’s current mission, vision and values, or if these have not been previously determined, getting this essential work completed. It is also useful to examine the history of the practice for the valuable perspective of where the business has been on its way to where it is now.

After this introspection, the analysis commences by examining the current state of the world outside your practice; this is called the external analysis. The external analysis of the macro environment encompasses examining the current economic, demographic, sociocultural, technological, global, political/ regulatory and natural environmental “state of affairs” in the world. The external assessment of the competitive environment comes next, and includes an examination of the industry’s current profile and economic structure, the industry’s life cycle, the forces that affect the consumer’s and service provider’s degree of power in their transactions, and the degree of competition in the industry.

A close look at the practice’s competitors then follows, with an analysis of these competing practices’ strengths, weaknesses, key success factors and likely future behavior.

Following the external analysis, scrutiny is undertaken inside your own practice. This internal analysis includes inspection of your practice’s leadership and culture, organizational structure, resources, capabilities, core competence and financial performance. Finally, utilizing SWOT analysis, SWOT strings and strategy matrices, you can develop a series of strategic recommendations for your practice to move in a desirable future direction. The strategic analysis and planning process is completed by considering managerial and competitive implications, as well as defining the action plan of implementation.

The strategic plan addresses the “what” and “why” of activities, but implementation addresses the “who,” “where,” “when” and “how.” Both planning and implementation are critical to success. Implementation of a strategic plan requires the careful creation of objectives and the action plans to achieve them. The most important steps in implementation of a strategic plan include:

• creating ownership—the most common reason a plan fails is lack of ownership. If your team members don’t have a stake and responsibility in the plan, it’ll be business as usual for all but a frustrated few.

• clear communication—the plan must be communicated and championed to employees, or they won’t understand how they contribute and make a difference.

• keeping long-term goals in sight—practice owners, consumed by daily operating problems, can become mired in the day-to-day struggle and lose focus. Treat the strategic plan as something special, separate and removed from the ordinary management process.

• an achievable, believable plan—the goals and actions generated in the strategic planning session must not be too numerous or unrealistic. Your practice members must know where to begin and feel excited about the future destination. The vision, mission and value statements should be supported by the planned actions, and the practice leaders should lead by example.

• regular progress reports—there’s a method to track progress, and the plan measures what’s important. Everyone feels the forward momentum.

• accountability—accountability and high visibility help drive change. This means that each action step, measure, objective and initiative must have an expected time frame and an owner who is accountable for achieving it. Accountability provides strong motivation for improving performance, but your team must also have the authority, responsibility and tools necessary to act.

Take-Home Message

Once the need to plan strategically is recognized and accomplished, the practice owners then assume the role of becoming the catalyst for facilitating the buy-in and commitment of your practice team. The practice owners play a vital role in facilitating and implementing their strategic plan throughout the organization.

This strategic analysis and planning series continues in upcoming issues of EquiManagement and will lead you through the planning process, providing a template for your work. Don’t miss the opportunity to make a strategic plan that can transform your practice.