strategic planning process
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STRATEGIC PLANNING Process
David Holdford, RPh, MS, PhDProfessor, School of PharmacyVirginia Commonwealth University
Planning to Succeed
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Slides to Accompany Chapter 4 of “Marketing for Pharmacists”
Failing to plan is planning to fail
Alan Lakein, author of How to Get Control of Your Time and Your Life
A goal without a plan is just a wish
Antoine de Saint-ExuperyFrench writer (1900 - 1944)
In preparing for battle I have always found that plans are useless, but planning is indispensable
Dwight D. Eisenhower, 34th President of the United States
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Learning ObjectivesDescribe the strategic planning process for services & products
Discuss business models used in pharmacy practice
Compare business models & business plans
Contrast goals, strategies, objectives, and tactics
Define terminology associated with strategic planning including mission statement, business model, business model canvas, business plan, SWOT analysis, customer value proposition, commodity
Identify major elements of business plans
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SETTING ORGANIZATIONAL STRATEGIES
Mission Statement:
“broad yet specific statement of an organization’s purpose for existence and its future direction.”
“All planning and strategies for future action originate (or should) from the mission of the organization”
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Every Part of a Business Plan Derives from the Mission
Mission
BusinessPlan
MarketingPlan
FinancialPlan
Human Resources
Plan
Distribution &
Supply
Mission
BusinessPlan
MarketingPlan
FinancialPlan
Human Resources
Plan
Distribution &
Supply
PersonalizedServices
Sufficient $’s To Support
Personalized Services
Competent, Service Friendly
Employees
Convenient products& Services
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Everything InAnd Out Of The
Pharmacy Should Support This
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STRATEGIC TERMINOLOGYGoals
Strategies
Objectives (SMART)
Tactics
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Strategic planning occurs atvarious levels in large health care organizations:
corporate
division
strategic business unit (SBU)
product Diabetes Management Program At Store #1989
WHAT IS THE DIFFERENCE BETWEEN A BUSINESS MODEL AND A BUSINESS PLAN?
BUSINESS MODELS AND BUSINESS PLANS BOTH DESCRIBE HOW A BUSINESS HOPES TO ACHIEVE THEMISSION IN A SUSTAINABLEWAY
BUSINESS MODELS ARE GENERAL, LARGE PICTURE VIEWS OF THE BUSINESS & TYPICALLY GLOSS OVER THE OPERATIONAL DETAILS OF THE BUSINESS
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BUSINESS MODELS DESCRIBE:• THE CUSTOMER VALUE PROPOSITION • RESOURCES & PROCESSES• THE PROFIT FORMULA
Details about
these elements
will follow
BUSINESS MODELS AREOFTEN DESCRIBED USING ABUSINESS MODELCANVAS
Organization's Operation - Specific background about the organization
where the product/service will
be provided
Strengths, Weaknesses - Your capabilities to serve targeted customers
Service/Product – Features and details about your program or service
Secondary Customers - all
other people you may serve
Partners - People or businesses who can
help you serve customers
Value Proposition - The case you make to customers
Opportunities, Threats - Potential
for success or failure in the market
Competitors – Alternatives for your
value propositionPrimary Customers - People or businesses you
want to serve
Costs - Financial and nonfinancial inputs needed to serve customers
Pricing & Reimbursement - Sources of revenue to sustain your value proposition
Communication Plan - How value proposition is communicated
Implementation - Details about critical factors for success of business
Source: (adapted) Osterwalder A, Pigneur Y. Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. Hoboken, NJ.: John Wiley and Sons; 2010.
Business Model Canvas for Pharmacy Services
Organization's Operation - Specific background about the organization
where the product/service will
be provided
Strengths, Weaknesses - Your capabilities to serve targeted customers
Service/Product – Features and details about your program or service
Secondary Customers - all
other people you may serve
Partners - People or businesses who can
help you serve customers
Value Proposition - The case you make to customers
Opportunities, Threats - Potential
for success or failure in the market
Competitors – Alternatives for your
value propositionPrimary Customers - People or businesses you
want to serve
Costs - Financial and nonfinancial inputs needed to serve customers
Pricing & Reimbursement - Sources of revenue to sustain your value proposition
Communication Plan - How value proposition is communicated
Implementation - Details about critical factors for success of business
Source: (adapted) Osterwalder A, Pigneur Y. Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. Hoboken, NJ.: John Wiley and Sons; 2010.
Business Model Canvas for Pharmacy Services
The business model canvas allows
pharmacists to describe what they do
(or want to do) on a single page. It
visually displays all major elements of
the model to facilitate structured
discussions about strategies. It also
shows the relationships between
elements of the model and helps
ensure that no major issues are
overlooked.
BUSINESS PLANS CAN BECONSIDERED MORE DETAILED VERSIONS OF BUSINESS MODELSTHAT PROVIDE SPECIFICDETAILS ABOUT PLANSFOR SUCCESS
MAJOR ELEMENTS OF BUSINESS PLANSExecutive SummaryProduct or Service DescriptionThe Pharmacy's OperationSWOT AnalysisPrimary Targeted Segments/MarketsPartnersCompetitorsRevenue, Pricing, and CostsPromotional PlanImplementation PlanAppendices
THE REMAINING PORTION OF THIS PRESENTATION WILL DISCUSS WHAT GOES INTO A BUSINESS MODEL CANVAS
Organization's Operation - Specific background about the organization
where the product/service will
be provided
Strengths, Weaknesses - Your capabilities to serve targeted customers
Service/Product – Features and details about your program or service
Secondary Customers - all
other people you may serve
Partners - People or businesses who can
help you serve customers
Value Proposition - The case you make to customers
Opportunities, Threats - Potential
for success or failure in the market
Competitors – Alternatives for your
value propositionPrimary Customers - People or businesses you
want to serve
Costs - Financial and nonfinancial inputs needed to serve customers
Pricing & Reimbursement - Sources of revenue to sustain your value proposition
Communication Plan - How value proposition is communicated
Implementation - Details about critical factors for success of business
Source: (adapted) Osterwalder A, Pigneur Y. Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. Hoboken, NJ.: John Wiley and Sons; 2010.
Business Model Canvas for Pharmacy Services
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10 11
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Organization's Operation - Specific background about the organization
where the product/service will
be provided
Strengths, Weaknesses - Your capabilities to serve targeted customers
Service/Product – Features and details about your program or service
Secondary Customers - all
other people you may serve
Partners - People or businesses who can
help you serve customers
Value Proposition - The case you make to customers
Opportunities, Threats - Potential
for success or failure in the market
Competitors – Alternatives for your
value propositionPrimary Customers - People or businesses you
want to serve
Costs - Financial and nonfinancial inputs needed to serve customers
Pricing & Reimbursement - Sources of revenue to sustain your value proposition
Communication Plan - How value proposition is communicated
Implementation - Details about critical factors for success of business
Source: (adapted) Osterwalder A, Pigneur Y. Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. Hoboken, NJ.: John Wiley and Sons; 2010.
Business Model Canvas for Pharmacy Services
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27
9 6
54
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10 11
3
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1. PRODUCT/SERVICE
Describe what is being offered. List features and benefits.
2. PRIMARY CUSTOMERS
Primary customers are the most important group of individuals served by what is being offered?
The model should focus on serving
this group over all others!
3. VALUE PROPOSITION
This is the promise to customers of the value to be delivered by your service (or product)
It explains in a compelling & clear manner why customers should choose you over competing options
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Value Propositions in Retail Business Models
1. Economic - argues that marginal benefits (i.e., utility) offered (compared to competitors) is greater than the costs and sacrifices paid
2. Functional - offers convenience by finding the right products with as little time and as little physical and cognitive effort as possible
3. Emotional – offers arousal of feelings associated with the act of shopping itself, e.g., enjoying shopping with others, the hunt-for-a-bargain, relaxation
4. Symbolic - attaches positive consumption meanings to shopping itself e.g., shopping local, shopping that supports environment
Organization's Operation - Specific background about the organization
where the product/service will
be provided
Strengths, Weaknesses - Your capabilities to serve targeted customers
Service/Product – Features and details about your program or service
Secondary Customers - all
other people you may serve
Partners - People or businesses who can
help you serve customers
Value Proposition - The case you make to customers
Opportunities, Threats - Potential
for success or failure in the market
Competitors – Alternatives for your
value propositionPrimary Customers - People or businesses you
want to serve
Costs - Financial and nonfinancial inputs needed to serve customers
Pricing & Reimbursement - Sources of revenue to sustain your value proposition
Communication Plan - How value proposition is communicated
Implementation - Details about critical factors for success of business
Source: (adapted) Osterwalder A, Pigneur Y. Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. Hoboken, NJ.: John Wiley and Sons; 2010.
Business Model Canvas for Pharmacy Services
1
27
9 6
54
8
10 11
3
1213
4. SECONDARY CUSTOMERS
These are the other customers served by what you offer
They may be
Internal to your organization and/or
External to your organization
5. PARTNERS
With whom will you partner to serve customers?
Will you work with other health care professionals, local businesses, insurers?
Inside the organization
Outside of the organization
6. COMPETITORS
Who is competing with your value proposition?
If they aren't partnering with you, individuals and organizations may be competing with you.
Organization's Operation - Specific background about the organization
where the product/service will
be provided
Strengths, Weaknesses - Your capabilities to serve targeted customers
Service/Product – Features and details about your program or service
Secondary Customers - all
other people you may serve
Partners - People or businesses who can
help you serve customers
Value Proposition - The case you make to customers
Opportunities, Threats - Potential
for success or failure in the market
Competitors – Alternatives for your
value propositionPrimary Customers - People or businesses you
want to serve
Costs - Financial and nonfinancial inputs needed to serve customers
Pricing & Reimbursement - Sources of revenue to sustain your value proposition
Communication Plan - How value proposition is communicated
Implementation - Details about critical factors for success of business
Source: (adapted) Osterwalder A, Pigneur Y. Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. Hoboken, NJ.: John Wiley and Sons; 2010.
Business Model Canvas for Pharmacy Services
1
27
9 6
54
8
10 11
3
1213
7. YOUR ORGANIZATION’S OPERATION
1. Tangibles - Location, facilities, and brief description of other products & services provided
2. Mission and Values - Mission of the organization & the values that are important in making choices (e.g., patient-oriented, profit driven, community-oriented)
3. Team - Key members of the team who are planning & providing the service
8. STRENGTHS AND WEAKNESSES
What unique strengths does your organization have that gives you a competitive advantage?
What weaknesses give you a disadvantage?
9. OPPORTUNITIES AND THREATS
What are opportunities that your service could meet?
What are potential threats to your success?
Organization's Operation - Specific background about the organization
where the product/service will
be provided
Strengths, Weaknesses - Your capabilities to serve targeted customers
Service/Product – Features and details about your program or service
Secondary Customers - all
other people you may serve
Partners - People or businesses who can
help you serve customers
Value Proposition - The case you make to customers
Opportunities, Threats - Potential
for success or failure in the market
Competitors – Alternatives for your
value propositionPrimary Customers - People or businesses you
want to serve
Costs - Financial and nonfinancial inputs needed to serve customers
Pricing & Reimbursement - Sources of revenue to sustain your value proposition
Communication Plan - How value proposition is communicated
Implementation - Details about critical factors for success of business
Source: (adapted) Osterwalder A, Pigneur Y. Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. Hoboken, NJ.: John Wiley and Sons; 2010.
Business Model Canvas for Pharmacy Services
1
27
9 6
54
8
10 11
3
1213
PROFIT FORMULA
10. COSTS
What are the major costs of the service being provided?
Startup Costs
Operating Costs
Fixed
Variable
11. PRICING & REIMBURSEMENT
How does the business receive revenue for the service being provided?
What will be the price for each unit of service provided?
Who will pay for the service?
Organization's Operation - Specific background about the organization
where the product/service will
be provided
Strengths, Weaknesses - Your capabilities to serve targeted customers
Service/Product – Features and details about your program or service
Secondary Customers - all
other people you may serve
Partners - People or businesses who can
help you serve customers
Value Proposition - The case you make to customers
Opportunities, Threats - Potential
for success or failure in the market
Competitors – Alternatives for your
value propositionPrimary Customers - People or businesses you
want to serve
Costs - Financial and nonfinancial inputs needed to serve customers
Pricing & Reimbursement - Sources of revenue to sustain your value proposition
Communication Plan - How value proposition is communicated
Implementation - Details about critical factors for success of business
Source: (adapted) Osterwalder A, Pigneur Y. Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. Hoboken, NJ.: John Wiley and Sons; 2010.
Business Model Canvas for Pharmacy Services
1
27
9 6
54
8
10 11
3
1213
12. COMMUNICATION PLAN
How will you communicate your value proposition to customers?
What messages will you communicate?
What do you want to achieve with your communications?
Organization's Operation - Specific background about the organization
where the product/service will
be provided
Strengths, Weaknesses - Your capabilities to serve targeted customers
Service/Product – Features and details about your program or service
Secondary Customers - all
other people you may serve
Partners - People or businesses who can
help you serve customers
Value Proposition - The case you make to customers
Opportunities, Threats - Potential
for success or failure in the market
Competitors – Alternatives for your
value propositionPrimary Customers - People or businesses you
want to serve
Costs - Financial and nonfinancial inputs needed to serve customers
Pricing & Reimbursement - Sources of revenue to sustain your value proposition
Communication Plan - How value proposition is communicated
Implementation - Details about critical factors for success of business
Source: (adapted) Osterwalder A, Pigneur Y. Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. Hoboken, NJ.: John Wiley and Sons; 2010.
Business Model Canvas for Pharmacy Services
1
27
9 6
54
8
10 11
3
1213
13. IMPLEMENTATION PLAN
What things do you, the customer, and the payer need to do to make the service a success?
What are the most important things your organization needs to do to successfully implement the program?
How will you know if you are successful or not? What operational & performance metrics will you collect?
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SummaryStrategic planning is an important skill for
pharmacists who wish to market their services
Planning requires systems thinking and an understanding of the complexity of pharmacy practice
SEE ‘MARKETING FOR
PHARMACISTS FOR
MORE DETAILS
D HOLDFORD
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