strategic planning process

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



be provided












want to serve







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



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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



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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.



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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?



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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?



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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?



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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

strategic planning process

Health & Medicine