Oftentimes physicians and administrators discuss strategies and may even devise a strategic plan, only to see nothing come of it. The most common reason for strategy failure is that they failed to build execution into their strategic planning process. We often see that budgets are not linked to strategy, staff incentives are not linked to strategy, and a very small number of employees understand the practice strategy. There are three reasons strategy fails to execute:
• Practice initiatives don't align with strategy
• Practice processes don't align with strategy
• Employees and physicians fail to engage
To ensure that your strategies are successfully implemented, you must build the execution into and across the strategy and the strategic planning process. Below are the five steps to successful strategy implementation.
1. Align your initiatives
A key road to failed implementation is when we create a new strategy but then continue to do the same old things. A new strategy means new priorities and new activities across the practice. Every activity (other than the most functional) must be reviewed against its relevance to the new strategy. A good way of doing this is to create a strategic value measurement tool for existing and new initiatives. Initiatives should be analyzed against their strategic value and the impact to the practice. Measuring your initiatives as such will help highlight the priorities and ensure the right initiatives are adopted for delivery.
2. Align budgets and performance
Ideally your budgets are structured in such a manner as to protect strategic expenditure from being re-allocated to short-term requirements of operating expenditures while subjecting strategic initiatives to a rigorous review (e.g. forecasted revenue growth and productivity), much like it is done for capital expenditures.
The practice's business performance should be closely aligned to strategy. Performance measures should be tied to strategic goals across the practice and for each physician and staff member. All staff members will have job functions that will impact strategy. Most staff members will have influence across a series of strategic goals (e.g. financial, patient experience, operational, etc.). Ensure employees are aware of their role and influence on strategy delivery and performance.
Likewise performance incentives should be directly linked to performance against strategy. They should include a combination of individual, team, and practice performance measures that ensure staff recognize their direct and indirect impact on strategy performance.
3. Structure follows strategy
A transformational strategy may require a transformation to structure. Does the structure of your practice allow strategy to cascade across and down the organization in a way that meaningfully and efficiently delivers the strategy? Practices that try and force a new strategy into an outdated structure will find their strategy implementation eventually reaches a deadlock.