December 3, 2012 – Recently, we were stunned when a new client handed us their strategic plan to review. The document was about 50 pages long and nothing more than a collection of Word tables that listed the activities of the organization’s leadership team. Of all the potential strategic planning flaws you could run into, this one is critical because it also gives rise to the most lethal flaw on our list of strategic planning flaws.
As we were to learn, strategic planning there was a rhetorical exercise in which everyone filled out a form at the beginning of each year listing the things they were going to accomplish. The forms were assembled into a tidy document and updated quarterly. It was all very task-oriented.
Yes, strategic plans contain tasks, but not in a vacuum. Without goals, objectives, and strategies to provide context, the tasks are meaningless. In this case, they were.
The lack of measurable objectives stunned me. Strategic planning flaws of this magnitude are bewildering. No wonder the organization was losing $17 million a year. Their strategic planning process was the collection of a series of yes-no items that had no meaning or purpose. For instance, one of the tactics was to develop a business plan for a new mammography unit. The only thing in question was whether the business plan was completed. Yes-No. There was nothing in the plan about actually increasing mammography volume. Another item read, “Meet with referring physicians throughout the region.” Again, Yes-No. Not a single mention of how many physicians the exec was to meet with, which would have been slightly better, but still insignificant. If the purpose was to drive physician referrals to the hospital’s specialists (which it was), then the executive should have been held accountable to achieving a target (e.g. increase inpatient discharges from 56 to 92). These are major strategic planning flaws that confuse being busy with being strategic.
The lack of measurable objectives tops our list of strategic planning flaws. Without them, you might be working hard and staying busy, but the work is meaningless. If the executives meet with every physician in the county, but discharges actually decline, has the executive accomplished his task? Of course, but to the detriment of the hospital. The exec has not met the objective, which means the strategy was flawed and the organization needs to rethink its approach to strategic business planning.
Measurable objectives provide us with a yardstick to determine the efficacy of strategies and tactics. If you think this hospital is alone in building into its plans these kinds of strategic planning flaws, think again. Over the years, we have seen hospital after hospital develop strategic plans using the “turn-in-your-action-plan” approach. And now, we are working with a mid-sized hospital in the Midwest to correct the same deficiency: A jumble of to-do lists that are not coordinated and have no stated objectives. And why executives can’t easily spot these kinds of strategic planning flaws is becoming increasingly clear.
A strategic plan without measurable objectives is no strategic plan at all. It is junk and will mislead the organization into believing it is blazing a path to the future, when, in all likelihood, it is setting up their own demise. After all, what is strategic planning if it does not generate real, meaningful, and tangible business results?