In Part 1 of this article
, bold revenue growth strategy requirements are described as possessing a concurrent moderate-to-high degree of innovation and impact. Four categories of such strategies were identified (i.e., acquisitions/mergers, physician-oriented, patient and employer-oriented, technology-oriented) and examples provided. Ten critical success factors were set forth. Fundamental to successful application of those ideas is accelerating the idea generation, decision-making, and implementation steps for the bold strategies. To accomplish this end, management teams and boards should consider striving to put in place the following enablers of bold strategy generation:
Enablers of Bold Strategy Generation
- Ensure the strategic plan establishes an orientation to the long-term, achieves focus, and has a "bold strategies" component. A strategic plan is the foundation for resource allocation, particularly specific to growth. To be effective, the strategic plan should have no more than five goals. Revenue growth should be one of the five. Additionally, there should be a "bold" strategy component to at least the revenue goal and preferably to each of the other goals.
- Achieve a culture of entrepreneurial thinking, an orientation to selected risk-taking and accountability, and rapid implementation of revenue growth strategies. Critical to accomplishing this is removing management rigidity by creating a team that effectively blends both entrepreneurs (who generate ideas and are willing to create change) and pragmatists (who manage the resources to achieve implementation). The team must support the concept of flexibility and be open to putting aside less critical initiatives in favor of a qualified new bold growth opportunity that is suddenly identified.
- Seek new perspectives and opportunities by scanning new sources of information on growth, innovation, and emerging trends. It is particularly effective to identify the implications for healthcare entities of societal trends and developments in other industries. Circumstances where multiple trends intersect provide the greatest opportunities for developing new products and services. An organization's leaders should proactively work to identify "opportunity cues." Examples of such cues include: 1) significant evolution in the "value" sought by customers and their behavior, 2) breakthroughs in clinical, telecommunications, and other non-clinical technology, etc., and 3) changes in the competitive environment.
- Find powerful growth opportunities by uncovering unmet and sometimes unarticulated customer needs and fulfilling them in a manner superior to competitors. Fundamental to achieving this is an understanding of the market and the value sought by the customers. In support of this, enhance the market intelligence function internally and/or with the assistance of third parties. Segment the target customer base in new ways (e.g., South Asian cardiovascular patients, individuals in occupations with repetitive motion injuries, relatives of cancer patients). Observe and listen to the segments. Adopt an orientation to providing services, products, and experience that enable those customers to achieve their goals. Challenge the organization to deliver superior value specific to those goals rather than settling for replicating the actions of others.
- Make resources available for bold strategies by ruthlessly pruning the allocation of funds, people, time—to non-core components, and redirecting them to investment in new opportunities that fit the overall strategy and respond to the value sought by target customers.
- Bring in outside expertise. Great income growth ideas wait for no one. Organizations with a strong track record in growth recognize that when they do not have the personnel to complete analysis or implementation, and/or when they need clinical, operational, financing, or other expertise that is not resident within their organization, they seek it from other entities. Hire, contract, or partner with the experts needed to maximize success in growth.
Enablers of Accelerated and Effective Implementation
1. Focus and accelerate decision-making by eliminating the "analysis paralysis" and seize growth opportunities before narrow windows of opportunity close. To do so, apply the 13 questions identified in Figure 1. With practice, that three-stage filtering process can be completed within two to three days. More detailed analysis (i.e., formal financial feasibility study) should be conducted only on the few bold strategies that pass through all three of the filters.
Figure 1: Three-Staged Filtering Questions
A. Keep for consideration:
- Is it consistent with our mission & vision?
- Is it consistent with customer needs/value sought?
- What overall growth strategy does it relate to and have we historically been successful at that strategy?
- Can we get the volume required for optimum quality and service?
- Are the revenue influencers favorable or can we impact them?
- Do we have/can we get the major investment requirements?
- Do the key constituents (internal and external) support the initiative given what it will take it to be successful?
- To what extent does this initiative contribute to our strategic direction?
- To what extent does this initiative contribute to our growth target?
- What is the probability of our successful implementation?
- What are the opportunity costs if we do not implement this initiative?
- What is the relative position of the strategy on the three dimensions for bold strategies?
- What other strategies could be positively/negatively impacted should this be implemented?
2. Set an expectation for, clear the barriers to, and reward acceleration of implementation so that your organization as a whole and your new services/products are in the market ahead of your competition. Organizations effective in seizing narrow windows of opportunity for growth consistently take these steps: 1) the CEO consistently reinforces the importance of the initiative; 2) once management (and, where appropriate the board) makes a decision to proceed with the growth initiative, all parties are aligned and committed to achievement—there is no second guessing, re-evaluation, or foot-dragging opposition; 3) all historical barriers are defined as malleable; 4) the team adheres to a rigorous implementation plan with intentionally aggressive timeframes; and 5) key team members' standing responsibilities are adjusted to "free-up" sufficient time to focus on the growth initiative (generally, at least one third of the individuals' time).