Presentation to Medical Staff leadership on executing a strategy for growth in an environment of healthcare change.

1. The Harbin Clinic
Leadership Academy
Session 2: Building Strategy
What Is the Right Direction for Growth?
Presenter:
Dr. Michael Burcham
EXECUTIVE AURA, LLC
105 Broadway, Suite 200
Nashville, TN 37201
In life, there is no dress
rehearsal. You get one
shot. Make it count.

2. Brand Promise
What do you provide that your Core Customers need that highly
differentiates you from your competitors?

3. …when a key element is missing, the strategy
picture is incomplete
strategy is comprised of three parts:
vision, roadmap and resources

4. Strategy
Formulation
Strategic
Change
Strategic
Thinking
1. Vision:
Compelling vision of the
future that attracts others
2. Roadmap:
Ability to show others
what should be done
3. Resources:
Capable people actually
choose to do things differently
The Strategy Process

5. Assess
External
Environment
Internal
Organizational
Assessment
Strategic
Direction
Define &
Select Base
Strategy
Implement
Strategy Plan
Evaluate
Performance
The Strategy Process

6. Harbin Clinic
• Goals &
Values
• Resources &
Capabilities
• Structure &
Systems
The Industry
• Competitors
• Customers
• Suppliers
STRATEGY
TheFirm-Strategy
Interface
TheEnvironment-Strategy
Interface
Execution Understanding
Analyzing Resources & Capability

7. Costs & Prices
Always Decline
Competitive
Position Drives
Options
Customers &
Profits Don’t
Stand Still
Simplicity Gets
Results
The Laws of Strategy
The Road to Results
Law 1:
Law 2:
Law 4:
Law 3:

8. Most of Companies & Our Strategies are “off” by
10 Degrees … so are most of our competitors.
Closing the Gap
Defines Success

9. Executive Decision Making

10. An Executive, by profession, is a decision maker.
Uncertainty is you opponent.
Overcoming uncertainty is your mission.

11. Nothing rots morale more quickly and more completely
than the feeling that those in authority do not know their
own minds…

12. 1. High-quality data. This a prerequisite for consistently sound
decision- making. The greater your understanding of your
company, your competitors and your environment, the more
you can move from guesswork to making strategic choices.
2. Executives need access to good technology and training.
Access to advanced information systems is crucial to
improved decision-making, as is training in helping employees
to make full use of them. Such tools must also be easy to use.
There is no point in spending on new technology if people do
not use it.
Ingredients for
Great Executive Decisions5

13. 3. Sound judgment. Decision-making processes, whether formal
or not, need to leverage the strengths of human intuition. Data
does not run companies; people do.
4. Trust. To gain employees’ confidence in management
decisions, establishing transparency and trust is at least as
essential as a good track record.
5. Flexibility. Approaches to decision-making, and even to the
use of data, need to reflect the fact that the world is a diverse
place, and one size does not always fit all.
Ingredients for
Great Executive Decisions5

14. Arenas
Vehicles
Differentiators
Staging
Economic
Logic
5Major Elements of
Strategy
Hambrick & Frederickson
Academy of Management Executive, Vol. 15, No. 4

15. Arenas
Vehicles
Differentiators
Staging
Economic
Logic
5Major Elements of
Strategy
- Which product categories?
- Which market segments?
- Which geographic areas?
- Which core technologies?
Where will we be active?

16. Arenas
Vehicles
Differentiators
Staging
Economic
Logic
5Major Elements of
Strategy
How will we get there?
- Internal development?
- Joint ventures & alliances?
- Licensing & franchising?
- Acquisitions?

17. Arenas
Vehicles
Differentiators
Staging
Economic
Logic
5Major Elements of
Strategy
How will we win in the
marketplace?
- Image?
- Price?
- Product reliability?
- Customization?

18. Arenas
Vehicles
Differentiators
Staging
Economic
Logic
5Major Elements of
Strategy
What will be our speed
and sequence of moves?
- Availability of resources?
- Speed of expansion?
- Sequence of initiatives?

19. Arenas
Vehicles
Differentiators
Staging
Economic
Logic
5Major Elements of
Strategy
How will we obtain our
returns (make money)?
- Lowest costs through scale advantage?
- Lowest costs through scope advantage?
- Premium prices due to unmatched services?
- Premium prices due to proprietary features?

20. The Activity System
Value Chain

21. The Activity System
Primary and Support Activities

22. Potential Entrants
BuyersSuppliers
Substitutes
The Industry
Competition
Threat of substitutes
Bargaining powerBargaining power
Threat of entrants
Adapted from M. E. Porter, Competitive Strategy
Drivers of Competition
Porters 5 Forces

23. Competitor
Offerings
Customers’
Needs
Company’s
Capabilities
The Strategic
Sweet Spot

24. Customer | Product
Profitability Analysis

25. You have a long list of people, organizations, special interest
groups, demographic groups, etc. that are all Stakeholders
Stakeholder Analysis

26. • Process whereby we identify relevant stakeholders and analyze
their interest and power
• Asks 4 Questions:
1. Who are the relevant stakeholders?
2. What are the interests of each stakeholder?
3. What is the power of each stakeholder?
4. How/what are coalitions likely to form?
Stakeholder Analysis

27. Concern
Power
Identification – Stakeholders
Post-It™
Stakeholder
Analysis
Low High
LowHigh
Map out your stakeholders using the Power/Concern Grid.
Stakeholder Analysis

28. Stakeholder Map

29. What are the 5 most
important competitive
attributes of Harbin
Clinic?
(e.g. price, performance, design)
attribute
2
e.g.
price
attribute 1
e.g.
performance
competitive attributes

30. 1
2
3
4
-
-
1. most important attribute
2. second most important
3. …
4. …
5. …
5 attributes

31. Strategic
Forces
(PESTLE
framework
)
Categories of
Entrepreneuri
al Business
Opportunity
Ideas for business
opportunities
Investment
criteria
Top 5
Opportunitie
s
P
E
S
T
L
E
PESTLE
Forces:
• Political
• Economic
• Social
• Technology
• Legal
• Environmental
PESTLE
A Framework for Identifying Opportunities

32. 32
Ideas
Ideas with
Data & Fit
Strategy
Ideas with Data
Framework for
Executive Decisions

33. “In God we trust; all others must bring data.”
W. Edwards Deming
Physicist & Quality Improvement Pioneer

34. Executive
Team
Information
Technology
Budget &
Capital
Human
Resources
Business
Units
Aligning & Focusing Resources
Around the Primary Strategy

35. Companies typically realize only about 60% of their
strategies’ potential value because of defects and
breakdowns in execution.
Build a strategy that the CEO can communicate, the board
can support, and the organization can execute.
Strategy Execution

36. 1. Keep it Elegantly Simple.
– Avoid drawn-out descriptions of lofty goals.
– Instead, clearly describe what your company will and won’t
do.
Rules for Successful
Strategy Execution7

37. 2. Challenge Assumptions.
– Ensure that the assumptions underlying your long-term
strategic plans reflect real market economics and your
organization’s actual performance relative to rivals’.
– Check all the math.
– Validate marketing beliefs with real customer input and
feedback.
Rules for Successful
Strategy Execution7

38. 3. Speak the Same Language.
– Business Unit Leaders & Corporate Strategy, Marketing and
Finance teams must agree on a common framework for
assessing performance.
– Transparency of the various measurement tools is vital.
Rules for Successful
Strategy Execution7

39. 4. Discuss Resource Deployment Early.
– What new resources will be required to execute strategy at
the Business Unit Level?
– By asking questions such as, “How fast can you deploy the
new sales force?” and “How quickly will competitors
respond?” you create more feasible forecasts and plans.
Rules for Successful
Strategy Execution7

40. 5. Identify Priorities.
– Delivering planned performance requires a few key actions
taken at the right time, in the right way.
– Make strategic priorities explicit, so everyone knows what to
focus on.
Rules for Successful
Strategy Execution7

41. 6. Continuously Monitor Performance.
– Track real-time results against your plan, resetting planning
assumptions and reallocating resources as needed.
– Doing so allows the team to remedy flaws in the plan AND
its execution – and avoid confusing the two.
Rules for Successful
Strategy Execution7

42. 7. Develop Execution Ability.
– No strategy can be better than the people who must
implement it.
– Make selection and development of managers a priority.
Rules for Successful
Strategy Execution7

45. Strategy is Never Done…
• The market is always changing; your strategy needs
to change with it.
• Since design thinking is inherently rooted in the world,
it is ideally suited to helping your strategy evolve.

46. Exercise: Identify 1 Key Strategy
Include These Elements in Your Plan
• Efficiency: How do we improve our overall efficiency in the
delivery of care – standardization, lower costs, maintain
margins.
• Data: How do you show, communicate, track, prove quality of
the Harbin experience?
• Incentives: How do we create the right incentives and
compensation plans that focus on value?
• Culture: What is the culture of Harbin that would be required to
execute this….