HCM_3305 Last Chance Hospital (LCH) Strategic Planning Process Essay
Background Statement
Last Chance Hospital has been well-received by the community it serves with many patients in older age groups as compared to other hospitals within the region. The hospital is located outside San Diego, California in a densely populated area with other health facilities facing operational and financial challenges. Although Last Chance Hospital has had a financially sound history that has seen it remain independent financially over the years, recently, the hospital has started experiencing financial challenges HCM_3305 Last Chance Hospital (LCH) Strategic Planning Process Essay. This has prompted the management to utilize their cash reserves above what the board of trustees recommends.
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There exist numerous gaps within the human resource in the…
Last Chance Hospital—Case for Chapters 5 and 6
Last Chance Hospital (LCH) is a 254-bed, community hospital located in a small, affluent suburb just outside of San Diego, California. The hospital has historically been well-received by the local community, which demographically has a higher concentration of older age groups than most other local areas. The greater San Diego area is densely populated, and over 25 hospitals operate in the larger geographic area. Historically, LCH had always been financially sound, and had managed to remain independent as their local competitors joined larger systems. But that was then, and this is now. HCM_3305 Last Chance Hospital (LCH) Strategic Planning Process Essay About a year ago, Last Chance Hospital undertook a strategic planning process to encompass the next five years. At the time, the hospital was doing okay financially, but was starting to dip into their cash reserves more often than the Board of Trustees liked; LCH was in need of an ideal strategy to bring them ahead of the market before things got out of hand.
As the strategic planner for LCH, Russ Newmarket reported indirectly to the CEO, Marvelous Marvin, but his immediate boss was Courtney Graveyard—and she had a lot on her plate. LCH did not have a chief nursing officer, and as COO, Graveyard was responsible for all of the nursing departments as well as surgical services, facilities, and information technology. A nurse by background, Graveyard spent the majority of her time trying to find different ways to recruit much-needed nursing staff HCM_3305 Last Chance Hospital (LCH) Strategic Planning Process Essay.
During the development of the strategic plan, Russ called together the usual group of senior executives, Board members, and key physician leaders. He diligently developed the SWOT using their input and applying their assumptions. During his market research, Russ became aware of some patient-centric trends emerging across the country, but he was also aware that LCH had always strategically catered more to physicians due to the notion that physicians were the ones who ultimately referred patients to the hospital. Through the strategy development process, it became clear that senior management was stuck on this physician-centric mindset. Russ, ambitious and eager to make a name for himself, found and presented valid information that concurred with management’s mindset. At the end of the planning process, Marvelous Marvin felt confident that their physician-focused strategy would give them a market lead—the plan was to attract more surgeons—and increase OR volumes. Graveyard was under intense pressure from Marvelous Marvin to make sure the operating rooms were as efficient as possible to handle the planned increase in volume, as OR efficiency would be a key recruitment issue for surgeons. The LCH physician recruiter was under the gun as well. The remainder of the executive staff breathed a collective sigh of relief that their areas were not part of the strategic initiative. Russ suspected LCH needed more of a strategy than attracting new surgeons, but he convinced himself that senior management knew best HCM_3305 Last Chance Hospital (LCH) Strategic Planning Process Essay.
After the Board approved the strategic plan, Graveyard immediately met with her OR Director and charged him with increasing the efficiency of the ORs. She then turned her focus back to her first love, nursing. The physician recruiter hit the ground running, developing an elaborate plan to increase surgeon recruitment. From all appearances, LCH was on a roll. HCM_3305 Last Chance Hospital (LCH) Strategic Planning Process Essay.
Over the next several months, the OR Director was able to reduce the OR’s operating budget by 13%, a result that made Marvelous Marvin very happy. At the same time, Graveyard made great strides in increasing LCH’s exposure to and status in the nursing community, and was able to decrease the nursing vacancies by over 6%. In a time of nursing shortages, the Board was impressed with Graveyard’s results. The physician recruiter was having only moderate success at recruiting surgeons, however, and her targeted volume projections were noticeably under budget. Marvelous Marvin approved her request to increase her staff, adding approximately $250,000 to her budget line. Overall, patient volumes were steadily decreasing at what was becoming an alarming rate, and thus the financial picture for LCH was in critical condition. Marvelous Marvin couldn’t help but wonder aloud, “Why isn’t the LCH strategic plan working?”
CASE STUDY WRITE-UP
Prepare a written report of the case using the following format.
Background Statement
What is going on in this case as it relates to the identified major problem? What are (only) the key points the reader needs to know in order to understand how you will “solve” the case? Summarize the scenario in your own words—do not simply regurgitate the case. Briefly describe the organization, setting, situation, who is involved, who decides what, and so on. HCM_3305 Last Chance Hospital (LCH) Strategic Planning Process Essay.
Major Problems and Secondary Issues
Specifically identify the major and secondary problems. What are the real issues? What are the differences? Can secondary issues become major problems? Present analysis of the causes and effects. Fully explain your reasoning.
Your Role
In a sentence or short paragraph, declare from which role you will address the major problem, whether you are a senior manager, departmental manager, or an outside consultant called in to advise. Regardless of your choice, you must justify in writing why you chose that role. What are the advantages and disadvantages of your selected role? Be specific.
Organizational Strengths and Weaknesses
Identify the strengths and weaknesses that exist in relation to the major problem. Again, your focus here should be in describing what the organization is capable of doing (and not capable of doing) with respect to addressing the major problem. Thus, the identified strengths and weaknesses should include those at the managerial level of the problem. For example, if you have chosen to address the problem from the departmental perspective and the department is understaffed, that is a weakness worthy of mentioning. Be sure to remember to include any strengths/weaknesses that may be related to diversity issues.
Alternatives and Recommended Solutions
Describe the two to three alternative solutions you came up with. What feasible strategies would you recommend? What are the pros and cons? State what should be done—why, how, and by whom. Be specific.
Evaluation
How will you know when you’ve gotten there? There must be measurable goals put in place with the recommendations. Money is easiest to measure; what else can be measured? What evaluation plan would you put in place to assess whether you are reaching your goals?
TIP: Write this section as if you were trying to “sell” your proposed solution to the organization. Convince the reader that your proposed solution is the best available and that it will work as planned. Make sure the goals you identify are worth the effort required to achieve them! HCM_3305 Last Chance Hospital (LCH) Strategic Planning Process Essay.
CASE STUDY: Report on LCH hospital Strategic Planning Process.
Background Statement
Last Chance Hospital has been well-received by the community it serves with many patients in older age groups as compared to other hospitals within the region. The hospital is located outside San Diego, California in a densely populated area with other health facilities facing operational and financial challenges. Although Last Chance Hospital has had a financially sound history that has seen it remain independent financially over the years, recently, the hospital has started experiencing financial challenges. This has prompted the management to utilize their cash reserves above what the board of trustees recommends.
There exist numerous gaps within the human resource in the hospital management such as the lack of a Chief Nursing Officer that is a setback to how day to day operations are held. The Chief Operating Officer; Courtney Graveyard faces challenges in overseeing nursing departments, surgical facilities, services, information technology and recruitment of nursing staff.
As the strategic planner for Last Chance Hospital, Russ Newmarket had the task of ensuring that the financial and human resource challenges starting to be experienced by Last Chance Hospital are done away with. The strategic planning team of Board members, senior executives, and key physician leaders made a decision that was physician-focused after a SWOT analysis, in an aim to attract more surgeons since majority referred patients to the health facility. However, this strategy was not the best for the meantime since market research conducted by Russ established patient-centric trends across the country.
Although the hospital was able to record reduction in OR operating budgets and vacancies in nursing, overtime, patient volumes started to decrease rapidly at a rate that was not only alarming but also had serious implications to the financial status of Last Chance Hospital. Evidently, this is a revelation that the strategic plan developed by the select committee failed to work with serious reasons thus leading to the failure of the whole system of Last Chance Hospital.
Major Problems and Secondary Issues
The major issue, in this case, is that Last Chance Hospital has begun digging into its cash reserves to finance its 5-year strategic plan. As opposed to the previous years, the hospital has stopped being financially stable and is currently operating on a financial instability that threatens its sustainability and future operations (Buchbinder & Shanks, 2013). There is also no division of labor and Graveyard, who is a nurse by profession has to discharge the duties of the Chief Operating Officer for the hospital. Instead of working as the chief unstring officer for the hospital, she is forced to spend the majority of her time thinking of how to recruit extra nurse staff for the hospital.
The hospital, through Russ also used a wrong approach in developing a strategic plan that ignored other critical areas touching on the hospital operations. The usual group comprising of executives and physician are the ones who were actively involved in the strategic planning process, leaving out the nurses (Moseley, 2015). The physician-centric mindset took over the patient-centric trend made Russ over ambitious and more focused to make a name for himself. So instead of focusing on how best to come up with a valuable strategic plan, he worked on an idea that could capture the mindset of the management.
Lack of organization is also a major issue in this case. LCH hospital is planning on how to increase OR volumes by increasing the number of operations, the efficiency of operations and the number of surgeons, yet it goes ahead to cut the OR budget by 13%. It is clear that such a move will not work in favor of the strategic plan approved by the directors but instead hamper its implementation. All the goals of this strategic plans require additional funding for them to be achieved (Zuckerman, 2014). Thus, it is expected that once the hospital has settled on such a goal in its strategic plan, then the OR budget should be increased.
The secondary problem, in this case, is the understaffing and diversity in the hospital. It is also a secondary issue concern that the patient volumes were decreasing constantly despite the strategic planning envisaging an increase in their number due to the improved OR department. The financial state of LCH deteriorated because the hospital lacked the revenue to fund its operations after the expansion in its strategic plan was implemented. This clearly explains the key issue in the case which is a strategic plan that is not working as planned.
The gaps noted within the human resource in the hospital management plays a critical role in ensuring efficiency in service delivery. Lack of a Chief Nursing Officer in Last Chance Hospital is not only a setback to how day to day operations are held but also a challenge to the Chief Operating Officer; Courtney Graveyard, in overseeing nursing departments, surgical facilities, services, information technology and recruitment of nursing staff.
The difference between the major problem and the secondary problem is that the secondary problems arise from the inconveniences caused by the major problems. For instance, when the hospital fails to incorporate all key stakeholders in its strategic planning, SWOT analysis, and other decision-making processes, it basically gives room for the emergence of the secondary problems such as decreasing patients numbers and reduced revenue.
The secondary problems, in this case, have the potential of turning out to be the major problems in case they are not solved in time (Zuckerman, 2014). The staff deficiency at the hospital has the potential of causing a strained workforce that cannot deliver as per the expectation of the management. Besides, it has the potential of hindering the effective delivery of services, which will, in turn, affect the number of patients attended to and visiting the hospital. As a result, this secondary problem will lead to reduced revenue, thus putting the hospital in a finical crisis. That way, the secondary problem shall have turned out to be a major problem.
An analysis of the causes of the major and secondary problems shows that relying on assumptions and the urge to satisfy self-assertion and the top management is to blame for the problems (Zuckerman, 2014). All along, Russ did not focus on solving the real issues affecting the hospital. Instead, he focused on satisfying the mindset of the executive by recommending what was only good in their imagination. The effects of this move is that the strategic plan did not work as expected since it was impractical in totality
My Role
I would address the current problem in Last Chance Hospital as a departmental manager. I choose this role since it provides the opportunity to talk to some of the patients who seek health care services at Last Chance hospital from the Department of Clinical services hence know some of the factors that largely contribute to the decrease in patients from their shared experiences and reasons (Moseley, 2015). Advantages of my role are that I have the opportunity to interact one on one with the client hence provision of firsthand information from those affected.
The disadvantage is that, even though direct contact with the clients is facilitated, it is hard to convince a client to continue getting services at the facility when he/she has made the decision not to. In addition, since the hospital has many departments, I am not in a position to influence much change due to client dissatisfaction in another department. In this case, the protocol has to be followed, which time is consuming.
Organizational Strengths and Weaknesses
The strength of the organization is that it is strategically located in a suburb and the good reputation it has been getting from the locality. It has the diversified workforce and different department within its operations. The dense population also provides a good market for the hospital. It is therefore capable of handling any number of patients and all kinds of patient’s needs (Zuckerman, 2014). However, the organization faces weaken in understaffing, lack of sufficiency trained physicians and nurses, working on budgetary constraints and facing financial instability. This means that the hospital cannot work outside its budget nor can it operate sustainably to provide efficient services to its patients.
Alternatives and Recommended Solutions
An alternative that LCH would have considered implementing is involving all stakeholders in the SWOT analysis, strategic planning. It should also consider various market segments in its market research so as not to focus on only one market of operations but rather have a diversified market that brings on board patients with different needs. Other alternatives are the goals of increasing nurse staff, increasing the budgetary allocation for OR and the nursing staff and giving more attention to the nurse demand (Shi, 2014). Also, patient-centric needs and physician-centric demands are better alternatives that LCH can implement for success in its operations
The feasible strategy recommendation that would help improve the situation at LCH is to have a chief nursing officer take charge of the recruitment process. It is also recommended that during strategic planning, the focus must be put to the interest of the hospital with preference given to the future of the hospital. This means that personal interest, assumptions, and egos must be left out of the strategic planning process and conduct the recruitment and budgeting on a need basis. These recommendations are good because they will help seal all the gaps that made the strategic plan fail. The pros of this strategy are that it will be focused towards solving the major and secondary problems and the key issues outlined in the case of LCH. However, its cons is that will attract extra costs in terms of implementation, thus increasing the overall operational cost and budgetary allocations (Shi, 2014).
Evaluation
Performance indicators are the best way of knowing that the objective and missions of LCH have been achieved. Thus, looking at the performance indicators against the strategic plan is a good way of knowing that the hospital has indeed gotten where it had planned to be. The outcomes of the implementation undertaken by the LCH must also be compared with the initial targets and plans to measure how effective the goals have been meeting (Hillestad & Berkowitz, 2013). This will help the management to make recommendations in areas where improvement is needed. By identifying the areas that showed poor performance, a recommendation on how to correct the mistakes noticed is made. On the other hand, the areas that showed outstanding performance against the targets and goals are improved to maintain such performance.
Apart from measuring the money spent and collected from the Operation Room in the hospital, customer satisfaction, efficiency of service delivery and the number of patients served are also goals that are measurable in this case. An evaluation plan that can be put in place is a constant review, monitoring the performance and implementation of the goals and making a recommendation (In Austin, In Bentkover & In Chait, 2016). This evaluation plan will help identify the best means of reaching the goals of the hospital as well as providing recommendations on how to overcome any challenge faced in the course of implementing the recommendations.
This proposed solution provides the best available evaluation plan that it will help the management of LCH to work as planned and achieve the goals outlined in its strategic plan. For instance, the goals of increasing nurse staff, increasing the budgetary allocation for OR and the nursing staff and giving more attention to the nurse demand, patient-centric needs, and physician-centric demands are worth the effort required to achieve them. HCM_3305 Last Chance Hospital (LCH) Strategic Planning Process Essay.
References
Buchbinder, S. B., & Shanks, N. H. (2013). Fundamentals of Strategic Planning for Healthcare Organizations
Hillestad, S. G., & Berkowitz, E. N. (2013). Healthcare market strategy: From planning to action. Burlington, Mass: Jones & Bartlett Learning.
In Austin, J., In Bentkover, J., & In Chait, L. (2016). Leading strategic change in an era of healthcare transformation.
Moseley, G. B. (2015). Managing healthcare business strategy. Sudbury, Mass: Jones and Bartlett.
Shi, L. (2014). Managing human resources in healthcare organizations. Sudbury, Mass: Jones and Bartlett Publishers.
Zuckerman, A. M. (2014). Healthcare strategic planning. Chicago IL: Health Administration Press. HCM_3305 Last Chance Hospital (LCH)