August 2020 | Point of View

With plan in hand: Realizing the value of your strategic initiatives through a culture of transformation

You’ve developed a strategic plan that you firmly believe in. But how do you achieve goals that turn investment into value?

You’re an executive at a regional or national health plan and you and your team put in the time, money, and effort to set the vision for your organization’s future success in a cohesive strategic plan. You brought in a strategy firm, canvassed your leaders, gained consensus, and documented your goals and challenges. 

But how do you turn that investment into your organization’s reality? 

Implementing a strategic plan while maintaining smooth day-to-day operations is a balancing act that requires support, discipline, and structure. This is particularly true in healthcare payer organizations. Without the right frameworks to remain both nimble and disciplined, an organization is likely to miss its strategic imperatives, potentially by wide margins as multiple parties attempt to row the boat in different directions. In fact, nearly 2 out of 3 companies fail to reach their stated strategic goals. With enterprise strategic support, however, research has shown that 38% more projects will meet original goals and business intent.

Moving your business forward in a methodical, sustainable manner to realize a vision is challenging. You’ll need the right partner—with the right frameworks, methodology, and specific industry expertise—to guide you. No matter if you’re a 300,000-member regional health plan or a large national player, it starts at the top and requires enterprise-wide alignment to one central strategy reinforced by consistent communication, engagement, and support.

To help simplify this, we have narrowed the keys to success to five core considerations: building buy-in, balancing priorities, ensuring that business drives technology, baselining and tracking value, and embracing change.

Build buy-in at all levels

It’s difficult to build buy-in if decision-making takes place at the project or functional level in a hub-and-spoke management style. While this can give the appearance of empowering people to make their own decisions, requiring each “spoke” to work through its specific “hub” for budget and resources—rather than pooling them together across similar projects—creates siloed teams and projects. This is all too common, and tends to result in money grabs during budgeting, with each spoke lobbying for the most they can get. 

For effective implementation of a strategic plan, the entire organization must unite around a future state vision of independent decision-makers paired with a culture of cross-functional collaboration based on one centrally organized and supported mission. An organizational structure and governance system that has achievable, incentivized goals by level written in from the beginning is in better position to maintain alignment to the overall strategic plan and associated key performance indicators than one without. Baking collective success into an organization’s operating model means leaders at all levels—enterprise, program, project, or individual—are empowered to define success and spur innovation together.

Balance priorities 

Managing your project portfolio through value-oriented business cases—rather than reacting to the loudest voice in the room—will position you to invest in the right projects at the right time. Organizations spend 70-85% of their IT budgets just to keep the lights on and maintain normal operations. While these allocations are critical in supporting the ongoing delivery of services and value to customers, they don’t leave much wiggle room for potentially more innovative, transformative ideas and initiatives.

It comes down to balance. Maintaining a healthy mix of tactical and strategic initiatives can help you keep costs in order and allow you to capitalize on project synergies and sequencing. One way to achieve this balance is to employ gating standards for scoping, prioritizing, and obtaining funding for projects. These standards will help you keep existing projects on track while having a reliable mechanism for responding to strategic, operational, technological, or regulatory changes. They will also create transparency in your decision-making and funding processes, keeping your teams aware of priorities and supporting the buy-in required to keep things moving.

Ensure that business drives technology

Options abound in today’s rapidly advancing technology market. But it is worth considering that, once implemented, only 25% of disruptive technologies yield tangible results. That’s a staggering number – the shiny-new-thing mentality is pervasive in organizational culture today, and it creates tension between business and technical priorities which, when coupled with the tech debt plaguing many healthcare organizations, can be severely inhibiting. 

Harnessing the power of new enterprise technology can only be accomplished with a business-driven technology approach; the right solution is that which best addresses an identified business problem. PMO control over IT spending is too often unbalanced, shifting from business to IT and back again. Although there may be a “best fit” solution for any given organization, the key to success lies in achieving a partnership between the business and IT segments based on shared goals. 

Clearly defining business requirements, developing a capability analysis, and employing enterprise architecture discipline will help ensure the chosen solution fits into your existing ecosystem and aligns to strategic imperatives—and it helps determine whether buying (or building, partnering, or enhancing) is the best course of action in the first place. This way, you stand the best chance of not overwhelming your talent base, straining budgets, or losing sight of priorities and replacing old silos with new ones.

Baseline and track value toward goals

Think about a health insurance company that considers drop to pay ratios, member readmission rates, member leakage to out of network providers, average cost per claim, and a host of other data points. Those data empower the organization to better understand their operational strengths and weaknesses, as opposed to a plan that is just focused on member counts as the gold standard, a single all-important metric. Setting clear targets for an array of data points allows teams to better manage and measure progress and provides leeway to course-correct throughout the life of an initiative or to iterate upon your success to achieve a compounded, greater level of success in the end. 

Your gating process should include a requirement for the articulation of a sound business case that presents reasonably accurate time and cost estimates, a tangible cost-benefit analysis, and the set of particular data points you anticipate being crucial to enterprise-wide performance measurement. This is not meant to be set in stone but rather to establish a baseline that will be reevaluated against outliers and new developments across the life of the project. 

Building this rigor into your standards of implementation and execution is imperative to the effective tracking and evaluation of progress toward stated goals and ensuring a standard approach to value measurement that accounts for more than one key metric.

Embrace a strong change management approach 

Innovation means change, and with change comes uncertainty. The execution of a strategic plan can be exhausting, confusing, and frustrating, particularly when there’s a level of comfort with the processes or methods undergoing modification. In fact, it has been widely stated for years that nearly 70% of change programs fail, in large part due to employee resistance, whether that resistance is outright or more subtle, which may not be surprising considering that only 3% of business leaders commit to investing in training and reskilling programs

You can’t build buy-in, balance priorities, work toward shared business and IT goals, or effectively baseline and track value without a strong change management approach. Therefore, the first steps of any change management strategy are to establish why the change is needed, identify champions, and build a coalition of supporters that seek to understand and reasonably address resistance and points of stagnation. Investing in the proper communication and support—training and reskilling—programs will help you temper potential employee dissatisfaction and avoid the pitfall of seeking the shortest path to implementation in order to please shareholders regardless of what your workforce feels and thinks. 

Embracing change requires that resources are effectively mobilized and buy-in is not only achieved up front—with the aid of readiness assessments and early barrier detection, for instance—but sustained throughout the duration of your initiative through frequent communication and in-depth training plans. With those principles and actions in place, your organization will have the discipline and energy to reach your desired future state.

Conclusion 

Developing a strategic plan is just the first step on a longer journey toward achieving your goals and realizing your vision. Business cases must start at the top and filter down throughout the organization; priorities must be balanced, transparent, and sufficiently flexible; technology must be a partner to business; value must be tracked across multiple strategic data points; and all levels of the organization must be supported not only with training and reskilling programs but also by a coalition of vested supporters. 

The goals of your strategic plan can be achieved, and the benefits to your organization and members realized. It will take strong leadership, discipline, and collaboration supported by sound frameworks and methodologies and enhanced by a mindset of continued, iterative improvement. The right partner on this journey will be there each step of the way, helping your organization achieve the greatest value on its investment and avoid costly pitfalls.

West Monroe’s exposure across industries gives us unique insights that we translate into the creation of lasting value by treating causes, not just symptoms. Our deep experience across the healthcare value chain is augmented by business transformation and organizational change management expertise to help your organization achieve sustained adoption of your strategic vision.

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