1. Art and Diseño

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FalVAutomne 1991
Article original
Original Article
Although the principles and process for developing a strategic plan are well
established, little information exists on how organizations can implement these
plans. The authors developed a framework and methodology for The Ontario
Cancer InstitutelPrincess Margaret Hospital that connects the implementation
of the strategic plan with resource allocation and the budget; thus, the budget is
a quantified expression of the strategic plan. To accomplish this, a specific cycle
of events leading to the development of a corporate calendar was undertaken,
which results in the establishment of the annual budget.
Bien que les principes et les processus de dkveloppement d u n plan strate'gique
soient bien connus, on dispose de peu dinformations sur la manidre dont ces
plans peuvent &re mis en oeuvre par les organismes. Les auteurs ont klabork un
cadre et une me'thodologiepour I'lnstitut du cancer de 1' Ontariolhhpital Princess
Margaret qui relient la mise en oeuvre du plan stratkgique a l'attribution des
ressources et au budget; ainsi, le budget est I'expression quantiJike du plan
stratkgique. Pour parvenir a ce rbultat, on a empruntk une suite particulidre
d' kvknements jusqu'd I' e'laboration d u n calendrier d entreprise dont le rksultat
est 1' e'tablissement du budget annuel.
A Process for Implementation
of the Strategic Plan: From Strategic Planning
toward Strategic Management
by Neville C. Chenoy, Mary Jean Morrison and Donald R. Carlow
M
any external forces have an impact on Canadian health care organizations, the cumulative effect of
which is the beginning of a fundamental transition in the delivery of health and social services in
Canada.' The uncertainty and rapidity of these changes require that they should be addressed through
the application of several principles that allow the organization to cope effectively with its changing environment. The following must be considered in strategic planning:
* The organization's mandate must be clear as to what it can and cannot do.
The organization's mission, philosophy and core values, in tandem with its mandate, provides the raison
d'gtre, the social justification for its existence.
The organization must be knowledgeable about its external environment and the opportunities and threats this
poses to the organization.
.
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Fall/Automne 1991
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The organization must know its own strengths and
weaknesses to determine how well it can cope with
external pressures and changes.
It must be able to identify its strategic issues and the
consequencesof failure to address these issues.
Strategies must be formulated to address the identified
issues which are technically workable, affordable and
politically acceptable to the key stakeholders.
The organization must have a “vision of success,”
knowing what it should look like as it implements its
strategies and achieves its full ~0tential.z~
However, although the principles and processes for strategic
planning are well defined, the literature is bereft of information
on how organizations can implement these plans. Institutions
have pursued the more limited approach by developing program-planningmethodologiesthat outline planning
mechanisms and priority-setting for new and expanded
programs, which, although important, constitute only one
aspect of strategic management.
Thus, at a time when the Canadian Council on Health
Facilities Accreditation is preparing new guidelines that will require governing boards to review strategic plans of their organizations and ensure their implementation,and when
provincial governments as principal funders of health care
facilities are calling for more effective governance from
boards, there is little information available to assist boards and
their organizationsto develop a process for implementing
strategic plans.
This article describes the principles and processes developed
by The Ontario Cancer Institutenhe Princess Margaret Hospital (OCIPMH) to implement its strategic plan. This information may be of value to other Canadian health care
organizationsthat may be reviewing their future directions and
exploring how they might reach their objectives.
.
History
Canada’s largest centre for cancer treatment, research and
teaching, the OCIPMH was established in 1958 and is affiliated with the University of Toronto. For the first quarter century, OCIPMH enjoyed a stable and well-endowed existence
that enabled it to achieve international status in oncology.
However, by the early 1980s, the institution had outgrown its
physical plant because of the rapid increases in the number of
cancer cases and a provincial shortage of treatment capacity.
Planning for new facilities was initiated; however, the recession of 1981-82aborted the institutions’ plans for redevelopment. By the late 1980s, serious serviceproblems began to
emerge at OCWMH because of overworked staff and limited
facilities that were unable to respond to the increased need for
Figure 1: Framework for Implementation of
Strategic Plan
r
lI
Reassessment
Strategic pian
I
.I
UI
environmental
issues
Strategic plan
equipment
proposals
II
directly from
the strategic
relevant)
Institutional budget
services. New or expanded facilitiesbecame urgent. With the
approval of the Ministry of Health, OCI/PMH began to plan
once again for appropriate facilities.
By the mid-l980s, a comprehensiveapproach to cancer care
had emerged from the earlier emphasis on radiation and medical oncology. Multidisciplinaryprograms, psychosocial services, networking among oncology service providers,
community involvementand cancer prevention strategies were
a few of these directions. Under new leadership, OCWMH
developed its strategic future directions and redefined its role
as a comprehensivecancer centre along these lines. Many other
new directions also emerged as a result of this strategic planning. Sharing of services with neighbouring hospitals was a
continuing initiative, while establishing strategic alliances with
other hospitals to develop a network of oncology programs was
new.
Multidisciplinarycare through site group organization,
epidemiology and cancer prevention strategies also emerged as
new ventures for the organization. Corporate reorganization, a
major initiativein continuous quality improvementand the
development of a Board of Directors dedicated to the institution, became necessary to support these new developments.
These major and rapid changes in the internal and external
environments of OCIPMH dictated a new future for the
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FalVAutomne 1991
Figure 2: Corporate Calendar Planning Cycle
Budget 1990-91
Retreat
documentation
P
b
Annual hospital
retreat
b
Cycle commences
again
14
Review of the draft budget
internallyby key groups
L
proposalssubmittedby dept
heads to VPs for review
z
Executive Staft Committee
Program ranking reviewed by
key groups
Initiationof the development of
departmental budgets
New programs & capital
kernsfinalized
organization. This was spelled out in its strategic plan; however, the plan needed a framework for its implementation.
Framework for implementation
of a strategic plan
Implementation of the strategic plan at OCI/PMH was seen
as part of a broader. integrative process, which had to bring
together the strategic plan and specific tactical level plans from
departmentsand proposals for new programs into a budgetbuilding process. To achieve such an integration between
strategic planning and the budgeting process requires
guidelines for change that reflect the organization’s preferred
future directions, as expressed in its strategic plan. These
guidelines also identify where priorities will be placed in supporting existing programs through departmentalbudgets;
where downsizing or phasing out will occur because these
programs no longer fit future directions; what criteria will be
applied to review proposals for new and expanded programs;
and provide the basis for assessing capital equipment requests
and any new construction projects.
me
of such an approach is that future services and
programs of the institution are proposed not on the basis of
departmentalaspirations or professional demands as is often
the case, but largely on the identified future directions of the organization.6-11
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FaWAutomne 1991
Figure 3: OCllPMH Strategic Plan Breakdown
Strategicplan
~
I
3
3
3
Goal 1
Goal 2
Develop a
comprehew
sive cancer
centre
Undertake
corporate
restructuring
to enhance
efficiency &
increase
quality of
working life
20 projects
14 projects
Goal 5
Develop a
dedicated
Board of
Directors
7 projects
Efficiently
accomplish
relocation of
OCIPMH to
University
Ave. site
Promote the
development
of provincial
and national
strategies for
cancer
control
13 projects
2 projects
A framework that incorporates these principles is shown in
Figure 1. To accomplish this, OCIPMH undertook a specific
cycle of events through the developmentof a “corporate calendar,” eventually leading to the establishmentof the annual
budget.
Development of a corporate
calendar
A corporate calendar is defined as a set of activities as part
of a repetitive process that an organization must undertake in a
set time frame to establish its basic priorities and identify how
it will use its resources in the next fiscal cycle and in the longer
term.
The implementation of the strategic plan was an integral part
of the corporate calendar process leading to the formulation of
the OCIPMH budget. The steps taken in this process are outlined below and shown in Figure 2. It was also important that
responsibility be assigned for the Completion of each step by a
specific date.*
Step 1: Review of key external and internal issues
Documentation was developed on external events, trends in
delivery of services to cancer patients, the oncology programs
needed currently and in the longer term and other relevant information. This information was distributed to all staff members who would later participate in a retreat.
Step 2: Development of corporate positions
Each key group in the institution must arrive at a consensus
on what it sees as the priorities within the strategic plan and
document its viewpoints. The viewpoints+x corporate positions-of each group are then distributed to the others so that
the expectations of the different groups are identified and understood. These corporate positions then become part of the
foundation for developing institutional guidelines and priorities
for the coming years.
For instance, medical programs are the responsibility of the
medical department chiefs. Therefore, these departmental
chiefs and the chairman of the Medical Advisory Committee
(MAC) are required to develop their corporate position relating
to future clinical developments,program changes for closures,
external linkages between their department and other organizations, developmentof new referral patterns, and so on. Such a
corporate position spells out where each department and the
MAC as a whole would like to see the hospital place its emphasis and resources in both the coming year and future years
based on its evaluation, for example, of changing demand for
services, new technology and programs and investment in oncological education.
Similarly, the Nursing Advisory Committee,the Research
Advisory Committee, and the Department Heads and Senior
Staff Committee documented their views on future developments at OCIPMH.
Step 3: Identification of goals and projects from
the strategic plan
The future directions for OCIPMH described in the strategic
plan were synthesized into five broad goals for the organization. Traditionalplanning approaches would suggest that for
each goal, a number of specific, measurable, achievable and
time-limited objectives should be established, along with
strategies for action. Although this approach could have been
taken, it was decided that a more practical way to implement
the strategic plan would be to identify for each goal, specific
projects drawn from the plan itself. These projects themselves
had to be implemented to realize the goals.
Fifty-five such projects were derived from the strategic plan,
each of which was associated with one of the five goals, and
every project was assigned to an individual “champion”responsible for its completion. The champion was assigned the
responsibility to develop a team to define the terms of reference for the project, set its objectives and the steps to be undertaken, identify a timetable for the project and the resources
needed for its completion.The Executive Staff Committee had
the responsibility to decide on the priorities for implementation
of projects.
Some of the projects required reorganizationor work to be
done in the institution that involved no financial implications.
Other projects dealt with new linkages and relationships to be
established with external bodies, such as the Faculty of
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Fall/Automne 1991
Figure 4: Status of Strategic Plan Projects
(Example)
Goal 1. To provide leadership in the development of a comprehensive
cancer centre and to become its “HUB”
Project
Responsibility
lor project
Develop
’resident
comprehensive
patient care
supportservices
which will
include
psychosocial,
palliative care,
prosthetics,
physiotherapy
and rehabilitation
Start date
I
Completion
date
qov. 1989 Awaiting
Ministry of
Health
approval
Current status
Proposals for new
and expanded
programs in
psychosocial and
rehabilitation
services have
been submitted to
Ministry of Health
as part of 1990-91
budget and
through the
relocation budget.
Medicine, and there were some operational projects that had
financial implications.
Figure 3 shows the strategicplan breakdown into goals an^
projects. Figure 4 shows the format for recording the status of
the projects, which has proven to be a useful tool for monitoring progress and communicatingthe status of the various
projects to the different constituencies within OCWMH.
Steps 4 and 5: Annual retreat to develop
guidelines for future directions
The future direction of OCWMH was discussed at a two-day
retreat attended by the members of the Board and key
clinicians,executivesand staff members. All of the participants
received a package of information relating to future projections, corporate positions of each group, goals and projects
emanating from the strategic plan and other relevant informa-
tion.
The outcome of the retreat was the identification of those
programs that required immediate attention, program priorities
for the 1991-92budget and ongoing organizationalpriorities
necessary to move OCIPMH closer toward its mission of becoming a comprehensivecancer centre.
Step 6: Development and weighting of criteria to
be applied for selection of new and expanded
programs
The discussions and outcomes of the retreat also provided
the basis for developing criteria that would enable the institution to decide how it would select competing program
proposals from the various departments.The Executive Staff
Committee developed this list and determined a weighting for
each criterion. These criteria would be used to assign priorities
to proposals from departmentsfor new and expanded
programs.
Step 7: Issuance of guidelines to departments
Guidelines that included the criteria that would be used to set
priorities were issued to department heads to inform them of
the organization’s priorities for the coming year and indicate
the basis on which their departmental proposals for new or expanded programs would be assessed.
Step 8: Development of proposals for new and
expanded programs and capital equipment
Department heads and chiefs prepared proposals for new
programs and equipment taking into consideration the
priorities of the organization. A special form was developed
that the department heads completed to provide information on
their new proposals as well as their program proposals.
Step 9: Ranking of program proposals
OCIPMH developed a process to rank program proposals,
which included sorting the proposals into their different
categories, screening proposals into “high impact” and “low impact” programs on the basis of the pre-established criteria, and
ranking the high-impact program proposals in order of priority.
Steps 10 and 11: Review of program-ranking by
the key groups
In keeping with the principle of developing a participatory
process, the ranking of proposals for new and expanded
programs was reviewed by the key groups in the institution.
Based on their comments, the Executive Staff Committee finalized the priorities for new and expanded programs and capital
projects for the coming year.
Steps 12 to 17: Preparation of the institutional
budget and submission to Ministry of Health
In this corporate calendar process, the developmentof the
budget reflects and supports the strategic directions of the organization. In a series of step-wise actions, the priorities for
new and expanded programs, major capital equipment,projects
emanating from the strategic plan and departmentalbudgets
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were established on the basis of the future directions of
OCWMH. The compilation of these decisions into an institutional budget resulted in a strategic management approach to
resource allocation.
It should be noted that in the first year (1990-91) after the
developmentof the OCIPMH strategic plan, certain projects
deemed vital to the organization, such as recruitment of leaders
for clinical departments and developmentof psychosocial support services, were implemented as soon as possible-even
before the corporate calendar was devised. With the introduction of the corporate calendar, the initiation of the remainder of
strategic projects followed the above steps. In developing the
budget for the next year (1991-92), the corporate calendar has
been followed in a step-wise manner (Figure 2).
Monitoring the implementation
of the strategic plan
A format has been developed to record the status of the
various implementationprojects, which is used to monitor the
progress of implementation(Figure 4). At OCWMH, this tool
is updated quarterly to allow management to monitor the
progress of implementationof the various projects.
With the integration of the strategic plan into the operating
budget of the institution,monitoring of the plan has been made
a part of the broader institutional monitoring processes. At the
corporate level, monthly financial reports and statistical and activity reports provide management with the information needed
to maintain or shift course. In addition, regular reporting on
OCWMH quality indicators provides information on the
quality of the output of the organization.
At the departmental level, plans, objectives and proposals for
new and expanded programs arise from the future directions
noted in the strategic plan. Monitoringat this level is effected
through monthly review of financial and statistical information.
In addition, departments are beginning to define their own indicators of quality and to evaluate their performance against
such standards. At the present time, new and expanded program proposals from departmentsare not assessed on the basis
of the ability of the department to offer a “quality” service.
With further developmentsin quality indicators, the notion of
quality could become a major criterion for setting priorities for
new and expanded program proposals.
Advantages and disadvantages
of a corporate calendar
Several advantages were noted in implementinga corporate
calendar at OCI/PMH.
1. It is an interactive, participatory process involving all key
groups in the organization. Because each group is required
to develop its own corporate position and explain it to the
others, there is an opportunity for better understanding of
each others’ needs and aspirations; this, in turn,can
enhance team-buildingand commitment in the
organization.
2. In this process, future directions and specific priorities are
identified by the key groups; this enables the organization
to assess collectively which new programs should be
developed, and which may no longer be necessary.
3. The services of the organization begin to be focused on the
strategic directions of the organization rather than
departmental aspirations. Members of the organization
begin to see the link between the strategicplan and
decisions that are subsequentlymade; thus, the activities in
the corporate calendar make the strategic plan a living
document.
4. By linking the various projects that emanate from a
strategic plan with the operational budget, a strategic
management approach to resource allocation is created.
5. The corporate calendar establishes a process and action
plan with a specific timetable to implement various aspects
of the strategic plan as part of the ongoing operations of the
organization. The disadvantagesare that the process is time
consuming, involves many people, and it requires staff
support which may have cost implications.
Principles for implementation of
the strategic plan
What was learned by OCIPMH from this experience that
might be useful to others? Several principles emerge:
The annual budget must be a reflection of the preferred
future directions of the organization.
The organization’s efforts must be directed toward achieving
its own future vision. Therefore, implementationof the
strategic plan must become a part of the budgeting process and
the resulting budget is then a quantified expression of that plan.
The implementation process must be iterative.
The integration of the broad strategic plan with the annual
financial planning is not a linear process; rather, it is iterative,
with the end of one cycle of events becoming the startingpoint
for the next cycle. Thus, a continuity is provided for the implementation process.
Participation from key groups is essential.
All key groups in the institution must be involved to establish guidelines for change. At OCIPh4H this involved the
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Fall/Automne 1991
Board of Directors, Executive Staff Committee,Medical Advisory Committee,Nursing Advisory Committee,Research Advisory Committee and Department Heads/Senior Staff
Committee.
Each key group must have the opportunityto present its
corporate position.
The key groups in the organization will have different
priorities within the strategic plan. They may also perceive future directions in different ways. Therefore, if a consensus is to
be reached, the key groups must be allowed to define their positions and make them known to each other so that there is a better understandingof each others' interests and expectations.
There must be a process for establishing consensus among
the key groups.
It is essential to develop a consensus in the organization on
priorities for the coming year(s) and the guidelines by which
the organization will select its new programs. The annual
Board retreat is a good forum for setting priorities for the future.
The process of implementation must be flexible.
Incorporationof the strategic plan into the budgeting process
requires time. Therefore, the process must start early in the fiscal year without all of the necessary information being available. This will require not only forecasting with limited
information but flexibility within the planning cycle to accommodate unexpected changes. Such flexibility is inherent in all
stages of the planning cycle and unanticipated events at any
time may require a re-examinationof the priorities and
guidelines that had been set earlier.
Final comments
A process is described that attempts to create a strategic
management focus at OCI/pMH in which the implementation
of the strategic plan with its emphasis on the future becomes a
key basis for the annual resource allocations through the
budget, thus making the budget a quantified expression of the
strategic plan. It is a dynamic process which will be refined as
experience is gained. The outcome has been joint decisionmaking by all key players in the best interest of the entire organization.
References and notes
2. Chenoy, N.C. 1984.Strategic planning: understanding and
responding to a rapidly changing world. Healthcare
Management Forum 5(2): 3-19.
3. Stacey, S.and Leggat, S. 1987.Strategic planning: a
practical guide. HealrhCare Management Forum 8(2):
41-51.
4. Webber, J.B. and Peters, J.P. 1983.Strategic Thinking:
New Frontier For Hospital Management,Chicago:
American Hospital Association: 7-18,120-130.
5. Bryson, J.M. 1988.Strategic Planningfor Pubiic and
Non-Profit Organizations, San Francisco: Jossey-Bass
Publishers: 46-70.
6. Cook, D. 1990.Strategicplan creates a blue-print for
budgeting. Healthcare Financial Management 44(5):
21-27.
7. Nyp, R.G. and Angermeier, I. 1990.Financial plan charts a
hospital's course for success. Healthcare Financial
Management 44(5): 30-36.
8. Glenesk, A.E. 1990.Six myths that can cloud strategic
vision. Ibid: 38,4043.
9. White, S. 1990.Corporate objectives and the planning
process. Dimensions in Health Service 67(1): 18-20,42.
10.Folger, J.C. 1989.Integration of strategic,financial plans
vital to success. Healthcare Financial Management
43(1): 23-32.
11.Jennings, M.C. 1988.What is financially driven strategic
planning? Topics in Health Care Financing 15(1): 1-8.
* For a list of the dates and the assigned responsibilities,please
contact Dr. Donald R. Carlow, President and Chief Executive
Officer, The Ontario Cancer InstituteEhe Princess Margaret
Hospital, 500 SherbourneStreet,Toronto, Ontario M4X 1K9
Neville C. Chenoy, M Pharm, MHA, CHE, is a Health Care
Planning Consultant in Toronto.
Mary Jean Morrison, MPA, CHE, is a Health Care Planning
Consultant in Toronto. Formerly, she was Director, Project
and Program Planning, The Ontario Cancer InstitutelThe
Princess Margaret Hospital, Toronto.
Donald R. Carlow, MI), CHE, is President and Chief
Execun've Officer, The Ontario Cancer InstitutelThe Princess
Margaret Hospital, Toronto.
1. Siler-Wells,G.L. 1988.Directing Change and Changing
Directions: a New Policy A g e d for Canada, Ottawa:
Canadian Hospital Association: 47-74.
El
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