Hitting the Mark
Radiology leaders prepare for the future by creating a strategic plan.
In one scene from Shakespeare's "Measure for Measure," circumstances align to provide Claudio with a keen sense of his own mortality.
Instead of fearing the unknown, however, Claudio chooses to embrace it, saying, "I will encounter darkness as a bride, / And hug it in mine arms." Health care reform combined with declining reimbursements have conspired to cause many radiologists to feel that the profession's future is ambiguous at best. However, like Claudio, radiologists would do well to move forward despite this ambiguity, taking practical steps to change their business outlook for the better. One proven way to navigate the darkness is to adopt a strategic plan.
A Measure of Control
Staying one step ahead of the challenges facing radiology today requires an aggressive response. Formulating a strategic plan can help radiologists realign their business priorities to keep pace with a rapidly changing industry. According to Bob Maier, CEO of Regents Health Resources, Inc., a health care consulting firm specializing in medical imaging development and strategic planning, groups often realize they need to make a change when they begin hearing negative messages from unsatisfied clients. Maier says a common warning signal entails "a hospital telling the group that they're no longer going to refer all of their patients to the group because another practice does a certain aspect of patient care better."
Maier begins his consultations by developing an accurate picture of the marketplace and the practice's place in it. Regents uses its national database of markets and practice benchmarks to understand the market share and relative strength of a practice when compared to its competition. Maier looks at client relationships, brand reputation, geographical coverage, and competition.
Once the market evaluation is complete, Maier conducts a SWOT analysis. SWOT — which stands for strengths, weaknesses, opportunities, and threats — helps the group determine its strengths and weaknesses using criteria such as subspecialization, coverage, support services, and client satisfaction levels to make its determination. SWOT also looks inward at the operational, technological, and organizational aspects of the practice to support its strengths and correct its weaknesses. Shoring up weaknesses often means understanding needs and meeting client expectations, whether those clients be hospitals, referring physicians, patients, or all three. Maier notes that this type of alignment can mean a number of things: gaining a better understanding of who constitutes the client base, becoming more proactive about exceeding customer expectations, and identifying opportunities for expanding services, the latter of which is a key feature of strategic planning. With reimbursements on the decline, every opportunity to expand with existing clients or perhaps with new clients needs to be explored and evaluated. One of the best ways to assess these deficits is by interviewing and surveying customers and prospective customers to see if their needs are being met.
Putting Words into Action
Once all of the data are analyzed, Maier sits down with a practice's leadership to refine its target markets and clients. During this process, leaders establish what the practice's product or service differentiation is within its specified market and identify what Maier calls "opportunity goals." Opportunity goals are those that a proactive practice will identify on a regular basis to enable new revenue streams. Identifying internal goals involves prioritizing those goals that constitute "easy operational or marketing fixes" and deciding which longer-term goals to implement. In addition, some fixes may require capital investment, such as installing new structured reporting software to meet referring physicians' needs.
Lastly, Maier breaks goals down even further into those that must be achieved within one to three years and those to be attained within three to five years. The former involve fixing weaknesses and maximizing the practice's performance with its current clientele, such as improving coverage or replacing an older MRI magnet. Goals within the three-to-five-year time horizon can include opportunities to expand a group's services outside of their current market, to invest more heavily in technology, and to hire more subspecialty trained radiologists to extend their reach to new clients.
Although setting down the building blocks for a thorough strategic plan takes time, the results can transform a practice. The name of the game is securing contracts, notes Maier, and that's not easy to do in the current climate, where the onus is on radiologists to prove their value to clients. Richard G. Abramson, MD, assistant professor of radiology and radiological sciences at Vanderbilt University, says, "The assessment process can be painful, but it is essential to formulating concrete strategic objectives with measurable goals."
Measuring goal attainment and building a framework for accountability are important components of an effective strategic plan. According to Maier, a successful practice must have two things: a good plan and accountability. "Without leadership, the practice will flounder and won't achieve its true potential," says Maier. "And without accountability, members of the group will continue doing the things they're comfortable doing and will avoid change."
In other words, simply creating a strategic plan isn't enough: a practice must meet measurable objectives, such as practice leaders providing opportunities for physicians to take a leadership role in their hospital and sit on hospital committees. In turn, radiologists must be held accountable when they do not meet those goals. Maier concludes that it is essential that everyone, whether they be partners or employees, understand the role they play in transforming the practice, and that clarity of communication must come from the top.
Strategic Planning: ACR-Style
Practices aren't the only ones who can benefit from a strategic plan; the ACR is in the midst of implementing its own strategic plan, endeavoring to become the most effective organization it can be for its members. Bibb Allen Jr., MD, FACR, chair of the ACR's Board of Chancellors (BOC), has made strategic planning a high priority during his term as chair.
"We recognized as an organization that there were many changes taking place — health care reform, the potential for new payment models, changes in how our members practice day-to-day — that made us believe that we had to reexamine our approach," explains Allen. "There are more opportunities than resources, so we wanted to make sure the programs offered by the College align with our members' needs."
So the ACR put together a Strategic Planning Task Force to guide the College through the strategic planning process. According to William T. Thorwarth Jr., MD, FACR, CEO of the ACR — who began his tenure after the strategic planning process was already underway — care was taken to include a diverse group of radiologists on the task force. Task force members included both private practice and academic radiologists, those from various subspecialties, and not just long-tenured radiologists but also residents and young physicians. The group put forward a core ideology, vision statements, and goals and objectives against which College programs would be compared.
Once the groundwork was laid, ACR hired an outside consulting firm to help develop the strategic plan. They began by assessing what ACR does well and where opportunities exist for improvement. The firm, Tecker International, evaluated ACR's strengths and weaknesses by performing surveys and holding interviews with both internal stakeholders (such as state chapter leaders, councilors, and individual members from both academic and private practice), as well as external stakeholders (such as representatives from other radiological organizations). Tecker also facilitated the development of the strategic plan that took place over several meetings last summer and was approved by the Board of Chancellors in September 2014.
However, developing the plan was not an end unto itself. The next phase involved a program assessment in which all of the College's programs were measured against the tenets of the strategic plan. In addition to this, programs had to also prove valuable to the membership as well as be financially viable.
Going forward, says Allen, the next step is called a "gap assessment" in which the College works to identify any gaps in services and explores how to fill them. It's important, explains Allen, "to determine if there are areas in the strategic plan where we don't have a program, and if existing programs can be modified to cover the gaps." If new programs are considered to fill gaps in the strategic plan they will be assessed using the same process as the original program assessment to ensure they represent the best use of College resources. Additionally, each program will be monitored against agreed-upon metrics to be sure the College stays on track.
One major finding of the strategic planning process so far, concludes Thorwarth, is that radiologists are looking for the College to partner with them in order to succeed in this new era of health care reform. Allen agrees: "It used to be that we radiologists could look to the College to do things for us. We'd send in our money and the organization would do the things we couldn't, like working toward coding policy and reimbursement values." But in the future the ACR will have to do more than that. "The ACR will continue to fight the reimbursement and health policy battles in Washington, but equally important will be establishing partnerships with our members to help them provide their own value to their referring physicians, health systems, and, most importantly, their patients," says Allen.
Planning for the future is a worthy task for any organization, whether it is a business or a membership association. Just as business leaders want to provide the best value to their shareholders and as radiology practice leaders work to ensure the highest quality care for their patients, the ACR strives to be a good steward of its members' resources. Experts agree that in these challenging economic times, any practice or department would do well to embark on a strategic plan to keep its house in order.
Learn More at ACR 2015
Visit the continuing education session titled "Strategic Planning for Radiologists: Challenging Times Require Proactive Solutions" to learn how to better position your practice for continued success.
The Anatomy of a SWOT Analysis
According to Bob Maier, CEO of Regents Health Resources, Inc., a SWOT analysis assesses not just a practice's market advantages, but also looks inward at the operational, technological, and organizational aspects of the practice. Here are some items that might appear on your practice's SWOT analysis.
Examples of strengths a practice might accentuate to distinguish it from competitors can include the following:
• Subspecialized expertise
• Strong relationship with hospital
• Support from administration
• Regional recognition
• Quality of physicians
• In-house coverage
Opportunities might range from the external — pouring more resources into marketing efforts, for instance — to the internal, which might involve the need to better leverage existing technology. Some other opportunities might include the following:
• Align with hospital
• Align with other radiology practices
• Gain market share
• Improve contracts
• Bring in new business
• Create awareness of radiology services
Weaknesses in need of improvement may include the following:
• Lack of income diversification
• Being tied to one hospital system
• No significant hard assets
• Lack of IT support
• Divisive politics within the group
External threats can come from many quarters, such as the following:
• Decreasing reimbursement
• Increasing after-hours work
• Increasing numbers of non-compensated cases
• National radiology practices
• Competing local radiology groups
• Leakage of studies
• Health care reform and ACOs
• Turf wars
• Self-referral/in-office imaging1
To learn more about strategic planning, read the Imaging 3.0TM case study "The Metamorphosis of a Practice."
By Chris Hobson, Imaging 3.0 content manager