HCO 7020 Module 1 Strategic Management Written Assignment Example

Four Hundred Ten Births and a $3.1 Million Loss: Why a Rural Hospital's Board Needs Strategic Thinking, Planning and Momentum

Student Name

MBA in Healthcare Management, Thomas Edison State University

HCO-7020: Strategic Management within a Healthcare Organization

Mentor Name

Month Day, Year

Four Hundred Ten Births and a $3.1 Million Loss: Why a Rural Hospital's Board Needs Strategic Thinking, Planning and Momentum

Skylands Community Hospital is a composite independent nonprofit hospital with 140 licensed beds in Sussex County, New Jersey, a largely rural county in the state's northwest corner. Its average daily census has fallen to 78, births have declined to 410 a year, and its obstetric unit loses about $3.1 million annually. Larger health systems in neighboring counties have opened urgent care centers and physician offices within its service area, and two of its cardiologists have joined one of them. The board has asked the new chief executive for a strategic management approach. This assignment explains the three components of strategic management in Ginter et al. (2018), compares them and applies each to Skylands.

Strategic Thinking

Ginter et al. (2018) describe strategic thinking as the continuing, creative process of understanding an organization's situation and imagining its future. It asks questions such as what is changing, what those changes mean and what the organization could become. It is not a document but a habit of mind that leaders practice in conversations, environmental scanning and reflection.

At Skylands, strategic thinking means questioning assumptions the hospital has held for decades. One is that a community hospital must offer every service it always has, including obstetrics. Another is that independence is the only way to remain responsive to the community. Strategic thinking would ask what residents of Sussex County will need in ten years, given an aging population, rising behavioral health needs and the movement of care to outpatient settings, and which of those needs Skylands is best placed to meet. Hung et al. (2017) documented that 9 percent of rural counties lost all hospital obstetric services between 2004 and 2014, which shows that the question facing Skylands is part of a national pattern rather than a local failure.

Strategic Planning

Planning, in the course text's account, is the scheduled and disciplined work of turning those insights into commitments: assessing the external and internal environment, setting direction through mission, vision and values, choosing strategies and writing plans to carry them out (Ginter et al., 2018). Its product is a plan with goals, responsibilities and resources. Mintzberg (1994) warned that formal planning cannot by itself create strategy, because strategy depends on synthesis and insight; the three-part model answers that criticism by pairing planning with strategic thinking rather than substituting one for the other.

For Skylands, planning would begin with a situational analysis of its service area, competitors, finances and capabilities, followed by a review of its mission. The current mission, to provide excellent care close to home, remains valid but could be sharpened to emphasize the services that most need to be local, such as emergency care, behavioral health and care for older adults. The plan would then compare strategic alternatives, such as an affiliation with a larger system, a restructuring of services or a combination, and set measurable goals for the chosen direction over three to five years.

Managing Strategic Momentum

Ginter et al. (2018) use managing strategic momentum to describe the ongoing work of carrying out a strategy and keeping it on course: monitoring results, learning from what happens, and adjusting as conditions change. Plans fail less often because they are poorly conceived than because organizations stop paying attention after the plan is approved.

For Skylands, managing momentum would mean a small set of measures reviewed monthly by leadership and quarterly by the board, such as outpatient visits, behavioral health capacity, physician recruitment and operating margin, along with explicit points at which the board will revisit major decisions. If the hospital decides to close obstetrics, for example, momentum management would track whether prenatal care and transport arrangements actually serve women in the county.

Similarities and Differences

The three components share a purpose, positioning the organization to succeed in a changing environment, and they depend on one another. They differ in form and timing. Strategic thinking is continuous and creative, often informal, and generates insight. Strategic planning is periodic and analytical, involves defined steps and produces decisions and documents. Managing strategic momentum is continuous and operational, turning decisions into results and feeding new information back into thinking. A useful image is a cycle: thinking informs planning, planning sets the direction for action, and monitoring action prompts new thinking.

Why Skylands Needs All Three

Each component alone would fail the hospital. Thinking without planning would produce ideas the board never commits to, while the obstetric losses continue. Planning without thinking would produce a polished document that preserves current services because no one questioned them. And planning without momentum would produce a plan that sits on a shelf while competitors keep recruiting the hospital's physicians. The chief executive should therefore establish all three: a leadership retreat and regular environmental briefings to build strategic thinking, a structured planning process over the next six months, and a dashboard and review schedule to sustain momentum.

Conclusion

Strategic management, as Ginter et al. (2018) describe it, combines strategic thinking, strategic planning and managing strategic momentum into a continuing cycle. For a rural hospital like Skylands, facing declining births, a costly obstetric unit and competition from larger systems, that cycle offers a disciplined way to decide which services to keep, which to change and how to remain viable while serving the community.

References

Ginter, P. M., Duncan, W. J., & Swayne, L. E. (2018). Strategic management of health care organizations (8th ed.). Wiley.

Hung, P., Henning-Smith, C. E., Casey, M. M., & Kozhimannil, K. B. (2017). Access to obstetric services in rural counties still declining, with 9 percent losing services, 2004-14. Health Affairs, 36(9), 1663-1671. https://doi.org/10.1377/hlthaff.2017.0338

Mintzberg, H. (1994). The fall and rise of strategic planning. Harvard Business Review, 72(1), 107-114.