As King's Medical began to change gears and prepare for a capital-intensive operation, Patton and the board decided it was time to articulate and put to paper a long-term vision for the company, which would feed into shorter-term operational plans of day-to-day business.
Mission Statement
To start the process, the King's Medical leadership group focused first on defining, in the clearest terms possible, why they were in business. "The questions you ask yourself are very basic, the kinds of things that are listed in any strategic-planning book," says Patton. (Among his favorites: The Executive Guide to Strategic Planning, by Patrick J. Below, 1987, Jossey-Bass.) They are questions such as, What business are you in? Why do you exist? What's unique about your company? How are you different from the way you were three years ago? How will you be different in four years?
First in 1986 and then again in 1989 Patton asked each of the five board members (himself included) and Van Kirk to answer those questions and write down their conception of the company's mission. He combined the answers, eliminating repetitive responses. Then the six got together and talked about the substance of the comments, hashing out a common list of mission aims and ranking them in order of importance.
For example, among the eight points articulated on the current King's Medical mission statement are the company's commitment to "offering the highest quality support services in the marketplace to ensure that both client and corporate objectives are reached," and its dedication to "expanding business operations to include services, technologies, and/or products that would complement the core diagnostic-imaging business of the company."
The mission statement is the most widely disseminated piece of the strategic plan -- all employees have a copy in their handbooks, and it is given to all job applicants as an introduction to the company.
Critical-Issues Assessment
The next step in King's Medical's strategic-planning pro-cess is to analyze the industry, which results in the production of a business plan. That analysis might include a description of the marketplace and the company's position in it; anticipated shifts in areas such as regulatory rules; and potential responses to challenges presented by competitors, regulations, or the economic climate. "This is very standard for planners," says Patton. "It's abbreviated SWOT -- evaluating your strengths, weaknesses, opportunities, and threats."
King's Medical used several methods to cull information for the document: brainstorming with managers and executives; buying stock in public competitors ("One company listed all 32 of its sites in its annual report, which was extremely helpful to us"); running an on-line computer search of trade journals. After Patton, who led the strategic-planning process in both 1986 and 1989, had been collecting data for several weeks, he, Van Kirk, and other board members began meeting again to figure out what would be the critical issues for King's Medical over the next three to four years. (Meetings were limited to three hours. "We all have other work to do, and the time limit keeps us fresh," says Patton.)
"For us in particular," says Patton, "we're looking at issues of technology -- what if there are new advances and we're stuck with $27 million in paper [debt]? We're looking at issues of personnel: how do we recruit and train in a rapidly growing company? We're looking at issues of capitalization: how do you finance projects costing $1 million to $2 million when you want to do 5 or 12 or 30 of them?"
"In so many companies, information like this is handed down from the finance department," says Van Kirk. "They'll say, 'You'll have to sell x, period.' Or maybe they'll ask you what you think you can sell, and you'll tell them, and they'll tell you that's not enough." King's Medical's evaluation process -- which the company will be going through again beginning this fall with Van Kirk, Patton, and the directors of marketing, sales, territory management, and finance -- gets a wide range of people talking about the company's needs, as well as the obstacles it faces and how they can work as a team to overcome them.
Long-Term Objectives and Action Plans
The final step in the strategic-planning phase of the overall planning process is to lay out specific long-range objectives for the company and devise action plans so it can meet each one.
For instance, one of King's Medical's earliest long-range objectives was to put a marketing department in place. That long-term goal was then broken down into four specific steps -- hiring, training, visiting sites, and writing up documents -- which became benchmarks to track progress. Included in the plan were estimates of how long each action should take, when it was to start and be completed, and who was responsible for seeing it through.
Taken in sum, the strategic-planning phase of King's Medical's planning program consists of three parts: an articulation of the company's vision in the mission statement, a detailed description of the critical issues the company anticipates facing, and a set of action plans that should enable the company to move forward.
The time involved? The first plan took a little more than six months to complete. Patton estimates the total time he put in to be 100 hours, or about a day a week over the course of the half-year cycle. The rest of the planning group, he says, spent 20 to 25 hours in group meetings over that period. For the 1990 session Patton spent less time -- about 50 to 60 hours overall, while the board still kicked in 20 to 30 hours. This fall's revamping of the strategic plan will be launched with a three-day planning retreat for the internal management team. Patton thinks that this time through, the process should take three to four months from beginning to end.
Operational Plans
Operational planning, in some ways, is where the strategic-planning process really begins to pay off: if the strategic planning has been done well, each department will be able to set up day-to-day itineraries that are straightforward and clear -- and that derive directly from King's Medical's broader visions.
