Although the needs of the divisions are different and the time frames within which they work vary, there is consistency in the way each area approaches its own planning: the same set of issues is addressed in every operational plan. "I want to see how these more specific plans fit into our long-range objectives," says Patton. "That helps us create the vertical integration of our planning, to have a set of common ends we're all going after."
Each plan, then, whether for the marketing department, the sales department, or territory managers, explicitly touches on five things:
* which objective it helps to meet,
* the measurable outcomes (what exactly will be done),
* the time frame,
* the cost,
* who will be held responsible.
It's not that there's a form to fill out ("That would limit people's creativity," says Patton), but this way of thinking about planning must somehow inform the way ideas are presented.
King's Medical department managers develop their plans in conjunction with their own staffs and then work with Patton to hone them. Van Kirk approves the final documents and is involved in periodic monitoring of the results. What the company ends up with is a several-way discussion.
"Having the material written helps with accountability," Patton stresses. "And it's become part of our culture. People may gripe a little about the paperwork, but they see the value in it." Elaine Shinko, the marketing director, says that "at times it feels like busywork, but it has a way of imposing a structure, of clarifying my goals."
It's easier, too, to tinker with plans and keep them flexible if there's an original version to tinker with. "Everything we do keys back to three questions," says Van Kirk. "How does it fit with the company's goals? Where does your department want to be? And how do you know when it's there?" It might seem counterintuitive, but heavy planning, he argues, makes a company more flexible, not less: if you repeat those questions often enough on the front end, you make them second nature later, and when rapid changes in the marketplace are pushing for rapid -- and potentially dangerous -- changes in plan, a company is more likely to make changes that still fit into its vision.
Business Plans
Outside of its strategic and operational planning, King's Medical also does planning for new ventures. The company, though, learned the hard way: in 1987 it entered the business of mobile MRI units -- units that visit several hospitals a week -- without having a specific plan to cover basics such as competition, suppositions about the marketplace, and obstacles to be overcome. "We tried it, and we blew it," says Patton. It was a $150,000 mistake.
King's Medical now has two new businesses under way, and both of them are getting the business-plan treatment this time. This past May the company acquired a modular-building-construction company, to bring in-house the most expensive work -- work King's Medical used to contract out. Already sure that the purchase fits into part of the company's core vision of "expanding business operations to . . . complement the core diagnostic-imaging business" (from the mission statement), Van Kirk is in the process of writing a business plan to walk himself through the relevant new-business questions. After researching the industry and customer opportunities, Van Kirk wrote a draft, which he passed on to the management team; he anticipates at least one or two rounds of back-and-forth critique and revision before he's satisfied he has a document that will work as a management tool. The first draft was completed about two months after the purchase, and Van Kirk is giving himself another month to incorporate changes and write the second draft; he expects a definite plan three weeks after that.
The other new business will be a consulting division that will work with hospitals on their own planning. Steve Bruns, who's been with the company for a year, began in July to write a plan after talking with (and getting notes from) account reps and salespeople about their impressions of opportunities in the market. He also has had detailed conversations with Van Kirk about how this new business fits into the overall vision of the company. "As part of the ground rules," says Bruns, "we have to articulate how this serves the core business."
The processes of planning have seeped into other, nonoperational areas of King's Medical. For instance, all employees are encouraged to set annual personal goals -- to write them down and help figure out how the company can help them be met. The company, for instance, pays for college courses, which are reimbursed at 75% during studies, with the other 25% paid upon graduation; it also pays for conferences and memberships in associations.
The idea of setting personal goals came out of a board retreat held two years ago and a separate discussion about what was lacking in the company. "People aren't evaluated per se on these goals," says Patton, but discussing goals raises important issues that might not otherwise come up. Those discussions take place at least four times a year during informal performance evaluations; the meetings take 30 to 90 minutes.
At other times, employees have picked up on the propensity for planning and have used similar formats for bringing ideas to managers. Marketing specialist Jill Forrest wrote a nine-page proposal for getting computer upgrades and the Windows program after she and three other employees attended a computer meeting; the plan came complete with detailed cost information and suggested time lines. Her ideas are being incorporated into a plan by an outside consultant who's setting up a local area network within the company.
Overall, planning has helped to strengthen King's Medical's focus. The company's plans have encouraged a sense of ownership among employees, forced management to think with clarity, and fostered accountability at every level of the organization. Planning has helped carry a young company over its first formidable hump. "At this point we can probably survive one big mistake," Van Kirk says, "but until last year, we couldn't. Not with projects this big; not having to borrow the kind of money we borrowed in order to grow. One mistake and we'd have been out of business."
Of course, the record shows that King's Medical never made that fatal misstep. "The key," says planning convert Van Kirk, the onetime skeptic, "is keeping on track."
