A straightforward approach to veterinary practice strategy

Why does strategy matter?

Strategic planning is important for ensuring you continue to have a meaningful and viable business that distinguishes itself from its competitors and meets the needs of its clients.

Creating a strategy will help you identify your “unique selling points” (USPs) and guide what you do day-to-day in allocating resources such as people, equipment and money to best effect, so you are balancing short-term needs with longer-term ambitions for a sustainable business that doesn’t simply lurch from one thing to the next.

Strategic thinking helps you anticipate and adapt to these changes, ensuring your practice remains compliant and relevant, as well as helping to identify opportunities for growth

The veterinary sector is competitive with many practices vying for the same client base. It’s also subject to constant change, eg in regulations, customer expectations, the economy and technology. Strategic thinking helps you anticipate and adapt to these changes, ensuring your practice remains compliant and relevant, as well as helping to identify opportunities for growth, whether through opening in new locations, expanding your services or leveraging your assets.

If you don’t engage in strategic planning, there is a risk that your practice will become less relevant, perhaps because it has lost touch with external realities, or it lacks something internally. In the worst case scenario, the whole purpose of your practice could become divorced from the reality of what is happening both inside the practice and in the outside world, becoming “lost organisation” (Thompson and Martin, 2005).

The strategic planning process

The strategic planning process can be as simple or as complicated as you wish it to be – there are countless models that can be used to help frame your thinking but stripped down, it is about asking yourself three questions:

1. Where are we now?
2. Where do we want to be?
3. How are we going to get there?

1. Where are we now?

The strategic awareness stage of the process is about analysing the external competitive environment, your internal resources and values, and the vision and mission (purpose) of your practice. You need to ask yourself whether you are delivering on the “sweet spot” where these factors overlap and through offering something that your customers desire – and in a better way than your competitors (Figure 1).

The simplest tool for understanding your current strategic position is the good old strengths, weaknesses, opportunities and threats (SWOT) canvas (Figure 2). The best approach to this is to ask everyone in the practice team (or at least a selection of people from different roles as they will bring different perspectives) to complete a SWOT analysis of the practice, asking them for their opinions as to the practice’s strengths, weaknesses, opportunities and threats.

I also suggest you apply your SWOT analysis to each of the four quadrants of the 4Cs whole practice model (Figure 3). In this, you should ask what strengths, weaknesses, opportunities and threats your practice has in respect of:

• What you clinically offer in terms of services, clinical standards and providing a caring, safe and happy environment for your patients
• What you do for customers in providing a customer experience that attracts and bonds the customers you want and who would recommend us to others
• What you do for colleagues to attract, develop, engage and retain a team of people who support, challenge and care for each other in the delivery of outstanding clinical, client, people and business performance
• What you do for the commercial health of the business, generating a reasonable profit through maximising income and controlling costs, which ensures the business is sustainable, protecting jobs, attracting investment to develop and grow, and providing a fair reward for the work put in

Once you have received everyone’s contributions, pull them together into a complete SWOT analysis and start some provisional discussions to gather more clarity and detail before seeking to move on to question 2.

Advanced practice

If you’re keen for a deeper dive, there are further models you can use to provide additional direction to your thinking, the output from which can then be used to feed into the SWOT.

These include:

• Porter’s 5-Forces and from competitors
• PESTLE for analysing opportunities and threats in the wider external environment
• The VRIO framework for assessing the value of your resources and capabilities
• The BCG Matrix for prioritising the products and services you offer
• Ansoff’s Matrix for thinking about ways to grow as a business
• Porter’s Value Chain for ways to improve efficiency and reduce costs
• SERVQUAL for analysing your service quality

Introducing too many models will be overwhelming though, so to begin with, the SWOT, the 4Cs and the wonderful minds of the people that work in your practice will be more than enough to develop a strategy.

2. Where do we want to be?

From SWOT to TOWS

A useful way of analysing the output from the SWOT is to use the threats, opportunities, weaknesses and strengths (TOWS) matrix (Figure 4), where you simply list the opportunities and threats across the top and the strengths and weaknesses down the side and ask:

1. How can we use our strengths to (i) take advantage of opportunities and (ii) better handle threats?
2. What, if anything, should we do about our weaknesses so we can (i) seize opportunities and (ii) avoid threats?

Purpose and strategic direction

Before you start to make any decisions about strategy, it’s good to take a step back and question your purpose – ie what your practice exists to do.

Figure 5 shows some of the key elements of strategic direction that emphasise the alignment of operational activities with strategic goals. At the top of the pyramid are the “purpose” aspects – your practice’s mission and vision for the future – which are usually expressed in either one or a few short, snappy sentences each.

Before you start to make any decisions about strategy, it’s good to take a step back and question your purpose – ie what your practice exists to do

As an example, when I worked at Vets Now, our vision was “Together, improving the lives of vets and pets” and our mission statement included a set of objectives around service delivery to member practices, pet owners, pets and each other, advancing emergency and critical care development across the UK, and business growth.

So, with this in mind, look at the SWOT while asking yourself:

• What is our mission? What are you selling? What business are you in? What is the purpose of your practice beyond profit? What is its history? What are its values? Who is it there to serve? What problems is it there to solve? What do you call success? Are we focused on cost or quality? What makes your practice special to your clients and to your practice team?
• What is our vision? What does the ideal future look like for your practice? Where do you want it to go? What do you want it to look like in 3, 5 or 10 years’ time? What would you like to see it do more or less of? How would you like it to be perceived by your stakeholders and the veterinary industry? What would you like its legacy to be? What are your long-term goals across the 4Cs?

Only once you have defined your mission and vision can you start to make some choices on strategic direction, as everything you do strategically should relate to them.

Assessing your options

Hopefully, your SWOT will give you plenty of food for thought and the next step is to prioritise so you have a manageable number of strategies to pursue, enough to ensure focus and that they are achievable (eg one to three in each area of the 4Cs).

There are several ways of doing this:

1. You can discuss each option, its pros and cons, and simply decide or take a vote
2. You can add an element of scoring to the process – discuss each option, its pros and cons and then:
   • Score each out of 10, or
   • Score each out of 5 based on how you “feel” about the idea then out of 5 on what you “think” about the idea to get a “heart and mind” score out of 10, or
   • Score them each out of 10 against a more particular set of criteria
3. You can also do the above but with weighting applied to each criterion for more nuanced scoring

Criteria, weighted or otherwise, might include aspects such as:

• How successfully can we implement it?
• How quickly will we get a return on it?
• How attractive are the potential financial returns?
• How attractive are the non-financial benefits?
• How risky is it?
• How well will it go down with clients/employees/patients/suppliers/investors?
• How much of a “fit” is it for our vision/mission/values?
• How well does it overcome weaknesses/tackle threats/build on strengths/seize opportunities?

The strategic plan

Figure 6 shows a basic way in which you can capture your strategic plan in one document, and Figures 7 and 8 are example plans from two fictional small animal veterinary practices with distinctly different strategies.

The practice mission and values form the bedrock of the template with the vision at the top. Each strategic area has an overarching objective (or “mission statement”) to capture what is important to your practice across the 4Cs.

Below this, record the strategies you will deploy to work towards each objective over the period of the strategic plan.

Below that, indicate how you will measure your progress.

The template can be used to record a three-year plan, or a one-year plan as a step towards the three-year plan.

You may also find the target framework in Figure 9 useful to record your current position for each of your strategies, where you would like to be at the end of year three, and where you would aim to be at the end of year one as you progress towards that three-year plan. Figure 10 gives an example of doing this for a pet health plan launch as one of the strategies in the customer strategic area.

Obviously, you should try to make your goals as specific, measurable, achievable, relevant and time-bound (SMART) as possible, but bear in mind some things worth doing are not easily measured, so sometimes a description of the situation as it is now and how you envisage it looking in year one and then in year three might be the best you have. It’s still a measure!

3. How are we going to get there?

Tactics are actionable, granular tasks and projects taken in pursuit of the strategy and highlight who’s doing what and when in the execution of the plan

Most strategies are broad game plans with a level of complexity and require a set of more detailed tactical plans to achieve them. Tactics are actionable, granular tasks and projects taken in pursuit of the strategy and highlight who’s doing what and when in the execution of the plan.

For example, if one of your strategies is to grow the number of patients on pet health plans from 15 percent to 20 percent over the year, you may need to include tactics around:

• Reviewing your pet health plans – what is included/excluded, pricing, types of plans available, etc
• Rebranding your pet health plan offering(s)
• Digital and traditional marketing tactics
• Educating and improving employee advocacy of pet health plans
• Integrating selling and retention of pet health plans into the client journey

The strategy owner will need to keep track of the tactical plan through regular catch-ups with those involved and an action-based approach to drive progress. You can record actions and keep track using a spreadsheet like the one in Figure 11 or treat each tactical plan to its own spreadsheet.

Some strategies may require you to adopt project management or change your management approach depending on their complexity and impact on the team.

Reviewing, measuring and adapting

Most tactics will have a set of low-level detail measurements to help inform them and track progress, with objectives and strategies tending to have fewer, higher-level detail measurements associated with them. For instance, high-level detail metrics might include number of patients on a pet health plan and the percentage of active clients with a pet health plan, with lower-level detail metrics drilling down to understand where the growth is coming from.

It is good to have regular strategy update meetings to monitor progress across the strategic areas, taking a balanced approach to look at the high-level financial, customer, people and clinical measurements alongside each other. This gives a rounded view of performance, helping prevent one area improving at the expense of another, and to ensure that lessons learned driving strategy in one area could be applied to other areas. If you’re not on track, could you do something more or something different to get back on track or are your targets too ambitious and in need of adjustment?

And repeat…

The final point to make is that strategy is not static. As well as having to evolve your plan through the year, as part of your budget process for the following year, you should review your progress and repeat the above exercise.