An exploratory study of healthcare strategic planning in two metropolitan areas

Little is known about empirical variation in the extent to which healthcare organizations conduct formal strategic planning or the extent to which strategic planning affects performance. Structural contingency and complexity science theory offer differing interpretations of the value of strategic planning. Structural contingency theory emphasizes adaptation to achieve organizational fit with a changing environment and views strategic planning as a way to chart the organization's path. Complexity science argues that planning is largely futile in changing environments. Interviews of leaders in 20 healthcare organizations in the metropolitan areas of Minneapolis/St. Paul, Minnesota, and San Antonio, Texas, reveal that strategic planning is a common and valued function in healthcare organizations. Respondents emphasized the need to continuously update strategic plans, involve physicians and the governing board, and integrate strategic plans with other organizational plans. Most leaders expressed that strategic planning contributes to organizational focus, fosters stakeholder participation and commitment, and leads to achievement of strategic goals. Because the widespread belief in strategic planning is based largely on experience, intuition, and faith, we present recommendations for developing an evidence base for healthcare strategic planning.