Building Alliances

Subscribe | Advertise | About Us | Contact Us | Home

April/May 2000

By Frances J. Fowler, FAAHC

Using creative strategies to jump-start growth in a mature market.

Frances J. Fowler, FAAHC

Never before has strategic thinking been as important to rehab providers as it is today. The rehab market is now mature—and those providers who fail to adapt to the new conditions in this phase of the market life cycle will find themselves falling by the wayside.

While an emerging market is fueled by aggressive expansion, the mature market is characterized by slow to no growth. Rehab may continue to be driven by an aging population, and providers may embark on aggressive marketing tactics, but these factors will still be insufficient to counterbalance the slow growth cycle. As chief financial officers can attest, slow or no growth essentially means trouble. It ultimately leads to leaner bottom lines as overhead costs continue to rise from factors such as inflation, salary adjustments, and ongoing equipment/facility maintenance.

Surviving this environment of slowed growth is not an easy task. It is crucial to stimulate growth in some way, yet the old formulas no longer work. Regardless of the level of care, rehab providers face an interesting challenge—can they change their thinking from traditional rehab services and approach the business in a new, creative light?

Mind-set is difficult to change. It permeates all levels of thinking, from initial assumptions to possible solutions. And on a corporate level, it is even more difficult than on an individual level. It requires significant and sustained effort at all levels of the organization from the board to the staff. It also necessitates leadership and understanding of how to help these key groups think in new and different ways.

Developing a Creative Strategy

In contrast to common perceptions, thinking outside the box is not a free-flowing creative activity. Rather, it consists of a number of progressive steps. Once completed, these steps then serve as the foundation for future strategy.

The following guidelines can be used to develop a strong, creative strategy. Based on the successes at Good Shepherd Hospital, a 75-bed rehabilitation provider in Allentown, Pa, these guidelines will help providers effectively lead their organizations from the here and now into the kind of expanded future that is pivotal to generating the growth needed to survive.

Redefine your business. For most providers, rehabilitation is generally defined by tradition—the 10 diagnostic groups, specialty programs, of levels of care. Instead, providers need to think of rehab in a broader context.

“Rethinking your definition of rehabilitation is the first and the most critical step to developing a new strategy,” says Sally Gammon, president and CEO of Good Shepherd Hospital. “The process helps you think in ways you would not have perceived as possible before. It expands the world of opportunity and can reshape the future.”

For Good Shepherd, redefining its business springboarded the hospital into a different future. “At a retreat 3 years ago,” Gammon says, “a group of board members, managers, and key staff changed the concept of who we are. Instead of being in the rehab business, Good Shepherd is now in the function improvement business. The difference may sound minimal, but it is not. It has allowed Good Shepherd the opportunity to seek new and different business lines and to produce growth opportunities.” Indeed, since redefining its business, Good Shepherd has undergone dramatic growth. The organization expanded its levels of care; diversified its base of core services, adding subacute care and a long-term acute care hospital (LTACH); and implemented off-site programs to better serve more geographically distant acute care partners. Good Shepherd is still looking ahead. Plans are under way to expand the continuum beyond the current levels of care.

Rework your vision. Once you have really thought about the business you are in, or should be in, it is vital to look at your vision and what it reflects. “Once we looked at the business elements, we then considered what health care would be like in the future,” Gammon says. “It quickly became apparent that our vision statement did not address how our customers and environment are changing, nor did it fully align with our new values. Before, our attention was focused on being the best provider at a reasonable cost. We now see that our responsibility is to ensure that the population with functional limitations receives the right care at the right level, at the right cost, and with good outcomes.”

Build your strategy but only after the foundation has settled. Many providers move too quickly into a strategy before the dust has settled. Developing an innovative strategy takes up-front time—time to think through the implications and time to ensure that other key members of the team have integrated the new concepts and ideas.

When the ship leaves the dock, you want everyone aboard.

Shoot for a fluid, not a fixed, strategy. Basing your strategy on predicting the future 5 years out might have been fine in the old days, but today’s environment changes too rapidly. Instead of defining fixed action steps, today’s strategy outlines the direction the organization should pursue and identifies different options or a set of options for consideration. While such analysis may lead you to the best option, it will also identify different paths to follow should the best option be difficult to achieve or the environment changes unexpectedly.

Look at strategic partners in a new light. Most rehab providers look at partnering as a means of garnering more rehab business. Few delve into what the partner really needs for a successful core business. Since most partners for rehab providers are acute care hospitals, it is critical for the rehab partner to understand acute care’s needs, the trends in that segment of the industry, and the services that could be provided to meet that need. “Coming out of a rehab environment, we found it difficult to fully appreciate what acute care providers are up against,” Gammon says. “By using outside experts, we were able not only to understand our acute partner’s needs, but also how to create a win-win opportunity for us both. And what an opportunity emerged. It was beyond what we thought was possible.”

A slow growth market may seem daunting at first, but opportunities are there for the taking. Rehab providers need to reach out in a new way. ®

Frances J. Fowler, FAAHC, is president of Fowler Healthcare Affiliates’ national consulting practice in Atlanta. She can be reached at (770) 955-5957 or fha@mindspring.com.

LOOKING FOR EXPERT ADVICE?

Experts here are available to answer all your questions!

Please contact us for more information about this feature, or to become an expert.

MEDIA CENTER

Interactive Media

Resources

	Classifieds
	Calendar
	Consumer Resources
	Media Kit
	Advertiser Index EAB Reprints Submit an Article

Find a Job

www.thejobcure.com

ADDITIONAL ONLINE RESOURCES

Allied Healthcare		Medical Education
24X7mag Chiropractic Products Magazine Clinical Lab Products (CLP) Orthodontic Products The Hearing Industry Resource HME Today Rehab Management	Physical Therapy Products Plastic Surgery Products Imaging Economics Medical Imaging RT Magazine Sleep Review	SynerMed Communications IMED Communications
		Practice Growth
		Practice Builders

Become a featured employer

Featured Employer

Alliance Imaging, Inc.

High Quality Clinical Care

The nation's leading provider of diagnostic medical imaging services with 25 years of industry experience is seeking qualified professionals to join their team.

Learn More
View Job Openings

April/May 2000