The current turbulent veterinary practice environment has caused the larger practices to pursue strategic planning. In the 1980s, human healthcare responded to competition in the same manner. They responded to the competition by funding elaborate strategic planning conferences, developing detailed action plans, then observing their best laid plans fail. By the late 1980s, they had found one common flaw. In most cases, no one person had been given the responsibility and authority as their primary function to make the strategic plan happen.

In the further assessment, at the beginning of the 1990s, there was one common factor present, whenever the strategic plan provided enhanced positioning within the healthcare community. The organization with the best gain had put "people concerns" into their strategic plan. When the focus was on profit rather than people, failure occurred. In retrospect, the detailing of the healthcare system profit motive was counterproductive in motivating the people in the "caring professions" of healthcare delivery.

Another common shortcoming in the strategic planning process was the nature of the process made it problematic. The implementation of the strategic planning process ended with goals and objectives, but without strategies or methods of implementation or performance monitoring. When implementation strategies were developed, they were usually ineffective, because the strategic planning tended to be a top-level, administrative function, with the exclusion of the middle management and staff. Without participation and support from those who it would potentially benefit most, strategic planning did not often develop into an ongoing process.

Strategic planners never failed, according to their own reports. The organization failed to follow the plan that was developed. Gerald McManis said it well in Healthcare Executive (1987, Chapter 6, pp 18-23): "While many hospitals have elegant and elaborate strategic plans, they often do not have supporting human resource strategies to ensure that the overall corporate plan can be implemented. But strategies do not fail, people do."

I've made the following observation about most veterinary association strategic planning efforts: "The association(s) take the existing board into a retreat, bring in high-powered strategic planners from outside the profession, and then expect the board, who created the fiasco called 'today', to educate the strategic planners on the future of veterinary medicine and practice. Then they wonder why their five-year strategic plan works for one year, flounders for a year, then sits and collects dust. Board members are victims of their own limitations, and one board does not always have the same vision as the next. Worse, the 'greater community' never got to read the plan, so it evolves according to an entire separate set of paradigms and pressures. Strategic assessment and strategic response are the watchwords of a service industry like veterinary medicine."

Human Resources

Human resources, as a critical competitive factor, have not received much attention in healthcare. It has been found in non-healthcare industries that three environmental factors cause better integration of the strategic planning process and human resource functions (see Buller, 1988, Organizational Dynamics, Chapter 17, pp 27-43):

1.  Increased competition.

2.  Technological change.

3.  Changing labor market demographics.

All of these factors applied to the practice of veterinary medicine in the 1990s and are now becoming critical to survival in the new millennium. Linking business and human resource management has repeatedly proven beneficial, such as with the consulting adage, "As you treat your staff, so will they treat your clients."

There are four basic, yet very different, management approaches to link human resource management with the strategic planning process:

 Administrative: "We are primarily concerned about the product/service, the market, and the bottom-line. We can always get the right people, when we need them, either by contract or replacement."

 One-way: "Once we have established the business strategy, we make sure the staff understands our needs. It is up to them to respond to those needs, with the appropriate programs and services."

 Two-way: "We work closely with our staff in exploring implications of the various business strategies. They point out some of the blind spots and we strategically place our people to address those concerns."

 Integrative: "We don't make financial, marketing, technical, or human resource decisions, we make business decisions. We routinely involve all the functions, including staff, in important decisions. The staff is as critical to the practice success as the clients and the veterinarians."

Some readers can see themselves in one of the four systems, without much thought, while others have never even considered the fact that there were different approaches to problem solving and planning. There are a few who are reading the above options and looking for the "loop-holes" to allow them to continue doing what they have always done, and there are some who are self-assessing and saying to themselves, "I have been there, but I really know I should be here, so what do I need to do to get there?"

If you are in this later group, these next few tables and accompanying concepts are for you, as is Chapter Seven of this text. If you are just a "loop-hole-looker", then I will probably frustrate you in the subsequent chapters, and even the balance of this chapter. As Chef Emeril says, when starting a new recipe that takes chopping and mincing of components for an outstanding entree, "This might be a great time for you to go out and get one of those cold or frozen things."

Education is the progressive discovery of our own ignorance.

Table 1. Probable Outcomes of Different Management (Linkage) Types on Business Strategy and Competitive Environment

With the Table 1 management or linkage descriptions in mind, it is important to define "strategic human resource management", as used in this description, for veterinary medical healthcare delivery situations:

The strategic management of human resources must ensure that qualified people are available to staff for the various technical and business units that will operate the practice entity on a continuing and recurring basis. To lead and develop human resources strategically, astute coordinators must understand the relationships that exist within the mission focus and daily practice functions, so that appropriate methods can be unilaterally selected within a practice zone to accomplish the objectives required for exceptional healthcare service delivery.

In the following Table 2, the above definition is developed into a model that details how a veterinary practice can implement the strategic human resource management process to gain a competitive advantage. With the great amount of information that has been written on the strategic planning process, the goal-setting portion does not require further explanation within the context of this article. This model provides a framework to determine and focus on desired outcomes and anticipate essential human resource management actions required for successful implementation of a business strategy. It is designed to stretch management thinking.

The VCI® Signature Series Monograph Strategic Assessment & Strategic Response, addresses an alternative to the traditional strategic planning process. Before we proceed to Table 2, it would be useful to note that it uses the same four quadrant assessment grid as any other SWOT format: the Internal assessment of any Strength or Weakness traits, plus an External assessment of emerging Opportunity or Threat conditions.

Table 2: Strategic Human Resource Management Model

From this point, there is a change in operational logic. A strategic plan has traditionally been based on current perceptions, which causes it to lose focus within a year. In the "old days", things moved slower, but in today's dynamically changing society, the "average for today" becomes out-of-date tomorrow. The facilitator of the process must be a futurist, not bound by internal paradigms or community bias, but rather unbound and thinking of the practice's world ten to twenty-five years in the future. The text Veterinary Medicine & Practice - 25 Years in the Future - and the Economic Steps to Get There was written as a template to begin this new thought process required to change the practice entity to meet tomorrow's community needs.

To allow the reader of the VCI® Signature Series Monograph Strategic Assessment & Strategic Response to understand what is being done, we spent time talking of the various strategies needed, and the new metrics needed for the new strategies. The point here is if you measure the new program with old metrics, you will seldom know how you are doing. A good example lies in emergency and critical care:

 Traditional logic and experience has shown that any emergency practice that has the full commitment of twenty-six FTE veterinarians to refer, will be successful.

 Currently, as consultants, this number of twenty-six is only a start-up number. The continuing number is how many new RDVMs (referring doctors) have been added to the recurring referrals this quarter?

 It is not hard to see, as practices go twenty-four-seven, or new emergency practices open, the growth is far more critical than the "magic twenty-six" number.

In team-based healthcare delivery, strategic use of human resources is a pivot point of success. It does not stand alone. Rather, it is systemically pervasive throughout the concept of an integrated healthcare delivery system. In the text Building the Successful Veterinary Practice: Innovation & Creativity we shared the concept of mind-mapping. As I visit practices that say, "We have read all your books", I notice they have not followed the initial directions, they have not gleamed ideas from the chapter and completed the icebergs, nor have they completed the mind-map at the end of each chapter. When I wrote the back page article for the monthly DVM Newsmagazine, I wrote of "management junkies", and the editors of DVM Newsmagazine had more distraught readers than ever encountered before. Nine people complained that I wrote about them and their practice activities, and seven even stated I had never been in their practices. Of the two practices that I had been in, they could recognize their practice by the good words, but assumed the "negative statements" were about them also. In fact, the article was a combination of observations and placed into a fictitious culture. But to placate the two clients, who saw themselves, I offered to publish a counter-point article for them. I told them, "Just write your own philosophy and I will get it printed, with no editing." That was seven years ago, and to date, no one has given me an introspective article to be published.

This indicates the lack of commitment to systemically change their ways of thinking, and actually points out the management "cherry-picker". Management "cherry-pickers" are those who believe they are a super manager, and attend every management seminar they can, taking copious notes. They go back to their practices with some great ideas, to throw them around, like mud on a barn wall. Yes, some ideas do stick, but most of those ideas just dry out and fall off in short order. They belong to practices that are in constant turmoil. The staff not only says, "Oh gosh, he's been to another management seminar, hang on!", they also say, among themselves, "This, too, shall pass". And they are right, because they are waiting for the failure, and to celebrate the return to the status quo.

To summarize the Table 3 model that follows Figure 11, the strategic approach to human resource management includes six areas of interest, with the final two as key integrative concerns of practice staff development and utilization:

 Assessing the environment and mission focus.

 Formulating the client-centered practice business strategy

 Assessing the staffing requirements based on the intended strategy.

 Comparing the existing staff resources, such as numbers, characteristics, and practice policies, with the strategic requirements and the practice's market niche and services.

 Formulating the human resource strategy, based on the differences between the strategic requirements and current staff strengths.

 Implementing the appropriate human resource practices to reinforce the strategy, use the staff strengths, and achieve the competitive advantage.

Synergy is the magic ingredient, the link that joins the multiple aspects of human preferences, with the business factors of healthcare delivery. It is the essential element in the unique art of leadership, one that establishes and maintains the organizational spirit. The model, also in Chapter One, showed this relationship:

Click on the image to see a larger view

Figure 11. The Synergy Factor (revisited)

Click on the image to see a larger view

To look at the pattern of relationships that are commonly used to link generic business strategies with human resource practices, we need to assess the implementation emphasis. Upcoming Table 4 reflects these linkage relationships for five basic business strategies:

1.  Diversification into new veterinary-related or non-health-related markets.
The desire to gain a competitive advantage by diversification in the 1980s was seen with satellite facilities and pet supply stores. In the 1990s, ambulatory care, health maintenance programs, larger practice networks, and other "vertical systems" to serve more of the needs of the individual clients and patients in our catchment area will be seen. The demand for more diversification within the staff will be a concurrent managerial realization, and more variations in benefit packages will be used to attract and retain these unique individuals.

2.  Technical quality leadership.
The emergence of privately-owned, well-equipped, multi-discipline, veterinary hospitals that offer residencies and group multiple board-certified specialists together has already started. They are developing reputations of excellence that expand their traditional catchment areas. Escalating equipment costs will give these secondary and tertiary veterinary facilities an "economies of scale" market niche. The support staff requirements for these complexes are often larger, more skilled, higher compensated, and generally require continuing education benefits commensurate with the professionals they support.

3.  Functional quality leadership.
Many practices found that they can achieve the competitive advantage by being proactive in stating the patient needs, while being sensitive to the client preferences. Amenities, not discounts, to bond the client to the practice are pursued concurrent with offering the best veterinary care in the community. The client is made part of the decision process. This system requires above-average staffing, by quality caring people who communicate the standards of care with compassion and empathy. This allows them the time to tailor the "need" responses to the client's desires.

4.  Client-centered patient advocacy.
The client-centered aspect can be defined as the "client comes first". They may not always be right, but they are never wrong. When a client calls in with a question, the answer is usually, "I am glad you called. That is just the type of case the doctor wants to see before we medicate." In the case of patient advocacy, it is speaking for living entities that cannot speak for themselves. If we do not speak, the animal suffers, and no one wants that. So when a client calls in, with a health or wellness concern, the answer is usually, "I am glad you called. That is just the type case the doctor wants to see before we medicate." When a client makes a decision to waive or defer the care stated as needed, we must make the client's decision "okay", and, concurrently, increase the nursing telephone surveillance of the case until the condition is resolved on the master problem list.

5.  Cost containment.
Achieving cost containment requires leadership. This varies from the full-service approach taught in veterinary school. Inversely, we cannot discount our ways into prosperity. A discount is one hundred percent net, and affects every member of the team in an adverse manner, as well as the practice entity's existence.
We have found some believe the "discount" or "no charge" meets the immediate perceived needs of the client, then tell us they plan to cross-market other services for the patient, based on the client's liquidity. This is illogical thinking at best. The spay clinics, shot clinics, and weekend parking lot veterinarians are such examples we saw in the 1980s. Their number has decreased and most have moved into a not-for-profit entity, such as the IRS 501.c.3., so they can solicit donations for their own survival.
Control of resource consumption has always been a weak area of veterinary practices, as has charging for everything provided. These challenges are addressed and managed by a profit-aware staff that is motivated by the patient advocacy of needs. Cost control and cross-marketing needs are actions by selected individuals, who understand those aspects.

6.  Specialization.
The ability to focus on a small market niche allows a practice to gain a competitive edge within a given market segment, such as cat practices. Bringing in a contract surgeon, or another uniquely skilled professional, allowed the new millennium practices to hire the specialty needed for the market niche.
In a general veterinary practice, staff specialization is needed as the number of doctors and transactions grow. Complete cross-training is very difficult in a mega-practice. The need for flexibility within the staff to support the variances within the care givers means the standards of care have become obscured by leadership complacency. When a flexible set of practice habits is needed, clients will be confused and will try somewhere else that does not confuse them as much.
Good continuity of care requires special medical record documentation training, strong practice protocols that have been jointly set, and a strong belief in a staff-run practice.

7.  People development.
The most important aspect of formulating a veterinary practice business strategy is to accept the core values, mission focus, and standards of care as inviolate expectations for all providers. That carries with it the concurrent commitment to train the staff members to those levels of understanding and competency.
In the VCI® Signature Series Monograph "Staff Training & Orientation" we have the ninety-day checklists to establish the baseline development for all candidates, and this reference even has a special section for new doctors who join the team. The on-going, in-service training is a must for every staff member. And the coordinators and program leaders must attend outside continuing education experiences, so they can bring back and implement the "cutting edge" information. In fact, we usually make it a term of employment that for every day of outside CE funded by the practice, the attendee will bring back at least one new idea and unilaterally be accountable for the staff training and implementation of that idea. They will also keep the program alive for a minimum of ninety days, before team evaluation.

Table 4: Links Between Strategies, Implementation Emphasis, and Key Human Resource Management Practices

Real life is, to most small business owners, a long and painful second-best experience, a perpetual compromise between the ideal and the possible. But the world of pure reason knows no compromise, no practice limitations, no barrier to the creative activity of a true leader.

In the current veterinary healthcare community, growth, prosperity, and survival depend on gaining and retaining a competitive advantage. Although there are many paths toward that end, one that is frequently not recognized is capitalizing on the benefits of superior human resource management.

While it is difficult to categorically state that "integrative linkage" is more effective than "two-way linkage", each has proven to be preferable over the disposable attitude of the "administrative linkage". The effective implementation of any business strategy requires the veterinary leadership to continually assess how their human resource management techniques affect the competitive position of the practice.

Organizational performance is a manifestation of the functions performed by people. Failure to meet the needs of the staff limits the ability of a practice to focus on quality healthcare delivery. Staff problems require an internal focus, rather than an external client/patient concern. This is called leadership in most every business.

The normal day-to-day operational concerns must consider the human resource implications if the annual, or long-range, strategic plan is to be realized. Veterinary business strategies for the new millennium must link the veterinary practice's implementation planning cycle, with real and perceived human resource development needs to achieve economic and psychological success.

As practices grow, leadership is shared, usually by virtue of partners, sometimes by just the physical size of the facility, and, most often, by the need to drive more income to stay alive. When there are multiple owners, governance is needed, a form of interactive group-think from a board of directors. Decisions are made only between the falls of the gavel at the board meetings. Implementation is a human resource function directed by the hospital administrator, not by a doctor, nor by only one of the owners. Effective human resource management requires multi-doctor hospitals to engineer their veterinary practice board to operate in a new environment, where doctors only diagnose, prescribe, and do surgery, and everything else, from operations to administration, is a staff function

Governance

The actions of a board, comprising three to five people and never more than seven, entrusted with oversight of the organizational structure, budget review, and establishing global policy and precedent. Within these three areas of responsibility lie: the framework of internal exchange actions, hospital strategic planning, explicit and implicit exchanges with the outside world, and the legal and moral responsibility for the professional staff, appropriateness of services, and the quality of healthcare delivery.

The text Veterinary Management in Transition: Preparing for the 21st Century was written for multi-doctor hospitals, who wanted to return to being doctors and divest the "adminsitrivia" and day-to-day operational hassles to the paraprofessional staff. In veterinary medicine, governance, or even the concept of governing boards, is usually alien, while organizations, like Veterinary Emergency and Critical Care Society (VECCS), have been pioneering the leadership and management training of potential veterinary boards.

In human healthcare, governance has existed from the very beginning of cooperative time. The client's need for quality healthcare and the technology for delivering this "best of care" creates a core set of functions, which each modern veterinary hospital must accomplish. In small private practices, governance and ownership are synonymous. But in affiliated or merged veterinary healthcare delivery situations, a new structure is needed. Emergency practice boards have generally been the first to introduce the responsibilities of governance to veterinarians. In reality there are six basic systems in most every veterinary healthcare organization:

 Executive/leadership system

 Medical staff development

 Operational/human resource systems

 Planning/marketing system

 Public relations/relationships

 Information management

Governance is within the executive/leadership system and must be the one system accountable for making the other five systems "look good," both within the structure and externally to the community.