and Revitalize Your
By David Waldron
Business Plan: Part 1
The credit earned from the Quick CreditTM test
accompanying this article may be applied to the
AHRA certified radiology administrator (CRA)
operation management domain.
• The diagnostic imaging department has a
pivotal role within the hospital and its pillar services. Understanding this role and
also understanding the population served
helps to further define and justify the
“what” and ”why” of the business plan.
• Understand the market capacity and
how market needs can be satisfied.
Develop a “go-to-market” strategy,
which is the part of the business plan
where it is decided how to share that
message with the market.
• In the aftermath of healthcare reform and
the economic recession, investing in new
imaging technology has never been under
greater scrutiny. A three step process for
developing support is provided.
In this first of a series of articles, the steps to take in revisiting, revamping, and revitalizing (or R3ing) a
business plan in diagnostic imaging will
be discussed. In subsequent articles, an
expanded discussion will cover organization and structure; managing with financial statements and balanced dashboards;
and management development programs
for senior staff.
The year ahead promises to be both
challenging and exciting for diagnostic
imaging providers. Challenging to understand the near and longer term impacts of
healthcare reform and exciting as providers decide what to do. Come what may,
the world is changing and the pace of
change is accelerating. The fittest will survive and the fittest will be those “best in
class” providers who prepare for reduced
volumes (particularly in CT and MRI),
reduced per study reimbursement, and
over capacity leading to increased competition. Providers should focus on providing the highest quality service, becoming
the lowest unit-cost provider, and embracing referral sources to become their
service provider partner of choice.
By preparing for the worst, the fittest
will gain greater economic benefits if
the consequences of healthcare reform
are not as severe as expected. However,
the road to a successful R3 starts with a
strategic work over.
Business Plan Overview
The first step in the journey to R3 enlightenment is actually a step back—to reassess
what is trying to be achieved. This is the
“revisit” step. What exactly is a business
plan? A business plan is a commitment by
a manager or business leader to deliver a
specific financial result in a specific period
of time from the business unit for which
that manager is accountable. There are
three key elements to this definition:
1. Commitment: Not just a good intention!
2. Financial result: Typically, a cash operating surplus.
3. Fixed time period: Typically, a year
with monthly and quarterly goals.
The substance to the business plan will
include detail showing how that financial
result will be derived, with action plans
addressing each of these questions:
• What is actually going to be done in order to deliver the committed financial
• Why is it being done (what is the rationale)?
• How will it be done in order to achieve
the goals (what resources are available)?