While most organizations have a strategic plan, it is somewhat rare that pharmacy organizations go through all the steps recommended in the business planning process when contemplating a new product or service offering. Ideas for potential new services are often plentiful. But these ideas have to be carefully evaluated to select the right one and see it to successful fruition. Doing so is part of the business planning process, which produces a business plan. Steps in the development of a business plan include: define the business or program, conduct market research and analysis, identify the target market, conduct competitor analysis, assess clinical and quality requirements, define processes and operations, develop a marketing strategy, develop financial projections, identify an action plan, assess critical risks and opportunities, and establish an exit plan.
Tichy et al employed a formal business planning model to develop a transplantation pharmacy practice.1 Their planning helped them identify a relative lack of competition in the area but also the significant start-up resources it would take to effectively launch the practice. The evaluation of processes and evaluation of the market made crystal clear the myriad rules and regulations under which the practice would operate as well as the potential funding sources and funding hurdles they would have to navigate to make the practice a success. They developed both a financial and clinical justification for the new practice, which took into account the clinical expertise required in addition to the necessary personnel to perform diligent billing activities from payers who might not otherwise been keen on or accustomed to providing payment for these pharmacist-led services. The end result was an entirely unique service that was viable from the start and which grew more clinically relevant and financially solvent with the passing of time.
Additional information about Business Planning for Pharmacy Programs can be found in Pharmacy Management: Essentials for All Practice Settings, 4e. If you or your institution subscribes to AccessPharmacy, use or create your MyAccess Profile to sign-in to Pharmacy Management: Essentials for All Practice Settings, 4e. If your institution does not provide access, ask your medical librarian about subscribing.
1Tichy EM, Pilch NA, Smith LD, et al. Building a business plan to support a transplantation pharmacy practice model. Am J Health Syst Pharm. 2014;71:717-757.
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How many pharmacists whom you know actually engage in the process of business planning? How many of you could use some more information/education/training on business planning? Hey, this stuff really works. Time and again, it's been shown that pharmacies engaged in REAL business planning prosper, while many others close. Business planning is especially important nowadays in the face of shrinking margins yet new opportunities with expanded scopes of practice.