External Environment And Strategic Planning

The world of the healthcare environment is fast-paced and implementation of new healthcare technology requires an organization to have a strategic management plan. Subsequently, in order to start building the strategic management plan one must understand the external competitive forces that influence a strategic management plan by doing an environmental analysis, which is the first step involved with strategic planning and strategic thinking to understand the external environment (Ginter, Duncan, & Swayne, 2013, p. 40). Environmental analysis involves assessing the “trends, events, concerns in the general environment and in the healthcare industry, and the service area” (Ginter et al., 2013, p. 41). Moreover, environmental analysis attempts

54). The first step in forecasting is to develop the opportunity or threat with different alternative conclusions, which is most useful when using a brainstorming method (Ginter et al., 2013, p. 54). In addition, there is a need to identify the associations between the tendencies, changes, predicaments, and or likelihood of events and the environmental categories (Ginter et al., 2013, p. 54), such as the judicial/political environment of the Affordable Care Act. In doing so, it will allow management to see the possibilities of how these issues can affect the future of the company. In turn, this allows the management team to build a better strategic plan, so that the healthcare business has longevity in the fast-paced environment. However, one must assess all the information proposed from the scanning, monitoring, and forecasting of the potential threats or opportunities to the healthcare

Therefore, within 2 miles of the previous hospital Henry Ford built a health-center in Woodhaven that was interoperable within the Henry Ford Health System, but provided the necessary medical needs of the community (Henry Ford Health System, 2011). In doing so, the Henry Ford Health System ensured that the public would not go to the competitor, which at that time was the Oakwood Health System. Perhaps the most striking result of a healthcare organization reacting to external environment occurred when the Beaumont Health System merged with Oakwood and Botsford. Beaumont merged with the other two health systems in anticipation of the Affordable Care Act (ACA) severely affecting the profitability of the healthcare organization (Greene, 2014). Thanks to the environmental analysis of the external environment, Beaumont is now the third largest organization in Michigan, but it has now become a strong competitor against the Henry Ford Health