A short guide to practice business plans
Many GP practices have a thriving business, but day to day pressures can prevent partners and practice managers taking a step back to ensure it stays healthy.
In the current environment with growing demand and increasing financial, workload and workforce pressures, even those whose business are in good shape need a plan to keep them that way. Meanwhile those that are struggling, often through no fault of their own, need to take stock and work out what to do next.
Our practice development lead Claire Deare, an experienced practice manager who manages PCC’s GP resilience programme, has developed a step by step guide to developing a business plan. It is based on three simple principles.
First, the plan needs to be developed and owned by the practice. What worked somewhere else or sounded great to a management consultant might not work here or might not be what you need.
Second, the plan needs to have clear objectives and actions. It’s not decorative, it’s functional, and if it doesn’t make a difference to the practice it’s a waste of everyone’s time.
Third, it needs to be brief. If it contains a mass of contextual or operational detail no one will read it and its purpose will be obscured. The plan is a tool. It needs to be sharp.
These are the steps:
Start with your mission statement – If your plan doesn’t help you achieve the mission, it’s the wrong plan (or the wrong mission).
Do a stakeholder analysis – Your stakeholders include your staff, the organisations you work with and, of course, your patients. All of them make decisions that directly or indirectly affect your practice. Understanding how will help you later.
Do a PEST analysis – PEST stands for political, economic, social and technological. Like the stakeholder analysis, PEST will help you identify the opportunities and threats to your business. For example, under the political heading you can look at the impact of national policy (such as the GP Forward View) as well as local politics (such as your CCG’s estates strategy).
Do a SWOT analysis – This is where the work you’ve done in previous steps can be used to identify strengths and weaknesses (typically internal factors), as well as opportunities and threats (the external factors). This is an important step for understanding the actions your practice will need to take.
Develop a budget – Your accounts tell you where you are right now, but a budget tells you where you’re going. A budget gives you a forecast and financial plan for the foreseeable future. It gives you an objective way to measure how well the business is doing rather than rely on crossed fingers or scraping by from month to month.
State your business objectives – So far you’ve worked out where you are and where you want to get to. Documenting your business objectives is the next step. These are the things that will propel your practice towards its ultimate goal. Aim to set concrete objectives for the next one to two years and while further horizons may seem harder to plan for, consider what the five year view might look like.
Document your management and leadership structure – You’ve set out your objectives. Now you need to describe how the people responsible for meeting these goals – you and your team – will work together.
Write an action plan – Each of your business objectives needs to be broken down into a series of actions that make it them possible to achieve. You also need performance measures so that everyone understands what “achieved” looks like and definite completion dates for each step so that plans don’t drift.
Write an executive summary – No more than one page that summarises where you’re going and how you’re going to get there.
Agree a review process – Your plan will need to be reviewed from time to time to determine if it’s working and where it could be improved or how it needs to change in light of internal or external developments. When will it be reviewed and who will do it?
Finalise and share the plan – Get some of your most important stakeholders to review and comment on the plan. A second and third pair of eyes will help ensure it’s free from mistakes. Getting others involved will also help establish wider ownership. You may want to publish the plan on your website, perhaps with some of the commercially sensitive and technical detail removed.
A longer version of this document is available to PCC subscribers. Please contact us to discuss support to develop business plans for your practice or for groups of practices. Email email@example.com
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