Smart Growth Revisited
Editor’s note: Meghan Robb, VP, Strategic Growth Domain Solutions, Sg2 contributed to this post.
At Sg2, our job is to stay ahead of changing health care trends—and to help you, our members, proactively navigate industry change to benefit your top lines. Over 10 years ago, we introduced the smart growth concept because we foresaw the need for a course change in health care strategy. Smart growth challenged members to invest in services not just clinically appropriate, but also financially favorable and sustainable in a future that balanced fee-for-service and value-based reimbursement.
That was then, 2011, and this is now, 2023: margin compression has transformed smart growth concepts from merely novel thinking into a critical business mandate. Revisiting Sg2’s 2011 smart growth guidance—through the lens of today’s challenges and opportunities—may be just the playbook your organization needs to navigate today’s difficult environment.
The (Smart) Growth Levers
“Successful organizations of the future will focus on identifying smart growth opportunities that capture market share and will build integrated, coordinated Systems of CARE for targeted patient types and diseases. Organizations that act decisively to identify and execute on smart growth opportunities, even in the face of uncertainty, will win the loyalty of health care decision makers and establish positions of competitive advantage.” —Sg2 Smart Growth Planning, 2011
Where might the best smart growth opportunities across the near-, mid- and long-term lie today? We think of the broad categories below as your next-generation strategy growth levers that allow you to exert control over your top line:
- You can accelerate and expand revenue capture by driving superior patient experience and consumer loyalty.
- You can strengthen and diversify revenue streams via contracting and risk strategy.
- You can gain competitive advantage via asset optimization and delivery innovation.
Retooling your System of CARE into a purposeful, smart growth–enabled care continuum to match (and surpass!) those of health care industry disrupters (ensuring your patients are receiving the right care, in the right place, at the right time), then converting the tension inherent across these next-gen growth levers into momentum for your growth engine is today’s most important strategic challenge.
Done well, you create a new flywheel for growth—delivering immediate top-line results while positioning your organization for long-term, sustained success. You can grow your share of health care spend most immediately by engaging current patients while finding and activating consumers and converting them to new patient volumes. You can also strategically gain access to new patient populations via well-considered, refreshed, smart growth–informed payer strategies. Further spinning the growth flywheel, those same skills needed to engage the consumer—access, convenience, experience, price—also drive success under value-based payment arrangements, which is key to future payer strategy success.
The (Smart) Growth Team
“A successful strategy balances the implications of external opportunities and threats with an objective assessment of internal strengths and weaknesses. That’s why organizations are increasingly looking to multidisciplinary teams of planners and operators to work together in crafting the service line strategic plan.” —Sg2 Smart Growth Planning, 2011
Executing smart growth successfully in 2023’s dynamic health care landscape quite literally takes a village. Historically siloed business disciplines of strategy, operations, finance, managed care, population health, marketing and business development need to better coordinate to optimize growth using a variety of levers across multiple growth time frames to drive meaningful movement at the top line.
While building a core team to run the process is essential, the involvement of a broad set of stakeholders that range from the CEO to patient experience representation is critically important. Interdependencies between operating capacity, consumer experience, quality (value) care delivery, positioning for pricing and contracting, and approaches to clinical product diversification necessitate new working relationships among legacy roles and teams.
There are many ways to connect modern growth teams: rolling quarterly budgetary processes, C-suite growth mandates and margin management intervention work. Some teams are a natural expansion of previously connected strategy, marketing and business development groups that forged new relationships with operations, patient experience and finance for COVID care delivery. Think carefully about your growth team composition and dynamics: do you have the right team assembled and the right processes for inter-team, coordinated growth efforts that allow multi–time frame smart growth work to succeed?
Whether you need turnkey solutions for immediate top-line relief—or the necessary data, analytics, frameworks, and expertise to simultaneously tackle experience, value and access issues—we’re ready to help. Sg2 was founded to help hospitals and health systems achieve sustainable growth and ensure ongoing market relevance through our guidance on health care trends, our insights and our analytics.
Contact Sg2 today to let us help you manage the impact of this current set of industry changes.