One of the common themes in this week’s readings was planning for the long term. Having the ability to anticipate, and plan for, impactful events is beneficial to the growth, and survival, of a business. “Ten IT-enabled Business Trends for the Decade Ahead” looked at anticipated IT trends through 2020, many of which have come to fruition.
A company I used to work for, HealthStream (HS), began in the early 1990s as a software distribution company. Medical device manufacturers would create training and HS would convert the documentation into digital training materials. Customers that purchased a set of trainings through HS would receive a CD with the requested documentation. HS’s value was in the amount of training software they were able to collect; they were a single source of training for the industry. By the last 90s, the company had hit a plateau on revenues and began looking at where they wanted to position the company over the next 5-10 years. The industry had always been of the mail-order sort and convincing their customers to change wouldn’t be easy, but the CEO decided to heavily invest in an internet delivery platform.
Several years later, the company is thriving, having created a learning management system that allows purchase and delivery of training in a single click, and has recently completed a long-term strategic plan for a second time, identifying the growing analytics market, social technology, and game theory as directions to pursue over the next several years.
In this example, HS did some things well. Due to their long-term planning, they were able to capitalize on the impending growth of the internet and the digitization of the healthcare industry. Building the web platform as a separate project meant they could continue to service their existing customers without impact and would be able to weather new competitors (in the short term) while moving in a new direction. Going through the exercise a second time was also a positive, showing that there has been some thought towards the potential avenues new entrants would use to shake up the market.
However, there is one suggestion I would provide to their management. Long-term planning activities should be performed much more regularly. While the plans don’t need (and shouldn’t) change frequently, there is benefit to reviewing, tweaking, and evangelizing these plans on a routine basis. The analytics industry and social technology have been mainstream for several years (both mentioned in the 2013 article referenced above) and these seem like areas that could have been identified much sooner if this exercise was performed more often.