Business planning

Business planning

An NHS trust is essentially a non-profit-making business whose chief executive and board are accountable for delivering high, safe standards of care for its patients through the effective and efficient use of resources within an agreed annual budget. Each year trusts undertake a business-planning exercise. Within each NHS trust the business-planning process is intended to align trust services with national priorities and local priorities. National priorities are described each year by the Department of Health in a document called the NHS operating framework, and primary and secondary care organisations must plan their services with this in mind. Local priorities will be dictated by the additional requirements of those commissioning the services (primary care trusts at the time of writing but soon to be general practitioner consortia) and these will depend on demographics and epidemiology in the local health economy as well as the specialist services that the trust provides.

For an NHS trust the primary objective of the business-planning process is to describe its vision and to develop organisational objectives that will support the delivery of that vision. Chapter 1 described the organisational arrangements of trusts – divisions or directorates making up the whole. Divisional and directorate objectives will be developed which then support the trust objectives, and the pharmacy objectives should be derived from these and other documents which relate to the quality, safety and the professional pharmacy agenda. It is important that all staff have an annual appraisal and have their own objectives agreed which are derived from the pharmacy business plans so that staff are clear what they are required to deliver during the year and how their work supports the trust’s plan.

Preparing a business case

The business-planning process is often underpinned by a requirement to prepare a detailed business case that provides a thorough analysis of the implications for changing or developing services. Not only will a business case be used to judge the merits of the specific proposal and how it contributes to the delivery of trust objectives and performance targets, it may also be compared with business cases from other departments or directorates as part of a prioritisation exercise. Pharmacy managers need, therefore, to muster all their skills, knowledge and expertise to produce a well-reasoned, robust case which can withstand detailed scrutiny and then market the benefits of the changes that any funding will bring. Understanding the intended recipient of the case is vital – what are their priorities and objectives?

In most business cases it is expected that a range of options will be described. These may range from the ‘do nothing’ approach to an option that requires the highest level of funding in terms of capital investment and revenue consequences. The business case will need to be well argued, show a detailed financial analysis and, perhaps most importantly, set out the benefits to the organisation and to patients.