The crux of a business is to make a profit (unless you are a not-for-profit organisation). But the reality isn’t that simple, in order to make a business such as dental practice successful and profitable, there are many, many facets to manage not just the financial ones.
Having a business plan in place with set objectives is vital but this is only the first step in the process. Without monitoring, measuring and reviewing your performance regularly (as opposed to just annually when the financial accounts are due), how do you know that you are on course to achieve what you set out to? By monitoring and measuring along the way you are more in control of your business and able to take remedial action should you have steered slightly off course.
Key performance metrics will be specific to each individual establishment but here are some key areas which you may wish to focus your metrics on:
- Financial Performance – revenues, costs, profits
- Productivity – production for each fee earner, operating costs per surgery per day
- Marketing – source of new patients, word of mouth requests, website analytics, social media metrics
- Staff – performance, attendance, lead conversion targets
- Patients – frequency of attendance, average value per visit, membership conversation rates, assessments to consults, complaints, positive testimonials
The important thing is to not just collect metrics purely for vanity’s sake but to look at the metrics in terms of what key information they provide you in order to help you make managerial decisions about your business. Think in terms of measuring outcomes rather than outputs.
Once you have ascertained what metrics you need to measure, it is important that you devise a process for collating the information and presenting them in an easy-to-digest format such as a single spreadsheet with visual graphs.
Interestingly, according to something called the ‘Hawthorne Effect’; those things that we measure or observe will improve. Your team will like to be kept informed of how the practice is performing and will find it motivational to feel valued for contributing to the practice’s success. And, you will feel more in control of your business resulting in a little bit less stress!
Below are some useful resources that we’ve found online to help you:
- Tips on building your business with better metrics
- Metrics every growing business should keep an eye on
- Business metrics; you can’t manage it if you can’t measure it
- must-measure metrics for your business online
We hope you found this post useful. If you have any comments then please do get in touch, drop me an email at firstname.lastname@example.org or call 01463 223399