Speaker 1: Hi everyone, Tristan Bond here, Director of Healthcare Business Coaching and I'm bringing to you another video today on practice development. Today we are talking about the very important area in your practice that I refer to as KPI management. So KPI means Key Performance Indicators. So we're going to be looking at what are KPIs and why do we need them in practice and how do we go about using them to your advantage. So first of all, what are KPIs, what are Key Performance Indicators? Well, KPIs are quantifiable measurements that affect the critical success factors of a practice or small business or any business for that matter actually. So whatever KPIs are selected, they must reflect the goals of your business and they must be key to its success and they also have to be quantifiable and measurable. So that way we actually know whether we're actually meeting our targets or not. So KPIs are usually long term considerations for your business survival and success as they don't vary too much from quarter to quarter, year to year or even week to week or day to day for that matter. The definition of what KPIs you want to use and how they're measured doesn't change often but the goals for a particular KPI may change as your practice and also your personal goals do change. So you may move your KPI dashboard or KPI expectations up or down depending on what stage of growth you want or what stage of business you're in or what results you're chasing. But the actual what, the what of what you're measuring remains exactly the same. So it's very important to make sure you're actually measuring the right things. So once you've determined what your goals are, what results you're chasing, you then determine what KPI it is that's going to actually measure that success. For example, it might be, one example could be the number of new patients that you generate from your website. So that's a key performance indicator. So we can look at other things behind it which influence that KPI but that's the actual KPI that we are measuring. Another KPI could be looking at the particular revenue generated by one of your staff members. So that's a number and we know there are a number of different things which influence that KPI but the ultimate thing is yes, that is one of the KPIs that's key to your long term success and we do have to measure it. Okay, so next point, KPI 100% must be quantifiable. If it's to be of any value to you at all, you have to be able to accurately define and measure it. For example, more new patients from a particular referral source like I just said before and not just simply the practice is getting busier. See, that's way too general, that's not a KPI. Okay, KPIs are an essential metric that are really critical to the survival of your practice no matter what type of practice you're in, whether it is actually dental versus physiotherapy versus chiropractic versus surgery, we all need these essential metrics to be in place otherwise we're going to be completely lost. So fundamentally, KPIs actually become like a GPS in your business and you can refer back to your KPIs and it lets you know if you are on track or if you're lost. Without it, we don't know where we're at at the end of a certain defined period. I find it really crazy to me that a lot of people don't actually know where they're at until they get to the end of financial year and they get their statistics and that dashboard and financial data back from their accountant. This just seems mad because they can say, well, hey, here you are and you're waiting almost a year to find out where you're at. So it's like getting advice but looking back in the rear view mirror, if you know what I mean. I've always found that strange when I talk to my accountant like that and they always give me retrospective advice. So I just wonder, what is the point of receiving advice which is actually occurring after the event that's too late? Is it not far more beneficial to have this information at your fingertips so that you can access it at any time and also be able to influence it and influence your outcomes as well? So that's another important factor with KPIs is you not only need to know how to understand them but you also need to know how to influence them and improve them. And as part of our program, we're going to work a lot together on that, is actually influencing the outcomes. We don't want to have a KPI that would power us over and teach you how to actually exert strong influence over it so that you are in charge. So here's an analogy for you that I think is relevant for referring back to key performance indicators and key performance in your business generally. You have no idea about the success of your diet without using a set of scales. You don't know how fast your car is going without using a speedo and you don't measure the length of the time of your jog without using a stopwatch. So you cannot expect to improve the performance of your practice without measuring the results of your business via KPIs. I have another example for you here on why they are so necessary to have these in your practice. When we're speaking with our staff, whether it be a therapist or whether it be a front of staff, in speaking to them, your staff may report to you and I notice a lot of business owners actually report to me in this manner as well. They report to me that they've made changes in their behavior and their approach to treatment management or their marketing or so on and so forth. They report they're more happy. They report they're less stressed. They report to me they even feel more fulfilled or finally they report to me that they can flap their wings and fly. So I don't believe the last statement and there's no way I would believe any of their former statements either. For example, why would I believe that they've made changes or they're more happy or they're less stressed or more fulfilled unless there's measurable results to back it up. Much like I wouldn't believe I could fly unless I could actually physically see that. So I need to see rock hard evidence of actually their business improving and you need to have KPIs in place so that you know that your staff are improving or you know yourself that you are personally improving. So I like to say the following to my clients and my staff. Work is cheap. Claims are easy. But behaving differently and getting improved results is hard. So we need to show rock solid results to quantify our improvement. One of the biggest killers in owning a small business and practice is the stress levels that go with it. It creeps into every area of your life and it affects all those people that you have relationships with. So in order to reduce stress we need to exert a whole lot of control over our business. Key performance indicators are the best way to keep your business or practice in check and to maintain a balance of control. It helps abolish micromanagement which is the single greatest cause of stress and discontentment in private practices. Without having the knowledge of where you are you don't know where you're going and you don't even know what to do or even how to get there. Think about your staff. The best businesses are built around the best teams. Now how can we help our staff grow, provide feedback to them and encourage performance if we don't know how they're performing and furthermore we don't know at what level they should be performing at. And let's take that one step even further. How do we know how to manage and influence their performance if we don't know where they're at? So quite simply put you can't give them accurate feedback and provide encouragement or support or give them guidance if we don't have a dashboard of how they're actually performing. Okay. So let's look at some of the benefits of having KPI systems in place. Having an accurate set of KPIs that guide your business you gain control and lose stress. It's worth noting that one of the top reasons that people choose to join our coaching and mentoring programs in the first place is to decrease stress. So if you're listening right now to this, stress might be something you want to alleviate so make sure that you do actually implement some KPI changes to your business after watching this video. Another reason for having KPIs in place is to achieve greater, faster and more consistent growth of business but also to become more results focused and not concerned about factors that do not lead to better outcomes. KPIs give us the ability to leverage our staff to get exponential growth and KPIs give us the ability to provide accurate and effective feedback which again leads to greater outcomes. So next point, what to measure and how. We need to identify the areas that determine your practice success and focus on improving each of these. There are only five major ways to grow each practice and let's look at those. Number one, to increase the number of new patients. Two, increase number of new episodes. So for those of you that aren't familiar with my lingo and that of my other consultants and coaches, increasing number of new episodes. New episode refers to someone that rings your clinic or rocks up at your practice and they've come in for an initial episode, it may be a new problem but they're actually already on your database, they've been in before so that's a new episode. So that's another way to increase your business, increasing the number of new episodes. Number three, another way to grow is to increase your fees. Number four, increase profit via decreasing your level of your overheads. And point number five, increasing the number of health services that you provide, whether it be additional services, upselling, cross-selling or actually providing more product which a patient will develop from, which a patient will benefit from. Whether it be for a dental clinic, an extra product could be whether you're looking at providing some extra tooth whitening for example, if you're looking at a podiatry clinic is it that you're actually an extra product could be more sales of orthotics or double up sales of orthotics for example. So each of those five areas are the five revenue raises of your practice and if we can just increase each of these areas by only 10% and your overall revenue will subsequently increase by up to 50%. So as you can see in many cases the changes needed are not that dramatic but the overall result is huge. Okay so now that we know the ways in which a business grows it makes sense to measure them because if we can measure the five ways in which we're growing we can influence them then we're going to grow. So let's look at what to measure. Number one, obviously the number of new patient numbers. Number two, number of new episodes. Number three, number of services per week i.e. number of appointments or procedures provided per therapist and by the practice overall. Number four, the volume of product or other services sold at the practice. So it might be a service which isn't your mainstay. So if we are looking at your mainstay is we're looking at dentistry and we might look at another service could be how busy our hygienists are for example, how busy they are, how much revenue they're producing. Whether it's another practice that could be looking at a physiotherapy clinic, how many extra dry needling or acupuncture appointments are they providing which is away from their hands off type service. Number five, the total revenue which is raised by the practice that week or you know also for that fortnight and month. Not just for the practice but also per practitioner, that's the KPI in itself. Number six, what else can we measure? We can measure the amount of lost business and lost finances per week. So this refers to number of cancelled appointments or appointments not attended. Number seven, we also need to measure the lifetime patient value. This is the most important number in your practice as it really define how successful you will be. So we are looking at how much is your patient worth to you over their lifetime or the lifespan of your business. And you need to know that number. Quite obviously we need that number to be increasing in order for your business to improve. So now we know the areas we need to measure, how do we go about measuring them? Well I recommend that you have a dashboard of statistics at the front desk for your support staff to be completing. They need to be measuring all of the above and they need to have a phone script with them so they can actually get that information whilst they're on the phone. For example, they might be recording for you to get a really specific number of new patients or new episodes. They need a phone script to first of all find out if the person is new to your practice so they need to record that so they can adequately fill it out for you. But also a KPI could be how many referral sources have been generated by the speech that you gave last week to the specialist orthopedic surgeon. So if we record referral sources out the front on the phone, you'll have a much quicker way of finding out your KPIs and how successful they are. Now the results you actually gather from the phone need to be added to a spreadsheet weekly for all the KPIs that are relevant to your practice if you're referred to. You need to learn to read the KPI reports correctly so you can see the correlation between what is happening on a daily, weekly, monthly basis at the practice and relate this back to your KPI dashboard. So you need to be able to get to a point where you can look at your KPI dashboard and know exactly where things are going right or wrong at your clinic so you can bring about change fast and accurately. The results need to be recorded so that you can actually quantify if there's an underperformance by someone and you can learn why that is happening and provide adequate feedback. And then you can tell people how to change it. There's no point in recording statistics just for the sake of recording. We need to actually use this to action something. So let's look at your action steps. So right now you will need to set up a dashboard to measure the results at the front desk so that your front of staff or assistant can actually start recording all this for you. You need to set up phone scripts to ask the questions that are needed to record the correct KPIs. You need to teach your staff how to measure these results. Have the KPI data compiled weekly for you to review and then send it to your business coach for us to critique and then provide you feedback on it. So remember, you cannot see the frame when you're in the picture. So having a third party who specializes in this area look at it will be critical in gaining an understanding of how to improve your results. So when you send those through to us, we're going to give you some critical feedback and we're going to look at it through a different set of eyes. We're going to be able to look at it and say, look, I can see that you're having issues here, here and here and then give you some adequate information so you can go back and bring about changes straight away in your practice. So make sure you do that. If you have any trouble with implementing any of that advice, please speak with your consultant at Healthcare Business Coaching and we'll obviously help you with the implementation. I cannot stress how important it is to get an immense and really close understanding of your key performance indicators. Okay, look forward to hearing from how all you guys go with that. Thank you.