In this message I want to talk about 3 things:
The Weather (big topic these days)
A Membership Benefit
Years ago my dad taught me this little weather forecasting poem:
Red Sky at Night, Sailor's Delight
Red Sky at Morning, Sailors Warning
According to that poem, a beautiful red sky can predict the weather based on whether you are seeing it at sunrise or sunset. This rule of thumb dates back over 2,000 years.
Does it work? I don't know. I recall that poem every time I see a red sky, but always forget about the sky by the time I can test it out.
Weather forecasting has come a long way. After the poem, early forecasters predicted weather based on cloud patterns and changes in temperature, humidity and barometric pressure. Then came radar and live satellite images and constant computer models.
Atlanta's Channel 11 used to advertise that they would show the weather forecast in the first eleven minutes of every newscast. Another station had a "ding, ding, ding" sound that played to get everyone's attention when they gave the 7 day forecast. They know all we care about is the weather.
Now that we all have the weather on our phone, who even watches the news?
Forecasting in our optometric practices has also come a long way. Today's practice software programs have every imaginable piece of data about our practices. But unfortunately, most of us don't know how to use the data. The problem is there is so much data and information, it is hard to know what to pay attention to.
We may as well be using poems. How about this one?
Tonight's deposit was pretty big, I think I am going to dance a jig.
Yesterday I only deposited a little, so for the week - we are in the middle.
Forecasting and Benchmarks
Most business consultants establish a set of benchmarks to measure and monitor how things are going with the practice. The best set of benchmarks looks into the future to pick up on problems BEFORE they occur.
What to measure
It is important to maintain a good strategy on collecting and evaluating data from your practice. There is a balance of how much to measure and there is no set of data points that is perfect for every practice. If you don't look at any data, you will eventually run into trouble. If you look at too much data, then you aren't really looking at any data.
I have come up with over 100 benchmarks that all individually make sense to monitor within a practice. But only two are for every single practice:
Number of exams
Income per Exam
For the rest, some need to be monitored constantly in some practices and occasionally in others. Figuring it all out can be a daunting task.
Leadership OD Membership Service
This month, Leadership OD members are invited to log onto their membership page and schedule their own 45 minute Benchmarking Call with Dr. Mickey Kling or Mike Rothschild.
Mick has taught me a lot about setting up financial strategies for practices and we confer with each other regularly about the best methods. We don't always agree with the best measurements to make, but we do develop a strong plan for any practice.
If you are not a Leadership OD member follow these steps to set up a benchmarking system:
List all the distinct areas of your practice that generate significant income. Some examples are Clinic, Medical Testing, Surgical Co-Management, Contacts, Optical, Lab, Vision Therapy, and Administrative (insurance).
Identify 1 or 2 key indicators in each of those areas to measure their effectiveness. Find a quick, easy way to routinely measure those benchmarks. Most of ours come from a report, but some involve a stopwatch. I think it is a good idea to get information from a variety of sources.
Try to think of something that happens when problems are coming. This is an art and the real challenge in tracking data.
Create a system to look at the data, follow the trends and react accordingly. The report system is the most common failure point. If you look at the data when you think about it, then you look at it only when it is too late. I usually recommend reporting on 2 - 4 benchmarks at weekly staff meetings.
Looking at historical data may be my least favorite part of owning a practice. I think it is because I like looking forward so much more than looking backwards. But I do know how easy it is to get off course and I realize how important it is to monitor progress.
So for me, I work hard to make it easy, effective and fast. And I will keep trying until I hear "Ding, Ding, Ding - The forecast for the practice is good."
Happy Valentines Day,