Dentists seemed to be challenged by the increasing information that today’s practice management systems provide. The information is intended to help dentists make improved decisions within a short time frame. Following the basic Key Practice Indicators (KPI’s) will assist in cutting through the data overload and allow you to determine quickly whether the goals of your practice goals are being achieved or not.
These performance indicators are some of most important for a business owner.
- Practice Overhead (cost to run business)
- Collections Production
- Amount of New Patients
- Production per New Patient
- Production per Patient
- Treatment Acceptance (how much you present vs. scheduled)
Key indicators provide statistics of your dental practice. KPI’s keep the doctor and the team on track for reaching goals, budget, and effectiveness of the business.
Certain expenses are normal and necessary to run a dental practice such as rent/mortgage, dental equipment, supplies, utilities, marketing, and staff cost. As the owner of the business, you should be aware of how much it costs to open the doors of your practice each day. Do you have a budget that accurately reflects your overhead expenses? Does your schedule each day reflect the production needed to cover your expenses every day and for the month? If you are not meeting the budget daily, it is going to be hard to stay within your budget by the end of the month.
We all know that dentistry is a business. However, dentists seem to ignore this fact and run their business like an expensive hobby. Patients (consumers) expect to pay for services that are received. It is understandable that patient care is always the doctor’s top priority. However, it is an absolute to collect payment from patients at each dental visit, no matter how uncomfortable you or your dental team may feel. You are in the business of dentistry.
Your patient’s dental needs drive your practice. If you are failing to tell the patient what they need, then you are not providing them with the service for which they have paid. Do you have daily, weekly, and yearly production goals? Are you meeting or exceeding the goals that you have set? Are there always opportunities for your dental practice to increase production? All patients can have a treatment plan whether it is preventive or restorative.
Number of New Patients.
To continue growing the needs of your dental practice, you should focus on obtaining new dental patients every day, week, and month. Dentists lose patients each year due to death, relocation, dissatisfaction, and lack of commitment. Are you tracking your turnover? Do you have an internal and external system in place to gain new patients? Are you tracking your referrals and thanking the sources of your referrals on a regular basis?
Production Per New Patient.
When seeing a new patient, many doctors worry about overwhelming them with information. Doctors are constantly worried about how much information should be shared with patients. Often doctors wonder, what if I scare patients because their mouth is full of cavities, and they do not come back? These are normal concerns, but you have an obligation to present the facts in an honest and understandable way to your patients. Doctors should be able to set up long-term goals with their patients, allowing patients to keep their mouth healthy for a lifetime. The dentistry that you provide for a new patient should be tracked to determine the production per new patient that you are averaging. Often a new patient will produce an average of $1700.00 for your practice in the first year.
Production Per Patient.
Long-term patients always present ongoing opportunities for increasing production because they trust that you will advise them of treatments that are necessary and present options that are best for them. Maybe you have added new dental services, such as Invisalign, Six Months Smiles, TMJ treatment, OSA Treatment, new products, or even cosmetic dentistry. Regardless, your team must commit to offering treatment options to patients. Small sales per patient equal large increase for the business over the course of a year.
Is your treatment acceptance over 58% role-playing, team meetings, and even scripts distributed amongst the team? This aspect is imperative to increase case acceptance. You cannot expect your team to sell dentistry and elective services if they do not understand the available options, including the advantages and the process for treatment.
Your goals should all be geared toward profitability, not survival. When your practice gains new patients, increases production and collects money for all services rendered, you should have no problem achieving profitability.
Tracking the statistics of your practice helps to create challenges, yet also has its variables. For example, increasing your daily production does not necessarily increase profitability if your scheduled services lack a sufficient amount of high-profit services, then you just have greater overhead to go with your increased production. On the other hand, if you increase production without having proper staffing in place, then your patients experience reduced or even poor customer service. This experience could drive patients out of your practice and through the door to your competitors.
Dentistry is an ever changing, ever challenging, and forever evolving field that offers patients, doctors, and team members an outstanding quality of life. There will never be a “cookie cutter” system that is suitable for all practices, but tracking your practices statistics allows you to evaluate the health and growth of your business. If you can identify the weak areas of your business, then there is always a way to strengthen those areas.