BUSINESS PLANNING

MAP A DIRECTION FOR YOUR FUTURE

FOLLOW THESE THREE STEPS TO MAKE 2017 A MORE PROFITABLE YEAR

Jason R. Miller, O.D., M.B.A., F.A.A.O., Powell, Ohio & Scot Morris, O.D., Conifer, Colo.

WITH A new year right around the corner, now is a good time to reflect — and build — on the business of your optometry practice. This process involves three steps: 1. Obtain a clear picture of your practice’s current business status; 2. Set goals for the business status you’d like to achieve by the end of 2017; and 3. Devise a specific plan to get from your current business status to the one you’d like to achieve.

Here, we provide action items for achieving each of these three steps.

1 OBTAIN A CLEAR PICTURE

To acquire a clear picture of your practice’s current business status, assess and continually focus on your key performance indicators (KPIs):

• Revenue per encounter. This KPI, calculated as total revenue by total number of encounters, is a true measure of production effectiveness or, more commonly known as, the sales process.

• Patient encounter per hour. This KPI, calculated as the total patient volume through a given period divided by total clinic hours, is the best measure of efficiency and overall volume, also known as throughput.

• Revenue per hour. This KPI, calculated by total revenue through a given period, divided by total patient hours through that same time period may be the most important, as it reflects overall production effectiveness and efficiency and is largely affected by the two previous KPIs.

• New patient ratio. A healthy practice has a consistent supply of new patients. Obviously, newer practices and doctors have a higher new patient ratio compared with seasoned practices and doctors.

• Percent of medical care patients. This KPI is calculated by looking at the number of patient encounters billed with medical diagnoses (not refractive in nature) vs. the overall number of patient encounters in the practice.

2 SET 2017 BUSINESS GOALS

Where do you want your business to be by the end of 2017? Think big, and don’t limit yourself. Look for areas where changes can be made that will positively affect the KPIs you are tracking. Track them weekly, monthly and quarterly to see whether your efforts are working.

Focus on areas that will give you a competitive advantage by performing a Strengths, Weakness, Opportunities and Threats (SWOT) analysis. Given the local and national risks to our businesses, it makes sense to focus on as many opportunities as possible, but focus on accomplishing them one at a time. Also, don’t forget to look at your own personal strengths and determine where you can capitalize on these. For example, you may have a strength in diagnosing and treating patients who have ocular surface disease. If that is the case, focus on growing the “percent of medical care patients” stat for 2017. Look for ways to establish referrals (both internally and externally), and invest in technology that allows you to market this strength to other providers.

3 DEVISE A SPECIFIC PLAN

One or more goals will not get you anywhere without follow through. Follow these steps to take action:

1. Write the goal(s). First, write the purpose(s). This is the motivation that will get you through the tough times, telling you “why” you are committed to seeing it (them) through. For example, if your goal is to garner more new patients, write why this important to you: “I want to grow my new patients by 10% during the first six months of 2017 because there has been a growth of new homes in my area, and I want to be those occupants’ eye care provider.”

Next, focus on how you are going to achieve that goal by creating Specific (or significant), Measurable (or meaningful), Attainable (or action-oriented), Relevant (or rewarding), Time-bound (or Trackable) and Responsibility-driven (SMARTR) goals to achieve the one or more goals you have. Goals that are measurable can be achieved. Everything else is just fluff and open to interpretation. Spend about 5 to 10 minutes on your SMARTR goals.

For example, to garner more new patients, you could devise a direct mail program to the aforementioned new occupants and compare the mailings to new patient appointments made through a specific period. Also, you could implement specific programs geared toward bringing new patients in through social media marketing or an internal referral program.

Another example: If improving your revenue per hour is your goal, you may want to look at your internal processes. Consider adding a scribe or, if you have the space, another exam lane or pre-test center to improve your patient throughput. In addition, look at specific ways of improving your revenue per encounter. This could be through bettering your annual supply of contact lens patients or focusing on your eyeglass capture rate.

There are many ways to improve your KPIs, but making a plan is necessary to move that needle in a positive direction.

2. Create action steps. Break the goal down into little steps that can be taken every day or every week to make the goal(s) manageable and, therefore, feasible. Using the additional new patients example, this may start with staff training. Each staff member needs to know how to answer a call and convert those “phone shoppers” into patients.

Making positive and meaningful change takes time. Only plan one major change every three to four months. It is more important to focus on one thing, and do it well, than to do three things mediocre.

3. Visualize the outcome. All successful people do this. Specifically, schedule three minutes every day to review your goal(s), to think about and “see” how much easier and better your life will be once accomplished. The mind is an incredible motivator and inventor.

4. Create accountability. Tell those close to you what you are going to do, and empower them to remind you to stay on track. You don’t want to let them down do you?

GET MOVING

Take the first step toward building a strategy for the future, and schedule 30 minutes for the next six weeks to determine where you are, where you want to go and how you will get there. What are you waiting for? That’s only five minutes per day. OM

	DR.MILLER is a partner at Eyecare Professionals of Powell, in Powell, Ohio, on the board of the Ohio Optometric Association and is an adjunct faculty member for The Ohio State University College of Optometry. To comment on this article, visit tinyurl.com/OMcomment.
	DR.MORRIS is medical director of Eye Consultants of Colorado and an operating partner in Morris Education & Consulting Associates. He is chief optometric editor of Optometric Management. To comment on this article, visit tinyurl.com/OMcomment.