How We Reversed a Downward Revenue Trend to Finish the Year Strong
by Larry Golson, OD | Jan 11, 2023 | Business Management, Featured Series, Metrics, Moving the Needle with Metrics
What was your biggest challenge in 2022?
Despite a strong quarter one and quarter two, we had a dip in quarter three. The biggest challenge was understanding how to “pick back up” in quarter four. All of the KPIs that we follow had declined in that quarter, so we needed to figure out how to make that up at the end of the year.
What strategies did you use to overcome that challenge
We first had to try and understand what the issues were that caused the numbers to fall in the third quarter. We started asking our office manager to sit in with the doctor and listen to the conversation and the handoff, then offer suggestions to improve the patient dialog. We also had the optical manager sit in with the opticians to listen to the conversations that they were having with the patients.
These feedback mechanisms gave us some terrific results. One of our key metrics, Revenue per Patient, saw an increase of over $150 in September and October. That had tremendous benefits on the practice so that we could finish the year really strong.
Have you been able to sustain that level of performance?
We have been able to maintain that success rate. It’s tempting to discontinue some of your procedures once you feel like you’ve “solved the problem,” but I wanted our team to continue that level of performance, so we kept a scaled-back version of these feedback programs in place, and that worked really well. That same KPI (Revenue per Exam) was even higher in December.
One thing we work toward is a level of psychological safety, which helps our team members be open to receiving feedback without feeling defensive. We’ve worked to develop a high degree of trust between team members in order to make that positive criticism really effective. It ultimately improves the practice and the patient outcome.
What are you planning for 2023?
We are focused on the entire year. We run a system called Traction in our practice, which has what we call an Annual Meeting Pulse. That’s a 2-day meeting with the leadership team where we develop the goals we want to achieve. We base those not only on what we feel is manageable, but also what’s a bit of a stretch. We’ll choose our revenue and growth goals, and select the metrics we feel will help us build them.
We always analyze the results to see if we can develop a clear understanding of what works well, or else figure out where we may be needing to improve.
Your staff leadership is involved in selecting goals for the year?
We do involve the staff in creating goals. It’s empowering for our team to consider what is a realistic goal and analyze what barriers to success they may be facing. It’s also important to understand that this is the work that they’re doing; they’re the ones working in the optical, etc., so they need to have a say in what those goals are. I may be able to influence their aspirations, but I want them to come up with their own numbers to shoot for.
What is your advice to practitioners planning for 2023?
It has been said and proved many times, but it’s so important: the simple act of measuring something tends to improve it. We need to remember that we’re a business. The profit we create allows us to reinvest in building that business, improving ourselves, and creating success. You need to select something measurable – there are lots of resources that will help you decide which KPI to focus on, but choose one. Then you need to measure your performance / improvement regularly throughout the year. Finally, you need to actively change behaviors based on your results.
About Dr. Larry Golson
Larry Golson, OD, founded Envision Eyecare in Asheville, NC as a cold start in a challenging economic climate in 2008. Since then, the single-location practice has grown to support a second doctor, five exam lanes, and a team of 13.
Dr. Golson has been using metrics to manage his practice for 15 years, with a special focus on Revenue per Patient, which he feels is one of the keys to success. His goal in analyzing his practice performance is to understand the effectiveness of the business’ systems.
“The numbers will tell a story. If we’re listening, that story will help instruct us as to how we can improve our practices and make it a strong 2023.”