Improving Your Practice Using Key Performance Indicators (KPIs)
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1 Improving Your Practice Using Key Performance Indicators (KPIs) 1
2 2 Dow Jones Industrial Average The best known U.S. index of stocks. A price- weighted average of 30 actively traded blue- chip stocks is a barometer of how shares of the largest US companies are performing. There are hundreds of investment indexes around the world for stocks, bonds, currencies, and commodities.
3 Definition of KPI Key Performance Indicator (KPI) KPIs evaluate the success of an organization or of a particular activity in which it engages. Accordingly, choosing the right KPIs relies upon a good understanding of what is important to the organization, 'What is important' often depends on the person or department measuring the performance - e.g. the KPIs useful to the clinic will really differ from the KPIs assigned to optical. Using KPI s often lead to the identification of potential improvements, so performance indicators are routinely associated with 'performance improvement' initiatives. A very common way to choose KPIs is to apply a management framework, such as the balanced scorecard. WHAT GETS MEASURED, GETS DONE!
4 4 Why Do You Measure? Set goals and measure performance Promote personal accountability Increase productivity Increase net income
5 KPIs to Track & Analyze 1. Office Production per Refraction 2. Optical Production per Refraction 3. Frame Capture Rate 4. Lens Capture Rate 5. AR Capture Rate 6. Contact Lens Capture Rate 7. % Booked 8. % Medical 9. Frame Inventory Turn 10. Sales to Stock Ratio
6 PRACTICE KPI #1 Office Production per Refraction PRODUCTION REFRACTIONS 6
7 OPTICAL KPI #2 Optical Production per Refraction PRODUCTION REFRACTIONS 7
8 FRAMES KPI #3 Frame Capture Rates SOLD REFRACTIONS 8
9 LENS PAIRS KPI #4 Lens Capture Rates SOLD REFRACTIONS 9
10 AR COATINGS SOLD KPI #5 AR Capture Rates LENS PAIRS SOLD 10
11 KPI #6 Contact Lens Capture Rates CL ANNUAL SUPPLY ORDERS CL EXAMS 11
12 REFRACTIONS KPI #7 Percentage Booked PERFORMED TOTAL REFRACTION APPOINTMENTS 12
13 KPI #8 Medical Percentage OFFICE VISITS LEVEL 1-5 New/Established Patients 99201, 99211, 99202, 99212, , 99204, 99214, 99205, REFRACTIONS 13
14 FRAME UNITS SOLD KPI #9 Inventory Turn FRAME UNITS ON-HAND 14
15 % TO KPI #10 Sales to Stock Ratio TOTAL SALES % TO TOTAL INVENTORY 15
16 16 Optical Production Goals Determine expected optical percentage sales increase over last year Make the goals reflect any changes in the practice, ie: doctor on vacation, 2nd doctor now seeing patients, increased/decreased office hours, increased/ decreased # of opticians, new products lenses or coatings Allocate total optical sales goals between opticians (based on monthly hours worked) to set each optician s individual goals
17 17 How Do We Communicate KPI Data with Staff? Bi- weekly or monthly staff meetings Create agenda of topics, include KPI update Morning huddles for a quick 2-5 minute touch base Manager should know what to discuss Pick 2 topics for the week, & update each morning, ie: Office production goals where are we Optical production goals where are we Manager can keep and update a calendar of daily goals
18 18 How to Manage & Coach Employees to Achieve KPIs? Leadership/Management Monthly Business Review Recap all KPIs? What are the hits and misses? Manager and individual staff coaching meeting is manager communicating with staff? Hold staff accountable for doing their part: Patient Services- % booked Techs- Optos % and annual CL supplies Opticians- Capture rate (Frames/Lenses), AR, optical Zone
19 19 Rewarding Success KPIs are a good way to associate individual staff performance with? Recognition Salary increases Bonuses Contests All of the above
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