Key performance indicators or KPIs seem to be mentioned a lot, but in our experience poorly used. When we start to consider what we could measure as a performance Indictor it is easy to get overwhelmed. This is often why we at Elevate Your Clinic get asked about KPI’s a lot. Most therapy business owners know they should be using them (often they have read a business book or blog) but unsure what to use.
In this article, I attempt (🤞 ) to explore the overwhelming reality of data points in your business BUT then attempt to simplify some metrics which you can use on a monthly bases.
Why use Key Performance Indicators (KPIs)?
The most common reason is to make sure your business is running to plan. They can be used as a ‘dashboard’ to measure business performance. This data dashboard can help you recognise what is working or not. It can also improve your decision making process. Furthermore, will tell you what you need to spend your time, effort, and money.
Often without the use of a good KPI dashboard or data points therapy business owners can end up wasting valuable time, energy, and money. This is something we should all want to avoid.
What does GOOD performance look like?
It is essential that you take some time to understand this. As each business is different this is hard to give generic answers for all the data points. If you look at any marketing books or blogs there are some that identify what a successful click through rates might be.
The definition of good performance is down to the therapy business owner (YOU) to decide. If you have a team or considering hiring, then they need direction. This will need leadership. Therefore, when you ask them to do a good job in your organisation you must explain what good is!
Now, if you have been in business a while then hopefully you have some data that you can look through and decide what you feel is good.
Or if you have some financial data you can set yourself a profit target and then work backwards to decide how many customers you will need to reach that.
If you haven’t defined what good looks like, then during this read please make notes, pause, think and make more notes until you have an answer. Accept the answer may change months down the line. That’s ok. You have a start.
If you already know what good looks like, take some time to revisit it and see how it stands up today.
Marketing and Lead Generation
Marketing and getting new customers was the highest concern for therapy business owners during one of our recent surveys. It is also what we see so many owners spending their time effort and money on. Although, still many fail to measure the success of their marketing. If we consider all the data points we could measure:
- FB like,
- IG like,
- new followers,
- number of shares,
- Google analytics including website traffic, bounce rate,
- calls to actions used on website,
- email click campaign,
- ebook downloads,
- Enquires either a phone call, text, what’s App or email
- Conversion rates
- Influencers referrals
- Consultant referrals
- Insurance referrals?
This list could be endless. We look into this even in more depth in my success or survive e book (which you can download for free here).
This key point to remember is to decide what is important. Is it to bring you in the number of new customers you want? Then furthermore where have you got them from?
The aim of a business to make a profit. So how much does your business make? The success of a business depends on understanding the difference been profit and loss. It is about making sure each transaction a customer makes in your business is making your profit? Do you know how much profit you make from each session that a customer attends?
When you do, you can then predict profit by knowing how many customers you see. Exciting isn’t it! Often most businesses wait until they hand over their figures to their accountant do know if they have done well. Please don’t be like this.
Profit simply put is all money in – all money out. Profit is what is leftover. Unfortunately, it isn’t always that simple. When we have debt (loans and overdrafts), or when we are owned money (debtors).
When we have customers from insurance companies on 30, 60, 90 or even 120 day payment terms! This affects our cash flow.
Other things we need to consider may be:
- Cost of acquisition
- Profit per customer %
- Overheads to income %
- Staff to income %
- Profit and loss
- Cashflow (monies owed and monies we owe)
- Average Total customer spend per journey
Again this list can go on. Using good CRM software can help calculate this all at the press of the button when you set it up correctly and take the time to look at the data.
This can be measured in so many ways. When it comes to people performance we must consider not just quantitative data but also qualitative. People have emotions and feelings. These must be taken into account too.
A good leader must recognise the best way to motivate an individual to get the best performance out of them, for the customer and the business. The danger of just using quantitative data is that a burnt out or overworked team member will quickly underperform. This causes greater issues for you as a leader.
Therefore, when identifying best performance indictors for a team member this may have to be done on an individual basis to get the best out of them. Some may be driven by the total number of customers they see, others by the amount of money they have contributed to the business. BUT some may be driven by the outcomes they have achieved with the customer or that they perceive is doing their best.
When it comes to therapists, we must accept the human element of them. Many became therapists in the first place to help others. This is often the downfall of many business owners. They are so focused on helping the customer they sometimes forget that they need to be remunerated for their services.
Understanding under your brand, what a good team member performance looks like can also help improve your recruitment. It allows you to identify who are suitable candidates for your business. This helps you and them in the long term.
Clinical Outcomes Performance
As a therapist what should also be important is how well the customer improves with your service. Let’s be honest, as a therapy business, there is no point focusing just on profit if your service fails to solve customers’ issues! You won’t last long. Although this is normally not the case. Most therapists focus so much helping customers with their issues that they actually provide a very inconsistent service. When they can they give customers extra time over the agreed 30, 45, or 60 mins. This in itself can create issues.
Within the therapy industry there are plenty of clinic outcome measures. Here are 4 articles from the clinical world if you want to read more:
Life Outcomes Performance
For me though, although these are important to have some standardised outcomes we MUST also explore what the customer wants from us. Therefore, we must include their dreams and desires of our services. Are we helping change their world for the better? And how do we measure that?
A simple approach I use is understanding what they want their life to be in their world. An easy example is a runner. The obvious outcome is to be ‘back running’ But the dream may be to run a sub 3 hour marathon or simply beat your best mate at the race for life on a Saturday morning by running a 26 min 5K.
For me achieving the life goals create more customer satisfaction and also work satisfaction for therapists. The challenge is measuring and recording this stat. Some ways could be
- Feedback forms
- Client testimonials
- Evidence on discharge of goal achieved
- Net Promotor score – Stats that a customer will refer your business (0-10)
Like most of these sections I could list several others the key though is to work to your means. Do things simple at first then you can begin to explore more.
Keeping things simple
When we look at any business, to begin with these are the key stats we use:
- New Customer – source, includes returning patient.
- Total number of customers
- Customer Journey Length
- Ave Sale (Total monies taken (excluding product sales) / total number of customers)
- Incomplete journeys (those who didn’t return as UTA/DNA or non discharged customers)
Alongside the profit and loss accounts this information can give you a snapshot of performance. When you understand what they stats should be on a good month then you can identify where you need to spend your time, energy, and money to improve. This is where you can delve more into the details and seek to understand what isn’t working well. Then you can adapt and change.
If you have a team then use this for individuals to record their individual performance
Exercise to complete
By now I hope there is some more clarity on what you can be using and what you should be focusing on. Hopefully, you have started to begin to define what ‘good’ looks like. From then take some time to record the data. Use this monthly to analyse your business performance. Decide if it is reaching a good level. If not, decide why and what needs to change.