HOW TO BENCHMARK YOUR PRACTICE FOR SUCCESS

I grew up playing and teaching people how to play tennis.  Some players would practice and practice, but it was not until they actually played in a tournament that they got real feedback on how they were progressing. Similarly, as you work day to day in your medical practice, it is easy to operate in a vacuum.  However, you can solve this problem by benchmarking your practice against others locally and around the country.

Practicing medicine is data driven.  You spend years learning to quickly review and interpret data to improve patients’ lives.  This data driven mindset can help you optimize your practice as well.

There are four keys to successful benchmarking:

(i) The ability to produce accurate data in your own practice

(ii) Access to quality data on key metrics for comparable practices

(iii) Proper analysis and interpretation of the data

(iv) The will to execute on your findings.

Producing Your Own Data

How much do you know about your own practice?  It’s hard to make comparisons to others when you don’t know your own numbers.  This starts with creating sound accounting practices.  What type of accounting software are you using?  Can it track all of the detail you need?  Is the information easily accessible?  Work with your accountant or practice consultant to ensure you are capturing the necessary data.  As bestselling author Stephen Covey taught, “you want to begin with the end in mind.”  Therefore, think about the data you want to be able to review, and then make sure that you have the systems and data collection to give you what you need.

Comparable Key Metric Data

You want to look both at practice characteristics and productivity measures when analyzing comparable data.  For example, practice characteristics include:  size of patient base, number of exam rooms, hours of operation, number of physicians, number of staff, fees, and payor mix.  Productivity measures include revenue per square foot, annual revenue per active patient, gross revenue growth, patients per day, gross revenue per exam, staff turnover, percentage of gross income and net income for staff, marketing, insurance, etc.  It is also helpful to compare salaries, rent costs, and insurance premiums.

Where do you get this type of information?  There are associations such as the Medical Group Management Association that have a great deal of this type of information available.  I’ve also found that practice focused associations also generally have good data on practice areas. Finally, some of the medical industry vendors (e.g. pharmaceutical and device manufacturers) have very good data as well.

Analyze the Data

Your job is to practice medicine, not to be a forensic accountant.  Therefore, your practice reports should be clear and easy to understand.  You’re looking for trends and patterns in the data.  It should not make you cross-eyed to interpret the data.  I prefer nice graphs and charts to graphically illustrate the information.  This helps me to spot changes over time.  One additional point is to know the value of your time.  I encourage professionals to do the basic equation (income / hours worked) to know their “hourly rate.” This is very helpful when you consider how you spend your time and what things need to be delegated or outsourced.

As you know and understand your own data then you can better compare it to the benchmark data you review.  It’s important to make sure that you are comparing “apples to apples” in your analysis so be cognizant of distinctions based on urban/rural settings, practice size, and geography.  How does your practice stack up?  Are you managing costs appropriately?  Is your practice being productive with the resources allocated?  It takes time to actually compare this important data.  This is truly thinking “on your business” versus thinking “in your business.”  Take the time to set aside good thinking time to review the data.  I would recommend getting out of the office so you’re not interrupted.  You may want to get some of your trusted advisors or staff to review it with you.  Having more than one perspective can be helpful.  What is the story that the data is telling you?  Write down your conclusions and potential action items.

Act on What You Learn

I have spoken with many physicians who are disappointed when their patients don’t act on the valuable medical advice they receive.  As any physician knows, it’s not what you know that counts, but what you do with what you know.  Once you’ve taken the time to create the systems to produce accurate data in your practice, gather quality third party data, and to thoughtfully review and analyze the information, now it is time to act.  Create written goals and action items based on your findings.  Make sure you have action items delegated to those who can get it done.  Most importantly, you want to follow up and make sure your organization is accountable to complete the proposed changes. Finally, it’s important to remember that this process is an ongoing one.  It creates a positive feedback loop in your practice.  I would recommend at least annually making sure that your practice is on the right track!

 

ORGANIZATIONAL HEALTH

Rich Roll is one of the fittest men on the planet. He has been interviewed by CNN and featured in numerous fitness magazines. Roll has been a top finisher in the Ultraman World Championships which is a three-day/320-mile double ironman distance triathlon. The event is invitation only for 35 select participants from around the world.  The first day is a 6.2 mile ocean swim followed by a 90-mile cross country cycling race.  The second day is a 170-mile cycling race, and the third day finishes up with a 52-mile double marathon. I am exhausted just thinking about that type of incredible endurance feat.  While he had been a competitive swimmer in college, this attorney and father of four had hung up his “Speedo’s” after college and was almost fifty pounds overweight by his 40th birthday.  Roll overhauled his diet and got back on track with his fitness program, and within two years, he was competing at an international level for endurance athletes.  What he has done through intentional planning and hard work is to achieve a level of optimum health that is allowing him to compete internationally well into his 40’s.

Similarly, organizations of different types and sizes can achieve a level of optimum health. This does not mean that we need organizations full of ultra-athletes.  Rather, we want organizations that operate in a healthy, complete, and consistent way. Best-selling author Patrick Lencioni emphatically stated in his book The Advantage, “The single greatest advantage any company can achieve is organizational health. Yet it is ignored by most leaders even though it is simple, free, and available to anyone who wants it.”  Most organizations fail to embrace organizational health, and the typical reasons include that it is too “touchy feely,” the concepts are too simple, or the tyranny of the urgent feeds our adrenaline addiction. Lencioni describes a healthy organization as one with minimum “politics” and confusion, employees with high morale and productivity, and low employee turnover.  Wouldn’t that be a great place to work?  As obvious and important as that is, we tend to spend all of our time and energy on the technical aspects of the organization (e.g. strategy, marketing, etc.) and very little time in making sure that we have a healthy company.  I have summarized below a few of the ways to help make the transformation from being a “couch potato” organization to one that has optimum organizational health.

Establish Trust

You don’t need to go to the ropes courses to build trust (although team building exercises can be helpful); instead, there are some simple things you can do to increase the trust in your organization.  One of the major symptoms of unhealthy organizations is that the management group does not feel free to share their opinions.  When managers are simply “yes men and women,” the organization is not benefitting from the collective wisdom of the group. Teams that always have complete consensus are potentially toxic because people are certainly withholding their true opinions.  The intelligence of the organization is hindered as employees all try to CYA (cover their assets) instead of contributing their best thoughts and ideas. The leader of the organization sets the tone here and should insist on candid discussion and promote vigorous debate. Remember healthy conflict is to be encouraged, not discouraged.  Team members need to understand the boundaries for conflict and be willing to commit to the path ultimately decided by the leader.   Another way to help strengthen the trust in the team is to utilize personality tests like DISC®, Myers Briggs Type Indicator® or The Birkman®.  These allow team members to better understand both themselves and their colleagues.  Many misunderstandings can be avoided once communication and personality styles are better understood.

Create Clarity

Healthy organizations have clarity and alignment around the main things and know how to “keep the main things the main thing.”  This is easier said than done and requires asking some simple but challenging questions. I recommend having the organization’s management team periodically independently respond to the following questions:  (1) What is our reason for being as an organization – why do we exist? (2) What are our true core values that guide our behavior? (3) What business are we in? (4) Where are we going as a company – what is our strategy for success? (5) What are the most important things that need to be done in the organization in the next 30-90 days?  (6) Who needs to do what to accomplish the most important things? (7) What are the key metrics for measuring the success of the organization?  Answering these questions independently will ensure that “group think” does not set in and that everyone does original thinking about the answers. The team can then gather and debate their answers and synergize their responses.  I am an advocate for having a concise 1-2 page summary of the results of this process which serves as the guide for the organization and an accountability tool for team meetings.  Answering these types of questions requires time and a change of perspective from “thinking in the business to thinking on the business.” In our world of constant emailing and texting, it is important to unplug and get away to periodically think on our organizations to create clarity.

Communicate, Communicate, Communicate!

Healthy organizations know how to communicate well. Their leaders repeatedly communicate key themes. They know that repetition counts and that they need to communicate with clarity what is really important.  I have found that whether coaching sports, raising kids, or leading in an organization, the key is to keep the messages simple and repeat them often.  Effective leaders use different mediums and tools to constantly reinforce messages.  Ambiguity and confusion are the hallmarks of dysfunctional organizations.  The anti-dote is communication!  Too often leaders fail to communicate enough because they are too busy or incorrectly believe that they are being too repetitive. Healthy organizations not only have effective top down communication that cascades through the organization, but they also have effective lateral and bottom up communication.  Smart organizations know that the information gathered by front line employees is invaluable and needs to circulate within the company.  Innovative companies will create regular opportunities to make sure upper management is spending time with front line employees to foster open communication.  Leaders can also promote good communication by being accessible and utilize techniques like “management by walking around.”  There is nothing worse for leaders than to get stuck behind their computer all day.  Focus and alignment occur when organizations have clarity on what matters most and communicate effectively throughout the organization.

Conclusion

While being an Ultra athlete is not in the cards for me, I do know that I can be a part of making sure that organizations I am part of achieve optimal health. There is no reason to settle for working in dysfunctional situations. By recognizing the important of being “healthy” in our business and utilizing some of the simple ways to become healthier, we are on our way to building healthy organizations!

CREATING AN ENGAGED WORKFORCE

One of the key habits of entrepreneurially minded physicians is developing an engaged workforce. The Gallup Organization has done extensive research on the engagement level of employees in organizations and the overall impact on company results.  According to Gallup’s research, engaged employees are more productive, profitable, customer-focused, safer, and less likely to leave.  In the average organization, 30% of the employees are engaged, 50% are disengaged, and 20% are actively disengaged.  In comparison, in world-class organizations, 63% of employees are engaged, 29% are disengaged, and 8% are actively disengaged.

Engaged employees are those who have a positive attitude, take personal responsibility for their actions, are passionate and committed to the company’s goals, contribute discretionary effort, and are solution oriented.  These are the “A” players on the team. Disengaged employees are those who “punch the clock.”  They do just enough to keep their jobs and are resistant to change.  They don’t give the organization their discretionary effort and tend to react passively to problems.  Finally, disengaged employees are those who are poison pills in the organization.  They stir up trouble and recruit others to their cause s.  They blame other people for their problems and make excuses.  They erode a company’s bottom line and bring down the morale of an organization.

Physician leaders, like other organizational leaders, spend an inordinate amount of time dealing with actively disengaged employees.  They are the squeaky wheels on the staff.   We often are forced to ignore our engaged employees as we clean up the messes of the disengaged and actively disengaged members of our staff.  Effective leaders know how to raise the bar and increase the level of engagement of their teams.  They know how to actively listen and learn what the root causes of the problems are.  They don’t ignore issues, but instead, deal with them head on.  Leaders can raise the level of engagement by sharing a compelling vision, coaching their team members, communicating clearly, raising expectations, and insisting on accountability.

In a medical setting, a poorly engaged team can lead to disastrous results.   Patient care and safety is obviously first and foremost.  Disengaged and actively disengaged employees are apt to “let balls drop” that can lead to safety issues for patients.   This could include forgetting to follow up on medications or testing, or even mishandling paperwork or other instructions.  Beyond safety issues, disengaged and actively disengaged employees project their poor attitudes to patients.  The patients (customers) have plenty of options for healthcare services.  Rude treatment by staff can run off patients in a hurry.  For better or worse, these staff team members are the front line representatives.  The quality of the patient experience will largely be dictated by the treatment from the medical staff.  The net effect is that the level of engagement of a practice’s employees has a direct impact on the bottom line.

Interestingly, Gallup’s research found that engaged organizations have 2.6 times the earnings per share growth rate compared to other lower engagement organizations in the same industry.   The engagement level of employees has a direct impact on key performance areas including absenteeism, turnover, safety, customer satisfaction, and profitability.

Creating an engaged workforce is easier said than done.  First, sometimes we have to “get people off the bus.”  This means we have to recognize and deal with actively disengaged people.  While some employees may be salvageable, sometimes the best thing to do is to let someone go.   A disengaged employee is obviously not happy.  We don’t do them favors by keeping them in a miserable job.  For salvageable disengaged employees and the generally disengaged, we need to learn how to be better coaches.   We do this by observing our employees better, questioning them to learn more about their motivations, truly listening to their responses, and giving candid feedback.  Finally, we have to rally them to action.  This means that we  establish clear expectations and standards, and I prefer to put these in writing.  It is critically important to have regular accountability meetings to track progress towards goals and expectations.

It is important to remember that employees do things for their own reasons, and not their leaders.  In the end, all motivation is self-motivation.  While we can yell, scream, and threaten someone into doing their job better, they are not going to become an engaged worker utilizing that management style. Engaged employees respond best to visionary and coaching leadership styles.  The dilemma for physicians is that they are extensively trained on their clinical skills, but not on the entrepreneurial skills of being a great leader.   Learning to be a great leader can be accomplished by first embracing it as a real priority.  Books and podcasts can be used to grow these leadership skills.  Ultimately, it is a process that the physician must undertake in conjunction with his or her team.

Regardless of your practice setting, you will likely be working with people that either work directly for you or with you.  There is no reason to allow your practice to be an “average” organization with almost 70% of your employees disengaged.  Just imagine the patient satisfaction and enhanced profitability that you could experience if you were able to reverse that and have at least 70% of your employees be engaged.  Creating an engaged workforce is a habit that you can start today in reshaping your practice and planning for tomorrow!

THE POWER OF AFTER-ACTION REVIEWS

A training document for the Department of the Army begins with the statements, “Modern combat is complex and demanding.  We must use every training opportunity to improve soldier, leader, and unit task performance. To improve their individual and collective-task performances to meet or exceed the Army standard, soldiers and leaders must know and understand what happened or did not happen during every training event.”  The document I am referencing is a training manual on how to conduct After-action reviews (AARs).  AARs are widely used in the military.  These reviews “identify how to correct deficiencies, sustain strengths, and focus on performance of specific mission essential tasks list training objectives.”  These AARs help everyone understand what did and did not occur and why.

AARs create a feedback loop that compares the actual output of a process with the intended outcome. It takes honesty and candor to actually make this a meaningful exercise.  Soldiers learn and remember more by participating in the AAR process than just getting a critique of their performance.  In the military, AARs are conducted either formally or more spontaneously as informal reviews.  The purpose of the AAR is not to punish or be hypercritical.  It is a powerful learning tool to improve performance.

I spend a lot of time interviewing employees of organizations.  I am shocked at how often employees tell me that they never get feedback on their performance.  To grow and learn as an organization, you have to create feedback loops.  Every organization has key events, projects, and performances that warrant taking the time to do an after-action review. Business consultant and best-selling author Peter Senge has stated, “The Army’s After Action Review is arguably one of the most successful organizational learning methods yet devised.”  I encourage organizations to adopt this “habit” that has been so successful for the military.

Organizational After-Action Reviews

Organizations that seek continuous improvement can utilize AARs to engage and equip their workforce. Again, AARs are intended to focus on tasks and goals to discover why things happen.  They are not intended to judge success or failure.  Examples of when formal AARs can be used in the workplace include after major presentations, technology changes, or launching a new service or product.  Informal AARs can also be used routinely.  For example, they can be used after a patient or customer encounter. The leader uses these opportunities to ask open ended questions and to understand why certain actions were taken. Participants are challenged to explore alternative courses of actions that would have been more effective.  Participants should also compare the results and actions with the expected standards and outcomes.

The biggest challenge to utilizing AARs in our organizations is time.  In our hectic and fast paced schedule, we rarely take time to purposely have these type learning sessions.  However, failure to do so slows our learning and can cause us to continually make the same mistakes over and over.  It is also easier to bark a reprimand at an employee than to take the time to probe his or her actions and find a better way to do things.   Don’t let the tyranny of the urgent keep you from benefitting from this powerful tool in your organization.

Personal After-Action Reviews

John Maxwell is one of my favorite authors.  He is a prolific writer and effective speaker.   In his book Today Matters he states, “People create success in their lives by focusing on today.  He emphasizes that, “It may sound trite, but today is the only time you have.  It’s too late for yesterday and you can’t depend on tomorrow. That’s why today matters.”  I learned from reading his books about a habit he has of reviewing each day.  He has list of questions that he asks himself as he reflects on his day.  What he is really doing is having a personal AAR for each day of his life.  When you take time to reflect and learn from your daily experiences, you create a powerful virtuous loop of improvement.  I believe we create so many of our own “potholes” in life by needlessly repeating poor habits and behaviors.  When you have a daily AAR you see these “potholes” clearly and can learn to avoid them.

I took his concept and created my own daily list of questions to focus my reflection on my day.  I write out the answers to force myself to think through my responses.  It never takes more than five to ten minutes, but it is one of the most important things I do each day.  You can use this type of personal AAR to reflect on how you are doing on your goals and how you are living as compared to your values.  This time allows you to see your progress in developing good habits and eradicating bad ones.  Having a daily AAR is an investment of time, but one that pays large dividends.

While we might not be preparing for military battle, life and business do have significant challenges.  In order to thrive and not just survive, we need to be constantly improving individually and organizationally.  I encourage you to borrow the After-action review concept form the military and apply it in your own organization and personal life.  You won’t regret it.

 

Originally Published in Mississippi Medical News

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