There are many different ways to measure productivity, with each providing a different lens with which to view your business. For a veterinary practice, for example, you could measure charges, patient visits, and procedures, to name a few. But with each measurement, it is important to view them not independently, but as they relate to the practice as a whole. The calculation of one measurement of productivity may initially appear negative, but if it furthers the overall goals of the practice, the end result is positive.
At least monthly, it is a good idea to measure productivity at a whole business level AND at an individual driver level, such as per veterinarian. If the current trend is positive for one veterinarian but not for another, then you may want to dig deeper (yes, that is a recurring theme) to find out why and how you can duplicate the positive results. If revenue shows an increasing trend, is it because there are more patient visits or higher average charges or procedures per visit? Is it possible that an incentive system is encouraging this behavior? Can you extend the incentive system to non-DVM staff, perhaps to increase ancillary service revenue?
Below are some basic productivity measures that should be looked at for a veterinary practice, at both a practice level as well as per veterinarian.
- # of patient visits
- # of procedures
- # of surgeries
- # of ancillary services
- total dollar value of charges
- total dollar value of ancillary services revenue
Of course, each can be broken down to more specific measurements, such as # of cat vs dog visits, # of new clients vs # of repeat client visits, # of different types of surgeries and ancillary services, charge/procedures vs # of procedures, and many more. But the basic measurements can provide a quick overview into positive or negative trends.
The most important objective when defining productivity is to use a balanced scorecard and align the measurements with the goals of the practice. An increase in the number of patient visits without a correlating increase in the number of procedures will show a more productive veterinarian without a similar bump in revenues. The goals may change over time, as well. A new practice may strongly emphasize the number of patient visits as a key productivity measurement in order to monitor the acquisition of new clients. Once a stable client base is reached, a bigger push to increase revenue may make the number of procedures a key productivity measurement.
Along with defining productivity for the practice, its mission, its definition of success, needs to be well understood by all employees. Only then can everyone be on board with striving to increase productivity through creative collaboration.