In my dental practice, I used to wish that high blood pressure was painful so that patients
would know they had it and would want to do something about correcting it. Or maybe if Type 2 diabetes made you itch – more people would recognize that they have it and would seek the behavior changes to improve the situation.
To me, these chronic, debilitating diseases were winning a battle the patient didn’t know they were fighting. By the time patients notice something is wrong … lots of damage has been done.
In the world of practice management, employee turnover is the same, deadly, silent force – eroding away your profits and practice growth opportunities.
In the corporate world, when you have hundreds of employees, you can quantify your losses and give them a dollar value by looking at things like:
Cost of hiring
Cost of onboarding and training
Cost of learning and development
Cost of time with the unfilled role
But in our world of practice management, the telltale signs may be harder to define. Once again, I encourage you to NOT attempt to apply corporate measurements and procedures to our practice world.
A better (and more constructive) method for our particular situations involves what I call, Practice Dynamics. Practice Dynamics are a way to compare your current state with your previous state. Think of it as a way to compete only with yourself and your own practice.
For example, we just finished up tax season, so you have last years’ numbers at your fingertips. One of my clients currently has 37 employees and independent contractors. In the past year, they filed 42 1099’s and W2’s. To figure out their own Retention Rate, they would:
Number of current employees and contractors = 37 = 88% Retention Rate
Number of 1099’s + W2’s 42
*yes, I know this doesn’t take every variable into consideration, but let’s learn the concept before we go crazy*
The number 88% – all by itself, isn’t good or bad. It’s a starting point.
Practice Dynamics come into play when you, as the business owner, start to think “How can I improve this number?”
What if you decided to improve your Retention Rate, whatever your starting point, by 2% in 2021?
In another article we’ll discuss the most effective areas to focus on to increase your own Retention Rate.
But can you see from this example, the clarity and focus you are given when you know this number?
It doesn’t label your practice situation as good or bad. It’s not about judgement.
The knowledge of where your practice currently stands gives you the ability to know exactly where to focus as you move forward through the rest of this year.
It gives you a metric to recognize progress.
Do the easy math and let me know where you end up. Are you happy with what you see? Leave a comment and share what ideas you come up with.
Need some help? Reach out to me at Ruth@ShorelineStrategies.com. Let’s put Practice Dynamics to work for you and your business.