Financials

This week, a friend posed a simple question, "What do you mean when you offer clients financial assistance?" Well, the answer is both simple and complex. First, let me tell you what it isn't. It is not related to personal finance, nor, is it an alternative to your accountant. Instead, financial services are related to the everyday "operations" of the practice. In short, financial services entail evaluating any number of expense ratios to aid the practice in better financial management.

For example, every business, including medical practices, has marketing and advertising expenses. Yet most practices have not real idea as to what constitutes the proper marketing and advertising expense budget. The answer lies within established benchmark values. In general, medical practices should budget 1-5% of net income for their marketing and advertising budget.

There are multiple metrics a practice can use to evaluate their current financial performance; yet looking at one metric is not advisable. My experience demonstrates that these benchmark should be viewed in the context of the practice, and, how one metric relates to another. In our marketing and advertising example, a practice could spend more or less depending on a marketing initiatives, how well known the practice is (or isn't) or the general desire of the owner. I know a doctor who insists on having the most aesthetically pleasing office in town. While he may be a little "over the top" in decor, he simply made the choice not based on financial sense, but instead, personal desire. A good consultant would not criticize this doctor's choice, but instead, simply point out the financial consequences of the decision.

Knowing and understanding these metrics is the first step in financial management. If you have not done so, please consider benchmarking your financials as compared to prior years. By doing so, you can easily see trends you may choose to ameliorate.

Internal Customers; They're Your Customer

For your business owners out there, your employees are your customer. Think about it, you could not run your business without them, and, it is to your benefit to treat them with the same care as you treat your paying customers.

Internal customer service starts with business owners and managers. It is their responsibility to set the tone and culture of the business. If the tone and culture is one of treating employees well and with respect, you can bet that your employee will treat your external customers (paying customers) with similar tone. In contrast, if you treat your employees as simply workers, they in-turn will treat your external customers as just customers.

Evaluating your internal customer service "quotient" can be a simple as conducting your own SWOT (Strengths, Weaknesses, Opportunities & Threats) analysis. Though typically reserved for marketing strategy analysis, a SWOT analysis that examines customer service, internal and external customer service can be revealing. Below, is an example of an internal customer service SWOT analysis.

STRENGTHS	WEAKNESSES
· Practice includes customer service as part of their Mission Statement · Management has set the expectation · The practice utilizes staff uniforms, including a name badge · Office is clean and provides an open, inviting reception area	· Practice experience relatively high turnover, necessitating only basic CS training · Little daily management of CS activities · Retail area appears unkempt
OPPORTUNITIES	THREATS
· Annual employee evaluations do not include customer service as a measured metric · Practice does not use EMR or other CRM technology · Need for ongoing CS training	· Other area practices utilizing EMR/CRM technology · Improve staff retention

For your analysis, consider conducting an input session with your practice's management team. Remain open with all critique and refrain from defending any position you may have taken in the past. By doing so, you demonstrate one of the key elements of leadership, listening. You might be surprised at what you learn and the new direction this activity brings.

Where Have I Been?

It has been a week or two since I last issued a blog. Frankly, I've been tied up with a project for a pharmaceutical company. They asked me to create a few training manuals for their sales teams. One of the training modules concerns providing excellence in customer service. In my research, I was surprised to see so much material regarding the little discussed of internal customer service.

When we hear the term customer service, most of us think about the service we provide to our customers or clients. Internal customer service is the recognition that our employees are customers of the owner and management, and the employees are customers of each other. This recognition is important because the better customer service we provide our team members, we improve our external customer service, business efficiency which leads to greater profitability.

Simple steps to improve your internal customer service include:

• Communicate, Communicate, Communicate - be proactive in communicating with co-workers about your expectations of them and them of you.

• Management must build a sense of teamwork - Likewise, staff members must understand how their actions, or inactions, affect their co-workers ability to complete their tasks.

• Eliminate work silos - the medical practice is a business and should operate as a cohesive team.

• Managers, treat your employees like customers. Providing your employees excellence in customer service fosters excellence in external customer service.

• Create a rewards system in your office. Rewards can be as simple as a monthly award all the the way to cask bonuses. Make sure you set the expectation and reward the observed activity.

Robert

404-394-0014

Social Media Good For Businesses, Including Vet Clinics

At Primoro, Inc. we have a strong interest in seeing medical practices use social media as a communication, education, marketing and advertising tool. The same holds true for other businesses, including veterinary clinics, hospitals and emergency facilities.

You may recall that during last year's holiday season, brick and mortar retailers embraced social network site Facebook to offer their "Fans" discount codes. These codes, in fact, were only available to their fans. In other words, their fans had a purchasing advantage over all other consumers.

While we are not suggesting veterinary clinics use these sites for discounts or specials, the consumer at large is using these sites to determine who their vendors will be. If you think about it, a business that is active with social network sites suggests to the consumer, that they are an active part of the community and worthy of consideration as a supplier or vendor.

If you are currently using social media as a communication outlet, you should. Companies, like PrimoroVet, build social media systems that remove all the drudgery of social networking participation, and can make it as easy to use as writing an email.

If you need more convincing, take a look at this article from March 16, 2010.

Robert Rosser, Owner & Senior Consultant

PrimoroVet

404-394-0014

PrimoroVet, A New Consulting Option

PrimoroVet was founded in early 2010 as a division of Primoro, Inc. Our mission is to provide the practicing veterinarian an option in business consulting services. We focus on the four key business metrics:

• Financial Performance
• Business Processes
• Human Resources
• Client Relationships

PrimoroVet is pleased to offer new clients a one hour free consultation. So whatever you are considering, PrimoroVet can offer you an opinion or recommendation at no cost to you. If, during the initial consultation you need is outside of our scope of services, we may have another service provider to recommend.

For the very best in practice building consultations, give PrimoroVet a call.. Our tag line is what we do...Building Better Practices.

Robert Rosser

Owner & Senior Consultant

PrimoroVet

404-394-0014

Customer Relationship Management

Recently, I've been working with a pharmaceutical company in development of some consultative tools their sales team can use with customers. One topic the company asks I comment on is customer relationship management (CRM). CRM is broadly defined as strategies designed to manage a company's interaction with customers and prospective customers. Typically these strategies involve the use of computer software organize and automate the various business functions such as sales activities, marketing of products, customer service and other support.

CRM in itself is very interesting to me as most organizations view the CRM strategy from a company centered point of view. That is to say, a company will use these strategies only to the extent the system is beneficial to the company. For me, that seems backward.

As I have written many times, I have never seen a case where excellence in customer service was bad for business. Likewise, I've never seen any computer software deliver excellence in customer service. Excellence in customer service is always delivered by PEOPLE!

Now I do not discount the value of technology helping house customer data, making it easily accessible to those who need and the ability to mine data to help a company understand their customer better. But in the end, your business cannot depend on computer systems to deliver the service your customers expect. In today's technology driven business world, too few companies really train their people in customer service.

I am reminded of the customer service story I found as part of my research. A well dressed lady visited the local Nordstrom's shoe department. She jokingly asked saleslady, "I bet you won't sell me one shoe. As you can see I have only one leg." Well the lady lost the bet. This story exists because of Nordstrom's commitment to developing a customer oriented customer service policy. It should be no surprise that Nordstrom continues to be very successful clothing retailer.

Using technology to help you gather and maintain customer information, but remember to invest in the people who interact with your business's customer.

Office Efficiency Can Lead To Greater Profits

Experience over the years illustrate that many medical practices, including veterinary practices, are likely to be inefficient. With the demands of running a practice as challenging as they are in today's economic environment, it pays to operate as efficient as possible.

As the best example, benchmarking data from Veterinary Economics show that the best veterinary clinics collect $157 dollars per veterinarian per client visit. Now imagine, if you could increase your client schedule by simply 1 additional client in the morning and one additional client in the afternoon. This would mean you clinic's annual revenue would increase by $56,520, assuming a 4 day work week and 45 working weeks per year. Of course, you actual numbers may vary, but the point is that improving efficiency improves financial performance.

So how does one improve efficiency? There are three elements that contribute to efficiency:

• Doctor's capacity - the ability and comfort of the doctor to process "x" number of clients per hour.
• Staff capacity - the staff's ability to process the check-in, check-out processes as well as the back office clinical processes.
• Your office - generally speaking, your office must have an efficient flow of clients throughout the physical space of the clinic.

It is the combination of these factors that either enhance or detract from your efficiency. Consulting firms, including PrimoroVet, can assist you in determining your level of efficiency. As you can see the financial opportunity, it may well be worth your efforts to seek out professionals to assist you.

Oh, and if you are wondering about that $56k, remember, you would have already paid your practice's expenses, including staff. That $56K goes in your back pocket!

Robert