Leading Through Data-Driven Insights: How to Go From “I Think” to “I Know”

I joined the hearing healthcare field about 35 years ago, serving in a variety of sales, sales leadership, and training roles. Historically, it has been a relatively low volume, high margin industry. We have seen more change in the last five years than in the past three decades combined.

Consumers have more choices than ever before due to the advent of big box, internet sales, and discount plans, not to mention the yet-to-be-determined impact of OTC.

The low volume, high margin nature of the field has allowed for inefficiencies that must be addressed in any healthy organization going forward. Too often practice leaders have managed by “I think” versus “I know” when it comes to practice Key Performance Indicators (KPIs).

If you happen to be one of them, below are proven strategies to help you change that.

Annual Planning

At the start of each year, most practice leaders set an annual revenue target using a simple equation:

The challenge is that leaders must commit to investment ahead of revenue. This includes leases, equipment, marketing, and other expenses. However, payroll is typically the single largest expense. In an era with increasing downward pressure on margins, it is critical to focus on per person productivity for each staff member. Said differently, when the practice helps more people, everyone wins, including the patients, staff, and practice owner.

Don’t Chase Outcomes

Helping more people is an outcome. More revenue is an outcome. For this reason, the solution to helping more people is completing more opportunity appointments. However, completing, or even creating more opportunities each day, are still outcomes. Therefore, practice leaders must commit to leading their staff each day to the behaviors that will result in more opportunity creation while investing in staff skill development.

Mindset Drives Behaviors and Behaviors Drive Results

Start With The Why

As a practice leader, you must first start with the WHY. Communicate to your staff why it is necessary to have an opportunity mindset and measure daily behaviors that will lead to more people helped.

I Think We Do That

The key part here is “I think.” Daily tracking is the key to creating awareness for the practice leader as well as the rest of the staff. Of course, most will say, our practice management software tracks information such as opportunities created, completed, and other outcomes. However, the problem is that in most practices, no one is looking at this information on a daily basis. The other problem is that, unlike the financials found in a P&L (profit and loss statement), many behavioral KPIs are prone to subjective interpretation.

Starting With Tracking

The first step to tracking is to come up with definitions for KPIs that everyone in the practice understands and agrees to follow and report on every day. For example:

  • What is an opportunity?
  • What is a completed appointment?
  • What is a candidate?
  • What is a hearing aid sale (vs. a fitting fee from discount plan unit sales)?

How CQ Partners Can Help

In partnership with your Account Manager, our experienced Sales Analytics team can help you and your staff to come up with your KPI definitions. We can even help you to plan for a company meeting where you can roll out your plan to do a daily huddle where KPIs are captured each day at the individual provider level. To make this task less daunting, we will start with measuring only the first four data points from the huddle. Your Patient Care Coordinator (PCC) will come to the huddle with the number of opportunities (opps) created. Your individual providers will very likely be able to recite the number for the next three items from memory if measured daily:

Once this is being done daily, we will gradually add the other questions and begin to track on a daily tracking form where one row of data relates to the answers from one daily huddle. Because this tracking form is a rolling sheet, you will eventually be able to spot averages and trends such as:

  • Number of opps created per day
  • Number of opps that arrive per day
  • Number of opps that arrive with third party companion
  • Number of people sold vs. tested not sold
  • Private pay/insurance units vs. fitting fees

Once you KNOW your averages, you will be better able to plan for how many opportunities you MUST create and complete each day in order to reach your revenue targets at the individual provider level based on your arrival rate, third party companion rate, payer mix, and other KPIs.

So, do you think, or do you know? Commit to measuring key performance indicators so you can lead your staff and remain a thriving organization in a rapidly changing market.

Learn more about our industry-leading Business Services & Sales Analyses!

About the Author

Ed Anthony is a Regional Sales Manager and previously served as a Regional Sales Trainer and the Vice President of our Northeast Division. He graduated from Bloomsburg University of Pennsylvania and has over 30 years of experience in the hearing healthcare industry. Ed has worked in a variety of sales, training, and leadership roles for multiple companies, including a hearing aid retailer, a hearing aid manufacturer, and an audiometric distributor. Helping hearing care professionals help more people is his passion. Ed lives in Doylestown, PA with his wife Krista and is the proud father of three—Sam, Luke, and Sarah.

Own Your Success. Control Your Destiny. Your P&L is the Key to the Lock.

Whether you realize it or not, your business has a report card. Knowing how to read it and regularly reviewing it will empower you to control the performance of your business. Knowledge is power. It’s a cliché because it’s true. The more informed you are about the performance of your business, the better equipped you’ll be to make smart, strategic business decisions.

The report card in this case is your profit and loss statement (P&L), sometimes referred to as an income statement. When I start talking about P&Ls, often people’s eyes glaze over or they tell me “I’m not a numbers person.” The good news is – you don’t have to take a complex accounting course to glean helpful information from your P&L. However, as a business owner it’s important to understand the big picture of what it is: a report that shows the revenues and expenses of the business, and resulting profit or loss, over a specific time period (a month, a quarter, or a year).

Why is that important? And why can’t we just rely on your bank statement to tell us your profitability? Well, for a few reasons. The most important being that the P&L is the linchpin of the strategic planning process.

Step #1: Gather Information

Without a P&L, we either get stuck at Step One and can’t move forward, or we are forced to make some assumptions that may or may not be true, and therefore, compromise the validity of the rest of the process. With quality information from the P&L, you can gather several Key Performance Indicators (KPIs) that can then be compared to recommended benchmarks, including:

  • Average Selling Price (by payor types – private pay/insurance/third party administrators)
  • Average Margin per Unit
  • Gross Profit Percent
  • Expenses as a percent of revenue (i.e. advertising, payroll, rent, etc.)
  • Net Profit Percent

The analysis of these KPIs will give you an understanding of the financial health of your business above and beyond how much money is in your pocket at the end of the year.

Step #2: Identify Goals

Anyone who has read Stephen Covey’s bestselling book, 7 Habits of Highly Effective People, knows that you should always “begin with the end in mind.” So that means that before we can make a plan, we need to know what we are trying to accomplish. My question to you would be: How much revenue do you want your practice to generate? This is about the time that people switch from the glazed eyes to the dumbfounded look, and I often hear them say “I have no idea what’s even possible.” If you consider yourself to be one of those people, here are some guidelines that I would offer:

  1. Start with either your current revenue level or break-even point (the point at which you’ve covered all of your expenses and begin making a profit, which we can help you calculate).
  2. From that number, you should increase your revenue to the next desired level. When considering how much to add, consider either a percent growth rate or define the amount of money by which you need to grow to cover additional expenses. For example, are you looking to:
    • Pay off debt?
    • Incur capital expenditures for additional staff, locations, or renovations?
    • Purchase additional equipment?
    • Make personal investments (i.e. child’s college fund, retirement plan, buy a vacation home, etc.)?

When considering these or other factors, don’t just think short term. Whether you’re preparing the business for sale or planning to work in it for many years to come, we recommend identifying one, three, and five-year revenue goals.

As part of this process, Consult YHN’s P&L analysis tools and goal setting procedures will help you to create what we call Pro Forma P&Ls, meaning that they are projections of the future. As a result, you will have a figurative map with a big red star that says “you are here” at point A (current financial status) and pins at points B, C & D, which represent your destinations (financial goals).

Step #3 & #4: Devise Strategies & Implement the Plan

When choosing which strategies to implement, your Consult YHN Account Manager will help you quantify the financial impact of each option so that you can prioritize those that will have the most significant impact on both operational effectiveness and financial performance. Any changes to your processes, procedures, or marketing efforts should move you in the right direction toward achieving the agreed upon goals of your Pro Forma P&L.

Step #5: Track Results

While there are several additional KPIs that are important for measuring progress and evaluating behavior-based performance, the P&L should be prioritized as one of the tracking mechanisms reviewed on a routine basis.  As a parent, I pay close attention to my kids’ school report cards. I don’t want to wait until the end of the year to know how they did on any given subject. I want to know as often as possible how they are performing and whether or not there are specific subjects that need special attention to get them up to the scholastic levels where I expect them to be. In order to do so, I’ll either work with them myself or hire a tutor to make sure that they are getting the attention and support that they need and deserve. That way, by the end of the school year there are no surprises from final grades, and I know that I’ve done everything that I can to help them succeed.  Why would you treat your business any differently? By reviewing your P&L monthly, you’ll have an indicator of which areas need your attention and focus so that you can either fix it yourself or utilize your Consult YHN Account Manager to help, leaving you with no surprises and the security of knowing that you’ve done everything within your power to attain the goals you set out to accomplish. 

Another frequently asked question at this stage: “Is a monthly review really necessary? Wouldn’t quarterly be okay?”   Sure, quarterly is better than semi-annually or annually. But if you’re looking at your P&L monthly, and other tracking indicators even more often, then you have the luxury of knowing that you haven’t let too much time pass in case you’ve gone off course. If you wait too long, you may not be able to make up the lost revenue in time to achieve each target as scheduled. 

Step #6: Evaluate the Plan

Once you know how well you are tracking toward goal achievement, you can re-evaluate the plan itself: Are your goals still realistic? Is there anything that has thrown a wrench in the plan that requires you to re-evaluate? For example: Are you down a provider unexpectedly? Has your provider mix suddenly shifted due to a windfall of insurance or TPA patients? Did a pandemic strike the entire world and shut down the business for several weeks/months? In times like these, it’s critical to understand the impact on your P&L. You’ll need to re-consider your goals for the year, conduct a cash-flow analysis and catch-up analysis, and revise your business plan accordingly. Don’t worry if you don’t know where to begin with these tasks. That’s why you have a Consult YHN Account Manager.

A healthy P&L is important not only for the business owner, but for all of the stakeholders of the business. That includes the business owner/administrators, the employees, the patients, and by extension, the families of each of those individuals. By focusing on the financial health of your business and ensuring that you’re doing “All The Right Things,” you’re also doing the right thing for those who rely on your business to maintain their quality of life; whether it’s by means of a paycheck, better hearing, or improved communication with a loved one. Many people rely on your business to support them, so make sure that routine review of your P&L is part of your future plan to keep it healthy and thriving.

About the Author

Ridgely Samuel joined Consult YHN in 2005. She has held several positions within the sales and operations teams but has found her passion for developing others in her current role as a Training Manager. Ridgely has experience working as a financial analyst for a former Fortune 500 company, holds a degree in Business Administration from Wake Forest University, and is a certified Six Sigma Green Belt. When she’s not working or acting as a chauffeur for her two daughters, Ridgely can be found relaxing in a hammock with a novel, tossing tennis balls for her dog, or paddleboarding on the lake.

How Healthy Is Your Practice? Let’s Do the Math!

Every year at your annual check-up, your doctor probably recommends routine lab work to ensure you’re in good health. Just like your doctor, you should be routinely checking your financials to monitor the health of your practice.

If your lab work comes back and reveals you have a high white blood count, low hemoglobin, or high cholesterol, you probably know that this is bad news and that you’re going to have to make some adjustments to your lifestyle.

But what should you be looking for in your financial data?

Overall, your financials will obviously tell you a lot about your practice, however, analyzing even just a handful of numbers and doing some simple math will provide plenty of insights. Key Performance Indicators (KPIs) are the specific measures we use to determine the health of a practice. We then compare your practice KPIs to the “benchmarks” or “industry averages” to identify any successes, concerns, or areas for improvement.

I know math can be scary for some people. Not everyone is a numbers nerd like me. However, math is the language of business and I’m going to help simplify it for you. Here are a few of the most important numbers you want to identify and understand what they mean:

Income/Sales – The amount made on selling products or services

Cost of Goods (COGS) – The amount it costs the practice for the items sold or services rendered

Operating Expenses – All costs associated with running the practice

Now we’re ready to calculate some KPIs:

Income COGS = Gross Revenue ($)

Income ÷ Gross Revenue = Gross Profit Margin (%)

COGS ÷ Gross Revenue = COGS Margin (%)

Gross Revenue Operating Expenses = Net Income ($)

Net Income ÷ Gross Revenue = Net Profit Margin (%)

 

NERD ALERT!
Operating Expenses can be further broken down to show the percentage spent on specific items like payroll, marketing, or rent. Talk to your Account Manager about getting a Monthly Financial Analysis for this level of detail.

Time to compare your answers to industry benchmarks! We find the most successful and profitable practices have KPIs in these healthy ranges:

Gross Profit Margin = 60-65%
COGS Margin = 35-40%
Net Profit Margin = 10%-15%

Remember to check your work: Gross Profit Margin % + COGS Margin % = 100%!

Now that the math is done and you’ve compared the numbers, it’s time to read the results. Obviously, the benchmark ranges are the sweet spot, but let’s define what it means to be outside those ranges.

Above Average is GOOD when its…
Gross Profit Margin – You are more profitable than the industry average
Net Profit Margin – After expenses are paid, your practice has a healthy bottom line
Below Average is GOOD when its…
COGS Margin – Your prices are set well; you realize a healthy profit on each sale

 

NERD ALERT!
Gross Profit Margin and COGS Margin have an inverse relationship. If you find that ether is outside the ranges described above, a Pricing Analysis from Consult YHN can identify areas where small adjustments could be beneficial.

Congratulations, you just analyzed your financials!

This is a great start in understanding what your numbers are telling you and identifying potential areas for improvement. By continuing to regularly track and analyze metrics such as Opportunity Creation, Unit Sales, Third Party Attendance, and Closure Rates, you can make the necessary adjustments to help more patients and increase revenue.

For a deeper dive into your practice’s finances, talk to your Account Manager about taking advantage of Consult Tracking. Our business analysts are industry pros when it comes to providing actionable business intelligence—from breakeven and territory analyses to compensation plans and monthly tracking reports. Consult YHN also has several tools that can help you track your finances, including Wake Up Call and the Pro Forma tool, which you can access anytime via Navigator.

Start evaluating the financial health of your practice today!

About the Author

Kimberly Costanzo joined Consult YHN in 2017 and currently serves as a Business Analyst. Her diverse professional background includes revenue accounting, internal audit, system support, and project management. She holds an MBA from Stockton University in New Jersey. When not working, Kimberly enjoys spending time with her husband Chris and her daughter, Gianna, either at the local playground or playing competitive matches of Go Fish. She also serves on her daughter’s school board and volunteers in the community to promote emergency awareness.

Three Reasons Why You Should Mine Your Data

You’ve been practicing for years and everyone in town knows who you are, but you’re not increasing the number of patients you help each year. If this describes your practice, you’re not alone! In fact, this is a common concern we hear from our Associates—they’re working hard, feel busy, and yet, the number of patients helped, and revenue generated is not increasing.

So, what can you do to reach more quality people? If you’re thinking the answer is “marketing,” you’re correct. However, it’s important not to get so focused on marketing to new patients that you forget – you’re already sitting on a patient gold mine: your database!

Whether it’s through a sophisticated practice management system or less sophisticated paper folders in a metal cabinet, you’re already keeping great records of your patients and tracking everything. Obviously, organization is key. But what you do with the data makes all the difference, especially with patient touchpoints.

We call this data mining and here are three reasons you should mine your data regularly:

#1. Stay Connected with Your Patients

If you’ve been on an airplane lately, then you’ve probably heard the flight attendant say something along the lines of: “We know you have many options for your air travel needs.” This is a very true statement and it’s not limited to the airline business—it applies to every business, even yours. Touching base with your patients regularly (at least twice a year) gives you a chance to show you’re thinking about their well-being and thank them for choosing you as their trusted hearing healthcare provider. This will also remind patients of the wonderful experience they had with you, making them less likely to go to one of your competitors.

#2. Help More Patients

Based on Consult YHN’s studies, 60 percent of patients with hearing loss will not purchase hearing aids during their first visit. That means, if you’re seeing 300 patients a year, 180 are leaving your office without accepting help. When you reach out to those patients, you can restate the impact hearing loss has on their overall health and remind them how you can help (yearly check-ups and cleanings, hearing aid troubleshooting, upgraded technology, etc.). This will fill your schedule with quality opportunities.

For example: If you’re a five-year-old practice seeing 25 patients per month, then you are helping 10 patients while 15 patients leave untreated. At this point, you could have about 900 patients that were tested but didn’t accept help as well as a database of about 600 patients whose technology is out of warranty. Over the next 3-4 years, you want to stay connected with those patients so that when new and improved technology is released, you can fit them with an even better device.

Our tracked data shows that for every 38 letters sent to patients for either new or upgraded technology, one appointment is scheduled. For every appointment scheduled, we see one hearing aid sold. From a business standpoint, think about what that can do for your revenue: if you reach out to 300 patients a year, you could possibly sell eight hearing aids for an additional $16,000 in revenue (assuming an Average Selling Price of $2,100 per device). The Consult Upgrade program is by far one of the most effective ways to reach your patients, with the average event yielding more than $51,000 in revenue.

#3. Minimal Effort and Costs

You’re already spending the right amount on your annual marketing, so what’s the cost associated with sending letters to patients? Minimal at best, especially compared to the average cost of a new patient: $760.

You can find several customizable database letters on Consult’s MarketSource that are proven to drive appointments. All you need to do is export well-constructed lists from your database and perform a simple mail merge to personalize the letters for each patient. Or, you can let Consult YHN’s marketing professionals handle all of this for you. From designing to mailing to reporting, we can execute a 12-month strategy for you so that you and your staff can focus on other important responsibilities, like follow-up calls, scheduling appointments, and more.

Starting mining for gold today! Reach out to your Account Manager to learn how Consult YHN can help you implement a database mailer strategy that drives results.  

About the Author

Mary Catherine McDonald is the East Regional Manager at Consult YHN. Previously, Mary Catherine served as an Account Manager in the company’s Southeast Division. Prior to joining Consult YHN in 2014, she worked in educational franchising and was responsible for the growth and profitability of 70+ locations. Mary Catherine has a master’s degree in Administration and Leadership from Niagara University.

Your Biggest Health Fair Questions Answered

Here I am at a senior health fair a few years ago as my amazing coworkers talk to potential patients and perform otoscopy. See, I’m smiling—nothing to be scared of!

Health fairs are an excellent opportunity to connect with your community, educate consumers about hearing loss and hearing aids, promote your business, and drive new patients in the door.

However, understandably, many practice owners and providers find the idea of standing in a crowded room, starting conversations with strangers, and asking for their business to be intimidating – some might even say terrifying.

But, fear not—I’m here to help make your next health fair or community outreach event a little more fun and a lot more successful.

Here are answers to several of your most plaguing health fair-related questions as well as some helpful tips and tricks I’ve learned over the years.

Q: How do I find out about health fairs and other senior events in my area?

A: There are plenty of ways to do this, but here are three that I’ve had the most luck with:

1. Google “senior health fairs near me.” This might seem obvious, but you’d be surprised just how many events there are going on around you all the time. You may also be surprised to learn how many senior organizations there are in your area—home healthcare companies, community centers, services for the aging, etc.

2. Check your local newspaper and its website – Organizations that host seniors events know that many Baby Boomers still read the newspaper and therefore, advertise in the events section. Most newspapers also allow people to post events online for free.

3. Check your local hospitals – If they don’t have an Audiology or Speech Therapy Department, that could be your in. Hospitals have open houses and other events and if they need a hearing provider, you could make a great connection.

 

INSIDER TIP: Don’t ignore events that have passed—they can be a goldmine. If you come across an event from the previous year, reach out to the coordinators. Sometimes they already know when and where this year’s event will be held and can add you to their contact list so that you know when the event opens for vendors.
Q: Should I do video otoscopy?
A: If you can, go for it! Explain to the patient that this is the first step of the hearing exam and invite him/her to your office for the other two steps. Have a printed copy of your schedule so that you can see what dates and times you have available for appointments and book them on the spot. Don’t take an iPad or laptop—you only have a short window of time with each person and you don’t want to waste it inputting his/her information. Also, you don’t want to rely on the venue’s Wi-Fi.
Q: Should I offer free hearing screenings on site?

A: Absolutely not. This is a big no-no for many reasons, starting with the fact that there usually isn’t a space that’s quiet enough to conduct hearing screenings at a health fair. More importantly, it defeats the purpose of attending these types of events which is to grow your database, establish relationships with members of your community, and attract new patients. Why give the milk away for free?


INSIDER TIP: Even if you can’t attend a health fair as a vendor, check it out anyway and bring a stack of business cards with you. Talk to the vendors that are at the event. Network. Mingle. Have fun. Find out what events they’re going to next. Perhaps one is worth keeping on your radar.
Q: What should I bring?

A: Here are five absolute essentials:

1. Information about your practice – business cards, brochures, etc. .

2. Educational materials – picture of an ear, hearing health articles, handouts they can take home, etc. Consult’s MarketSource has a large selection of collateral to choose from.

3. Directions to your office – seniors who have hearing loss usually also have poor vision. So, make sure your message is clear and the font is BIG. And don’t get them lost!

4. Appointment sheets for the next 2 weeks – I can’t stress this enough. Paper is your friend.

5. Giveaways – such as pens and notepads with your logo and practice information.

Q: How do I stand out from all the other vendors?

A: This is one of the most important questions you should ask yourself. And one of the best things you can do is to engage everyone who walks by your table—don’t just sit there and wait for them to stop and show interest. Make your table pop with a colorful tablecloth, preferably one with your practice name/logo on it. And lastly, a little bribery can go a long way—as in free candy, water, or snacks.


INSIDER TIP: When talking with individuals who were in the military, thank them for their service, ask when they were discharged, then respond, “I’m guessing that’s the last time you had your hearing checked.” Anyone who is discharged from the military must have a hearing test and for most, it’s the last one they’ve had.
Q: What should I say to people when they’re at my table?
A: Start by asking when they last had their hearing checked or if they have their hearing tested every year. Once you get people talking, see if they have a history of hearing loss or have ever worn hearing aids. Educate them on the importance of having an annual hearing evaluation. Deliver your “why.” Talk to them about your practice and why they should choose you over another provider. Remember: you have less than five minutes to leave a lasting impression on that person before he/she moves onto the next table.
Q: What’s the best way to handle any appointments that I book during the event?

A: Track your results. Create a spreadsheet listing all the pertinent patient information, including each person’s appointment date and time. Update the spreadsheet every morning for each patient:

  • Did the patient get tested?
  • Did the patient have a hearing loss?
  • Was amplification purchased? If so, what type of hearing aid and how much?
  • Was it a no-call, no-show? Pick up the phone and call the patient to reschedule—don’t wait for him/her to reach out.

 

INSIDER TIP: Since you’ve already established a relationship with these patients, call to confirm their appointments the day before to ensure they feel comfortable and know where your office is located. Additionally, confirm they are bringing a Third Party to the appointment. If a patient’s appointment is four or more days out, send him/her a reminder postcard with a handwritten note: “Nice to meet you at the health fair – see you Tuesday!”

Hopefully, I answered all your questions. If you have any others, don’t hesitate to ask your Account Manager or shoot me an email: JGesuale@ConsultYHN.com.

About the Author

Julie Gesuale joined Consult YHN in 2010 and currently serves as an Assistant Account Manager in the company’s Hospital and University Division. Her diverse professional background includes customer service, marketing, and project management. When not working, Julie enjoys spending time with her wife of 15 years and her two rescue dogs, Sheldon and Leonard. She’s also been singing in church and community choirs for over 25 years.