Green with Envy: An Alternative View of Benchmarking
Relying solely on benchmarks can be detrimental in achieving your vision
By John Farahmand, PT, DPT
As a physical therapy private practice owner for the past 20+ years, I probably have at least a few things in common with you.
I started my business because I could not wait to track key performance indicators (KPIs), create budgets, and constantly re-engineer my business plan. Hopefully, you’re still reading, and can sense the sarcasm in my words.
Seriously, as physical therapists, I believe most of us got into this profession because of a deep-seated desire to help others. We are sheep dogs. We like to be of service, we like to see people make progress, and most of us feel that the relationships we form with our patients and the intangible rewards associated with playing a part in someone else’s recovery are far more reward than we could ever ask for.
As business owners, it is important that we continually balance great care and a great employee experience to create a sustainable and profitable business. While benchmarks can help new owners find their way, relying solely on benchmarks can be detrimental in achieving your unique vision for your company.
If every single private practice owner reading this was asked, “Why did you start your practice?” how many of them do you think would give the exact same answer?
It’s likely that not one of us would give the exact same answer, but the question itself is what’s really important. In fact, rather than playing a comparison game through benchmarking studies, I believe there are five questions that every single one of us needs to continue to revisit throughout our time as practice owners that will serve as far better guides than any benchmarking study or comparison game could ever provide for us.
Before I outline those questions specifically, let me ask a few rhetorical questions. How many of us practice in the exact same town? How many of us pay the exact same rent per square foot for our facilities? How many of us have the same production standards for our therapists? How many of us have the exact same average reimbursement per visit?
Depending on the state where we practice, how many of us are able to provide the exact same set of services?
This list could go on and on and on, but my point here is this: none of us have the exact same practice, with the same sets of constraints and opportunities, so can benchmarking really give us the answers we’re seeking to take our practices to the next level? I doubt it.
Previously, I alluded to five important questions (adopted from Peter Drucker, one of the world’s foremost authorities on management) that I believe all of us need to ask and continually reevaluate to create what we want as private practice owners.
As a small disclaimer, I’d like you to know that as you read through the list, you may become triggered. Some of you may be triggered because you do ask these questions regularly and are on track to building the life you want with your private practice as the vehicle. If this sounds like you, congratulations!
And unfortunately, some of you may become triggered because it’s been a long time since you’ve asked any of these questions, and you’re feeling as though you’ve lost your way, and have no idea how to get your practice moving in the direction you’d like it to go. If this sounds like you, that’s OK. Every single day is an opportunity to completely reinvent yourself and your practice!
Now, let’s get onto the five most important questions we will ever ask about our private practices. If we’re ruthlessly honest with ourselves when answering these questions, it is my opinion that they will lead us to answers about ourselves and about our practices that no benchmarking study could ever provide.
1. WHAT IS YOUR MISSION?
Why does your practice exist? What is its purpose? Your mission should be inspiring, and it should be what you want your organization to be remembered for. For our practice, it’s about changing lives. In fact, our exact mission is, “Changing the world, one patient at a time.” Our patient graduation giveaway t-shirts even read “Be More. Do More. Move Better.” Remember that an organization’s mission cannot be impersonal. It must have deep meaning, and it has to be something you believe in — something you know is right.
2. WHO IS YOUR CUSTOMER?
For us, these are our patients. Are we going after the right patients? We’re not here to “save” anyone. Remember, if our practices aren’t healthy, we can’t produce healthy patients. Are your patients a good fit for your practice? Are you making the correct assumptions about being in-network or out-of-network with a particular payer? Who do you want to serve, specifically? Are you confident enough in yourself to turn patients away because they’re not a great fit for your practice? If not, how come?
3. WHAT DOES YOUR CUSTOMER (YOUR PATIENT) VALUE?
If we remember that the only profit center for our practices are our patients, we must ask if we’re doing enough to understand what they really want. Further, are we positioning ourselves, and our practice, to be able to provide exactly that?
If we’re being real, most patients don’t necessarily care about our credentials. It hurts, I know. They care about their results. It’s our job to understand what they want and provide it for them at the highest levels. When you have a real value exchange like this, you not only create a patient for life, you create a lifelong marketer for your practice!
4. WHAT ARE YOUR RESULTS?
On the surface, this seems like a very simple question, but it has many layers. Is your practice providing the kind of results that you want for your life? Financial results? Time freedom results? Personal and professional growth results? Is your practice producing the kind of results you want to help your patients achieve? Is your practice helping your professional staff achieve their goals?
In my opinion, this needs to be answered with the quantitative, “hard” data, the likes of which KPIs produce for us, and with qualitative measures that address the depth and breadth of your entire organization. Are you having the kind of impact you want to have in your community, for example?
5. WHAT IS YOUR PLAN?
Whatever your plan is, it ought to encompass your mission, vision, goals, objectives, action steps, budget, and an appraisal of where you are now and where you’d like to go. Your plan helps you determine whether or not your mission statement needs to change, or whether it’s still effective at communicating and reflecting opportunities, competence, and commitment.
Now, because I like to keep things simple, let me point out that these five questions are nothing more than a self-assessment tool. That’s right…a SELF-assessment tool.
Well because, behind every private practice is a deeply passionate individual or group of individuals like you and I who began this crazy journey as practice owners with a particular vision and mission in mind. Some of us have stuck to it, some of us have changed it radically over the years, and some of us just began, hoping to discover our mission and vision along the way.
When you started your practice, you began with a particular vision of what you wanted it to look like. Lots of things have happened along the way, some good, some bad, and some downright miserable. But you’re still at it! That, more than anything, should tell you something. Personally, my reasons for venturing out in private practice over 20 years ago are the same today as they were then…fulfillment, freedom, and contribution.
WHY DID YOU START?
If I had to guess, the answers to those questions have nothing to do with KPI’s, budgets, and business plans. Those answers lie much deeper, and the only place we’ll find them is by looking inward. So, rather than worrying so much about what the “other guys” are doing, or what gimmicky new service the practice down the street just started offering, I encourage you all to look inside yourselves.
That’s where the magic is. That’s where you’ll always find the fuel to fill your tank. That’s where, if you’re real and raw with yourself, you’ll be able to answer the most important question of all for you, for your private practice, and dare I say it, for everything in your life….
What do you want?
John Farahmand, PT, DPT, is the founder and CEO of Balance Physical Therapy & Human Performance Center, a multi-location outpatient practice located along the central coast of California. He can be reached at firstname.lastname@example.org.