Benchmarking, for a more profitable future
Benchmarking will help you to evaluate and understand your business. It is a great way to set new goals, to refocus and make key changes that will put you on the path to a more profitable, successful future.
Looking outward, to find opportunity
Benchmarking is an exercise in comparing yourself against another practice, using various metrics and enabling you to identify which areas of your business are ripe for improvement.
It goes way beyond simply researching the competition and is not about quick fixes either. In fact, for benchmarking to be truly worthwhile, it should be ongoing. You’re essentially looking outward from your current position to find examples of best practice – and best practice isn’t ever a static concept!
There are different types of benchmarking and the beauty of the process is that you can adapt it for any size business, and to zone in on particular areas, depending on what is most appropriate for your practice.
Types of benchmarking
Performance benchmarking involves gathering and comparing qualitative data and this is often a good place to start. You’ll need to determine what you’re going to measure, by identifying your Key Performance Indicators (KPIs). Examples of KPIs for dental practices include overheads, revenue, profit and production per established and per new patient. For performance benchmarking, you will also need the means to extract, collect and analyse this data– another reason to regard it as something that isn’t a one-off, but an ongoing, continual part of how you optimise your business.
There is also process benchmarking, when you focus on every day, yet critical processes. Learning from how others are doing it better is particularly useful and you will probably see swift results from any changes you implement. At the other end of the scale is strategic benchmarking, which would be carried out if you feel that you need to improve your all-round performance and long-term strategy.
You can get support with benchmarking from specialist dental accountants, Figurit. Its experts will give advice on things like setting relevant KPIs, as well as how to collect and analyse the data you gather.
Benchmarking is a way to improve quality, drive revenue up and save money. It’s an ongoing process that will help you get to know your practice and maintain your competitive edge. Start benchmarking and you will realise your potential and optimise profitability.