Saturday, October 13, 2018

Lean Veterinary Scoreboards

In my last post, I discussed the difference between Management By Means (MBM) versus Management by Results (MBR). MBR means only focusing on the end result of the metric or KPI (and hoping the means of getting there are efficient and value-adding processes) or focusing on the processes that lead to that result, understanding that if all of the processes are behaving as designed and under control, the end result is a reasonable assumption. Too often with MBR, dollars is the only metric.

So, I wondered, could it be possible (theoretically speaking only!) to successfully manage a practice without actually measuring any money related metrics? And, what would that look like?

In other words, without tracking gross income, average client invoice, payroll expense as a percent of gross; any money metric?

What non-financial Key Performance Indicators (KPIs) could be used to assure the monetary goals are met? The trick is to be able to identify all (or many) of the processes that are components of the money goals and to assign a metric to adequately monitor those processes.

For example, Average Client Transaction is composed of gross income divided by the number of client visits. However, these two components are the result of other systems, such as fees, reminder efficacy, ease of appointments, number of incoming calls that result in a busy signal, hours of operation, client satisfaction, medical record audits (% of services performed that get invoiced) , etc.

Here is a list of some of the non-monetary metrics I came up with in order to manage a veterinary practice:

  • Door to Doc time 
    • The time from the moment the client enters the practice to the time they see the doctor; a measure of flow and, therefore, value to the client.
  • Number of unscheduled follow-ups
    • The number patients needed to be seen a second ( or more) time in order to get resolution of the pet's condition. Notice this is not scheduled follow-ups for additional treatment, tests or monitoring.
  • % visits scheduled for recall
  • % recalls made
  • Response to 1st reminder
  • Response to 2nd reminder
  • Response to 3rd reminder
  • % pets current on RV (rabies vacs)
  • # client surveys returned
  • # of client referrals
  • % staff completely cross trained
  • % dogs current on HW (heartworm) prevention
  • % pets current on flea prevention
  • % blood sample hemolysed
  • # of blood samples requiring redrawing
  • % of medical rounds performed on time
  • # idea (kaizen) cards submitted
  • # idea (kaizen) cards/ staff
  • # idea (kaizen) cards completed
  • % idea (kaizen) cards completed
  • # staff injuries / time period
  • # pet injuries / time period
  • # of adverse anesthesia events
  • # of drugs or supplies found to be out of stock
  • % blood sample hemolysed
  • # of blood samples requiring redrawing
Some of these probably have sub-systems or sub-processes that might require monitoring and, thus, metrics of their own.

I am not proposing that no financial KPIs be watched. Veterinary practice is a business, after all. Some financial metrics are important and necessary. (However, they shouldn't all be financially focused, either.) Maybe we have not thought about the role that systems, processes, quality, waste, and flow plays in the money numbers; the Lean mindset. Maybe we should not worry as much about the end results and concentrate more on how we get there.

What metrics you decide to monitor is up to you and your staff. Remember, Lean is about making your practice the best "your" practice it can be, not a carbon copy of the practice down the road or on the other side of the country or, even, what a management guru says it should be in order to conform to some cookie cutter model. Your True North and your team (and some experimentation) will decide what metrics are important.

There would be high level, focus area metrics for leadership to monitor, sub-system metrics that managers would monitor and, still another layer (sub-sub-system) that frontline staff would create. These metrics are all aligned and make up your management scoreboards. Incidentally, this is an example of visual management.


Note that these layers generally flow down from our True North statement (they're top down, but there's input from lower levels along the way). Leadership metrics arise from our practice's focus areas. They check the destiny or course of the ship. Are we heading in the right direction?

The middle and lower level metrics, created by the people responsible for that work (with some input from their leaders), check the systems and processes that make up the focus area (leadership) metrics. Are we getting to our destination with quality, safety, effectiveness and without waste?

This flow is, in essence, what Lean strategy deployment (hoshin kanri) is all about; getting the ideals of the practice down to the floor (gemba) and aligned throughout the practice. It is everyone pulling the same rope, from the same end, in the same direction and at the same time.

The routine of management and frontline staff huddling together in a safe, honest and trusting environment every morning to discuss the scoreboards is Lean Daily Management; a topic of later posting.

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Thanks for reading. Comments always welcome. Please, let your friends and colleagues know about the blog.

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