Best Practices

Keeping score: Why use departmental scorecards?

Measuring performance drives improvement.

By Maureen Waddle

Ophthalmic practice owners often ask, “What reports should I review?” In addition to financial reports such as monthly profit and loss statements and balance sheets, I recommend the use of departmental scorecards, especially for larger practices.

Although the name for departmental scorecards has changed over the years — they are commonly known as flash reports, KPI reports, department summaries and balanced scorecards — their primary functions have remained the same: They help managers measure performance across the entire company, evaluate results, monitor customer behavior, think strategically and save money.

Practice leaders who use scorecard reports are in a better position to make sound business decisions, as well as manage daily operations and set long-term strategy.

LET US COUNT THE WAYS

I’ll explain the specific reasons why ophthalmic owners and administrators should use departmental scorecards to monitor their practices and drive success:

• To improve. The founder of modern statistics, Karl Pearson, states, “That which is measured improves. That which is measured and reported improves exponentially.”







• To have a clear picture of the entire organization. Financial metrics alone can be misleading. Unknown or unidentified external forces can impact a practice’s financial picture. Looking at all aspects of the organization helps focus attention on areas that might be faltering, such as a high staff turnover ratio or a low patient-retention rate that, when improved, will enhance the current financial metrics in a positive manner.

• To provide transparency and accountability. Scorecard reporting examines and measures all departments. This allows supervisors, executives and owners to see the relationship between departments and how their particular areas of responsibility can impact another department.

• To improve teamwork. Scorecard reporting gives the leadership team a sense of commonality. As they learn about the duties and responsibilities of other departments, they begin to better support each other and make suggestions for improved interdepartmental processes.

• To stay focused on the right things. Scorecards are developed to measure key indicators and practice goals. Review of scorecards can help practices focus on priority items rather than following a list of “to-dos,” which may not produce much change or improvement.

• To allow for better organizational decision making. More eyes monitoring progress and staying focused on identified goals helps team members make better business choices.

The ability to accurately measure results is key to continuous practice improvement and ongoing success. The use of departmental scorecards provides a reliable method of measurement and brings a disciplined analytical approach to a practice. OM

Maureen Waddle is a senior consultant with BSM Consulting, an internationally recognized health care consulting firm headquartered in Incline Village, Nev. and Scottsdale, Ariz. More information about the author, BSM Consulting, or content and resources discussed in this article is available at the BSM Café, www.BSMCafe.com.