What is Managing By Statistics?
Well, the best way to get across, drive home, make stick, bring home, teach, or what have you, the importance of managing by statistics is a good old story just like this one.
Dr. Bob was happily married with two children, a third on the way, and a successful practice. Life was good; what could go wrong?
He did have a slight problem with his patient retention falling. But he had solved similar issues in the past, so wasn't too worried about it.
Bob set about solving his retention problem. He checked over the elements you might suspect: Report of Findings, Front Desk scheduling next visit, having staff practice their roles in the office, everything he could think of, but his retention continued dropping. He had fallen from 200 patient visits to 180 to 175 to 150 to 130 and was rapidly heading for 100 or even lower. This had become an ongoing problem that was not responding. And this is where his worrying really began. Was it him? Was it the staff? What was it?
The picture gets more complex
Plus, with the overhead of a mortgage, a lease on his office, two kids, and a third on the way, Bob was pretty desperate and defeated; the practice it had taken three years to build was evaporating! What could he do? Was he just doomed? He was now losing sleep, his production at the office was suffering, his relationship with his staff was becoming strained, and he had even begun to have trouble at home; you can just imagine what that was like.
We begin digging into statistics
In desperation, Bob reached out to me for a consultation. He told me what his problem was and what he had done to correct it without any results. The first thing we did was go over his statistics. Of course, like many, Bob did not keep any statistics but also, like many out there, could tell you all the ins & outs of his office. What that meant to me was I was able to gauge his statistics from what he knew.
I went down the list. Check, check, check, it was all sounding pretty good, which piqued my interest even more because of this golden rule: STATISTICS ARE CAUSED, THEY DON'T JUST HAPPEN. UP OR DOWN, THEY ARE CAUSED. If you don’t already know and use this rule, take a minute to write it down and start USING it! You will soon swear by it too. But, knowing this rule, I pressed onward until we hit the thing that Bob thought was being done, but he could not without any doubt say it was. What was it?
It was the thing that turned out to be at the root of his dwindling retention problem. It was, as it is 99% of the time, something that could be corrected internally in the office. It was not some mysterious external factor; it was not voodoo.
And what was that? Catch my next blog!
Spotting the correct cause
So, what was the thing left undone that had ended up causing Bob such trouble? As it turned out, there was one main element.
The main thing was a failure of his staff to follow the cancellation policy, which stated the patient had to pay a $25 cancellation fee if they no-showed or canceled with less than a 24-hour notice. Long story short. He got that action being done, and his patient visits went back on the rise the same week. A simple case of staff saying it had been done when in actuality, it had not been done. Right?
Story over, you say? No, not really because of this one simple little fact: STATISTICS ARE CAUSED; THEY DON'T JUST HAPPEN. Remember? So, If there was a cancelation policy, why was it not being followed?
My philosophy, chase it down
I dug a bit deeper, “Bob’ when did your patient visits begin to decline?” “Hmm,” he said, thinking back. Then it came to him, “Shortly after being told by a staff member who came to me in tears. She told me, all the patients hated that policy, and she had even been yelled at by patients because of it. The poor dear was in tears; I felt so bad for her.” “I see,” I said. And then what did you do?” “Well,” he said, “I moved her from the front desk position to a back-office job. Yea, she didn’t really like that job and quit maybe three weeks after that. It was sad, really. I thought she had such promise too.”
Statistics vs. Emotions
What do you think happened to Bob’s willingness to enforce his cancellation policy after that little episode? If you guessed it diminished, give yourself a prize. In Bob’s words, “My gosh, I felt like I was doing something harmful to my staff and patients by enforcing that policy! We had been using it for over two years without incident. How could I have been so blind?”
How? Simple, Bob had listened to the emotion. He had not looked at the Statistics. His statistics of patient visits had been on a steady climb with little dips along the way up until he bit on the emotion. True he did not have statistical graphs to show, but written down or not; they are there.
How could Bob have saved himself the headache and stress of nearly crashing his practice by using Management by Statistics? Could that have been done? I hear you; you want to know how you can use this?
Great question, and the answer is so simple and so obvious that you will slap yourself when I tell you. How You can put this to use in Your office is.
Using Managing by Statistics
Using Managing by statistics, what’s in it for you? Freedom and certainty, that’s all. Think that is worth learning about?
So yes, I was able to help Bob pull himself out of a death-spiraling nosedive by applying the principles of managing by statistics even though he did not keep any numerical stats per se.
But how to use them requires a little deeper look at what they actually are. Let’s look back at Bob’s situation briefly. He did not have any statistics written down. He could gather his Patient Visits statistics pretty easily, which I did have him do, and we did put them on a graph, but hey, what did we have there? Something that looked like a two-dimensional representation of a mountain range; it goes up for a while and then goes down on the other side, right? If you’re thinking, “Big deal, it just tells me what I already know!” I get it. But the point is—WHAT YOU KNOW IS IMPORTANT! Don’t discount it.
More in my next blog!