Key Performance Indicators, or KPIs, are an essential component of every business, including DME! KPIs allow you to measure the successes and failures of your business so you can make the necessary adjustments to help you move forward.
Do you already have KPIs in place? Are you confident that you’re monitoring and reviewing the correct metrics? At Medbill, one of our core values is focusing on continual development through learning and personal growth to serve the industry most effectively.
This article will educate you on a nine-step KPI evaluation process. Then you can feel confident that your business is operating under the best practices and most valuable KPIs.
The 9 Step Process to Assess Your KPIs
This process helps you to make sure you’re using the right KPI indicators.
Step 1: Review Your Business Holistically
Review all parts of your business and how it operates, learn what you can control and what you can’t control. This step allows you to understand the metrics you need to measure right away.
Step 2: Determine Which Departments Support Your Company’s Overall Goals
These will be the individual departments that help to drive your business forward. Review the below departments to determine what metrics you should be tracking.
- Customer Service
Step 3: Review Your Historical Reporting for Accuracy & Details
During this review, make sure that your billing software or system is robust enough to assess past performances accurately. You want reports that will provide you with the information you need historically and for the future.
Don’t lose valuable time searching through hundreds of files for one KPI metric.
Step 4: Identify How to Measure Success for Each Department
You’ll want to look at the key drivers in your business that’ll move growth and increase profitability. For instance, review your current collection percentage and determine where you want it to be moving forward. Then look at the departments that can help you increase that metric.
Step 5: Narrow Your List to Measurable Performance Metrics
Focus on the indicators that drive your overall business health. Examine the metrics for each department that’ll have the most significant impact on your business.
Step 6: Set Targets That Produces the Right Results
It’s important not to confuse inputs with outputs; this creates a false sense of success between activity and actual results. At Medbill, we review our customer’s internal scorecard every month to show where they are and where they should be with their metrics. Our goal is to drive our customers’ collection rate to above 95%.
Step 7: Focus on Continually Improving Your Metrics
Overall KPIs should stay the same every month. However, as your business grows and evolves, you should review those KPIs and adjust as needed.
Step 8: Develop Budgets & Forecasts to Plan and Measure Your Actual Results
This step keeps your business looking forward. It determines the resources you’ll need in the future to continue with your growth and momentum.
Step 9: Create a Plan for Your Cash
Cash is fuel for your business! Some of the best companies have great KPIs that help them move forward. Unfortunately, they can lose momentum if they don’t have the cash flow to protect themselves.
Your Next Steps Moving Forward
To narrow down your KPIs, ask yourself the following questions.
- Am I monitoring my metrics on a weekly or monthly basis?
- What do the metrics mean?
- Where do the metrics need to go?
- What goals do I need to put into place for my organization to improve?
When you use the above steps to evaluate your KPI’s, you’ll learn to correctly measure the data and use it as a driving force to move your business forward.