Transform your dental practice with key performance indicators

What are the core KPIs for my dental practice to track?

When it comes to tracking these indicators, focus on the metrics that align with the goals of your practice. However, there are some core KPIs that most dental practices will want to consider:

Revenue metrics

These KPIs measure the top-line performance of your practice. By analyzing these metrics, it helps provide a clear picture of how much revenue is being generated and identifies areas where revenue could grow.

Revenue KPIs include:

• Total revenue per visit

• Daily and monthly revenue per provider
• Revenue per operatory

• Collection ratio

It is also helpful to further break down these metrics between revenue from dentistry and revenue from hygiene so that you can better understand which part of your business has room to improve.

Knowing what percent of your total revenue is made up by hygiene is imperative to keeping the practice profitable as you could be missing out on potential revenue and higher margins from more complex dental procedures.

Practices should aim for a collection ratio of 98 percent or better to optimize cash flow. Providing patients with a number of convenient payment options may help to improve the collection ratio.

Patient Metrics

These metrics help you gain clarity into your patient base and how your practice is serving them. Patient-related KPIs help outline behaviour and satisfaction — understanding these is essential for the long-term success of your business. These KPIs include:

• Number of active patients
• New patient acquisition
• Patient attrition
• Number of patient visits

Expense metrics

Expense KPIs focus on ensuring the costs of inputs into your practice are driving the expected returns. These metrics, together with revenue metrics, help you zero in on the key drivers to profitability in your practice. These KPIs include:

• Total staff cost as a percentage of revenue
• Hygiene labour as a percentage of hygiene revenue

• Consumables as a percentage of revenue
• Overhead as a percentage of revenue

These are only three categories of core KPIs for your dental practice to consider. By focusing on these important metrics, you can gain a comprehensive view of the financial health of your practice and highlight areas for improvement.

How do I make KPI tracking work for my practice?

The real challenge isn’t tracking the metrics, it’s in leveraging this data to drive meaningful improvements in your practice’s performance and profitability.

Here’s how you can make sure your metrics are working for you:

Set clear goals

First, define objectives that align with the goals you have for your practice. This will help you focus your efforts where they will matter the most. This could be anything from increasing new patient acquisition to decreasing the number of missed or cancelled appointments.

Additionally, setting a clear budget will help you highlight your financial targets. You can track how well your practice is performing against these benchmarks, then use KPIs to provide insight into your performance against your budget and identify any underlying concerns that require action.

Choose the right KPIs

Don’t get overwhelmed with too many KPIs. Instead, focus on a handful of important metrics that align with your goals. You can always adjust your metrics over time as your practice progresses and goals shift.

Make it a habit to review the KPIs with regularity. Every month, for example. This will help you stay on top of your practice’s performance and make timely adjustments.

Data collection

To accurately track your KPIs, you typically retrieve data from two sources: your practice management system, and your financial statements. Using these two sources together allows you to combine the operational and financial results of your practice to drive key insights.

But it’s not enough to just collect data, you need to collect accurate data. Keep your information reliable by maintaining up-to-date patient records and schedules. Clearly communicate your KPIs and objectives to your team; their involvement is critical to maintaining accurate, clear data.

I have the data, now what do I do with it?

KPIs can transform your dental practice, but only if they’re successfully implemented. Here’s how to take action on the metrics that you’re tracking.

Prioritize improvements based on impact and difficulty

Start by highlighting the areas that will have the most impact on your practice. From there, prioritize actions based on the potential impact and the effort required to implement them. For maximum benefit, you may want to first focus on high-impact, low-effort changes.

Start small

Implement improvements in manageable steps instead of overhauling everything at once. This lets you monitor the impacts of each change and adjust as necessary. If you’re nervous about practice-wide changes, consider testing new initiatives on a smaller scale — like a pilot program. This can help you fine-tune the processes before full implementation.

Create an incentive plan for your staff

Encourage your team to participate in data collection and implementing improvements. Their help is vital for maintaining accurate and updated records, which makes sure your KPI data is reliable. Incentive plans may be helpful in motivating your workforce to embrace change. For instance, you may consider offering a bonus for reaching specific improvement targets.

Perhaps most importantly, keep your staff updated on progress and celebrate successes together. A win for your practice is a win for your team.