Consider two focused questions:
As you think about the status of your Practice, can your current Revenue Streams support your Practice to be as healthy as it really needs to be, in order to meet all of your goals?
Based on current Revenues and Margins, would you be an Investor in your Practice?
Good quality Revenues and Margins are the “Mother’s Milk” of every Healthy Business.
Life would be simpler if Physicians only had to do the roles of being the business CEO and a Doctor. This includes the Office Manager or Practice Administrator that has to don many hats in support of the Physician.
An Updated Perspective
The Physician of Today needs to wear many hats and too often they end up wearing multiple hats at the same time. It doesn’t work and isn’t sustainable.
We start with the roles that many Doc’s report having to fulfill.
CEO – Chief Executive Officer
CRO – Chief Revenue Officer
CFO – Chief Financial Officer
CPO – Chief Product Officer
Doctor – Medical Practitioner
CMO – Chief Marketing Officer
COO – Chief Operating Officer
CSO – Chief Strategy Officer
Founder and occasionally, Senior Partner
Now, Todays Practice looks at the role of being the Chief Revenue Officer (CRO).
One of the biggest challenges that the Doctor as CRO faces, is the fact that most of the Practice Employees (or Associates as the current Politically Correct term), don’t “get” the fact that they are part of a Business that is a Helping Enterprise. They don’t think Revenues or Margins or Cost Structure or Budgets. They “do their job”.
As the Chief Revenue Officer, you want to think about Revenue Streams (products and services you can be paid for as a Business). It also has to be GOOD Business. That means it has to be Good for the Customer, Good for the Practice and Good for the Owners. Revenue Streams need to be thought of in terms of the Resources needed to get them going, their Value to the financial goals of the Practice, their Sustainability and life expectancy.
This begins with a good Dashboard on where revenues come from now and the impact on the overall Business. You want good reporting mechanisms to know what revenue streams are in place now and the Resources and Cost Structure for each stream.
Ideally, you will get good Payment clarity on Categories like Insurance Type, Cash, Credit Card, Credit Finance Program, Procedure, Cost of Goods sold, [the CFO role develops this structure and reporting]. With that information, you begin to have a basis of defining Revenue Stream opportunities that help the Business achieve its performance goals.
Some of the current streams being explored include “Elective” Procedures or Programs that have good margins and high perceived personal value. This includes the general needs that people have for increasing their real Health, their Energy, Stamina, Strength, Overall Wellness, Mobility, Agility, Reduction of Chronic Pain and Longevity. These are topical potential Practice Offerings that can be featured in the form of Products and/or Services that complement the Practice Business Strategy.
In some cases, Practices are creating the position of a Business Development role. This is NOT a Sales Rep, it is a Case Manager, or Director of Patient Well-Being, or Staff Advisory role, perhaps a Program Manager who helps people fulfill the potential of their Bodies and overall health. It is chartered with building a pipeline of Customers for Products, Services and Procedures that have healthy margins, offer recurring purchases and have a long value lifespan. Sometimes, these roles are outsourced for leverage.
When planning and developing revenue streams, the real need here, is for the Doctor to shed all hats except for the CRO hat. The focus needs to be purely on generating the maximum Revenues possible for an 18-36 month time frame, so that the well-being of the Practice is improved or assured.
To get the most out of your CRO role, do the following for yourself:
1. Identify the things that the Practice does exceedingly well and has the best impact on the Customers as well as your Top and Bottom Lines.
2. Identify the Market opportunities for Revenue Streams based on Geographic or Specialty Demographics
3. Recognize what you, yourself do well and where you need Resources to generate these Revenues
4. Create specific coherent Offering and rollout to the Market (Your CPO or CMO roles will help here)
5. Create and Monitor your Performance Dashboard, with spend and ROI limits.
6. Review daily and weekly for the first 6 weeks then weekly and/or monthly for the next 2 Quarters.
As the CRO, you only care about Revenues and Margins, while focusing on achieving the largest potential possible in your chosen Marketplace. Everything else is secondary. After you have it clear, take off the CRO hat and put on your CEO hat, to make sure that the Revenue focus includes the needs of the whole Practice.
To your Success.