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PDT
#155 - Three Reasons to Use Benchmarking
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Chart Your
Destiny November
4, 2009
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Private Duty Today
Welcome to Private Duty Today,
the bi-weekly electronic newsletter for Private Duty Home Care Leaders
from Leading Home Care ...a Tweed Jeffries company.
I'm Jason Tweed, Director of Business Development for
Leading Home Care, and Editor of Private
Duty Today.
Private Duty Today is published every
other Wednesday, and currently goes to over 7000 subscribers.
Private Duty Today is
a permission-based newsletter.
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Talking with private duty home care company owners and
CEOs is one of the more enjoyable parts of my daily routine. I
get to hear the enthusiasm in their voice and their entrepreneurial
spirit emerging. For the most part, our clients enjoy charting
their own destiny and they're passionate about serving clients and
their families.
Later in the conversation I hear frustration in these same
voices. It results from one of two situations, both having to do
with tracking data. Some owners don't know how to gather and
accumulate valuable data that gives them insights into their own
business. Other CEOs are quite adept at gathering data but are
frustrated because, while valuable, there isn't a solid body of
benchmarks of other companies in the same industry to which they can
compare their company performance.
Today there are over 15,000 companies providing people with non-medical
home care services, yet there is not a single solid set of valid
benchmarks that can be used by all 15,000 companies. Some of the
franchise companies have tracked data among their own franchises.
There have been a couple of attempts by other organizations, but none
that have given us a big picture perspective. We are changing
that.
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Three Reasons Why You Should
Participate
· You will make better strategic
decisions.
· You will be able to chart growth over time and
predict the future.
· You will be able to positively define the resale
value of your company.
Strategic
Thinking: Benchmarking can help your business
today by giving you the tools to make better strategic decisions.
By gathering important data points in an organized fashion you'll be
able to determine what marketing decisions give you the best return on
investment. You be able to see clearly the effects of efficient
recruitment, selection, and retention of caregivers. You'll be
able to make decisions that will lead to corporate and personal
financial health and stability.
Many of you are collecting data and analyzing it. By creating a
benchmarkable industry-standard, you'll know that you're collecting the
right data and using the right methods of analysis. You'll also
find additional opportunities to collect data.
Charting over
Time: The economy seems to be improving.
Just yesterday Ford Motor Company announced a 10 figure quarterly
profit demonstrating that people once again are making big
purchases. Unemployment is improving, and generally there is a
reduced sense of uncertainty in our personal economic futures. We
are cautiously optimistic because we know we have a ways to go and
there are still large challenges to face, including continued crises in
credit and lending and a rapidly growing federal budget deficit.
Ironically, none of these numbers have any meaning without the context
of time. Individually they are snapshots.
Your business faces the same challenge. Admissions are up.
But why? Profits are down. But why? Turnover has
declined, why? Charting many data points over a period of time,
even a relatively short time, starts to show trends. Does a big
marketing push increase revenue immediately, or does it take time to get
traction? Should you be spending money on retention today to
guarantee profits tomorrow? Your bank account is full.
Should you take out some of the profits, or do you need that money to
weather an impending storm.
I had a professor in college who taught meteorology. With all of
our scientific knowledge and computer modeling today, the weather is
still a pretty difficult thing to predict. However, that
professor taught me how to look at the clouds. By examining the
clouds, and feeling the wind, and knowing the temperature it's possible
to predict the weather with almost absolute certainty about one hour in
advance. This little piece of knowledge has become incredibly
valuable. Should I take the dog for a walk? Am I going to
get drenched taking the kids to a movie? Should we light the
barbecue or the oven?
Do you have data today that can accurately predict what to expect next
week, next month, next quarter and next year?
Resale Value:
Many of you are happy knowing that the decisions you make in the
data you collect will result in black numbers at the bottom of your
profit statements.
Many of you are also thinking about the future. Where will your
company be at the end of your career? Increasingly owners have
been thinking beyond personal income and their IRA and realizing that
they are creating long-term value. A well-run private duty home
care business can have substantial value.
When talking with business brokers, buyers, and sellers we have found a
few things that can help bring a premium price when the time comes to
sell.
Two of those incentives can be improved through benchmarking.
Buyers of private duty home care want to see a spotless set of
books. They want to be able to see clearly the financial value
they can expect going forward. Tracking and charting your
financial data in an easy to digest format will go a long way toward
making a sale.
Secondly, buyers are looking for the best value. If you can
compare your data to other companies and definitively demonstrate that
you are ahead of the curve, your sales price can increase.
What if you don't have good data, or aren't ahead of the
competition? Now is the time to be planning and creating
strategies. Tracking data internally and comparing it to industry
benchmarks will help you make those decisions that eventually lead to
an increased price on closing day.
Make better decisions, chart your own course, and get ready for your
future. At Leading Home Care we've been teaching these three
strategies to our individual clients for two decades, and now we
anticipate guiding individual home care companies en masse through
quality benchmarks.
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Private Duty Today is proud to invite you to participate
in the largest benchmarking research in non-medical home care. If
you served clients in 2008 you're eligible to participate in this
in-depth study.
The Accreditation Commission on Health Care is committed to this
research, and that's why they have chosen to be a corporate backer.
Readers of Private Duty Today, clients of Leading Home Care, attendees
at our Private Duty Academies and the research staff here will provide
the data and analysis for the first-ever comprehensive State of the
Industry Study.
Learn more about the project and how you can participate at www.privatedutytoday.com/survey.
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Two Private Duty Academies
Coming Soon
We still have a few openings for the Academy for Private
Duty Home Care in Louisville on December 2. We've also announced
a new Private Duty Academy coming to Florida in January.
If you are the owner or administrator of a private duty company, or the
director of the private duty division of a home health care company,
you owe it to yourself to take advantage of this opportunity for
development, networking and professional growth.
Spend the day with Stephen Tweed, other leaders who want to grow, and
other companies who are getting ready for the future.
Register now!
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