Your Dashboard is Noisy: Organizing KPIs into Tiers

I’ve been thinking about KPIs a lot recently.

When I owned a private practice, I didn’t pay much attention to them.? Like most dentists who owned a business but had zero business education, I only looked at things like daily production or monthly new patients.? My accountant would walk me through a quarterly P&L and I’d pretend I knew what he was talking about.

As time went on, I picked up a few more data points to monitor.? This was usually during a slow period in the practice when I desperately needed to find an explanation for why I struggled to pay my bills.

Here I was, a practice owner, with state-of-the-art practice management software that could generate hundreds of pages of data but without any plan for what I should be reading and when.? I was like a clueless pilot staring blankly at a dashboard of dials and blinking lights, just hoping to not fly into a mountain.

My real education began ten years ago when I became the Chief Editor of Dental Economics.? I had the time to study the business of dentistry.? I could pick up any issue from the 110 years of that publication.? I had regular conversations with industry luminaries like Roger Levin and Allen Schiff.? I started to figure out what the blinking lights meant.

Now I’m the Chief Dental Officer at Tend, currently overseeing 25 urban dental practices across the East Coast.? I not only have access to enterprise-level practice management software, but I also get to partner with colleagues who are experts in their fields of operations, finance, and information technology.? I also get to speak with peers at other DSOs and get a peak at their homework.

So here’s my current approach: I organize KPIs into Primary, Secondary, and Teritiary.? When all KPIs are given equal or near-equal weight, you and your managers can lose the story.?

A Primary KPI is something that is most critical to the business.? It’s so important that even other departments in your organization are aware of it and have work streams that hope to improve it.? You might only have 3-5 such KPIs.

Example: a dentist’s Average Daily Production

Secondary KPIs feed into a Primary KPI.? You might even be able to put them into a formula with the Primary as an output.??

Example: Average Daily Production = Visits Per Shift x Revenue Per Visit

Tertiary KPIs feed into Secondary KPIs.? There are arguably a lot of factors that determine a Secondary KPI and some of them are difficult (if not impossible) to measure.? Identify what you can measure and list them.??

Example: A dentist’s Visits Per Shift is determined by (1) Same-Day Conversion- treatment that is diagnosed and performed in the same day, (2) 90-Day Conversion - treatment that is completed within 90 days of being diagnosed, and (3) Template Fidelity - our measure of a team’s ability to book treatment optimally within a predetermined template.

Each tier of KPIs should be easily accessible to interested parties, ideally all sitting on a single dashboard.? There is a clear understanding of who looks at what, when they look at it, and what the target should be.

When a Primary KPI is falling short, we can look at the Secondary KPIs to help identify where the problem is.? As we dig into Tertiary KPIs, we’re getting closer to the root cause.

If you have a dashboard with data that doesn’t fall into the category of Primary, Secondary, or Tertiary, then it’s just noise.? Eliminate it so you and your team can focus on what matters most.