By Steve Sunder
March 13, 2019
Your support staff members often are motivated on their own to help patients, but offering monthly financial incentives, known as performance incentive management plans, can make them even more eager to do a great job. Here’s how these plans work, and how to implement them in your office.
What Are Performance Incentive Management Plans?
A performance incentive management plan is an ongoing financial incentive to reward future results, a reward for doing a job well, rather than a reward for something that has already taken place.
Performance incentive management plans can be designed for, and implemented, in any practice no matter the size or number of locations.
Your objective is to change the behavior of your staff to perform at higher levels, go the extra mile, make extra effort and to create new ideas that drive a smarter business.
Your plan should include the following key success factors:
• Objective is directly related to the practice’s financial performance
• Objective must be clear and concise
• Objective must be transparent and communicated to staff
• Your staff must know how their performance affects progress toward achieving the objective
• Focus on the near-term goal/objective
• Objective achieved, there is a payout to all staff; exceed the objective, and there’s a higher payout
Choose Financial Goals to Work Toward
The link to financial performance shows your staff why the goal is important. It isn’t an objective in which you’re throwing a dart blindly at a dartboard. It has value and can be measured.
Examples of financial goals can be the number of prescription glasses sold to budget, increases in optical capture rate or increases in the number of new patients seen. Your budget is your financial playbook of the practice, and all staff influence your ability to meet or exceed the budget.
The objective is your monthly gross revenue budget in which practice performance and incentive rewards are measured monthly to budget. Doing it monthly is important to maintain staff involvement and drive toward meeting or exceeding the monthly budget.
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How Do I Do It?
A strategic outcome of a well-thought-out performance incentive management plan is the calculated, exponential increase in the practice’s revenues. The amount of incentive reward would be a percentage of the monthly incremental revenue increase.
In a budget-based monthly performance incentive plan, the monthly budget drives the plan, with incremental incentive percentages based on performance and a monthly incentive payout per team member based on monthly practice performance.
In this kind of performance incentive plan team members are not limited to their incentive amount, as it is based on their impact on practice performance and achievement above monthly budget, so that they could earn upwards of $1,000.
How Do I Make My Performance Incentive Plan a Success?
In a successful performance incentive management plan all staff must perform to higher levels or all staff take the hit. You should discuss with staff how all employees impact the patient experience. For example, you could explain how all staff members have input on directing/recommending a patient’s visit to the optical after the exam where the optician has an opportunity to make sales, and the front desk has direct control to ensure patients do not cancel, but reschedule their appointment.
Schedule a kick-off meeting as part of the state of the practice overview where this plan can be presented to the staff for buy-in:
“…We have developed a performance incentive management plan to inspire us to reach our financial and operational goals. The budget and key performance indicators have been established, and will be accurately measured each month, so that, compared to the budget, when the practice performs to certain financial levels, you will be compensated a percentage of the incremental financial growth.”
Steve Sunder is a health-care consultant with over 20 years experience in the eyecare industry at a multi-location practice, and as a consultant to other practices. To contact him: email@example.com