The 3 Key Indicators of Business Health
You know how to look at symptoms, charts, and results to tell what is wrong and what the solution should be.
But what about the health of your business?
What is the business equivalent of healthy blood pressure, a healed bone, or a disease in remission?
Allow me to break down three key indicators of health in your business, so that you can diagnose and act accordingly.
1. Financial Metrics
Sounds obvious, I know. But is your practice making money?
A great way to assess the ongoing health of your practice is whether or not your cash position is getting better each month.
After you’ve paid your expenses, do you have more money left than you did the month before?
If yes, your business is growing in profitability, and you’re seeing the clear test results that show that.
2. People Metrics
A little less quantifiable than the financial metrics, but do people like your business?
Do you have a high turnover of staff members? Do your patients speak highly of you and become long-term patients or are they seeking other doctors?
If staff are leaving very quickly it could be a sign that it’s not a nice environment to work in, and if patients are complaining or seeking medical help elsewhere it would imply that they’re not happy with the service they’re receiving.
Businesses are built on people, so happy and engaged staff, coupled with happy and long-term patients imply that you are creating good relationships that a healthy business needs to thrive.
3. Credit Metrics
No one gets picky about business like someone about to offer you a loan. They want to know that you’re a good bet and will pay the money back on time, so they do their research.
Meaning, your credit rating can be a good indicator of your practice’s health.
If it would be easy for you to get a good loan, the bank is essentially saying your business looks good and they trust in it. If it would be hard, or you’re offered bad terms, they’re not exactly giving your business a big vote of confidence.
Need help?
I hope these three metrics are helpful and enable you to engage with and diagnose the health of your business. While these metrics will certainly provide some good insight into the overall health of your clinic, there are other areas that may require further professional analysis. For example, You Legal offers a ‘Governance Health Check’. A You Legal Lawyer will consider the individual circumstances of your business and we will advise you of the steps required to protect your practice from any vulnerabilities discovered. Contact us.
The Governance Health Check is available here.