Define measurable goals for employee success

Wednesday, October 31, 2007

Q. How do I align my business goals and staff incentives properly?

A. Frequently, company incentive programs (if they exist) do not support and reward goal achievement. In order to build a "high margin" patient base, the first step is to determine profitability by product line and payer. Once those targets have been established, it is important to be certain that everyone in the company understands these priorities and to develop a marketing strategy with a laser-like focus on generating patient referrals in those categories. Salespeople and staff will be motivated to achieve the plan if they understand it, believe it to be realistic and feel supported.
When high margin products are not identified, sales people will not understand where to dedicate their time. And if low margin therapies are rewarded, a company can expand its patient base and revenue but decrease its profitability. For example, there are dealers that pay a sales commission based on a percentage of revenue (which I believe to be a big mistake). As they earn commissions, business owners may struggle with profits and cash flow because of the mix of low margin products and poor payers. It is a surefire way to grow into bankruptcy. Reducing costs and increasing profits can result from operating changes to the business model, but the customer support staff needs to understand and support the change. For example, home respiratory providers, customer service reps, therapists and delivery technicians need to understand and support the transition to oxygen generating portable equipment--and be rewarded for successful conversion. If not, the process may be undermined and cost savings not realized. Cash flow is the lifeblood of the business, so customer service and reimbursement reps need clearly defined, measurable goals and be rewarded for success. Their upfront patient review, attention to document flow and persistence with payers is intensified with an incentive program. The HME business owner will be the beneficiary of their hard work and dedication. hme
Bernie Lambrese is a senior partner at Healthcare Strategies. Reach him at