Why Defects Are Costing Your Practice £43k per year
# Defects in TIMWOOD: Understanding and Addressing Wastes in Dental Practices
In the realm of Lean Six Sigma, the concept of TIMWOOD is pivotal for identifying and eliminating wastes in any operational context. TIMWOOD stands for Transport, Inventory, Motion, Waiting, Overproduction, Over-processing, and Defects. Among these, defects are particularly critical, as they can significantly impact the efficiency, profitability, and patient satisfaction of dental practices. This article delves into the nature of defects in dental practices, quantifies their costs, and discusses effective strategies for addressing these issues.
Understanding Defects in a Dental Context
Defects in a dental practice can take many forms, including:
Incorrect Patient Information: Mistakes in recording patient details can lead to treatment delays and misunderstandings.
Missed Calls: Failing to answer the phone promptly can result in lost leads and potential new patients.
Unreturned Voicemails: Not following up on voicemails can lead to missed opportunities for consultations.
Delayed Follow-Ups: Not contacting patients who had consultations for high-ticket items can result in lost revenue.
These defects not only disrupt operations but can also tarnish the reputation of the practice.
Impact of Defects on Dental Practices
Defects can lead to decreased patient satisfaction and trust, resulting in negative word-of-mouth and a damaged reputation. The financial implications of lost leads and missed appointments can be substantial, while operational inefficiencies can affect team morale and overall productivity.
But let’s quantify it.
Understanding the financial impact of defects is essential for justifying improvements. Here are some calculations to illustrate the potential costs:
Lost Leads
Average Number of Leads Missed: If a dental practice misses approximately 25 leads per week due to missed calls, this can have a significant financial impact.
Average Patient Revenue: Assuming the average revenue per patient visit is £112 over a year.
Estimated Lost Revenue: If 30% (industry standard) of missed leads move on to other practices, the calculation would be:
25 leads x £112 x 30% = £840 lost revenue per week.
Annualised Loss: £840 x 52 weeks = £43,680 lost revenue annually.
Patient Attrition
Average Attrition Rate: If a practice experiences a patient attrition rate of 17%, this could lead to the loss of approximately 300 patients annually.
Estimated Lost Profit per Patient Visit: Assuming a profit of £56 per patient visit, the total lost revenue would be:
300 patients x £112 = £33,600 annually.
Cost of Replacing Patients
Average Cost to Acquire a New Patient: This can range from £150 to £300.
Total Cost for Replacing Lost Patients: If 300 patients need to be replaced, the cost can range from:
300 patients x £150 = £45,000 to 300 patients x £300 = £90,000 annually.
These figures highlight the significant financial implications of defects in dental practices, underscoring the need for effective solutions.
Solutions to Address Defects
Gemba
We wrote an article about Gemba’s - this is an excellent starting point. If the receptionists & front line teams can’t answer the phone promptly, there are barriers that need removing! Gemba’s will implement a mechanism ‘to see things as they happen’ but also allow you to gather the feedback and understand the barriers your staff members face.
Utilizing AI
Implementing AI-driven chatbots and systems can help handle inquiries promptly, ensuring that potential patients receive immediate responses. This technology can also automate appointment reminders and follow-ups, reducing human error and enhancing communication.
Our Missed-Call-Text-Back system, for example, can get back to leads who have experienced a missed call within 30 seconds. Imagine this kind of automation and effectiveness in your front line.
Creating Service Level Agreements (SLAs)
Service Level Agreements (SLAs) are formal agreements that set clear expectations for response times and service standards. Companies like Amazon, for example, live by SLA. It ensures that it gives customer peace of mind that things will be taken care of. By establishing SLAs, dental practices can ensure that reception staff understand the performance metrics they are expected to meet. For example, an SLA might specify that all phone calls should be answered within three rings or that voicemails should be returned within 24 hours. This clarity helps staff prioritise their tasks and manage their performance effectively.
Managing Performance
SLA - however - only go far if they are measured. Regular performance reviews based on SLA adherence can help identify areas for improvement. Encouraging feedback from staff on potential barriers to meeting SLAs fosters a culture of continuous improvement and accountability.
CRM systems, like ours, help dental practices to keep track of when calls come in, when they are responded to, and action outcomes. This system can then provide effective metrics and allow you insights into SLA effectiveness - and ultimately - your front line effectiveness. Ultimately, it’s not about managing a person, but it’s about managing a process and giving your team the tools, training and support to be able to perform better.
Empowering Dental Staff to Reduce Defects
Empowering dental nurses and receptionists to flag issues and suggest improvements is crucial in reducing defects. Creating a culture of accountability and ownership among staff can lead to better communication and problem-solving. Training staff on best practices and the importance of accurate information management will further enhance the quality of service provided.
Conclusion
Addressing defects in dental practices is essential for improving operational efficiency and patient satisfaction. By quantifying the costs associated with defects, practices can better understand the need for change. Implementing solutions such as AI, SLAs, and performance management can significantly reduce defects and enhance the overall quality of care.
Ultimately, the success of these initiatives depends on leadership commitment to support and act on feedback from staff. If leadership takes the necessary steps to address issues and remove barriers, the workforce will view these efforts as valuable. However, if no tangible improvements result from these initiatives, the practice may find itself wasting resources on ineffective processes. Embracing a defect-free environment will lead to long-term benefits for both patients and staff, ensuring a thriving dental practice.
