How to Set Production Goals

Today's video tip describes how to set your practice production goals. Many clients ask me: “How do I know what numbers to use for my daily, weekly or monthly production goals?” I help them determine this by looking at three things:

1. The first thing we look at is: What is the breakeven point in your practice? Your breakeven point is what you need each month to cover your overhead. It’s the total of all of your monthly expenses in your practice. Don’t forget to take things into consideration that aren’t necessarily a monthly expense, but are something that you need to factor into this number. Once you have your breakeven point, you know that your goals need to support that. So, for example, if your breakeven point is $50,000 a month, we need to make sure that your production goal will allow you to collect a minimum of $50,000 a month.

2. The second step in determining your production goal is to look at your history. What have you historically produced? What has your hygiene produced? I recommend looking at your 12 month average, as well as your most recent 3 month average to get a good sense of your historical production.

3. The third thing we look at is: Where is the potential? When you have a goal, it’s supposed to be attainable, but also to stretch you. So we ask questions like: Is this goal attainable? How far is the gap between what you’re doing and what we’re setting for your goal? This will allow your practice to grow into your potential. Sometimes seeing your own potential in your practice is a little bit tricky to do. That’s why I always recommend having outside eyes help you with this - whether it’s an advisor or a consultant or a coach that you work with - an outside party can help you identify where the potential is in your practice by asking questions and challenging your assumptions.

When you look at these three things together, you can set a solid goal that will be attainable but yet stretch you, and allow your practice to grow to reach those goals.