It's tax day in the U.S., and chances are that means that you have recently spent time putting together your personal and business financial information - or you've been avoiding doing just that and are now forced to file an extension. Either way, like it or not, you've probably been faced with some financial realities about how well your practice did last year. But what about this year?
The first quarter of 2010 is already behind us, and if you're like many of my clients who made resolutions to be better at staying on top of the business end of their practice, but find that (just like last year) they haven't gotten around to it, take heart - it's not too late to do something about it.
The 'where are you now' evaluation In order to ascertain what needs to change or how to improve your practice, you first need a good idea of where you are now. After all, even if you know where you think you want to go, you can't plot your course unless you know your starting point. One of the tools I use with my clients is what I call the "where are you now" evaluation.
This evaluation is like a snapshot of your practice as it exists today. Some of this information may be at your fingertips or easily accessible through your practice management program, but some of the information may not be as easy to obtain. But the process of gathering this information and reviewing these items will help you to highlight not only where you are now, but where your systems may be lacking to capture the information you need.
The information I recommend that my clients gather includes:
Clients
- What new clients who retained the firm over the past year?
- What revenue was received from each client?
- What is the value of each client to your practice (keep in mind that a particular client's value may or may not be directly reflected in the revenue received from that client)
- How are your clients coming to you? (be specific)
- What services were provided to each client?
Ask the same questions about new business generated from existing or former clients.
Practice Areas
- What areas does the firm practice in?
- What services does the firm provide?
- How valuable is each practice area or service to the firm?
Financial Management
- What are the firm's expenses?
- What is the firm's revenue?
- What is the firm's yearly gross?
- How steady is cash flow?
- Is there a pattern or some predictability to the firm's cash flow and revenue?
Space and Facilities
- Describe your current space and facilities
- How are your current facilities serving your clients?
- If you meet with clients outside of your facilities, describe the manner in which you do so, and the benefits to your clients?
- How does technology affect your use of space/facilities?
Technology
- What technology is currently in use within the firm?
- How does the firm’s current use of technology help clients?
- What obstacles does the firm’s current technology present?
Marketing
- In what ways is the firm currently marketing the practice?
- For each marketing effort, note the client segments/niches and practice areas/services being marketed
- Do these marketing efforts target the firm’s identified ideal clients?
- Are these marketing efforts integrated into a plan? Do they support one another?
Referral sources
- Who refers business to your firm?
- How often are you in contact with your referral sources?
- What kind of business do you receive from these sources?
- What is the value of business received from each source?
Procedures and Systems
- What procedures and systems are currently in place in your practice (ex: client pre‐qualification, potential client follow up, intake, billing, etc.)
- Are those systems used consistently?
Strengths and Weaknesses
- What are the firm’s three biggest strengths?
- What are the firm’s three biggest weaknesses?
- What are the three biggest strengths of your biggest competitors?
- What are the three biggest weaknesses of your biggest competitors?
Challenges
- What are your biggest marketing and business development challenges?
- What are your biggest operational challenges?
- What are your biggest business or practice challenges?
- What have you done in the past to deal with those challenges?
- Are those solutions working?
- Why or why not?
- What are your clients’ biggest challenges? How well are you currently meeting them?
Need help with your "where are you now" evaluation or finding solutions to the challenges you've identified? Contact me to find out how I can help.
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