The Pareto Principle in Your Practice
We live busy lives, and you run a busy medical practice. There are so many things that need doing and so many things to keep track of. How do you figure out which things to do, which things to delegate, and which to just choose not to do? That is a dilemma we all face. The bigger your practice grows, the more help you have but also the bigger the number of things that need to be done. How do we solve it?
In 1896, Vilfredo Pareto noted that 80% of the land in Italy was owned by 20% of the people. Since then, it has been noted that most things in life follow a similar law and it has become known as the Pareto principle. 80% of of our time produces 20% of our results, while 20% of our time produces 80% of our results. 20% of our efforts produce 80% of our income. The key, then, is taking some time to review and reflect which 20% of our activities are producing the results.
Here are some typical things a Doc running a busy medical practice needs to spend time doing:
- Patient Care: actual face-to-face time with the patients, including OR
- Paperwork: the time it takes to document and record what we did with our patients
- Reading: keeping up to date on the latest literature
- Conferences: meeting with colleagues and keeping up to date on practices
- Federal Regulations Management: keeping compliant on all the federal and state mandatory guidelines like HIPPA, COBRA, CLIA, MIPS, etc.
- Practice Management: Taking care of the business end of your business including employees, financial statements, marketing, etc.
If 20% of our time creates 80% of our income, we need to take that list and decide where we should be spending our time. Some other things for a growing practice with more responsibilities are:
- Leadership Development
- Meetings, Internal
- Meetings, External
- Building Net Worth
- Supporting Team Members
Now, think about what your income generating activities (IGA) are. Of those lists, what are the things that actually make money? These can be divided into things that make money now and things that make money in the future.
For example, it may look like this:
- Face-to-face with Patients
- Making Practice More Efficient and Effective
- Leadership Development
- Developing New Skills
- Training Others to Leverage Your Time
Now, these become the 20%. 80% of our time should be spent on these activities. I bet if we kept track of everything we do for a week, these are not the numbers we would get. So, what do we do? We go to war!
- Increase the amount of time (percentage of our time) spent on these things and
- Decrease the amount of time we spend on everything else.
How do we decrease the time we spend on other things? We leverage it, get someone else to do it, find a scribe, hire a personal assistant, find ways to streamline your CME learning, etc. There are thousands of ways if we put our mind to it.
Do the same thing every six months. List all your activities, decide which are your current and future IGAs, and go to war increasing time spent on those and decreasing time spent on everything else. This will quadruple your productivity and your income!
Living Every Minute,