Prepare Yourself for Practice Ownership

April 5th, 2012 7:03am
Amber Banks

We have worked with many dentists this past year who have acquired or started a dental practice. The process of practice ownership is very intensive.  So how did these dentists decide what was best for them?  What did they do to prepare themselves for ownership?  Take these steps to better prepare yourself for practice ownership:

Step 1:
HIRE THE RIGHT TEAM!
Work with your team of advisors and take your time in putting your plan together.  Get proper advice from dental specific advisors to assist in mapping out your career path.  Ask your peers who they recommend working with.  Hear their stories for what worked and what didn’t work for them.

Step 2:
Get prepared for financing!  Start off by maintaining a good credit rating.  Determine what your estimated financing needs may be and if you’ll be able to get approved for a loan.

When was the last time you checked your credit score?  Determine if there are areas that you can be working on now to improve your credit score to increase the opportunity for you to be approved for the loan. Prepare and review your personal budget and savings.  Do you have a co-signer available for a secondary source of income, if needed?  These are all factors that should be considered when preparing for financing.

Step 3:
Determine your business model.  What are the things that are going to be important to you as a business owner?  Think long-term.  Perform a self analysis.  What are your needs, your wants, and what are your deal breakers?  What is your risk tolerance?  We have seen many doctors go back and forth between start-up and acquisition and after performing a simple analysis, they can more clearly identify the right fit for themselves.

Step 4:
Identify your practice model.  What kind of dentistry do you want to do?  Fee for service, PPO, Medicaid?  How may operatories do you want?  What is your desired annual production?  What do your staffing needs look like?  What type of procedure mix will you have?

Step 5:
DO NOT SETTLE!
If your dream is to start a practice from scratch, then stay focused on getting your very own practice started.

Making the best decision that is going to fit you and make you happy now and in the future takes time and planning.  Be patient and focus on one thing at a time!

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Balancing Financial and Mental Health

March 29th, 2012 10:44am
Adam Decker

One of the most enjoyable pieces in working with dentists and their practices is the process of really getting to know them – what drives them, how they think, and how they operate.  It’s enjoyable not only on a personal level, but also from the perspective that it better enables us to more specifically advise to the needs and plans of each particular dentists’ situation.  While this understanding begins during an initial meeting or preliminary conversation, it grows and deepens over the years and truly evolves into a partnership.  Although it is a good place to start, it takes more than just a questionnaire to get to the level where we feel we can best advise.

An aspect where this deeper understanding is very noticeable in what we deliver is balancing the dentist’s financial health and their mental health.  What do I mean by that?  There will be a time or two where the most correct financial answer doesn’t weigh in as well against a mentally healthy answer.  Sometimes maximizing returns, minimizing risk, or increasing wealth doesn’t exactly jive with what will help you sleep well at night.  It’s in these moments and scenarios where the deeper understanding and partnership allows us to help bring a solid perspective that includes a healthy financial and mental balance.

For instance, consider the dentist who has been practicing for five or six years and has a decent chunk of student loan debt.  Fortunately, the loans are at a favorable interest rate.  The practice is profitable and generating some good excess cash, but still has decisions to make in how that cash is used.  A good strategy, and perhaps the financially superior one, may be to maximize tax deferred retirement savings.  This will save a lot in taxes both short-term and long-term.  However, we’ve come to understand that this student loan debt just drives dentists crazy.  It’s not so much the, “I have all of this debt and I don’t like it,” but more along the lines of, “I can’t sleep at night until I deal with this debt!”  So in this instance, striking a healthy mental and financial balance is important and the financially superior answer is likely not the best in this case.

Another example is the dentist who has been told countless times from consultants, colleagues, and advisors that they should eliminate acceptance of Medicaid because it is not profitable and they are booked 8 weeks out.  Standing alone, this may be the best approach from a financial standpoint  However, this particular dentist may be very compelled to serve in this capacity and sees it as a social obligation to accept Medicaid-paying patients.  Again, the mental aspect of a social obligation here would bid well against the financial maximization of zero Medicaid acceptance.  In this instance, we would advise an approach where mental health could be achieved and still balance that with a financial approach that isn’t devastating.

There is no manual or guide that tells you what the right balance is for you.  It’s truly unique to each dentist and the surrounding circumstances.  Having someone who can help dig in and move toward that balance can be key to both financial and mental health in the short-term and long-term.

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The Impact of Appreciation

March 21st, 2012 6:04pm
Amber Banks

Many people need to hear that they are appreciated and valued.  Not only is it nice to hear as an employee, but it can motivate your team to work hard(er) and continue to take pride in their role on your team when they are recognized.

Have you recently noticed someone who stands out?  Take a minute to thank him or her.  Your employees may already understand their responsibility to perform their daily tasks, but taking that extra step to thank them for doing it well only takes a few moments.

As the dentist or “leader” of your practice, you want to lead by example.  You want your team to see you showing acts of appreciation so they then appreciate each other.  That positive influence in the office will not only funnel through your team, but it will flow into their interaction with the patients.

“Thanks for staying late tonight,” or “Thanks for going the extra mile today,” or “Thanks for filling in for Sally since she went home sick today,” are all great examples.  Praise for appreciation doesn’t always have to be costly either.  People enjoy just the feeling of being recognized.

Here are some great low-cost ways to show more appreciation:

  • Recognize the team’s efforts during monthly meetings or daily huddles
  • Take the team to lunch or breakfast
  • Gift them with movie tickets
  • Provide positive feedback on a job well done
  • Give an unexpected “thank you” card
  • Send them to a continuing education course they’ve been wanting to attend
  • Greet your team each morning with a smile on your face
  • Come up with an employee award that is passed on from one employee to the next for a specific item accomplished
  • Spend time with your team members – they will appreciate the interaction with the “leader”

The impact of appreciation can be contagious and spread throughout the office. So encourage your team by showing that you appreciate them!

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When Good Goes Wrong

March 16th, 2012 12:22pm
Adam Decker

How Do You Make the Best of a Bad Situation?

This will happen sometime in your career as a manager of staff: you decide to do something good for your team and then you watch it go totally wrong.  Somehow, “badwill” is then created instead of goodwill.  Your well-intentioned gesture, bonus, or reward is perceived in an entirely different light than you had intended.  And you may say to yourself, “Why did I even try to do this in the first place?”

We recently worked with an office that was adding a benefit partially paid for by the office and partially paid for by the employee.  Effectively, the participating employees were getting raises to account for the benefit.  Unfortunately, there was miscommunication on the amount that it was going to cost the employee for their portion.  So after a couple pays at the wrong amount, the correct amount was deducted from the paychecks.  Employees then saw their net pay go down.  Talk about a good gesture gone wrong!

In another instance, we worked with an office that had established a nice benefit for its team to go on an annual trip paid by the dentist when their annual goals were hit.  They had gone on this very nice trip for a number of years.  Then one year, the office was well off track from its goals, yet the staff was spending time each week planning the trip.  The dentist was faced with the decision to either not have the trip since the goals weren’t met or to go ahead with the trip anyway.  Neither outcome was going to have a favorable consequence for the dentist when having to explain it to the employees.

I’ll say from my own experience that even the best planning won’t assure getting to avoid these situations.  So either you don’t ever do anything extra for your staff or you have a plan to deal with these matters when they go the wrong way.  I’m a believer in rewards, so having a plan is the option I use.  In the first example, I recommended that the doctor sit down with each individual affected and explain what had happened, explain the circumstance, provide an option to opt out of the benefit at that time, and then empathize with their situation.  It won’t make it all better, but at least hopefully provide an understanding of the circumstance and explain your intentions.  This will help remove some of the created “badwill.”  In the second instance that I mentioned above, my suggestion is to be firm about the goal and not have the trip.  While it will likely create the unwanted “badwill” initially, an honest discussion about the intent and the purpose can at least help gain perspective with the situation.  Again, it won’t make it all better, but it should help.

You aren’t going to be able to avoid bad team member situations entirely.  But dealing with them quickly, personally, and honestly will help hedge the unintended negative results.

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What Are You Doing to Protect Yourself?

March 8th, 2012 7:56am
Amber Banks

I was talking to a client the other day and he mentioned he was receiving a lot of text messages alerting him that his accounts had been locked because someone was trying to access his bank account and had used too many incorrect passwords.  This was concerning to him and he asked if he should be changing his passwords regularly.  It had been six months since he originally set up the password.

My response was, “YES!”

It then got me thinking how often dentists are changing their passwords and adjusting their security measures within their offices.  You are busy enough as it is, but having someone steal any part of your security or identity can slow your practice down very quickly.

There are many things at your office that you absolutely NEED to keep secure, such as patient information, staff information, bank account information, payroll account information, insurance processing information, credit card and payment processing information… and so much more!

What are you doing to protect your privacy, as well as the privacy of the practice, your staff and your patients?  If you don’t have a solid plan in place, then I would suggest that you review security measures that are currently in place to determine if you have enough security or address what needs to be implemented to boost your security measures.

Areas to consider to improve your internal security measures:

  • Change all passwords every 30-60 days
  • Assign users separate log ins and passwords
  • Shred any and all confidential unnecessary information that is not required to be retained
  • Check your credit report at least once a year
  • Be cautious of how often you give out your social security number and to whom
  • Do not carry your social security card together with your driver’s license
  • Shop online with caution – do you know the site is trustworthy?
  • Review your bank and credit card statements monthly and look for any unusual transactions
  • Limit the number of people to whom you give user names and passwords
  • Avoid sending personal information to anyone via email, including credit card or bank account information, birthdates, SSN, etc.
  • Do not keep your written user names and passwords in your purse or wallet.  Avoid having them all in one location to prevent someone from accessing your entire database at one time.

Spend a few moments annually reviewing your security measures instead of worrying what could happen to you.  Take precautionary measures to avoid what could potentially be a huge mistake!

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Convenience: The Importance of a Turn-Key Operation

March 2nd, 2012 7:50am
Adam Decker

Amber and I ventured to Chicago last week for the CDS’s 147th annual Midwinter Meeting and walked the floor of the vendor show, mingled with clients and visted with colleagues.  As always, we had a great time!  I particularly enjoy seeing some of the new technologies, then talking to dentists to get their take on it.  Is it new and useful or just a gimmick, in their opinion?

One observation that stands out to me from the event is the turn-key setup in which the distributors create.  For a buyer, it is quite painless to go to the show, find what you want, agree to buy it, and take two steps to the left or right and get approved for financing and just like that, the sale is complete.  Most of you have either been through this process or have at least observed it with a classmate or colleague.  Isn’t it so much easier when it’s all right there in front of you, everything flows, there’s no waiting and very little hassle, not to mention everyone knows their role?

This makes me wonder how many practices are set up with a smoothly-run turn-key operation.  Does everything flow well?  Is there no waiting and little hassle for your patients?  Are you in a place where everyone on your team knows their role?  Can you present your treatment plan to an agreeing patient and within the blink of an eye, their payment plan is taken care of?

Don’t underestimate the value of how smoothly this can run — for many reasons.  Confident presentation is key.  Organization amongst the team in the process is important.  No waiting in between the treatment presentation to the financial discussion helps.  Observe your team… do you have a turn-key operation?

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