The Grass is Always Greener

I was speaking with an early career dentist four months ago. He decided to leave his first associateship after 1 year because he felt he was not involved enough in the actual business of the practice.  He graduated just last year, earns $11,000 to $12,000 per month, and has an owner who mentors him.  He has learned a lot and his production and income are increasing steadily.

I had to ask him, “After one year, why would you want to leave so quickly?”  This is almost as close to an ideal associateship as I have seen.  He told me he thought he could do better.

After more discussion I learned that he wanted to be on an equal level of an owner or partner without actually earning or paying for the right.  I spoke to him at length about the current state of dentistry.  We discussed how new doctors are fortunate to get great mentorship and build skills and speed before trying to run the business.  Back 10 or 20 years ago it was the status quo to graduate dental school and start a practice.  Not anymore.  

This article, however, is not about talking you in or out of buying a practice right after dental school.  The point I want to share is simply to take a deep look at what you have right now, and decide if you are not jumping ship too soon.   Having an associateship like the one described above is ten times better than another year of dental school or a residency because the associate is getting real world experience in a strong practice with a great owner willing to give his time to mentor the young doctor.

The doctor went on to leave that practice and join another.  During the interview process the practice owner told the dentist everything he wanted to hear.  The dream picture painted in the beginning turned out far from true once the doctor started working in this new practice.  He is now looking for a new job again because this practice does not have the production promised.  The associate’s income has taken a 20% hit.  He was promised partnership in 1 to 2 years, but he does not want to stay there.  

Too many times we think that there is something better out there, or we want to make bigger leaps in our careers than are possible after so little time.  Take a step back, be completely honest with yourself, and talk to others.  You may soon realize that you have the best thing right in front of you.

Written by Carl Guthrie. Carl has been with ETS Dental since 2007 and is the Western Region Recruiter. Contact: cguthrie@etsdental.com | 540-491-9104

Breaking an Unbreakable Cycle

During the third quarter, U.S. GDP grew at an annualized rate of 2.5 percent, reducing fears of a double dip recession for now. In August, there were more than 4 million hiring events. That equates to 3.1 percent of the total U.S. workforce getting a new job.  In September, the unemployment rate for those with a four-year degree fell to 4.2 percent and the unemployment rate for those who most recently worked in a management, professional or related occupation was just 4.4 percent.

That is good news for a lot of people—namely those with jobs in fields that require specialized experience and education. But there are also nearly 14 million jobless Americans who want and are searching for a job. The average duration of unemployment now exceeds 40 weeks, excluding those who have taken part-time work or given up searching.

“The country emerged from recession more than two years ago,” says Rob Romaine, president of MRINetwork. “The stock market has in large part returned and corporate earnings are at record highs, but everyone—both consumers and companies—are behaving as if we are still in a recession. Consumers continue to delay purchases and companies are choosing to sit on record amounts of cash rather than invest in resources and human capital.”

To be saving cash in uncertain times makes perfect sense on the individual level. However when looking at the country as a whole, it means hundreds of billions of dollars less in spending and the spending which does occur is at significantly lower profit margins.

“High unemployment doesn’t benefit anyone. As long as spending remains anemic, employment levels will fail to rise significantly, and those who have been out of work for more than a few months are likely to remain out of work for even longer,” says Romaine. “But in a classic catch-22, spending is going to remain weak as long as unemployment is high.”

Like any vicious cycle, this one needs to be broken. Yet, nothing will happen overnight and it might not be possible for there to be one bold action from the government or one strong economic signal from the economy to fix everything.

“This cycle will be broken on the individual level. Individual companies will look at their business and say, ‘despite the macroeconomic outlook, our business is sound and we need to invest to make it better,’” says Romaine. “Unemployed individuals will also have to dig deep and reevaluate what kind of career and lifestyle they are willing to accept.”

For someone who hasn’t found a job after 40 weeks of searching, their prospects aren’t going to change because of a simple resume tweak. Most long-term unemployed are going to have gain additional skills while lowering their salary or title expectations more than they ever thought possible to rejoin the workforce. Yet, these are the individual sacrifices which will break the cycle.

“Coming out of this there hasn’t been and there won’t be a ribbon-cutting moment, just a long series of small decisions that will slowly turn the tide,” says Romaine. “Companies who don’t invest in talent and resources will lag the recovery cycle and eventually fall behind their competition.”

Dental Practice Owners: 8 Simple Steps to Preparing a Business Plan for 2012

I am very pleased say our business has more than doubled over the past four years – a time period when more than 50% of the recruiters in the country exited the recruiting business due to the difficult economic environment. Certainly, much of our success here is due to our outstanding team of Account Executives/Recruiters, but I also attribute much of our success to taking the time and making the effort to write a comprehensive business plan every year. Even a talented team needs a plan!
Every week our Account Executives/Recruiters speak with hundreds of practice owners. We have found that a surprisingly small percentage of business owners actually take the time and effort every year to develop a business plan, and that most of the truly successful practices we work with do have a plan in place.

A business plan consists of three parts, which I will break down into eight steps:
1. A statement of what you want your practice to be in the future. (Step 1)
2. An assessment of where your practice is today. (Step 2)
3. A realistic breakdown of the steps you need to take in order to get from where you are to where you want to be. (Steps 3-8)

The 8 Simple Steps to Preparing your Business Plan:

1. Develop a Mission/Vision Statement for your practice – Simply stated, why does your practice exist? Who do you serve? What do you offer patients that they can’t get elsewhere?
• Vision – Write out a compelling description of a future desired state of your practice. Make sure you can clearly picture what your practice will look like in the future. Think in terms of where you want to be. The purpose of the business plan is to lay out the steps between where you want to be and your current reality.
• Values – What do you stand for? What are the guiding principals by which your practice operates? Values motivate us before we achieve a goal and determine how satisfied we are once we attain it. Does your current culture support your values?

2. Assess Current Reality – In a few paragraphs summarize your results for 2011. It helps to look at your monthly financials.
• Positive Effects on Growth – In which areas of your practice are you experiencing the most success? How do you optimize those to produce continued results?
• Negative Effects on Growth – In which areas of your practice are you experiencing more challenges? What do you need to change in order to obtain positive results?
• Current Office Structure – Diagram current office structure. Will your current team, with their current duties and responsibilities help you achieve the vision for your practice?
• Understand your key metrics – What is the average per patient production for each Dentist and Hygienist in your practice?
• SWOT – Draw a box with four quadrants: Strengths, Weaknesses, Opportunities and Threats. Be honest with yourself. Give a lot of thought to each area.

3. Describe what your practice will look like in 2016 – This is the fun part. Now is the time for specifics. There are plenty of ways to grow and be successful. In fact, some practices even choose to shrink and be profitable. It is up to you.
• Will you limit your practice to a certain type of patient base?
• Will you cater to patient needs by expanding hours, days and providers in your current facility?
• Will you expand your facility to accommodate greater patient demand?
• Will you expand your presence in a market by acquiring or building new practice locations?
• How many patients will your practice see?
• What clinical services will you offer?
• Will your equipment be all state of the art?
• Will your practice thrive because of your strong engagement with and ties to the community?

4. Commit to your 2012 Key Initiatives – Decide on a small, achievable set of initiatives that will help move you toward your goal. In most cases, you can’t achieve your vision in just one year, but you can take steps toward reaching it. Typically these initiatives fall into one of five categories:
• Improving office efficiency – Improving your responsiveness to current patient demand by treating more patients, maintaining or improving the quality of care with the same number of resources (team members and operatories) by eliminating inefficiencies in your current systems and processes.
• Broadening your level of services – Providing your patients with more clinical choices, which in turn improves the value and revenue from each patient visit.
• Increase Demand – Do a better job of filling your teams schedule through advertising, referral programs or adding new/profitable plans.
• Add Capacity – Add new Dentists or Hygienists to your practice to satisfy demand. (Don’t take this step until you have the demand and efficiencies to add someone profitably).
• Buy or create a new patient base – Serve a new patient pool by buying or starting a new practice.

5. Break your goals up into Bite-sized Chunks – Figure out what your 2011 objectives mean to each team member. It is critical that you involve your team. If you involve them in the process it will improve their buy-in. They will probably be the source of many of your best ideas. Define what the plan means to each team member:
• Does it mean they need more training in a certain area?
• Does it mean they need to schedule more efficiently?
• Does it mean they need to improve recall?

6. Install Guardrails – Make sure each member knows their daily, weekly and monthly goals.
• This is as simple as taking your annual goals and dividing them by the number of working days in a year.
• The key to exceeding your goals every year is to exceed them every day.
• Make it a routine to share results on a daily and weekly basis.
• Reinforce how important each team members part is to the practices overall success.
• Celebrate the daily and weekly victories.

7. Create a Budget – This is the tough part. Budgeting is the toughest part of the process because it makes you say no to things you really want to do. Tips:
• Zero based budget – Challenge each cost. Don’t assume you have to pay for something this year, just because you did it last year.
• Never count on revenue from a new hire or new initiative until it becomes a reality. Most practices count a very rosy picture when a new team member joins their practice.
• Fund new initiatives off the excess. Don’t buy something or hire someone unless you can survive a failure. Don’t borrow money and risk your practice because you think a new Associate, new location, new piece of equipment will produce. Wait until you can afford a failure. “Plan for the worst, Hope for the best”.


8. Print and Bind the Plan - Commit to the plan. Don’t just put it in your desk drawer.
• Carry it with you.
• Check progress weekly.
• Refer to it in team meetings.
• If you are falling behind, be aware of what needs to change and take action immediately.
• Celebrate the little victories and share them with your team.
• Bankers and perspective team members will LOVE you when you show them your plan.

You can do this! In fact, you should do it right now! You don’t need an MBA, CPA or Law degree to write a Business Plan for your Dental Practice. Certainly, advice from a trained professional is helpful, but in most cases you have what it takes to get the basics down on paper.
You are the leader of your practice. If you are serious about growing your practice, offering new services, expanding your reach, serving new patients, and preparing for a comfortable retirement, you need to write a Business Plan. If you haven’t done so already, start your plan today!

Written by Mark Kennedy, Owner/Managing Director of Executive Talent Search (ETS Dental, ETS Vision, ETS Tech-Ops). To find out more, call ETS Dental at (540) 563-1688 or visit us online at www.etsdental.com.