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A Successful Dental Practice Returns at Least 40% of Production to the Doctor.

For more than twenty years we have been working with dental practices from coast-to-coast.  Information we have collected is compiled into a do-it-yourself consultants' workbook...The Practice Management Cookbook. 

Weekly we will be sending similar tidbits to the above...such as, how to evaluate a dental practice for purchase/sale, how much to spend in different areas of the practice by %, what % of total production should come from hygiene, etc.  If you do not wish to receive these tidbits in the future, let us know.  We do not want to be intrusive. 

Information on the COOKBOOK is on our home page which is finally working...all the time...I am assured. (We are getting a backup server just in case.)  If you have had...or have...difficulty reaching us, fax (813) 963-7228 or call (813) 963-7228.  Since you may not know of us, you might want to receive the COOKBOOK by COD (extra COD for shipping). Email or fax us with your order and address.

Hurston

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Hygiene Should Provide about 30% of a General Practice Income.

We have seen very successful practices with a percentage as high as 43%, but frankly, the doctor is spending a lot of time doing hygiene checks.  HYGIENE PROTOCOL in your practice is vitally important to overall success.   All your best production will come from hygiene patients, and statistically they are more profitable by more than 40%.

If this is an area of concern, you might benefit from some of the forms and procedural suggestions in Chapter V, Section B of the Practice Management Cookbook.

Our website is  http://www.WiseDentist.com

As always, if you would prefer that we discontinue sending these tidbits, let us know.

Hurston Anderson

Your Staff Salaries Should Not Exceed 20-23% of Total Production!

This should be a total of all costs including taxes, insurance, vacations, etc.  Your increases to staff members should come from growth.  However, you should always make certain that as your team is helping you to do better they benefit as well.  By meticulously staying at a 20-23% rate even as you grow you will always be competitive, appropriately staffed, and completely fair.

The Practice Management Cookbook includes systems and protocols for hiring, defining, and managing your team with numerous examples of Job Descriptions, example ads, and an Employee Handbook sample.  For more information, contact us by email, or check out our website at

http://www.WiseDentist.com

Have a great week.  Let me hear your comments, and certainly let me know if you would rather not receive these Tidbits.  I get great feedback, but we will not send anything to anyone who would rather not receive it.

Thank God the tornadoes missed us here.  Two dozen lives were lost on Saturday nearby.  The power of nature is awesome.

Hurston Anderson

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Raise Your Fees 10%.  Lose 10% of Your Patients.

Is this really, really bad?  From a purely financial point of view this would allow dentists to reduce their workloads by half day a week and still increase their "take home" income by 5%.  Would you actually lose 200 patients from a practice of 2000?  Not likely.

Obviously, there are other considerations.  Dentistry is not simply about how much you make.  But, the truth is that of the hundreds of dentists with whom we've worked, more than 75% could raise their fees by 5%-10%  and lose less than 1% of their patients.  We could take more time per patient, reduce financial stress, etc.  Dentists are much more conscience of fees than are their patients.  Sure you hear this as an objection to treatment.  Deal with the real objection.  The fee is not the problem.  Handling objections is a learned skill that everyone in the office can master.

If your fees are so low that you cannot relax financially, cannot afford the equipment and materials that you need, cannot spend the time necessary with the  patients ......who really loses?   Certainly the dentist, but also the patient. 

Thank you for your response. I am delighted that so many have responded so positively to these small Tidbits.  Again, please let us know if you would rather not receive them.  Thanks also for the many of you who are relating your uses of the COOKBOOK (including the section on handling objections).  It really is heartwarming to know that we have been of assistance.

Have a great week.  The azaleas are beginning to bloom in the front yard.  Hope spring is coming soon for you, too.

Hurston Anderson

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Your Practice Is Worth Half Collections plus the Value of Your Equipment.

There are variations on this theme, but this is a good "rule of thumb".  A specialty practice will increase or decrease based on the strength of the referring dentists.  If your trend is going up rather than down, you can negotiate for a bit higher price.  If your trend is going down, you need to stop that decline because your value will be challenged...and it will be harder to find a buyer.

Generally, even at this cost it is still cheaper to buy than to start a new practice because of the enormous gap between investment and return while the practice is building its base of patients.  The best new practice I have seen was a client of ours last year who within twelve months went from zero to 750+ patients and production close to 1/3 million.  Yet, the cost to create this practice was high. 

Winding down toward retirement can really take the steam out of a practice making it a bargain for the buyer.  Increasing production/collections by $10,000/month can add $60,000 to the value of the practice.  As in business in general, a record of recent growth is valuable.

Our clients averaged an increase of more than $10,000/month last year by maximizing the doctor's time in the office through ideal scheduling, proactive recare protocols, and daily/weekly monitoring.  If you would like information about the COOKBOOK we wrote about how we did this...or other services please contact me or visit our website

http://www.WiseDentist.com

Thanks to so many of you for your concern regarding this tidbit of info being sent late.  The truth is I have been in Tampa/St. Pete looking for a location for a new office/workshop site.  Although, the weather is getting very spring-like here, Florida is, of course, absolutely gorgeous...flowers blooming and backs burning.  Have a great week.  As always, please let me know if you would rather not receive these thoughts and ideas.  We will gladly discontinue them.

Hurston Anderson

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Key Employee Loss Costs $10,000.

Staff turnover is a fact of life in a dental office, but it is extremely expensive. Taking into account the time recruiting, interviewing, and training you can expect to lose about $10,000 per employee replaced.... for whatever the reason.

Of course, sometimes the loss is greater with the employee on the premises, but turnover ...especially frequent turnover is a practice killer.  You can be the best dentist in the world, but if you are working with an inexperienced, uninspired, or disgruntled team your success will be stifled.

It truly must be a team effort.  Frankly, you can't treat a patient who doesn't come in the door.  Your patients will very often feel a closer socio-economic affinity with your employees than they will to you.  A look of disgust, incredulity, annoyance, or other unpleasant behavior from an employee can cause questioning of fees, poor collections, and poor treatment acceptance.  You can spend half an hour explaining a procedure to lose the patient with an assistant's raised eyebrow.

But before we go read the staff the riot act we must be honest.  The doctor is the leader and sets the mood.  Get a great staff to support you, trust and support them, and keep yourself upbeat.  Smile when it isn't easy.  You are the leader.  Your mood in the morning makes or breaks the day and all the days thereafter.  If you want a happy team, be a happy doctor.   Show respect to get respect.

More than one-third of our COOKBOOK is dedicated to hiring and managing your team.  It is that important.    We found our production costs on the book a little higher than we had expected, so there is an small increase with the next batch  (April 1).  Sorry...couldn't be helped. 

Have a great first week of spring.  Our website is up again after a few modifications which will continue through the week. It will get better and better as we learn.  As many requested, Personal Consultant program described in detail now.

Hurston

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Embezzlement in 83% of Offices.  Past or Present.

Financial checks and balances in dental offices are worse than almost any other type of business.  The owner of a dental practice spends the entire day in deep concentration about serious clinical issues.  Totally exhausted he or she usually delegates all business matters to others.  

Meanwhile, there is a flow of cash, checks, and credit cards passing through the hands of ladies who are trying to contribute a second, or only, income to a very often strained household.  It is so easy in most offices to steal that it almost seems okay.  The condition of our society is that a thing is not wrong if you aren't caught.  Most dental offices have no way to detect a shortage...it is the honor system. 

Anyone who takes what does not belong to her is a thief and must answer for her transgressions; however, dentists make it so easy that otherwise honest ladies who are feeling a temporary strain are too easily tempted.  In hockey or basketball the dentist would get an assist.

The pattern is usually that a check is floated temporarily to solve a small financial problem; then the check cannot be covered so a small change is made on a deposit/account;  Then nobody notices; nothing happens; and it becomes too easy. Other needs arise, and the pattern is repeated. 

We have seen it in so many offices that we can recognize it almost immediately.  In an office in Texas the dentist's sister took $50,000 in less than a year.  In an office in the Midwest it was the best friend and fellow choir member of the dentist's wife who took $181,000 in a two year period.  These are extreme cases, but the pattern was the same.

The employee justifies her actions because she should have gotten a raise, she is unappreciated, the doctor makes too much money, she worked without overtime, the doctor was rude, unkind, sexist, etc. And dentists too often are snappish with the staff, avoid salary reviews, and even make inappropriate comments. 

The solution is not rocket science.  Check the deposit every day including each and every Day Sheet entry.  Do it that day while the details are fresh in your mind.  Every day there are temptations placed in front of otherwise honest employees that are too great in a society that regards material possessions above other values.  They are responsible for their actions, but the situations should never arise.

Those dentists who have someone else filtering their email may never see this tidbit.  And, I realize almost no one believes it. 

Good internal procedures and protocols, doctor leadership and reasonable attention to detail are essential.  Lots can be gained from our COOKBOOK.  For information on this or other subjects email, contact our website at http://www.WiseDentist.com  or call.

Sorry about the negative content of this week's tidbit.  Have a great second week of spring. I'll be eating egg salad sandwiches and  betting on a sure thing...the Wildcats.  At least I think both teams are Wildcats.

Hurston

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All Dentists Should Collect 98% of Production.

Lots of new patients, working longer hours, exotic new technologies, changing locations, more operatories, hiring associates, etc.  are the types of things dentists are always thinking about to improve their practices.  The cold, hard truth is that the average dentist could increase his or her personal income by more than 25% simply by handling collections appropriately.

And these are pure, net, take home dollars.  The statistics are that with absolutely no increase in production most dentists can return an additional $50,000+ in a $500,000 practice simply by setting up a good Financial Management (Payment and Collections) Protocol.

It is not rocket science and it does not require bullying tactics.  Total AR should not exceed 1.5 times an average month's production.  No more than 30% of this should be 90 days or more. Policies should be written, clearly understood by the entire staff, and properly explained to patients.  Some of the most incredible changes we have seen in dentists' financial positions have come from their simply being paid for their work just like everyone else.

Major details of the Payment and Collections Protocol are available in our COOKBOOK with sample Financial Policies for patients, explanations of insurance, collections letters, telephone techniques.  If you don't have these things already, this is a really cheap alternative.

Collections does not require heavy-handed action.  Simply communicate your policies to your patients, believe and enforce them yourself, and see that everyone in the office understands and adheres.  You did the work....you deserve to be paid.

For additional information see our website or email.

Have a great weekend and an even greater week at practice next week. 

Hurston, Wisdom Management Group

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Taxes!  You Should Pay Half as Much...Probably. 

FOR 1996:  Even for 1996 it is not too late to deduct every item that is deductible.  This will take some time on your part, but getting good tax advice...not just depending upon an accountant could reduce your taxes as much as twenty percent.  Remember, the greatest fear an accountant has is for his client to be audited by the SERVICE...even if this means that you pay more taxes than you should.  This does not mean that I am anti-accountant,  I have a degree in accounting myself.

FOR 1997+: You can designate an amount you need for retirement; set a date for beginning that retirement and contribute a large sum totally tax free.  The IRS will get their money later, and they probably expect taxes to increase not decrease...but you defer now.   You can take your property and put it in a living trust for your heirs to be distributed after your death; act as the executor with all heirs as members of the board of advisors earning a salary.  Huge reduction in taxes.  These are  not actions you should take without estate planning advise from your non-broker  advisor.  (I also am not anti-stock broker, but they earn by churning stocks and collecting commissions.)

Most dentists do not really have a budget like other business for their practices or personal requirements.  Consequently, there are many areas that are not planned to the best tax advantage.  For the future look into preparing a thorough budget for 1997 with a specific amount set up for retirement, vacations, etc.

And we must be honest with ourselves.  We are the enemy of the government when it comes to taxes.  Politicians want to raise taxes on the rich.  That sounds great until you realize the target is on your chest.  Their definition includes almost every dentist in America.  In general, their definition breaks at about 51% of the voters.  If you can afford a house and college for your children you are a target for raising taxes.  Whether right or wrong that is the arena we are playing in.  You must protect yourself, your practice, and your family from all predators including legal ones.

Our COOKBOOK (tax deductible), now available by Visa/MC, covers in detail the  budgeting, planning, and tracking process.  For more info email, fax, call, shout out the window, etc.  or

http://www.WiseDentist.com

Have a great week.  After all there isn't much you can do about 1996 taxes if you have all your deductions itemized.

Hurston Anderson

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The Doctor MUST Provide Leadership.  

"Lead, follow, or get out of the way".  At least that is what my football coach always said. Unfortunately, that won't work in your dental office.  You are the leader whether you want to be or not...both in the operatory and, for owners, in the business office.  The buck stops in your chair.

If the doctor is not the leader there will be anarchy, and/or he/she will find that someone else has become the de facto leader.  Having assisted in hundreds of offices, we have found that all successful practices are lead by the doctor (unless it is a spouse or parent...but these are extremely rare).

Beware, leadership is not tyrannical authoritarianism.  That is pushing, not leading.  The effort you get from employees in an authoritarian environment is non‑creative, rote work.  Dentistry is completely different from any other type of business because the owner is unavailable almost all of the time.  For your practice to prosper your staff must be creative and inspired.  You cannot be a traditional supervisor.  Supervisors are constant overseers.  In dentistry we must have thinking, motivated employees who can make decisions while we are occupied.  We cannot supervise, but we must lead through our vision, our behavior, our consistency, and our compassion.

Effective leadership is genuine and sincere.  And, even if you weren't President of the Student Body at school you can still be an excellent leader for your team. These are learned skills.  The concept of the born leader is overworked, and by and large inaccurate.

If you are concerned about your ability to provide effective leadership, do something about it.  It will not change unless you change it.  This is extremely serious.  A rudderless ship will never get to the right destination.  Our Practice Management Cookbook includes a section on this subject, and I am a firm supporter of the Dale Carnegie courses having completed several myself.

Have a great week.  The pollen is providing a nice yellowish tint on everything here, but the blooming flowers are our compensation.  Contact me if we can assist in any way.

Hurston Anderson, President

Wisdom Management Group

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Double Patient Treatment Acceptance. 

One of the most frustrating and costly problems dentists face is presenting a necessary treatment to a patient...and the patient refuses or delays treatment.  Most objections patients offer can be overcome by very patient-friendly, non-salesy discussion. We have to first be certain that we know their real concern. 

In a capitalistic country like ours people are daily inundated with advertising, sales pitches, etc. We all develop a natural reluctance to believe anyone trying to sell something.  Sometimes our patients believe we are trying to sell dentistry.

But dentistry  is one of the most trusted professions in society according to all the polls.  When a patient makes an appointment in a dental office he/she is showing a great deal of trust...and an understanding of the need for some sort of dental service.  There is already a bond of trust which we need to maintain.  This is why a dentist must appear always to the patients to be the doctor who is a professional.  Although, many dentists are comfortable with the staff and patient calling them by their first names, I think you need to be careful.  A patient is looking for a knowledgeable doctor to trust...it can subconsciously erode that relationship if the doctor is simply Billy or Steve, or whomever.  Many dentists have very successful practices in this casual environment, but I think you should be cautious.

An initial objection like "I really can't afford this now" may actually have nothing to  do with money. This is the most common objection to all spending by all consumers...by a long shot.  Yet in most cases, this will stop the dental office from pursuing the treatment even if it is necessary to the patient's health and ability to keep their teeth. 

You have a duty to your patients to help them  overcome their concerns, if they truly have dental work that is necessary.  A patient will object to a crown they really need for financially reasons while driving a brand new car.  The problem is not money.  The problem is their perception of value.  They simply don't believe it is worth borrowing from the credit union, using the Visa, delaying the vacation, buying the new car next month, etc.  We must educate on the need.

If you have diagnosed the case properly, and are convinced of the requirement for the treatment your honest sincerity is the most effective "technique" there is for assisting the patient over their reluctance. Conversely, if you or any of your staff believe that the treatment may be unnecessary, overpriced, etc., you will see acceptance of treatment fall dramatically.  Human beings have been bludgeoned by hype, sales spiels, etc.  There is a natural, healthy skepticism in all of us.

Presenting in a clear, sincere manner facts that you honestly believe is the most effective way to convince the patient to proceed.  If you still feel you need to brush up on some specific approaches for you and/or your staff, consider a course from a solid organization...or contact me and I will suggest some ideas.

You really can see your case acceptance reach almost 100%.  The main thing is to believe in your presentation, and sincerely try to help the patient overcome their objections.

Have a great week.  Let me know if we can ever be of assistance.

Hurston

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See Patients Only 3 1/2 Days a Week.

Most dentists  (and their patients) would be better off if they worked a schedule which included three full days of dentistry, one-half day for large (productive) cases,  and one-half day for staff preplanning.

Obviously, you could be sharper and more relaxed.   However, only a small percentage of dentists are following such a schedule.  They have discovered how to eliminate the wasted time through ideal scheduling, reduction/elimination of cancellations, and better teamwork/communication.

Before you leave this document in disgust you need to think about how much of a 4 1/2 or 5 day week is actually non‑productive.  Squeeze that wasted, frustrating, stressful time from your schedule and even 3 days is probably achievable.

The arithmetic is simple 3 1/2 days @$300/hour produces more than $36,000/month; 3 1/2 days @$400/hour is $48,000/month and 3 1/2 days @$500 is $60,000.  What are your fees for procedures that take an hour?  More than $300-$500 probably.  Add 33% for hygiene, too.

How do they do it?  Ideal scheduling specified by dr. and hyg, teamwork with smooth patient flow, incredible diligence to avoid cancellations/no shows well in advance,  profit sharing for excellence, weekly preplanning meetings to cover next week, short morning huddles to kick the day off right, etc.   All these are covered in detail in our Practice Management Cookbook.

A last admonition for the doctor.  If you are unwilling to huddle with the staff,  pre-plan your weeks, treatment plan, and provide overall leadership, you better have an incredibly winning personality or an enormous amount of luck.  Most of us don't have those advantages, but we can still have an extremely productive, stress-reduced, patient aware practice.

Have a great week.  Let us know if we can assist in any way.  More comments from all are appreciated.  I can even take the negative ones.  However, it is especially gratifying to hear such nice things about our COOKBOOK and Internet advisor service. Thanks

Hurston Anderson

Wisdom Management Group

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Six Steps to Successful Dental Office Management

Managing a dental practice sometimes seems extremely difficult.  And, there are specific challenges you will face that are unique to dentistry.  So often dental practice management is compared to medical practice management, but in reality there are very few similarities. 

Yet, there are some dentists who seem to know management secrets that others seem never to discover.  That may be true.  The fact is, there are some things which must be done for your dental practice to meet its potential.

DREAM.   You must know what you are trying to accomplish first.  What kind of practice do you want?  If you could have the perfect life, what would it be like? Visualize it and don't be distracted by today's realities. Write it down as a goal for yourself and as a Mission Statement for the practice.

PLAN.  Create a real, all inclusive budget for the financial needs to support your  dream and Mission.  Combine this with an Action Plan for acquiring clinical skills, business skills, etc. Put together a set of Action Steps to get you to your dream with checkpoints along the way.  Think it through carefully, discuss it with your spouse/close advisor, etc.  Write it down.

CARE.   Remind yourself why you chose dentistry...do it daily if necessary.  Try to recapture your passion.  Remember the needs of your patients, your staff, and your family.  We can become so discouraged and jaded that we lose sight of what is really important.

ACT.  Wake up every day with the idea of acting not reacting.  Put your Action Steps (Action Plan) into effect.

MONITOR. Make certain there are adequate means to see how your action is working.  Check daily production and collections.  Look at tomorrow's schedule today.  Talk to your staff enough in non‑stressful situations to discover if there are difficulties.  Give staff evaluations regularly...never combined with salary discussions.  Know where you really are without a doubt.

REVISIT.  No matter how well or how poorly you think things are going take time at least quarterly to analyze your situation.  This is different from monitoring your daily activity.  This is the type of revisiting that will help you make slight changes in course if your action plan is running into snags. No plan is perfect.  A reanalysis, even if everything looks great, will anticipate future challenges while you still have time to act.

These are very broad categories, but a successful practice (or other business) will do all these things.  Our COOKBOOK is organized in this fashion because our consulting practice has always worked with dentists in this fashion.

Happy Mother's Day.  I always am a bit melancholy on this day because my own mother who was the primary source of unconditional love in my life passed away a few years ago.  Cherish yours if she is still with you.  

Have a great week.    

Hurston Anderson

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750 Patients Should Be Enough.

One of the great concerns for many dentists is new patient flow.  Yet there are usually more than enough patients in the practice if they are receiving complete dental care.

HYPOTHETICAL CASE.

Suppose a doctor is satisfied with an annual income of $200,000.  This should be produced from 750 patients.  It is essential to have an excellent Hygiene Protocol, to do thorough exams, and to have a team that functions smoothly.

On six-month recall there should be a full hygiene schedule from 750 patients.  This full hygiene schedule should produce about $10,000-$13,000 month.  Hygiene produces 30-33% of total production.  Dr.’s production added to this full hygiene schedule should bring the total to $360,000-$520,000/year.  At 40% of production the Dr.’s income should be from $144,000- 208,000/year while working a 3 1/2 day week.

Of course, these are minimal income totals for a vast number of dentists, but some seem to struggle to achieve even less.  If the dentist does a thorough exam on each patient, it is statistically true that there is essential dental service required.  In truth, most dentists produce less from many more patients because the time scheduled for  exams is too short.  Patient churning and skimming the surface of treatment is the result.  This leaves many dental needs untreated. And, even if the dental need is diagnosed the patient does not proceed with extremely important treatment because we have not done our job in educating the patient.

When we are working day in and day out, the real issues can become so muddled with daily difficulties that we lose sight of the basics.  You don't have to have 5,000 patients of record and 75 new patients a month.  You can't really treat them properly anyway.  To really enjoy dentistry it is often better to see fewer patients for longer.  Properly organized this can be extremely satisfying professionally and financially.  I have personally seen this work hundreds of times.

It can seem so very complicated and overwhelming sometimes, but running a dental practice is not "rocket science".  Provide a comfortable office environment, treat patients as you want to be treated, give your patients the benefit of your dental knowledge by doing a thorough diagnosis, hire and maintain a caring, able support team, and stay positive about your chosen life's work.

Have a great week.  Call on us if we can help in any way.

Hurston Anderson

Wisdom Management Group

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Overhead % Monitors That Guarantee Success.

Happy Memorial Day.   We can thank all those who went before and gave their lives to defend our way of life for giving us a Monday off...plus a great country and better world.

Many people have asked me to amplify some of the vital statistics we have suggested in the Weekly Tidbits of info from our COOKBOOK over the past several months.  This week  is really an extract of information that was shared recently with an Internet consulting client.  It follows:

"In reference, to budgeting "rules of thumb" it is a bit dangerous (although I have done so in other tidbits) to quote specific #'s without detailed information about what type of practice, community, care you have.

Be that as it may, we use the following for general dentistry before looking into the details.

Staff expenses (including EVERYTHING...uniforms, taxes, ins., ETC.)                              20%-23%

Lab Costs (heavy restorative higher; endo, ortho, perio lower)                                      10%-12%

Dental Supplies (all production items)                                                                          6%-8%

Office Supplies (admin. computers included)                                                                 4%-5%

Facilities (include janitorial, utilities, taxes, etc.)                                                           5%-7%

Minor Expenses (misnomer? includes bank charges, acct., consult, misc.)                           5%-7%

Promotional (newsletters, flowers for referrals, etc.)                                                      .5%-1%

Discretionary Expenses (Purchases like intraoral, x-rays, etc.)                                          5%-7%

Owner's Compensation (Everything including toilet paper from Sam's, cars, family salaries not really earned, vacations as CE, etc.)

(This is not for the IRS. This is for your own use, only.)                                              40%

Remember, a doctor may make specific decisions which may reduce his own income for the benefit of a better working environment.  Lots of times things get lumped into office overhead perfectly acceptably for the IRS that are really for the benefit of the doctor's reducing his stress.   This might include higher salaries, discretionary expenses, etc.  Your working budget is not an IRS document.  Also, sharing facilities with another dentist can lower overhead...however, this benefit sometimes (usually) raises irritation level.

This is, as I stated above, only a "rule of thumb".  To hone these we would normally complete the budgeting exercise and discuss the details with the doctor of what his/her mission is for the practice and life.  Very often we need to begin planning for retirement.  That is another whole area of concern for which we have a husband/wife retreat in a resort area (Hot Springs, St. Pete, NC, CO) with a small group of dentists.  We meet Thursday/Friday with the weekend available for personal  vacation time (deductible)."

Have a great week.  I hope the previous few paragraphs extracted from an email to a client has value.  Let me know if we can ever be of assistance.

Hurston  

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Monitoring with Statistics Alone Is Not Enough.

Over the past few weeks we have been passing along some percentages  that are good "rules of thumb" for managing a dental practice successfully.  However, there is more...much more involved in a healthy and satisfying practice than the numbers.

You must have a reason to be practicing, set realistic goals, monitor your progress, and make changes where required.

The following is paraphrased from the PREFACE to the Practice Management Cookbook.   Besides the numbers I believe that there are also inviolable truths which we must all face.

TRUTH #1 - You cannot be successful by doing poor quality dentistry.

TRUTH #2 - If you manage employees harshly, if you become involved personally,  and if you harass or otherwise intimidate employees,  your practice will suffer great, if not  terminal,  damage.  LETS BE DIRECT.  Don't berate them.  If they are doing a bad job, replace them.  Don't have affairs with them.  If you cannot resist a particular employee, wait until they are working elsewhere.  Sexual harassment and/or physical harassment are illegal, and you will ruin your practice.

 

TRUTH #3 - Some sort of a budget must be in place.  You cannot operate a business including a dental practice from the checkbook.

TRUTH #4 - Fees are less important to practice growth than any other element of dentistry.  You cannot buy good patients by attractive fees.  Patients who are shopping fees will go to the next low-priced alternative.  Your practice will succeed on long relationships with patients and families.

TRUTH #5 - You must be fair with your pricing.  If you gouge in pricing, you will get a reputation that you can never overcome."

This extract  includes some basic philosophies.  In general, successful practices are built and maintained by working hard, treating patients and employees with respect, maintain good clinical skills, and watching the details.

Have a great week.  Let us know if we can assist in any way.  Also, let us know if you would like to be removed from the group who are receiving these free Weekly Tidbits .

Hurston

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Is Your Retirement Plan on Track? None??

No matter what your age  you must begin to plan for retirement NOW.  It is simple...the type of lifestyle generally associated with professionals like dentists could never be supported by government retirement funds.  And the US Social Security system will be bankrupt in 2019 for everyone.  Maybe some political courage will be found eventually, but it won't help dentists.  At best indigent individuals may be assisted by raising retirement ages to 70 or 72.

You must begin now, and you can do so quite easily.  This tidbit cannot cover the subject thoroughly.  You really need to seek a good estate planner or financial consultant and look at your options.  (NOT a stockbroker,  you don't need risky investments.  There are many, many seventy-year-old dentists still practicing because of their investments.  By  choice...this is okay...by necessity...this is a shame. Please no complaints about stockbroker bashing,  after retirement is taken care of, investments are great .  My problem is that they get paid just as much if I lose as if I win. )   Back to retirement, there  are tax advantages to setting up specific contributions for a specific payoff later, at a  specified time.

First, you must know where you are.  Amazingly, more than half the dentists in North America operate without a good budget or any idea of how they are doing until after the fact. Some very simple steps can help.  But they are often uncomfortable actions  for dentists.

Almost all dentists have to be careful about being inconsistent with financial rules (not only too loose, but too rigid), about not wanting to deal with the day-to-day business, and about not planning ahead.  The personality traits that give you the inner motivation to become a dentist usually are in conflict with the necessities of business management.

Continuing to do the same thing day after day, and expecting the results to be different is self delusion.  For things to change, YOU must make a change.

Have a great weekend.  If we can help in any way feel free to call on us.

Hurston Anderson

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Maslow, Self-Actualization...Is this Relevant?  

Last week my tidbit included a statement that generated quite a few comments.  The particular sentence was 

 "The personality traits that give you the inner motivation to become a dentist usually are in conflict with the necessities of business management."

I have been asked to expound on this, and I thought this would be a good time to do so.  An extract of my recent email to those wanting explanation follows.  It is mainly opinion based upon a great deal of observation, but it's probably at least worth what it's costing you. 

"I think almost all who are attracted to dentistry as a profession are at heart, and primarily, care giving personalities.  I do not remember all my Sophomore Philosophy, but I remember a bit about Abraham Maslow's theory of man's motivations differing. 

Dentists are care givers first and businessmen second...or last...or not at all.

A rare few are comfortable looking at dentistry as a small business.  These few often are in other businesses on the side too, because the income potential from dentistry is good, but limited in a single practice.  So these folks are part-time or wannabe pizza men, video store owners, real estate promoters, etc. 

After spending most of my life in the business world outside dentistry, I can assure you that almost no successful businessmen are care givers as their first priority.  I will defend them, and me, by saying that they are much more honest and forthright than depicted in a biased media...but you don't get promoted in industry for your humanity so much as for your profitability. 

I really admire the motivation of most dentists.  My own background has been business, but my father and most of my extended family are teachers and "men of the cloth"... caring, and concerned about helping mankind.  I see that in most dedicated dentists.

That is why it is so sad to see them become discouraged with dentistry when it is not DENTISTRY really that is the problem.  It is the BUSINESS of dentistry.

My wife and I run a moderately-sized nationwide practice management organization with a few hand-picked associates.  Our emphasis has not been the dentist who is interested in making a financial killing, but the dedicated practitioner.  We really enjoy the successes we see in our clients, because they deserve it so much because they give so much themselves.  To see great human beings become debt free, fund their pensions, schedule and take vacations regularly, etc. is terrific. 

Although I built several rather successful companies, I quit trying to  become the next Bill Gates or  Ross Perot  several years ago.  It stopped seeming worthwhile just to make money and attain business status.  This is much more fulfilling, and provides a fair income while actually helping others.  Just like dentistry you'll never get rich, but most dentists are not attracted to dentistry for the money either...they are care givers. 

My belief is that it will never be comfortable for many dentists to be managers and businessmen, although there is some necessity for this in running a dental practice.  However, it is possible without sacrificing or compromising core beliefs to manage a successful and financially rewarding dental practice.  Establishing protocols, systems, and procedures that help the practice to run itself can be a great stress reducer.  Managing by instinct is not possible for many dentists...and this causes them great stress and conflict."

Have a great week, and take it easy on me for this one.  I did say it is just my opinion.

Hurston Anderson 

PS: Even as modest a project as our Practice Management Cookbook helps reduce some of the stress of the business side by providing protocols, tried and true techniques, systems, samples, etc.

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