14 Habits of Successful Dental Practice Owners
In our collective experience, there are a number of habits that are common among financially successful practice owners.
They treat their practice like a business, because it is one
Realize that you are the CEO. Delegate what you can to employees and vendors but monitor and hold them accountable. Remember the buck stops with you. If a team member fails, that’s your failure, at least as far as patients are concerned. You’re the leader and a coach. If you’re not naturally inclined, get educated on what great leaders do to inspire performance.
They like numbers
Production numbers, financial statements, invoices, ratios – successful practice owners watch, create, and analyze all the key numbers in their practices. Don’t be afraid of money or asking questions of your vendors and employees. Look for key productivity ratios like hygiene efficiency and capacity. Hygiene is the primary driver of casework in a general practitioner’s office.
They hold people accountable
Accountability means you and your team create goals (e.g., daily production by person), agree on the goals with team, gather data, and then communicate back to team how they did.
They communicate with team
Morning huddle, every morning. That sets the tone, the energy, and the goals for the day. Have a monthly team lunch meeting to review results, set goals, and acknowledge great work. Also have an extended team lunch or off-site meeting once a quarter or at least annually. Show them you care and it will come back to you multiple times over.
They incentivize the team when goals are exceeded
If the team exceed their goals, they should share in the rewards. Having a well-defined, intuitive incentive plan grows the pie for everyone.
They dig into details, but not all the time
Mark Cuban and Mark Zuckerberg started their software careers by coding. They intimately knew the product they were building and were better managers and problem solvers for it. No one went to dental school to learn about dental insurance, and dental schools don’t teach business. But insurance is part of your business, so you should get very familiar with it…otherwise it can become a black hole of lost revenue. I just heard a story of one doctor who discovered after 17 years that a team member had been miscoding insurance billings to the tune of $50,000 per year. That’s $850,000 of lost income. It matters.
Successful practices must market internally and externally. For example: You worked hard at your education and training, so tell people about it. Put an information sheet in the office about your background, education, and accomplishments. Same for key team members. Patients like to read that—it gives them confidence. Put it on the website as well. Patients chose you based on trust—help build it. Successful practices ask patients to review them on Yelp, Google, and Facebook. Yelp is probably the number one referral source for someone seeking a new dentist, aside from word of mouth. Assign social media management to someone in your office and manage your online image. If you’re a specialist, you know you have to network with referral sources and in the community. Measure what works – keep track of what marketing sources are working and which are not. Channel your effort and spending accordingly.
They learn how to sell
Most of us have never honed our sales skills because they were never thrown into that role. But the neurolinguistics and behavioral observation of selling are something that can be practiced and learned. Many consultants and programs can teach you how to do just that.
They create systems and scripts
Speaking of neurolinguistics, build scripts for the most common conversations your front office and back office team encounter. Start with the most common questions or highest revenue potential items. Getting a strong script in place helps your team sound confident to patients.
They empower the team
Toyota was famous for its “andon” cord, an emergency shutoff switch that any assembly line worker could pull to stop production to fix manufacturing quality issues. (It’s now a button, but same concept). Contrast that to the GM method of letting defective cars roll to completion and then retroactively repairing them in a giant parking lot. Each worker is given guidelines to work within, but within those guidelines, they can make decisions.
They have a Mission Statement for their office
It’s cliché, but create a Mission Statement that can be a guiding hand when an empowered team member is making a decision in the unique situations that come up in an office every day.
They make goals for the future
Do you want to retire, teach, travel, volunteer, but a home, start a family, buy additional practices? When? Set dates. If it’s not on a calendar, it probably won’t happen. A calendar date allows you to work backward in time to plan the steps needed to reach the goal.
They have a long-term plan to reach those goals
At what age do you plan to retire? How much money do you need to retire? How much do you need to put away each year to get there? How much does the practice need to earn to put that amount away each month? Should you pay off student loans, buy a house, or buy a practice first? What happens to your income and family if you pass away prematurely or are disabled? Answering these questions requires planning with your financial planner and an estate attorney. Start young—investing early allows time for your investments to grow.
They listen and learn
Great business owners attend seminars, listen to podcasts like “Dentalpreneur”, are constantly reading business and industry books and publications, and socialize with colleagues to learn about new techniques and opportunities. They also rely on trustworthy financial advisers and operational consultants to improve. Not every event or adviser will be fruitful, but you’ll quickly learn which ones propel you to success.
Greg Maravilla, CPA, PracticeCFO