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Profit Sharing in the Dental Practice

Profit sharing is a great model that drives profit to the business and inspires employees to perform effectively. In a nutshell, it is when a company contributes part of its profits into a pool that is distributed among eligible employees. It can be dependent on salary, hours, and can even be used as a supplement to an existing benefit plan. How you choose to do profit sharing in your practice can go in many different directions and needs to be what suits you and your team best.

Very often dentists feel compelled to give raises or bonuses to their employees, but doing so without any growth means they end up taking the money out of their own pockets. Ever had a year when your production was down, yet you still gave your staff an end of year bonus? Many dentists feel obligated to continue these practices, simply because the staff expects it. Since staff compensation is the highest overhead expense of the practice, it pays to pay wisely. Dentists typically lack a system for determining pay increases. Instead they pull figures out of a hat, often at the expense of their own compensation.

Start by looking at annual revenue and profit growth in the practice, set a benchmark on your break even, and be open to sharing this with your team. It is important that your team understands how profitability plays such an important role in business ownership. Have conversations with them about the overall health of the business and together come up with a profit margin. It’s okay for them to understand that the doctor makes more than the employees, after all, you provide them with a job.

Staff raises and bonuses should be based on increased revenue growth and profits. If the practice has no revenue or profit growth, it might be wise to delay raises. Boundaries should be placed for re-evaluation every year, you cannot pay out when you do less, and team members should know upfront that raises or bonuses are dependent upon the practice meeting or exceeding projected revenue and profit goals. This gives the employees ‘skin in the game’ and enables them to have control over their own compensation. Keep in mind, it is the Doctor’s responsibility to help the staff recognize their overall contribution to the practice`s goals that affect their salaries.

The positive impact of profit sharing is that it gives all of the employees the sense that they are working together on the same team. The employees then have the same goals and are rewarded equally. This, in turn, is passed on to the patients by enhancing the overall patient experience in the practice. Employees who know that they will receive financial rewards if the company does well are more likely to be motivated to help the company succeed because they have a vested interest in the company’s success.

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Dental Team Conflict

Conflicts amongst team members and with managers often are the leading cause of why many staff end up leaving their jobs. Not to mention that, the loss of a staff member can have serious ramifications for your practice. In fact, research indicates that frequent turnover has a negative impact on employee morale, productivity, and company revenue because recruiting and training a new employee requires staff time and additional money. The cost of employee turnover alone is reason enough to ensure you’re prepared for inner office conflict when it arises, and conflict is generally considered to be inevitable so there’s no avoiding it, it will occur.

Believe it or not, leadership and conflict go hand-in-hand and if you are not willing to address conflict in a healthy, productive fashion, your leadership role could be in jeopardy. While you may try to avoid conflict, you cannot escape it because it will find you whether you look for it or not. Conflict rarely resolves itself, in fact, it normally escalates if it’s not dealt with proactively and properly. It is not uncommon to see what could have been a non-event become a massive problem if it is not resolved early on. Leaders who don’t deal with conflict will eventually watch their good talent walk out the door in search of a healthier work environment. While conflict is a normal part of any social and professional setting, the challenge of it lies in how we choose to deal with it. Thus, developing effective conflict resolution skill sets are essential to being a great leader and building a sustainable work environment.

There can be many underlying motives of conflict, such as performance issues, power struggles, compensation concerns, or just the fact that someone is simply having a bad day. The list can go on and on, but if we focus in on what the true problem is, there are really only two major causes of conflict – poor communication and not being able to control one’s emotions. Being able to recognize these causes will serve you well as the leader of your team. Knowing that a conflict exists, while being able to identify the nature of the problem, and then having the ability to bring it to a swift and just resolution is an opportunity for positive change, growth, and improvement.

Here are some strategies to help maximize your ability to smooth over any stumbling blocks you may encounter within your practice:

  • Focus on behavior and events, not on personalities.

Describe specific instances instead of generalizing. Say “When this happens …” instead of “When you do …”.

  • Listen carefully.

Actively listen to both parties, avoid interrupting, and ask questions to clarify your understanding. Put yourself in their position to get a true sense of what has motivated the issue.

  • Talk it out.

Ask the people involved to name a time when it would be convenient to meet and arrange to meet in a place where you won’t be interrupted.

  • Develop a plan.

 Discuss which areas of conflict are most important to resolve and start with the most important issue. Focus on moving forward and set up future meeting times to continue your discussions.

  • Don’t avoid conflict.

Address it head-on before it escalates.

  • Stick to the facts.

It’s sometimes not possible to resolve a conflict, so it’s crucial to stick to the facts and ensure that no personal feelings or agendas enter into the equation.

  • Focus on the lesson.

What would you do differently next time? What can you learn from this particular situation? How can the business benefit from the issues raised?

  • Communicate your business values.

Leading by example, sharing your ‘why’ you do what you do, and stating your expectations will help you to recruit and retain like-minded employees.

  • Create positive employee relations.

Happy employees will make your practice flourish! Treat all staff fairly, with dignity, respect, and transparency.

As the leader, if you employ these strategies with sincerity, you can overcome the immediate tension and move the communication toward a more productive phase. Congratulate everyone involved when progress is made, even if it’s just a small step. Your hard work will pay off when discussions eventually will give way to ongoing, friendly relationships.

There’s no way to avoid conflict altogether, but if you are capable of carefully directing and resolving the friction, you’ll find you can improve progress for yourself, your staff, and the overall practice. In turn, your business will thrive and together as a team you will all deliver the results you aim for.

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Spouses in the Dental Practice

The topic concerning the realities of having a spouse working by your side in the dental office can be a difficult conversation to have. Opinions about the conveniences and drawbacks with this type of agreement vary considerably and seem to generally be based on the quality of the marriage partnership along with the personalities, competence, mindset, and dedication of everyone on the team.

There are many excellent tips to help guide a spousal business partnership in the right direction. For starters, do not take business issues personally, always have confidence in one another’s abilities, and keep in mind that there is a progression that occurs as a business relationship matures. The success of a dental spouse team is primarily dependent on whether or not they have a solid relationship, generally get along, enjoy being around each other often, are team oriented, have the same values and goals, have great communication, and have clear rules about one another’s roles in the practice. Some positive aspects that can be derived from these types of situations are: having the spouse serve as a cushion between the staff and the dentist; each person understands and appreciates the hard work and the stresses of the other; and the combined help allows for improved function of the practice and even extra down time for the doctor.

Some employees’ opinions are that having two bosses in a practice creates distraction, frustration, and animosity for staff when there are conflicts or differences within the office. Employee pushback can be expected, that’s why it is imperative that the dentist support his or her spouse. It is best for dental teams to open their minds to how they think about the spouse in the office. As employees may have a cynical conclusion about the spouse’s role, many dentists discuss the positivity and financial benefits of being able to trust their spouse/business partner more than any other employee when it comes to protecting the best interests of the business and having the patients’ best interest at heart.

It is greatly beneficial to do your best to separate work from home life. This means not “taking work home with you”, and even more importantly not bringing marital conflict into the office. Even couples who are very good at working through their problems, trust each other, and are always well-intentioned still find it difficult at times to “leave it at home”. Many times, doctors consult their spouses for advice, especially if they have a history of struggling. Sooner or later they reach a point where almost everything must be okayed by the spouse first. Typically, this is the beginnings of a business being out of control (business running the doctor), ultimately caused by a doctor not taking responsibility for their career and using their spouse’s shoulder to cry on more often than is really needed. Over time, this can decrease a spouse’s respect for the doctor, confidence in them, and even reduce physical attraction. This is why keeping your home life separate from your office life makes sense and is good dental practice advice. When you need to talk to someone about struggles you are having, talk with an adviser, a close friend, or another dentist you know and trust rather sharing your issues with your spouse.

Essentially, being “in” the office really means working “on” the business. Whether physically present in the office or as a supportive role from outside, the structure will depend on what the business needs are and what the spouse and doctor have agreed upon. Focusing on the business and business philosophy will help a spousal team to think about what they are doing and why they are doing it. Plan the business with intention, keeping in mind that being reactive is depleting, but being proactive is exhilarating.

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Do you NEED Marketing?

Many offices come to us asking for a “marketing plan”. You may hear them say things like “I need more patients” and “I want to do more implants”. This may be one of my favorite moments when talking to doctors because I get to challenge most of them on a totally different level.

Yes, you may in fact need a marketing plan; however, we find more times then not an offices primary needs in this area has nothing to do with a need for marketing rather a need to focus on case acceptance and their retention rate. Let’s consider the following for a moment, if every single patient that you presented ideal treatment to said yes, would you need a marketing plan or would you have so much work to do you would not know what to do? If you retained a healthy static on patients returning when they should for what has been diagnosed or for any healthy re care would you have less of a need for a “marketing plan”?

There are a lot of things that go into feeding the pipeline of business into a dental office and what we typically find is that marketing ends up to be one of the last things we need to focus on. I think you would be surprised to find that most offices have the patients they need in their practices already in order to have a thriving practice, they just are not getting as many people to say “yes” as they need to. Who are you talking to when it comes to this? What data are you pulling? It’s all at your fingertips, we just need to start to dive in.

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Road Blocking Your Doctor With Hygiene Checks

Have you ever played the ‘hurry up and wait game?’ Typically, when I ask this question to hygienists they furiously nod their heads and proceed to share that one of the biggest challenges for them and their Dr’s is in hygiene checks. Often times the hygienist and the patient are waiting on the Dr who is knee deep in a patient procedure they cannot step away from. Then the doctor feels stressed and rushed as the schedule starts to get behind. When this starts first thing in the morning it can be very challenging to get back on track.

Traditionally hygiene tends to do Dr exams at the end of the appointment which can create traffic jams throughout the day. Dr’s, what if I shared with you a more efficient method that empowers your hygiene team, increases patient communication and acceptance of treatment, and eliminates scheduling road blocks?  If you are ready to remove those hygiene traffic jams from your schedule there are three key areas to address. These will delight your hygienists and patients as well as alleviate stress!

Follow these 3 key points:

  1. Time management. Can you and your hygienists explain step by step what is done during the patient’s recall visit? Consistency is key ensuring a wow factor experience along with time management skills. By incorporating the hygiene time grid (see pie graph below) you and your team can anticipate when you will be needed for exams and start working around that accordingly. Notice that all needed info and diagnostics are taken within the first 15-20 minutes of the appointment so that the Dr may come in to do an exam at any time afterwards versus waiting until the very end when the clock is ticking.
  2. Communication with the patient and each other. At AMP we teach hygienists how to pre-heat patients prior to Dr exams thus eliminating how much time the Dr needs in the room answering questions or explaining treatment. The most powerful tool you can hand your hygiene team is in using intra-oral cameras on every patient every time. Like the old saying goes, a picture truly is worth 1,000 words!
  3. Handoffs. Do you and your hygienist do this at the start and end of your examinations? A brief summary of findings, concerns, and celebrations of what the patient is doing well create value and reinforce patient loyalty.

Follow the above three points and watch how your hygiene department transforms. This is sure to put a smile on everyone’s face- even yours! We love to hear your celebrations and help you through any challenges. Emails us at: [email protected]  so we can guide you through this process and keep you on the road of success!

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Incremental Revenue – Understanding the Numbers

Incremental Revenue is easily misunderstood. What if we told you that in 3 Years You’ll have $823,600 in Your Bank Account!

Now, would an extra $120,000 in growth really help you? Especially if you have to pay someone like the AMP team to accomplish it. This thought is totally fair and legitimate.

Here is the challenge, many react to it emotionally and not mathematically. So let’s dig into the math and find out.

Misconceptions First!

Many know that there overhead runs somewhere around 65% or maybe higher. Thus they assume, if you grow me only $120,000 and I have to pay overhead and your fees, there is nothing left for me.

This thinking looks something like this:

$120,000 in growth
less 65% overhead x65%
_______________
leaves in profit $42,000
less a consulting fee leaves nothing for me!!

Reality!! Reality!! Reality!!

Here is why this is flawed thinking. If you grow $120,000, will your rent, electricity, payroll and other fixed expenses change? No is the answer. Will your overhead increase in some areas, absolutely yes. It is called your variable overhead. This is composed of supplies, lab fees, and credit card fees. All in these total 15-20% of your incremental growth. So let’s use the high end of this can calculate how $120K in growth could impact your practice.

$120,000 in growth
less 20% in variable expenses x20%
_______________
$96,000
less the consulting fee of $50K -$50,000
______________

Incremental profit in year 1 $46,000 more in your bank account

Here is where this gets fun, what if you simply maintain your new level of productivity and do nothing else??

Year 2 Incremental Profit $96,000
Year 3 Incremental Profit $96,000
______________

Total 3 Year Incremental Profits $238,000 more in your bank account

This is all based of of your doing only $120,000 in growth. What if you met our average of $364,000 in growth? How much would you have in the bank at the end of 3 years?

$364,000 in growth
less 20% in variable expenses x20%
________________
$291,200
less a consulting fee -$50,000

Incremental profit in year 1 $241,200
Incremental profit in year 2 $291,200
Incremental profit in year 3 $291,200

Total 3 Year Incremental Profit $823,600

When looking at the longer term outcome of getting help, this nearly a MILLON DOLLAR decision for you. What would you do if you could pay down your debt, invest in your retirement almost a million dollars in the next 3 years. How much would that help.

We hope you fully understand his math, if you don’t, please contact us to discuss it. If we are wrong, please tell us how. We have seen this in reality many times.

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Is Your Hygiene Department Producing

How do you know if your hygiene department is successful from a profit stand point?  This may be one of the most commonly asked questions we come across as dental coaches.  The good thing is your hygiene department can become a profit center of your practice if managed properly. 

One of the key factors to remember when it comes to making sure that your hygiene department is successful from a profit stand point is making sure that it is run on proper systems.  For example; Hygienist will learn how to follow a clock grid for appointments allowing time to not only do what needs to be done clinically but also build relationships with patients. They’ll use scaling time more effectively, they’ll take all of the proper diagnostics in the appropriate amount of time and lastly discuss treatment needs with patients and how to address periodontal disease in the most effect manor. 

Once these systems are in place you will be amazed at how quickly patients accept either the restorative work that is addressed, cosmetics that are brought up or accept the periodontal disease that is diagnosed. 

Not only will you find yourself with the need to block schedule time for highly productive perio procedures you will also be scheduling much more restorative work as well. 

This is just the tip of the iceberg with it comes to this topic.  Always remember, your hygiene team is trained clinical professionals and when they have the systems that are needed for them to flourish and you as a doctor allow them to do the work they were trained to do you will see a whole new division to your practice.

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Leave the Baggage at the Door

Somedays our personal baggage feels heavier than others and it sure can weigh you down. Have you ever stopped to reflect upon how that baggage effects your ability to serve others whether at home or work? What about those around you- your significant other, your kids, your patients, and co-workers? Is it possible that in our society it has almost become a culture norm to carry those bags everywhere you go?

I’d like to share a recent experience I had at an established dental practice in Mississippi. The lady up front did not know who I was nor that I was there to meet with the Doctor. Yet within 30 seconds of walking into the reception area she unloaded her life story on me and my colleague along with 2 elderly patients waiting to go back for treatment. Before I share the details please hear my heart loud and clear- this was a scream for help from an overwhelmed employee drowning in heavy baggage with no where to put it down and as a dental coach this is certainly an area of expertise where we can help. The concern here is that work is not a healthy outlet to voice such frustrations such as her being a single mom, recently moving, and being involved in a hit and run.

Five minutes after I walked into this practice and awkwardly sat in silence while she continued to rattle away her list of life problems I realized I knew this gal’s life story yet I didn’t even know her name nor did she know mine. As she loudly shared that she told her attorney she was “out for blood” I started to imagine I was one of those cartoon characters who could slide out of their chair, slink down onto the floor, and slowly back away. Then it hit me like a ton of bricks- if I as a dental insider felt this way how were the patients feeling? What if one of those patients is already fearful of being at the dentist office does this put them at ease and give them a reason to come back? What if the gentleman sitting across from me was a new patient; what kind of first impression does that make? What are the chances of the rest of the team being set up to connect or fail based upon the stage set by the front desk?

Ever heard of the butterfly effect? We see it all the time in practices and it can truly make or break a person’s day. I’d like to share a few go to’s in how to address those dreaded bags. The first step in moving forward is not so much leaving the bags at the door as it is learning how to make them lighter. That’s where AMP comes into play with one on one coaching and guidance on health outlets to use when needed. Our unique focus on mindset coaching sets you and your employees up for transformational days whether for self or others.

We have the pleasure of gifting your practice with state management tools that they can always carry with them. We have found that when someone gets overwhelmed, such as the example of the front desk lady above, there is an automatic fight or flight response that takes place in the brain. This automatic response in the amygdala cannot distinguish between a real threat and a perceived threat meaning the response triggered is a false alarm. Once this occurs it can be challenging to take a step back for perspective much less manage one’s thoughts or feelings. Therefore, it is essential to shift the blood flow from the amygdala back to the prefrontal cortex in order to make better decisions.

There are 3 key points to focus on in order to do so:

  1. Change your physical state through movement.
  2. Change your focus.
  3. Change your language.

Our most successful clients know these techniques well, what is behind them, and why they work. It is not uncommon to get a text mid-day from one of our clients sharing they are challenged with something internally or externally of the practice and shifting the way they respond by taking a brisk walk or doing push-ups or jumping jacks. This first line of defense is the quickest and easiest way to break out of the fight or flight state. While it may feel uncomfortable or perhaps even silly at first once this becomes a go to utilized technique we typically then see profound personal and professional growth resulting in long lasting change. My challenge to you is in being aware of how you and your team affect one another and those around you at work and home and then utilize change through physical movement to get a different outcome. You never know, all those walks and push ups may have your significant other thanking us later too!

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How Effective is Your Morning Huddle?

A morning huddle can be the single most important meeting that you can have with your team because it encourages efficiency and high performance within your practice. It sets you on the right path, helps everyone to avoid obstacles, and sets the tone to deliver high quality care. The key lies in the purpose of the team huddle. A good huddle reviews the previous day and current days schedule, identifies problems, and determines the course of action for unexpected issues. Often, many surprises can happen in a practice, which can create frustration and stress, use your morning huddle to avoid these curveballs.

So how can you make your morning huddle outstanding and highly effective for your patients and your team? Here are a few things you need to consider if you want to run the most effective morning huddle.

Your goal is to check in with team members about what your day should look like, how you can improve, and how everyone can help one another be successful. An effective morning huddle is a chance for your team members to share information with each other and arrive on the same page for the day. The doctor should be present for the entire huddle because he/she is the leader in the practice and thus can set the tone for the entire day. It is also essential that all team members participate, staying mindful that a positive attitude and ‘can-do’ work ethic are essential to a successful huddle. 

Keep the huddle short and to the point. Keeping in mind that the purpose of the team huddle is to engage with your team. It is so that team members can communicate with each other, pull together and know what is going on with each patient for the day. The shorter your team huddle, the better. Keep it under 15 minutes, but also allow each team member to touch on all the points you’ve decided to include in the meeting. If the practice sees their first patient at 8am, the huddle should start around 7:40, ending at least five minutes before the first patient appointment.

Find a good time that works for everyone on the team. It’s best to have a regularly scheduled meeting time and a dedicated meeting place that is already set up and ready for action. All team members should be present and involved in the morning huddle. Vocalizing patient updates and information in front of the whole team will lead to greater commitment and accountability from each team member.

Here are some ideas of what to share during the huddle:

  • Upcoming appointments
  • Doctor schedule
  • Openings
  • Daily production numbers (previous day and current day)
  • Hygiene and Doctor chair opportunities
  • List of new patients
  • Emergency patients and available openings
  • Referrals
  • Family members without appointments
  • Hygiene schedule
  • Repeat no-shows, cancellations, and late patients
  • Patient medical alerts
  • Personal patient details
  • Unaccepted treatments
  • Upcoming appointments, lab cases, and materials
  • Billing, balances, and copays
  • What went well yesterday and what can we do better

Review your morning huddle process regularly to ensure that it’s still fulfilling your team’s needs. After a while, you might find that as your practice and team have evolved and you may want to add new things you’d like to communicate during your huddle.

When your morning huddle breaks, everyone will know exactly what needs to be done today in order to provide a positive patient experience and a healthy work environment.

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How Much Do You Know About Your Practices Cash Flow

After being in the dental field for sixteen years and working with offices on the exact topic of cashflow I have come to the conclusion that this is one of the most critical things to understand in your office on a daily basis.  Lets start with understanding what cashflow actually is.  In basic terms cash flow is the difference between the money generated by a business and the cost to run the business.

Lets do some quick math. If you collect 150k a month over a 20 year long career you are looking at operating a business that will see 36 million dollars pass though the doors.  Or, if you collect 75k a month over a 20 year long career you are looking at operating a business that will see 18 million pass through the doors.  So, no matter what size practice you have you will see a tremendous amount of money come and go and knowing how to manage your cashflow properly needs to be a priority.

Keep in mind, even if you do not have cash flow problems today, it does not mean that you could not in the future.

Why I appreciate AMP so much and our approach on this subject is that we do not only focus on the areas of your practice where you can improve cashflow we then help you manage what can be done with the increased cashflow to see profit also increase. 

All of the coaches at AMP have unfortunately seen offices that wait way to long to address this critical topic and then ending is not always pretty.  I would strongly encourage anyone who is starting in this field to work with someone that understands this aspect of your business so your story ends the best way possible.