Strategies for developing successful associate relationships

Oct. 1, 2002
Behavioral issues are critical to establishing and maintaining long-term relationships with associates.

by Lloyd N. Hollander, DDS, PhD

Why is it that so many relationships with associates fail? What can be done to increase the probability of success?

Most articles focus on the financial success of associate relationships. This article deals with the behavioral issues that are critical to establishing and maintaining long-term relationships. The primary cause of failure in these relationships is conflicting values. It is important to recognize that financial matters can be negotiated to points of mutual agreement; however, personal values, integrity, skills, and morals cannot be negotiated or changed easily. Hopefully the real-world examples below can help you map your own path toward a lasting, successful relationship with a dental associate. The term Doctor A refers to a senior dentist in search of an associate. Doctor B refers to a potential associate seeking a partnership with a more established dentist.

Getting started

Any dentist seeking a relationship — whether the senior partner or the less-experienced dentist — must begin by asking this basic question: What are my short- and long-term personal and professional goals?

The personal and professional values of dentists are as varied as the individuals concerned. If you are Doctor A, your primary goal might be the luxury of performing only the most challenging restorative dentistry or a graceful transition into retirement. If you are Doctor B, your primary goal might be a stabilizing income to pay off dental school debts or securing a mentor who can nurture professional development. Whatever your goals, what matters is that you take the time to identify them to determine whether a relationship with an associate is truly the best method for achieving those goals.

An effective method of accomplishing this is to list in two separate columns what you perceive to be the benefits and the negatives of an association with a particular person. There is a distinct advantage in putting this list in writing and then spending time carefully looking at the pros and cons.

Analyzing and evaluating

Here are the primary reasons why most dentists consider entering into an associate relationship:

•To relieve workload pressures. Dentists establish an association to increase efficiency, only to discover that the workload is not sufficient to justify two practitioners. Being "too busy" is frequently the result of being unorganized or not scheduling appointments efficiently.

Here is a typical scenario. Doctor A hires Doctor B to relieve a heavy workload. Doctor A immediately begins to shift his less remunerative work, emergencies, and problem patients to Doctor B. Soon, Doctor A realizes that his heavy workload was more an illusion than reality. With this imbalance in the work distribution, Doctor B has neither the opportunity nor the incentive to help the business grow. As the associate relationship reduces Doctor A's profitability, it becomes a sure formula for disaster.

•To increase revenue. Many senior dentists make the mistake of thinking that an associate relationship will relieve them of the less attractive aspects of their work while increasing their profitability. My experience indicates that neither presumption is entirely true. In reality, most prospective associates will have just as much ambition as the senior dentist. Unless the associate has significant incentives for financial success that eventually will be on a level with the owner-dentist, there will be little incentive for a long-term association.

It is a mistake is for the senior practitioner, "Doctor A," to fail to take into account the long-term aspirations of the associate. A motivated and talented dentist arrives at Doctor A's practice encumbered with debt and temporarily devoid of the skills, experience, and confidence necessary to establish and maintain an independent practice. In this case, it is easy for Doctor A to take advantage of Doctor B's less powerful position. At times, Doctor A may fail to realize that, within a few short years, the young associate's aspirations will have risen, along with his or her ability to achieve goals independently.

Practitioners of high-quality dentistry have a driving need not only to control their financial destiny, but also to develop their craft. In the scenario just described, it is crucial for Doctor A to provide Doctor B with continuing opportunities for growth, or the relationship will fail.

•To add a family member. It is tempting for an established dentist to bring a son or daughter into the practice simply because of the family relationship. My advice is to resist the temptation unless you would choose that family member as an associate even if he or she were not a relative. Even in the best of circumstances, where the parent and child share a professional work ethic and many of the same values, it is very difficult for a child to grow personally and professionally when continually cast in the role of "son" or "daughter." However, it is not impossible. When both parties work at building a new professional relationship, family partnerships can be among the most rewarding, reaping countless benefits from a shared history and common values.

The senior dentist should have frequent discussions with the office personnel to assure employees that their positions will not be threatened with their new "boss" — particularly when bringing in a family member.

Importance of shared values

Ask yourself: Can association with another dentist help me achieve my goals? If the answer is yes, then it is critical to find an associate whose short- and long-term objectives truly complement your own. In my experience, conflicts over personal values are the single biggest reason for relationship failures between senior dentists and associates.

One common scenario is where the senior dentist fails to hold up a prospective associate's work methods to thorough scrutiny. For example, Doctor A, mature and well-established, loves people and tackles work with perfectionism and idealism. Doctor A maintains a busy practice and realizes the need for an associate to whom he can entrust his practice.

Doctor B is bright and personable, but may not yet have the technical proficiency to create and implement the types of comprehensive treatment plans that are the hallmark of Doctor A's practice. More importantly, the associate may lack the ambition that would enable him or her to grow into the challenges of Doctor A's practice methods.

By the time Doctor A realizes that Doctor B's work is not up to his professional standards, valuable time has been lost investing in a partnership that is doomed to failure. Doctor A also should realize that if Doctor B's performance is below standard, his professional and personal reputations are also at risk.

This same scenario also can be played out in reverse. In this paradigm, it is the younger associate who is the perfectionist and the established doctor who has a lower standard of proficiency. Such a mismatch would be equally painful for both parties.

If Doctor A insists on delegating only the less desirable work, Doctor B will quickly lose interest in the association. Doctor B should be given an ample opportunity to develop his or her skills. It is not uncommon for the owner-dentist to pay the associate's tuition for continuing-education courses and clinics to improve various techniques and management skills.

Relationships with dental associates are not a short cut to increased profitability; they are frequently the most effective route to long-term personal and professional fulfillment. Both parties need to understand the increased costs associated with an expanded practice. And both parties need to be open in communicating their short- and long-term goals.

These relationships should be undertaken with more than due diligence; they should be undertaken with the same level of care and concern that you would employ in choosing a mate. A mistake can cost you years that can never be replaced. The good news is that, as with marriage, the rewards can be immeasurable.

Practical guidelines for Doctors and Associates

For Doctor A —

From the senior partner's point of view, the process is a bit complex. First, don't expect to profit monetarily from an associate's work. The way to become more profitable is to become more efficient in your work practices. You must acknowledge, from the outset, that eventually your associate will crave the same financial rewards and professional satisfaction that you do ... so act accordingly. Give your associate the same opportunities for development and professional growth that you desire for yourself.

I recommend that you select one or two areas of your practice that you can willingly entrust to your new associate. For example, if you would like to focus exclusively on major restorative dentistry, you might start out by giving up endodontics and routine restorative dentistry during your associate's first few years. Gradually, you could continue to give up other aspects of your work, until, ultimately, all you are doing are the most rewarding types of major restorative dentistry. This process should take place slowly. This concept is most applicable when there is a five- to 10-year buyout and the senior dentist wants to limit his or her practice.

Next, insist that your associate undertake graduate coursework and other specialty training to ensure that he or she eventually will be able to fulfill all of your patients' needs. Ultimately, you and your new associate will be sharing the treatment of your patients by performing dentistry in agreed-upon areas. You also must ensure that your staff accords Doctor B the same level of respect that they give to you. Continually make Doctor B's contributions to the success and growth of your practice clear to your staff.

Keep in mind that your associate will need an adequate support staff, so make financial arrangements accordingly. Refrain from involving a lawyer until you have determined each party's expectations. You don't want to pay an attorney for the time it will take him or her to become educated about the peculiarities of dentistry. If you need help from an objective party to define and clarify your goals, work with a consultant who is familiar with dental practice requirements.

I recommend that the initial agreement allow either party to walk away unconditionally within the first 30 days, and require a year's trial prior to entering a formal dental associate relationship.

For Doctor B –

Most younger, less experienced associates enter a practice with the goal of eventually buying out the senior partner. Ideally, such transitions should take place over a period of time, and all financial arrangements should be made in advance.

It is imperative to put your agreement in writing at the earliest opportunity. If both parties identify their objectives at the onset, they are more likely to realize them when the acquisition is completed. Outline the essential terms of the proposal in a letter of intent itemizing the basics, including the purchase price or formula, the assets to be purchased, the liabilities to be assumed, the scope and duration of restrictive covenants, and the timing of payment obligations. When agreed to and signed by both parties, this letter becomes the basis for the formal purchase agreement to follow. Included in this letter should be a statement that each participant can walk away with a 30-day written notice.

When seeking an established dentist to partner with, here are a couple of things to keep in mind:

•Find out whether the practice's staff has a high turnover rate, and avoid establishing an association with a dentist who has had difficulties maintaining a qualified, motivated staff.

•Never partner with a dentist who insists on a formal legal association without the benefit of a trial period.

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