Human capital: Your most valuable asset (part 2)

The opener to the first part of this article certainly bears repeating: human capital is your biggest single competitive advantage—an intangible asset deserving of your ongoing time and attention. I covered the first two of four key talent-management strategies used by successful leaders of businesses of all sizes to elevate the value of their human capital:

Retain good people.
Recruit strong talent.

Here, I’ll explain why the last two strategies underpin your ability to retain and recruit great people and develop them into high-performing team members capable of driving practice growth:

Create a high-performing, patient- centric, growth-oriented culture.
Increase the value of human capital through training and development.

Culture

Don’t make the mistake of thinking culture is a touchy-feely aspect of a business with little correlation to performance and profits. Your culture will make or break your practice, especially in today’s environment. The pandemic caused many people to quit their jobs after being forced to reevaluate what’s personally and professionally important to them. Good people are no longer putting up with working in a lousy workplace. To retain team members worth keeping, you need to rebuild trust and create a positive culture.

Simply put, culture is defined by:

how your employees feel about coming in to work each day, how they feel about working for you, and how they feel about their teammates.
how your patients feel when they call or walk into your office. The lobby, the greeting, how new patients are treated, and how paperwork is handled are all part of your culture.
how you feel when you’re at the office and with your team.

Your culture is unique to you, your team, and your practice. Unlike everything else you do, your distinctive culture cannot be replicated. It’s important to intentionally create and nurture one that you’re proud of and that your team and patients appreciate. It is also important to ensure that you enjoy going to work at your place of business.

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Culture is not just about having fun and being nice. We coach our clients to create a high-performing, patient-centric, and growth-oriented culture characterized by positive attitudes, people who enjoy coming to work, reward and recognition, high expectations that are clearly defined, commitment to achieving shared goals, and team training that sets people up for success.

In contrast, a poor default culture is characterized by negativity, bad attitudes, excuses, and tolerance of mediocre performance. No matter how much patients love you, if they can’t stand dealing with your team, you’re losing patients—you just don’t know why because they’re not telling you. Likewise, good employees won’t stand for a lousy employment experience, and they probably won’t tell you why they’re quitting. To retain even the most loyal team members, your culture needs to be one they want to continue working in.

You can forget about recruiting strong talent in today’s labor market if you don’t have an attractive culture. A study conducted by Chick-fil-A,¹ known for their outstanding service culture, determined today’s most talented job candidates are seeking three very specific culture-oriented factors from employers:

A better boss—someone who genuinely cares about their people, listens, mentors, shows appreciation, and values others’ input.
A brighter future—training and development that challenges and provides opportunities for employees.
A bigger vision—the opportunity to do meaningful work and contribute to the world around them.

Turnover of good people costs money, time, and energy. Being short-staffed because you can’t hire the people you need adversely affects the team, the patients, and your bottom line. When it comes to retention and recruitment, culture is how you will (or won’t) satisfy the needs and wants of talented individuals, who will in turn satisfy your patients.

Training and development

To have a thriving practice, you must keep growing, year-over-year. At the very least, you need to continually offset rising costs and natural patient attrition. Of course, your goals should be well above that, but you can’t raise production and revenue targets without training your team to perform at a higher level.

Training and development enable your team to achieve higher goals, underpin retention by building engagement and loyalty, and supercharge recruitment efforts by establishing a reputation that attracts strong candidates. The good team members you already have and top talent you want to hire will be motivated to improve their skills through training so they can perform even better. They want to be developed through new experiences, challenged to do more, and given opportunities to grow and advance.

Offer training as a privilege and a benefit. Provide development opportunities by delegating everyday tasks, assigning special projects, and creating the role of team leader. The more your team is capable of doing, the more your business is capable of earning. And contrary to those who believe training will cause people to leave, investing in training and development is part of a great culture that makes good people want to stay and good candidates want to apply.

Is yours a 21st-century practice?

Renowned management consultant, educator, and author Peter Drucker wrote, “The most valuable assets of a 21st-century institution, whether business or nonbusiness, will be its knowledge, workers, and their productivity.”² A great culture, combined with effective training and development, has a direct and immediate positive effect on asset value.

The financial benefits of having high-value human capital include the superior patient experience they’re capable of delivering that leads to improved retention and referrals, treatment acceptance, and new-patient growth. Plus, you get the maximum productivity of top performers working as a team to get more done faster and better, resulting in greater profitability.

Editor's note: This article appeared in the December 2021 print edition of Dental Economics. Read part one of Human capital: Your most valuable asset.

References

1. Miller M. What top talent really wants in a job: it may not be what you think. Michael Hyatt & Co. Updated February 20, 2018. https://michaelhyatt.com/what-top-talent-wants/

2. Herman RP. Let’s value people as an asset, and bring financial statements into the 21st century. HuffPost. October 28, 2011. Updated April 9, 2012. https://www.huffpost.com/entry/lets-value-people-as-an-a_b_1063698