The right time to expand your dental practice (Part III)
The best time for dentists to expand their dental practice is when they're ready, not when circumstances are right. Learn more about the right time to grow your dental practice.
Editor's note: This is the third in a series of four articles. Parts one and two appeared in the July and September issues.
Many dentists ask me about the best time to expand their solo practices. Should they wait until the economy gets better, for a population boom, or for lower interest rates? I tell them that the best time to expand is when they are ready, not when circumstances are right. To learn the answer for you, you need to thoroughly assess your qualities and knowledge. Specifically, I recommend that you evaluate your clinical, business, and interpersonal skills so you'll know when it's the right time to expand.
As a multipractice owner, you will need a new mindset. You will have to shift from being a clinical operator to an innovator and leader who can inspire and nurture people. Here are some questions to ask yourself:
• Have you been using the same equipment and procedures for many years?
• Do you stay current with the latest clinical skills and technologies?
• Do you know best practices that you can duplicate across offices for the greatest efficiencies?
Even if you don't know the answers, be willing to ask questions and learn. You don't have to be a pro or get all of the latest equipment. You just need to try!
At one time I was not happy with the way our practice was doing implants. The dentists were all doing them in different ways and with different brands. I educated myself on best practices so I could teach others. It was a win-win since I was able to create quality standards that could be reproduced, and I mentored the new dentists who gained more confidence and job satisfaction as they increased their scope of skills.
Be willing to become a student as well as a teacher. Relying on someone else to teach your team or run your business is like owning a restaurant and not knowing how to cook. No, you don't have to be the chef, but you do need to know the basics to increase your chances of success.
The takeaway: Be open to new ideas, educate yourself to become proficient, and then motivate others and duplicate successes.
Another area to assess is your strengths and shortcomings in business. Consider the following:
• How much attention do you pay to your profit-and-loss statement? Is it done by your bookkeeper on an annual, semiannual, or monthly basis? Do you have a clear understanding of each line item?
• Do you know your supply costs and lab bill? Do you know what inventory you have on hand? Are you aware how many times supply orders are placed per month? How many vendors do you use? Do you fall for "deals" that lead to excessive inventory? What are your redo rates for lab bills?
• Do you know the percentage of your clinical dentistry (all procedures performed as well as dollar revenue) that is referred to outside dentists?
• Are you paying attention to the percentages on your line item statement, what's high or low, and how to improve them to increase your bottom line? Do you know your turnover rates over the last two months? Do you know the cost of staff overtime? Are raises based on merits or a set guideline?
When I started asking these questions, I learned that my supply cost was almost 10%. I didn't know that supplies were ordered at least four to six times per month, and with every order a little something else was added, which resulted in, among other things, a nine-month supply of gloves in my stock room. I also learned that my local lab was actually outsourcing overseas for crowns and bridges. So I switched to work directly with an FDA-approved outsourced lab myself, and my lab bill decreased tremendously.
Whatever your level of understanding, you can continue to learn. There are many ways to improve your business skills. What was really helpful for me was the ADA/Kellogg Executive Management Program at Northwestern University. Even if you don't continue for an MBA, you can always grow your business skills as you manage your practice.
The takeaway: Everyone needs to become proficient enough in business to at least know how to run his or her own practice.
The most difficult part of running a large practice is managing people, and as you expand your practice you're going to be dealing with a lot more people. Developing leadership qualities will help you deal with the many people you work with every day as a multipractice owner.
Assess how well you work with others:
• Can you speak well in public?
• Are you charismatic?
• Do you think you know everything, or are you humble?
• Do your team members follow you because they love and respect you or because you pay their bills?
• Can you inspire, motivate, and nurture your team?
• Are you upbeat and energetic?
I learned about leadership the hard way. I had a lot of success early on and thought it must be because I was such a great dentist. Then people started to leave left and right because they didn't want to work for me. Even though I was producing a lot, my net revenue was small.
I had an awakening when I realized I had to become teachable and learn new interpersonal skills. I also learned that the boss must be willing to own all of his or her mistakes. It was only after I changed how I interacted with my team that things got better, and my organization was finally able to grow into the successful practice it is today. I never stop working to improve!
The takeaway: Be open to a lifetime journey of learning as you continue developing your interpersonal and leadership skills.
In summary, if you want to expand your practice, you need to honestly assess your strengths and weaknesses, including clinical, business, and interpersonal skills. Be humble enough to ask questions, and then, when you decide to expand, it won't be due to some element of chance. It will happen because you have prepared.
If you're interested in more tips on growing your practice, you can read my previous Dental Economics articles (visit dentaleconomics.com and search "Ting"), or my Keys to a Successful Multiple Location Practice e-book at http://bit.ly/2cw12nh.
Author's note: Although Dr. Ting's eBook is hosted on the Dentrix Enterprise website, he was not compensated by Dental Economics, Dentrix Enterprise, or any other party to write this series of articles.
David Ting, DMD, started practicing dentistry in Las Vegas in 2000 and established what is now BDG Dental Services in 2002. There are 23 BDG Dental Services locations in Nevada, California, and Arizona, with a team of 40 dentists and 250 employees. What drives Dr. Ting is "creating a better life for all," including patients, employees, and the community. He welcomes comments and questions and can be reached at firstname.lastname@example.org.