Investing in human capital

Oct. 1, 2001
Like the old clichè says, 'practice makes perfect.'

Like the old clichè says, 'practice makes perfect.'

by James R. Pride, DDS

A dentist spent $400,000 on designing a sparkling, new, high-tech office and developing a marketing plan to attract new patients. But when the new patients arrived, instead of being greeted promptly, they were treated with indifference by an appointment coordinator who had more "important" things to do.

The owner of this dental practice spent a considerable amount of money to attract new patients and to offer them the finest facility, but the dentist failed to spend money training staff members to do their part in making the patients' experiences memorable.

In his book, Against the Gods: The Remarkable Story of Risk, author Peter L. Bernstein noted that more than 50 percent of the increase in the material wealth of all businesses has come from the development of human capital, not from the acquisition of hard goods — i.e., tools, machines, etc. To "develop human capital" means to educate, train, support, monitor, and motivate your employees. Even the simplest business requires this investment — or, to put it simply, in order to sell apples, you need an apple cart and an excited employee to push it!

In selling apples, not only is the quality of the fruit important, but also how the fruit is presented. Even the juiciest apple in the world will go unsold if the seller's contribution is missing. According to research, a vast amount of training and development done by American businesses has failed to produce any tangible positive results whatsoever! (See Working with Emotional Intelligence, the best-selling book by Daniel Goleman, PhD.) These studies give persuasive evidence that although billions of dollars are being spent on human capital, most training and development efforts are off-target. Are you developing your staff? What methods are you using? Are they effective ... or are you wasting your time and money? How can you get the best return on your investment in human capital? Let's take a look.

Dr. Goleman sites research studies in neuroscience that corroborate the need for repeated practice in the acquiring of new habits or skills. According to these studies, neural pathways in the brain have been shown to enlarge when a specific task is practiced over and over again. These pathways will enlarge only by repeatedly performing the task; they do not enlarge merely by listening to lectures. Furthermore, when a task or habit is no longer performed, the neural pathways associated with it actually will shrink. This hard data from neuroscience confirms our own observations. We develop habits or skills by repeated practice; when we do not practice them, we lose them. There really is a scientific basis for us to say, "My tennis game is really good. I've been practicing," or "My tennis game is rusty. I'm out of practice."

When we were dental students, we all found things to criticize in our schooling, and sometimes we did not feel respected. On the whole, dental school is a classic example of the correct techniques to use in learning a skill. The mode of teaching in dental school is to give a one-hour lecture on a topic, followed by three hours of lab practice in which the student actually tries to do what he or she has learned about in the lecture. The physical practice must be repeated until it becomes rote. This is the point at which the student acquires the new skill. Hearing the lecture is only the first step.

None of us would feel confident prepping a crown without first having undergone supervised practice of the skill. The real issue of how to make training "stick" is the issue of how to incorporate and emphasize experiential practice in the learning process.

How do we dentists typically train our employees? Not by the method we learned in dental school, unfortunately. How many times do we send our employees to a seminar on customer service and expect them to implement new skills in the practice after hearing a lecture? And how many times are we disappointed?

The best way to improve the skills of employees is not merely to send them to a lecture, but to engage them in experiential practice of the techniques. This is not to say that a lecture is a waste of time. It is certainly valuable to hear information presented. However, when acquiring a skill — any skill, be it flying a plane, performing surgery, typing, or even just talking to customers — the real change in human behavior results from applying what you have mentally learned in lecture form.

You cannot simply watch a videotape of how to fly a plane, then go get into the cockpit and do it. Without experiential practice, we forget what we have learned in eight to 10 days. Most dentists and small-business owners lack a systematic approach to developing employees; their efforts are hit-and-miss. Others, however, have recognized the need for investing in human capital. They have followed the lead of America's best companies, making substantial investments in their employees' training.

The bad news is that the dentist who has spent a lot of money on developing his or her staff, yet does not use experiential learning techniques, may be no better off than the practitioner who has spent nothing.

As dentists, we know that we cannot treat a patient merely by watching a videotape or hearing a lecture on a dental procedure; we must actually try the specific procedure under supervision in order to acquire the skill. However, we often fail to recognize that the same learning principles apply to business techniques. In fact, it is rather arrogant of us to feel that we can just send staff members to a seminar and expect them to change their behaviors in the office. Since most of the increase in material wealth will come from improving the performance of our employees, then shouldn't we do something about making our training efforts more effective?

At minimum, we should be devoting two hours per month — but preferably one hour per week — to experiential training in the dental office. These training sessions are in addition to our staff meetings. We can accomplish experiential training through sessions in which new skills are not merely discussed, but practiced. These skills involve how to collect money, influence case acceptance, schedule appointments, and other business techniques needed to run the office. Practice includes a generous amount of role-playing or rehearsing of the techniques. The training session does not have to be conducted by the dentist; other staff can assist.

The time for training is absolutely necessary for the development of our human capital, and it's been confirmed now by the research findings in neuroscience. Yet, many dentists will object. "I can't hold training sessions because I'd have to take them out of production time," they say. My answer? "Yes, of course, these meetings do come out of production time ... but they also should result in increased production during the remaining time."

Our own studies of dental offices repeatedly demonstrate that an average practice with $450,000 of annual production can increase that figure by at least $150,000 per year. The practice can do that by developing new business skills that staff members learn in well-structured weekly meetings, followed by more practice on the job. This increase in the material wealth of the practice is primarily due to the investment in human capital, and it represents a substantial impact on the eradication of oral disease. This positive effect on our own wealth and on our patients' well-being is achieved when our human capital is developed effectively.

This kind of experiential learning takes more time than sending the staff to a seminar, but it is the only kind of investment in human capital that yields real results.

There is a way in which we can give ourselves and our employees a jump-start on the experiential learning practice ... and that is by hiring staff effectively. The president of a business known for its exceptional customer service once was asked, "Who trains your staff to be so well-groomed, friendly, and helpful?" The president replied, "Their mothers and fathers."

Hiring employees capable of and receptive to learning the skills they will need can expedite the learning process immensely; therefore, take your time, interview carefully, and hire the right people.

A phonetics scholar said to his seemingly hopeless, vagabond student after an exasperating lesson: "Think about it. Try to do it by yourself: And keep your tongue well forward in your mouth instead of trying to roll it up and swallow it. Another lesson at half-past four this afternoon. Away with you." This ordeal continued for months, but in the end, under the tutelage of Henry Higgins in George Bernard Shaw's play, Pygmalion, the common British flower-girl, Eliza Doolittle, became a lady. A clichè sums up the whole of the proper training methodology that transforms a stumbling student into a top performer: "Practice makes perfect." Give your dental practice a chance to grow, your patients a chance to improve, and your staff a chance to excel through the magic of experiential learning.

The ABCs of Experiential Learning

The four steps to teaching staff members new skills include:

Present the purpose of your training to the staff. Define the philosophy and direction of your practice and communicate that to the staff. All of the skills that your staff will be asked to learn will aid the dental practice in realizing its purpose. For example, if the purpose is to do comprehensive dentistry, then there are definite implications in how the staff schedules appointments, makes financial arrangements, and influences treatment acceptance to accomplish that purpose.

We simply cannot teach anyone to do anything by issuing an order! For example, the direction to "get production up to $2,000 per day" falls on deaf ears when we haven't explained why we chose that number and how we expect the staff to reach it. We must get staff members excited about the goal and motivated to accomplish it. This is the role that leadership plays in improving human capital.

Allow time for the staff to apply new skills. Because lectures and videotapes are insufficient for the mastery of a new skill, focus your training time on practicing the proper techniques until they become rote. This begins at the training meetings and is carried onto the job. For example, have your team practice making financial arrangements through role-playing.

Monitor and evaluate your staff's performance. It is extremely difficult for us to monitor our own training. The dentist or someone else in the office needs to supervise the trainee(s) and give feedback on their performance. We've heard many staff members complain that the dentist only tells them when they are doing something wrong, but they don't hear enough compliments when they do something right. Feedback should indicate the positive aspects of the performance, as well as any areas that need improvement.

Give your staff ample encouragement during the learning process. When we learn a new skill, it is common to have feelings of self-doubt. "Do I really have it in me?" "Oh, I'm afraid I can't do this!" "I goofed!" are indications of how our confidence may falter during the learning process. It is very important for the monitor not to be too critical during the learning stage. Accept that there will be mistakes and that some people will have to practice over and over. The role of the leader is to accept these mistakes without undue criticism. This is difficult for dentists because, as a group, we tend to be perfectionists with ourselves and others. We want things done right, as well we should, but we must remember that it took us four years in dental school to learn our skills. We should not expect staff members to master their tasks in a matter of moments. We need to learn how to tell our employees when they don't do something right, but, at the same time, we need to let them know that we still believe in them.

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