In his new book, author Bob Levoy shares insights to turbo-charge your practice.
From the introduction:
Real practices. Real solutions
In the course of my career, I’ve had the privilege of conducting more than 3,000 seminars for a wide range of business and professional groups throughout North America and overseas. As part of the market research for these programs, I continue to visit countless professional practices not only in dentistry, but also in the fields of medicine, podiatry, optometry, physical therapy, veterinary medicine, accounting, and law among others. These visits have enabled me to meet hundreds of high-performance practitioners in these professions and ask them such questions as:
• What makes your practice so successful?
• What are you doing differently than others to account for your success?
• What are the secrets of hiring top-notch employees, and how do you keep them motivated?
• What have been your toughest management problems, and how did you solve them?
• What do you wish you had done differently?
• What lessons did you learn that might help others avoid costly mistakes?
Their answers to these questions became the framework of my book.
From Chapter 3: Take Your Practice to the Next Level: Make it a “Brand”
No. 35: Brand your practice
Your brand represents the feelings that you and your practice evoke in the minds of patients, colleagues, physicians, and other potential referral sources. It’s who they think you are. It’s what you stand for: the expertise, quality of care, service, integrity, and professionalism that others associate with you. It’s also the type of mental awareness that predisposes patients to choose your practice over others.
If you are fortunate enough to have what’s called “top-of-mind” status, it will be your practice that patients first think of when they need a dentist (orthodontist, periodontist, other specialist, etc.).
From computers to cars, people buy branded consumer products. In doing so, they expect a level of quality, service, reliability, and satisfaction. If those expectations are met, people buy again. That’s “brand loyalty.” If the brand doesn’t live up to expectations, buyers simply go elsewhere.
A practice brand works the same way. Every minute of every day, it broadcasts information about who you are, what you and your staff do, and how you do it. If your brand is sending out the right messages about what people can expect when they’re in your office, they will travel further, wait longer, pay more, make more referrals, and remain more loyal.
“Your brand,” says consultant Andrea T. Eliscu, “is your personality. It can be a name, design, or symbol that enhances the value of your practice beyond its functional purpose - something that distinguishes it from others. A strong brand makes a promise. A strong brand is trustworthy and possesses great value. It has meaning, prestige, presence, and it helps confirm what is expected.”
Over time, the added value that accrues from branding is referred to as brand equity. This includes benefits to your practice such as consumer awareness, perceived quality, and patient loyalty.
Action steps: “Start by identifying the qualities or characteristics that make you distinctive from your colleagues,” says author/speaker Tom Peters (who is a brand name as an authority on the New Economy). “What have you done lately, this week, to make yourself stand out? What would your colleagues or your patients say is your greatest and clearest strength, or your most noteworthy personal trait?
Ask yourself: ‘What do I do that I am most proud of? What have I accomplished that I can unabashedly brag about?’ If you’re going to be a brand,” says Peters, “you have to become relentlessly focused on what you do that adds value, what you’re proud of, and - most importantly - what you can shamelessly take credit for.”
From Chapter 4: Long-Range Strategic Planning
Hard-learned lessons about busyness
• “New patients are essential,” says world-renowned clinician Peter E. Dawson, DDS, from St. Petersburg, Fla. “But trying to treat too many patients is counterproductive and unfair to patients. Too many patients is also the most common obstacle to clinical excellence, which is the single most important factor that determines how successful a practice becomes.”
• “Our profession seems fixated on trying to see more patients, even discounting fees until we end up working for insurance companies,” says Ron Schefdore, DMD, from Burr Ridge, Ill. “We churn out 20, 30, 40 patients a day, or more. The dentist, staff, and equipment take a beating every day.”
• “Being busy isn’t a badge of honor,” says Leonard J. Press, OD, FAAO, FCVD, from Fair Lawn, N.J. “It’s a badge of stupidity.”
Opportunities refer to what you and your staff could be doing (as opposed to what you’re not doing) that would produce increased profitability and/or practice growth. Opportunities also include things that, if done differently than you’re now doing, would achieve better results.
For example, consider the following matrix representing four possibilities:
The easiest of the four is Number 1 - getting more of your current patients to use more of your current services. It requires nothing new except improved communication skills.
The hardest of the four is Number 4 - acquiring new patients for new services. In this case, you need to acquire both expertise and new patients.
Chapters 5 and 6 include the action steps needed to mine some of these opportunities.
From Chapter 10: Measure What Matters to Patients
No. 132: Ask a simple question
An outpatient survey from the Williamsport Hospital in Williamsport, Penn., asks, “Have you used the Williamsport Hospital Services before? If yes, has the quality of the services improved, remained the same, or declined?”
The first principle in the quest for quality is recognition that quality is what the patient perceives it to be - not what you or I say it is (or what it should be).
Reality check: How would your returning patients answer such a survey?
From Chapter 13: Secrets of Staff Retention
No. 179: Hard-learned lessons about staff retention
• It’s far cheaper to retain good employees than it is to replace them. Since launching their Web site, North Suburban Dental Associates, located in Skokie, Ill., has found that staff longevity is an important element to the people who visit the site before showing up at the office. “We have found,” says Barry Freydberg, DDS, “that staff longevity has been a major confidence builder in new patients who we haven’t met yet. We didn’t know that this would have an influence on new patients, but it has. Our credibility gets a boost based on staff longevity.”
• “Good management is largely a matter of love. Or, if you’re uncomfortable with that word, call it ‘caring’ because proper management involves caring for people, not manipulating them,” says James Autry.
• Coddle your employees. Without them, you may not have a practice. If necessary, pay employees before you pay yourself. Give them benefits you would not take for yourself. Spoil them and empower them in every way possible.
• “Doctors should reward competence, encourage its development, and base all standards on excellence,” advises the Blair/McGill Advisory. “That is why we encourage doctors to give individual raises based upon merit performance - not across-the-board, cost-of-living increases that encourage mediocrity.”
• “Don’t give raises to marginal employees,” says consultant Jeffrey J. Denning. “Raises never motivate workers to improve. To the contrary, a raise in pay signals the employer’s satisfaction with status quo. Further, if an employee is terminated and sues, she has simply to point to the history of pay raises to show she was doing a good job. Judgment for the plaintiff.”
• When staff members enjoy their work, their performance improves. This leads to higher patient satisfaction and loyalty, which results in more referrals and a reputation in the community as a “Provider of Choice.”
• People’s on-the-job performance and productivity tend to improve when they know what’s expected of them, and they receive periodic feedback about their work.
• “It’s not the people you fire who make your life miserable,” says Harvey Mackay. “It’s those you don’t.”
• Maybe you’re a “glass half-empty” person, and think your current employees are still captives in a sluggish economy. If so, here’s a simple test. Do nothing. Then see what happens.
Editor’s Note: “201 Secrets of a High-Performance Dental Practice” can be obtained directly from the book’s publisher, Elsevier/Mosby, by calling (800) 545-2522, or by visiting www.us.elsevierhealth.com/Dentistry.
As president of Success Dynamics Inc., Bob Levoy has conducted more than 3,000 seminars for a wide range of business and professional groups in North America and overseas, including hundreds of dental associations, academies, local societies, and schools of dentistry. His current seminar topics include “Strategies for Improving Profitability and Patient Loyalty,” and “Secrets of Hiring, Managing and Retaining High-Performance Employees.” He can be reached at (516) 626-1353 or at [email protected].
Dentistry Gets a Makeover: Using Tax Deductions to Save Money on Equipment Purchases
By Penny Healey
Dentistry is changing, and a growing consumer demand for extreme makeover smiles is driving the dental technology market that once seemed futuristic and out of reach as little as five years ago. With this shift, laser systems, digital radiography equipment, and CAD/CAM equipment are replacing drills as the “must have” tools of the trade.
With cosmetic dentistry procedures on the rise and state-of-the-art offices becoming mainstream, a growing number of dentists are seeing the payoff potential for the large investments needed to transform their “drill-and-fill” practices into high-tech, cosmetic dentistry centers. More might be willing to plant both feet in the 21st century if they realized the payoff for their investments could happen sooner than they thought - by taking advantage of the tax and cash-flow benefits they would gain by financing their high-tech equipment purchases during an extended period.
By spreading out payments rather than paying cash upfront and maximizing tax deductions, dentists could actually boost cash flow while their new equipment generates more income and/or greater efficiencies for the practice. In essence, under the relatively new guidelines of Section 179 of The American Jobs Creation Act of 2004, this new equipment could pay for itself, and perhaps more.
Understanding Section 179
While dentists understand the benefits to their patients and to the practice’s efficiencies by owning new-age digital lasers and cosmetic dentistry equipment, dentists often overlook the tax and cash-flow benefits they can gain - especially if they choose to finance the equipment purchases during a five- to seven-year period.
Section 179 of the tax code currently allows buyers to claim an immediate deduction of up to $105,000 - an increase from $102,000 in 2004 - for as much as $420,000 worth of new equipment. This threshold represents the maximum dollar amount of equipment that can be purchased each year before the writeoff is reduced dollar for dollar.
For example, a dentist who purchases $200,000 in equipment can deduct $105,000 of the cost based on Section 179, leaving a difference of $95,000. Under the current tax laws, a dentist also could realize an additional 20 percent depreciation during the first year the equipment is placed in service. The remaining $76,000 in equipment cost can then be depreciated over the remaining years, depending on the equipment.
As is always the case with tax deductions, these are not automatic. A taxpayer must elect to take them. Also, these benefits only apply to purchases and financed purchases; lease agreements are not eligible.
For any dentist considering a major capital investment, the tax benefits provided by Section 179 are too good to pass up. By coupling this with the increasing demand for cosmetic procedures - and expectations among patients to see the latest technology in their dentist’s office - it creates a state-of-the-art office while also taking advantage of these generous tax benefits. This could be a smart move financially for dentists.
About the author: Penny Healey is manager of the southwest region for HPSC, a GE healthcare financial services company. For more information, call (800) 225-2488, or visit www.hpsc.com.
