Creating Growth In the New Economy

In the course of presenting 100 seminars throughout North America each year, I encounter greater and greater numbers of young dentists concerned about the future of dentistry and their dental careers. This is hardly surprising. These doctors are graduating with record levels

of debt and experiencing increasing difficulty becoming associates. They are also encountering something virtually unheard of in

the past – banks less willing to lend money to dentists. All practices in today’s economy also face a new consumer purchasing mentality. Consumers now ask the following questions prior to making a purchase:

By Roger P. Levin, DDS

Do I really want it? • Do I want it now? • Do I want to buy it here? This shift in consumer behavior has proved challenging for dentists when presenting cases. The number of rejected cases is increasing, and more patients are settling for less-than-optimal treatment.

I remind new doctors that, despite these daunting challenges, many in their field are not only surviving, but also thriving in the new economy. To young dentists concerned about the future of their careers, I make the following three recommendations: 1. Utilize The 3-Step Method For Accelerated Production Growth 2. Use Internal Marketing The Right Way 3. Outsource Everything Possible

Utilize the Three-Step Method for Accelerated Production Growth

After extensive study of other businesses to determine how top CEOs were addressing changing economic times, Levin Group created a new concept for dentists called The 3-Step Method For Accelerated Production Growth. This process allows

Roger P. Levin, DDS Practice Builders

young dentists to quickly master the most important aspects of running a business and ensure that the practice will increase production on a continuing basis. It consists of:

for the office. Practices that implement value-creation scripting are enriching their systems to achieve desired targets.

Use Internal Marketing the Right Way

Setting clear targets Creating defined targets gives practices clear indications of achievement. Targets allow all key areas of practice performance to be gauged accurately. For example, targets can include collecting 99 percent of all money owed to the practice, having 98 percent of all patients scheduled at all times, establishing a no-show/last-minute cancellation rate of less than 1 percent, etc. Once key targets have been identified, communicate them to all team members so that everyone in the practice can work together to make them happen.

Successful internal marketing enables practices to retain existing patients and gain new ones. Unfortunately, few practices know how to effectively implement internal marketing strategies. Often, one or two strategies are attempted periodically when the practice slows down. Such endeavors are never effective for long and require a great deal of effort with very little payoff.

Research from The Levin Group Data Center has demonstrated that most practices have less than 20 percent of their patients refer even one other patient each year. This is of concern for all dentists, given that the number of new patients entering dental practices has dropped by 30 percent over the last three years. In this new reality, internal marketing cannot be approached haphazardly. Practices are now dependent on the ability of internal marketing to bring new patients to the practice.

Designing systems to achieve the targets It is no longer enough for systems to simply get the dentist and team through the day. Systems today should be based on reaching established targets, or the practice may plateau or decline. When stepby-step systems are in place, production increases and stress – especially financial stress – disappears.

Young dentists should view internal marketing as a science – not a series of sporadic gimmicks used by practices to hopefully gain referrals. Correctly implemented, internal marketing represents by far the most powerful form of marketing dental practices can employ. External marketing, such as TV, radio and newspaper advertising, typically works just a fraction of the time – and at an enormous expense. Levin Group finds that 80 percent of the investment made in external marketing results in a monetary loss for dental practices.

Every top CEO knows that if targets are not achieved, they have not done their job properly and, in some cases, may no longer have their job. Most young dentists will eventually own their practice and therefore enjoy absolute job security. However, the value of owning the practice depends entirely on how well the practices achieves its targets.

Implementing excellent scripting to make systems work better Systems don’t run themselves. Smart teams have to administer them. And they must know what to say. Levin Group painstakingly reinvented how scripting works by going far beyond merely conveying accurate information. This new type of scripting is about the ability to influence people. Systems for scheduling, case presentation, customer service and collections are more effective when teams create value

On the other hand, effective internal marketing works most of the time – and with very little expense to the doctor. Achieving the three crucial targets listed below determines the success of an internal marketing program:

• 40–60 percent of patients refer at least one other new patient each year
• 80 percent of family members of new patients also join the practice • A minimum of 15 strategies functioning together at all times No one particular strategy is critical to a successful internal marketing program. Instead, a combination of 15 strategies leads to a “critical mass” of internal marketing activity that motivates patients to refer others to the practice.

Outsource Everything Possible

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tract and legal problems due to misunderstanding legal ramifications, overpaying for a practice, staff issues, etc. Many young dentists attempt to personally handle these activities to save money, but they end up costing themselves a great deal more in money, time and trouble.

Outsourcing means allowing expert advisors to handle work- or life-related issues. For example, areas such as taxes, financial planning and real estate acquisition can be handled by outside experts such as accountants and attorneys. This immediately decreases the burden on young dentists and will help them avoid costly mistakes.

Being properly advised will eliminate most serious problems that will arise in dental practices. I strongly recommend paying for expert advice early. It is far more cost effective for dentists than dealing with problems when they occur at a later time. Just as patients rely on your expertise for dental care, you should do the same in areas outside of dentistry.

Making decisions without expert guidance can result in bad associateships, con-

Conclusion Young dentists have greater debt and more competition than their colleagues in the past. Despite these challenges, they have no reason to be discouraged. Highly successful practices are being built at this very moment. Consequently, there is no reason why young dentists should accept diminished success as the new “normal.”

Top practices use proven business principles to operate not only as excellent practices but also as excellent businesses. This distinction must be understood. Young dentists who enter practice today with great clinical skills and wait for the practice to simply grow on its own will find themselves greatly disappointed.

Dentistry will continue to behave more like traditional businesses and those doctors who routinely implement new systems and innovation can avoid persistent and longlasting plateaus or declines. Remember that the recession changed the rules and created stress for every type of business. Young dentists who are prepared for the new economy with tools such as The 3-Step Method For Accelerated Production Growth will be able to experience success throughout their careers. ■

To learn how to run a more profitable, efficient and satisfying practice, visit the Levin Group Resource Center at www.levingroup. com. You can also connect with Levin Group on Facebook and Twitter (@Levin_Group) to learn strategies and share ideas.