WHAT WE SHOULD HAVE LEARNED FROM CORPORATIONS
Will corporations win the dental business model? I guess there is no way to be sure, but if we look at pharmacies, vision, and medical models it is a sure thing. The only item in question would be how long it will take. I think the independent practice of the future will have to take on the things corporations do well, while also adding the consistency of an independent practitioner. The first place to start would be to take note of the things corporations do well. When taking on an opponent, you always need to identify their strengths and weaknesses.
USAF Colonel John Boyd introduced a process of observation, orientation, deciding, and acting, called the OODA LOOP. This process is a flow of information that can be interrupted by outside stimulus that may cause a bad decision that restarts the process. If a decision cannot be reached, action is never obtained. To increase the percentages for survival, preplanning and skills streamline the process reducing the possibility of mistakes. We have observed the consistent growth of national corporations and the inherent movement of patients into this style of dental care. By now we should have oriented to this development and now we need to decide on a strategy to act on. Let’s take a look at what we should have already learned from corporations.
1. Location, location, location: Corporations know that if they have the best location, the most visibility to women, with the convenience of being on the way to everything, they will capture the lion’s share of dental patients.
2. The Business of Dentistry: Corporations have created a business model, understand the numbers, created protocols and executed well to insure an ever increasing profit margin in markets where the independent dentist struggles.
3. Marketing: Corporations have taken the marketing acumen of commercial business and applied it to dentistry. They overspend the independent dentist and raise the bar on execution and follow through when it comes to marketing. The numbers don’t lie: Corporations are increasing market share at 7% per year.
4. Range of patients: Unlike a large number of independent dentists, corporations offer dentistry for the whole family in every location they have. Women rule the world and make 92% of all dental decisions. Wake up and understand that working on kids is the fastest way to grow a practice, and expanding the range of clients you can attract is the secret sauce for success in Dentistry.
5. A wider range of services: Corporations clearly understand that the public wants all dental services in one location. Corporations bring specialty services to the entire family six days a week.
6. Consumerism: Giving people what they want, when they want it, at a price they can afford is the foundation of any successful business. It appears that corporations have figured out a way to push this simple foundational concept to the front of our potential clients/patients “want lists” and then deliver on the promises. The proof is that millions every year migrate to corporate dentistry and never return. They (corporate entities) are doing something right
7. Insurance: Winning the insurance game by being in-network has driven the overall success of corporations for years. Every patient with insurance will eventually gravitate to an in-network doctor. Corporations have figured out how to deliver insurance driven dentistry at a 50-60% overhead by integrating staffing, delegation, and technology to accomplish dentistry faster and with more consistency.
If we are going to compete, we are going to need to change. So the question is: WHAT ARE YOU WILLING TO DO to save the independent practice of Dentistry?
Michael Abernathy, DDS
PS—Ever wonder why I sign off these articles with my personal email and personal cell number? I want you to reach out, call, start a dialogue and consider what you can do now to grow and preserve your financial future. There is a way and it begins with a call and a frank discussion of where you are and where you want to be. That is how you Summit.