The nine most commonly cited causes of small business failure are:
- Lack of financial planning
- Absence of business records
- No understanding or use of business records
- Poor cash-flow management
- Poor debtor management
- Poor inventory management
- Poor costing-pricing
- Poor market research
Any material developed to help with these areas must be able to be used economically, learned quickly, and operated rapidly or they won’t be used. By developing systems and expertise to take care of the critical management areas, more time will be left over to attend to other details. Most doctors cite some combination of the following as desirable:
Quality Dentistry – Additional time to concentrate on their primary interest — delivery of high quality, highly ethical dentistry. Many doctors we encounter state something similar to the following: “Just let me come in and do the dentistry. Let someone else worry about the business.”
Free Time – Time away from the practice; enjoying other pursuits, either business or pleasure. The investment of extra time for one year (implementing the required changes) will pay multiplied dividends of extra time for many years to come.
More Money – This probably works to accomplish one or both of the above. We have yet to encounter a practice that couldn’t be more profitable.
Doctors frequently lack managerial experience, skills, and training. Doctors rarely have functional expertise in all the areas required to operate a business successfully.
Unsuccessful doctors often lack the mental makeup to run a business. Researchers variously attribute lower success rates to an inadequate internal locus of control (successful entrepreneurs tend to believe in themselves and don’t attribute their success to luck) or to a low achievement motivation (lacking a strong desire to compete and succeed). Doctors frequently lack the business acumen or personal inclination to adjust as their business grows. This becomes critical with the failure to develop appropriate systems, strategy, and structure.
There exists an assumption that the procedures and systems needing to be implemented will be elaborate and time-consuming. This isn’t true. We provide relatively simple, easy-to-implement plans. The overriding aim must be improving performance.
All of us are good at some things and not good at others. As business owners, doctors frequently have to jump in and do whatever is needed regardless of their own business management skills. In their situation no one else is available. Lack of doctor time is a critical factor. Strapped for time and unable — or unwilling — to take the time to properly educate an outsider on details of the business, many little problems swell into major obstacles to success.
Early in our consulting business we felt tempted to “take the bull by the horns” and get things going in our client’s offices. After all, we knew what to do and had done most of it many times. But we soon realized that our job now was entirely different: we had to learn how to help others do things themselves, in their own way. We found this adjustment difficult at first, and still struggle with it from time to time. But we have learned that the only way to instill permanent change within your practice is for you to “take charge” and implement the systems yourself.
There’s a phrase common to coaches in practically every type of athletic endeavor: NO PAIN, NO GAIN. In reality, it is also true for your practice. We’re here to help you minimize the pain (not eliminate it) and maximize the gain. So get busy and JUST DO IT!