Don’t forget that we will refer to any new doctor who will work for you in an associate relationship as a Trial Partner (TP). Remember that we do this to constantly create a cooperative culture with your new associate. I feel that the owner doctor owes it to the junior associate to educate them about the business of dentistry while listening to their concerns and finally arriving at an educated win-win employment agreement and culture. Your goal is to grow and develop this relationship so that each of you have risk and reward that is consistent with a long- term relationship. From day one, we want the young doctor to understand that we are not looking for a short-term employee. We are trying to develop a long-term partnership where each of us has a hand in maintaining and evolving and adapting to the new dental economy. From the very first day we want them thinking like an owner. They should be concerned about new patients, overhead, and staff relationships. They should want to expand the hours in order to increase their exposure to more patients. They should be looking forward to this relationship whether it is a life-long job or an ownership of a fractional share of the practice. Because we build strong practices centered around the culture of Purpose Driven, Doctor Led, Staff Owned, each employee, regardless of the position, needs the attitude of an owner. In fact, never hire employees, hire “partners” in the office. The culture should permeate an attitude of the practice being “our” practice, not just yours. Staff ownership fosters pride of ownership as well as drive to exceed expectations and shared profits from this effort. “Employees” on the other hand, will whine and complain, show up late, leave early, live paycheck to paycheck and show no concern about the team (and maybe little or no real concern about the patients). Start referring to the young doctor’s position as the Trial Partner (TP), and see the difference. An ownership mentality is exactly what you want in your new doctor.
Associates/Partners don’t eliminate problems. They magnify them. If you do not have your house in order, you will face a most daunting task to balance this new relationship. Adding this doctor will stress the ability of your systems to scale to another level of practice. We get so used to working the way we work, that we fail to see the obvious things that are holding us back. John Gardner said it best: “Most organizations have developed a functional blindness to their own defects. They are not suffering because they cannot resolve their problems, but because they cannot see their problems.” Because every office is always working at capacity, each of us must accept that any change requires doing things differently, not harder or longer. What works for a single doctor office never works for a multi-doctor office.
You must have an adequate facility, equipment, new patients and staff to make this a seamless transition. There is a myth that adding a doctor requires that you expand your facility. It is not impossible to have 3 doctors, 3-4 hygienist in a 6-op office. By breaking up the week into 6-hour shifts, 11 or 12 hours a day, a practice can produce over a million a year per doctor and another one and half million from the hygiene department and never even see one another. (Rick Kushner has done it with hundreds of offices.) It is not crowded and the overhead can dip below 50%. Keep in mind that if you cannot at least double your new patients, you are not ready for a new doctor.
While slightly ambiguous, you must know yourself and your staff. A group of people who work together every day in a dental office is not necessarily a “team”. You may just have a group of people who happen to work in the same office. A team mentality is paramount to making a successful transition to multiple doctors. The cement that binds a team is a cutting-edge culture that is built on excellence and relationships. If you know that your leadership and management skills have taken a back seat to your clinical skills, you will have to start to lead and manage once again. There are no “born leaders”; this is a learned trait and an area where anyone can improve. You cannot be an absentee owner and expect your office to run both effectively and efficiently without great systems and leadership from you.
Because the “Associate” never feels at risk, never feels the need to really learn the business systems, and never learns how to optimize revenue, they fail to ever “own” the process of operating the practice at the optimum level. An ownership mentality brings focused, persistent attention to running the business. Do not make your time with an Associate/Employee just a stop on the way to their ultimate goal of ownership somewhere else.
NOTE: Traditional associateships (employee attitude; not a Staff Ownership culture) do not require enough commitment from the junior doctor to later follow through with an ultimate buy-in transition or from the associate’s perspective, the ability to learn from this relationship and ultimately own their own practice. Without structured contracts that clearly outline how the office will operate, what the expectations are from the owner and the employee, the junior doctor may opt to leave the practice within the first 15 months. If, on the other hand, you both are considering a buy-in, poor contracts would leave issues undefined, such as terms and price of the sale to be negotiated later. This would probably put the buyer/junior in the bargaining position because he or she would usually be the party least needing the continuance of the association. In other words, he or she would usually be more flexible to leave in case terms could not be agreed upon. Furthermore, the longer the junior is present and working in the practice, the better this bargaining position would tend to become, because the more the senior doctor would usually desire or need the association to continue and the less he or she would want to risk turnover. Therefore, the senior doctor in this case would be the party most likely to need to make concessions, in order to retain the junior and keep the transition from perhaps breaking up. Leaving issues undefined does not necessarily favor the junior party, however. It tends to favor whichever party would be most flexible to termination. Usually, once into a transition, the senior, programming for upcoming retirement, would be less flexible to termination and trying to start over with another junior. On the other hand, once into a transition, the junior may have more desire for its continuance than the senior and then the senior would have the bargaining advantage. Ideally, there should be no such strategy involved, but unless both parties were more-or-less equally committed, the one most desiring continuance of the arrangement would usually be at a disadvantage. This is the reason that structuring the transition or sale from the first day with comprehensive contracts and financing will insure a successful transition strategy.
Granted, not all associates become long term employees, future partners, or even the ultimate doctor to buy out the senior doctor. But crafting and staging this transition with these possibilities in mind will ensure that whatever happens, there will be no surprises on either side. As we progress in discussing adding a doctor, you should see how much importance I give to making sure that both parties become “informed consumers” when it comes to any aspect of this transition. The process must be transparent, fair, understandable, and sustainable over a long period of time. Later I will show you how to memorialize each topic and step into a document that will anticipate any challenges and create remedy for each one.
Staging a transition is not difficult but there are a lot of moving parts. My commitment is making sure you understand each step and how to minimize any failed processes. This is how you Summit.
Michael Abernathy, DDS
PS. As before, feel free to give me a call or email and let me give you precise answers to any of your transition questions. I look forward to hearing from you.