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letra de 3 problems preventing you from growing your dental practice - jb

growing a thriving dental practice is difficult, to say the least. according to the american dental association (ada), as of 2021, less than three-fourths (73%) of dentists in the united states were private practice owners, down from 84.7% in 2005. the majority of dental school graduates don’t receive instruction on practice management and development, which are two sk!lls that can make or break the success of your growing practice.

this level of business and financial insight must be attained through alternate resources. and while it is not your instructor’s job to teach you how to run a successful company, it is extremely difficult — and costly — to learn on your own through trial and error. in order to offer your patients, employees, and family the very best experience, it is crucial to reinvest in yourself through professional development and stay up to date on advancements in treatment and technology, as well as financial management and operational strategies.

here are three issues most dentists face when trying to grow and expand their practices:

issue #1: strategy

at tower leadership, we stress the importance of creating a “top-down strategy,” meaning it starts with the ceo. the very first thing to start with is the leader’s ability to create and execute strategy and operations while fully understanding what it takes to do this. a leader must formulate a strategy and understand what makes the practice unique. then, they must create a pricing model that fits, whether it’s focused on cost-efficiency or perceived value.

from there, we create scalable processes and systems that repeat without the direction of the owning doctor. then, we will move into standard operating procedures and key performance indicators, and lastly, focus on training to ensure we can onboard team members quickly and meet the standards of the business.

often, most dental practices focus on starting from the bottom and then moving upward. even though it’s easier to implement a bottom-up approach that focuses on training team members first and the leadership and strategy last, there is a large problem with this approach. the issue is that these are the members most likely to leave the organization, and you have not built up the processes to train internally. this creates frustration with the business, excess fees to retrain, and a lack of future scalability.

even when we get all this correct, all businesses will eventually hit an organizational ceiling. this is the place where under the current business strategy, organizational structure, talent, pricing or service model, etc., you will find it difficult to achieve future growth, and the business revenues and growth tend to slow. this is the place you, an owning doctor, need to identify, and it is where the business must push through what is called a strategic inflection point.

oftentimes, owning doctors will find it difficult to do this, as it will create a period of temporary turmoil and uncertainty. however, without this push, the practice will eventually mature and then decline. if you look at the dental landscape, you can see examples of this everywhere.

to look at a non-dental example, think of this: netflix dominated the dvd industry far and wide, then saw the need to shift its business model to streaming services even though they were winning in total market share. it utilized several tactics to shift its business model away from warehouses and dvds to modern data centers and streaming services. in turn, netflix experienced a dramatic boost and remains an industry leader in the video streaming sp-ce. the same must happen to a dental practice. it is crucial to know when it’s time to make changes to your business model to not only keep up but outperform competitors in the same sp-ce

eric j. morin of tower leadership, a group practice consulting organization specializing in expanding dental practices and maximizing revenue, offers insight, as well as ways to overcome roadblocks that many practices face with growth and expansion

“we have these points in our business where we cannot grow anymore unless we change the business model,” morin explains. “our knowledge base can also stop us from moving the organizational ceiling and getting to the next level.”

issue #2 capital allocation

dental school teaches the intricacies of being a dentist, not excelling in business ownership, leaving many practice owners struggling with how to run a lucrative business. in his career, one thing morin has seen lacking the most is a true understanding of how to effectively make capital management decisions.

one thing that is definitely true of owning and operating a business is that “growth eats cash,” says morin. when we understand internal rates of return and the return on investment of decisions, it allows us to affect future profitability and, ultimately, cash flow. then we place controls around that cash to mitigate the loss of capital due to poor or lack of cash management decision-making. depending on the vision and growth plan of the owning doctor, this will have a significant impact on future growth and their ability to acquire and retain capital for future growth needs.

“having the wrong or no capital management strategy can cost a business tens of millions of dollars over a career, as well as years of productivity,” morin warns. “to add, the number one need of a business is access to capital.”

issue #3: organizational structure

referring back to the first issue, tower leadership’s emphasis on creating a top-down strategy also plays into the organizational structure. how your team is utilized in the day-to-day is just as important as your long-term strategy. by effectively placing each team member in an unambiguous position to succeed, the organization can move forward with fewer hiccups and less uncertainty.

many practices realize too late that they do not have the correct organizational structure or team to scale quickly. without the right team and structure, growth will create a tremendous amount of stress on the organization. morin encourages building out an effective business flywheel and the operations to support it, which allows your practice to scale quickly while reducing the stress of the owning doctor dramatically. this will create a better patient and team member experience and will ultimately create a much more efficient organization. it will also have a dramatic impact on future valuation if the owning doctor decides to sell.

when you start at the top of an organization versus the bottom and build effective leadership, strategy, capital management, and operations, the business can reach its future goals with much less stress and a greater outcome in less time. this is how morin has scaled dental practitioners from one to over 30 locations in a relatively short period of time, and the same can be true of your future organization
tower leadership teaches business, leadership, and wealth sk!lls to dentists. its mission is to help dentists match their ambitions, carve out a work-life balance, and positively impact their team, community, and family. for about 20 years, morin has helped small businesses grow to 30-40 million dollar group practices, in addition to assisting dental groups on a national scale to overcome developmental roadblocks. morin is available to speak to your dental organization and offer his sought-after insight today. for more information and resources, visit towerleadership.com, and watch the group practice accelerator flywheel video.

- jb

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