You can thrive as a small practice — you just need to be strategic. In this episode, Kirk Behrendt brings back Miranda Beeson, ACT’s director of education, to share how to differentiate and close your operational gaps so you attract the best patients and the best team in a changing market. To learn how to create and maintain a thriving private practice, listen to Episode 969 of The Best Practices Show!
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Episode Resources:
Main Takeaways:
Quotes:
“Your logo is not your brand — it's a logo. It doesn't make your practice different because you have a cool logo or website. It starts with the internal vision first. Who are your core customers? When you look at the people that sit in your chair, who are those people that are your core customers, that if you had more of them your life would be better, and your practice would be better? You have to identify your core customer because more is not better. Your favorite people care about the same things that you care about. They come in, you talk to them, and they respond. Your least favorite people are the ones that don't care about the same things that you care about.” (17:18—17:56) -Kirk
“The second piece of it is, after you identify your core customer, are your core competencies. These are truly strengths, things that you are really good at — not that you think you're good at them, or you'd like to be good at them. You're good at them. People have recognized you're really good at this. You've worked really hard, you're better than most, and they set you apart from others. For instance, we have some people that are amazing at composite dentistry — like, amazing. Some, at conscious sedation and some, at airway. They're really good at it, amazing at it, and those are things that they usually excel in.” (18:05—18:46) -Kirk
“When you take the time to reflect on what you're really good at, like your unique ability, you get energy from trying to be better at it, and you're never satisfied. You never go, ‘I'm there. I've made it.’ No. Anyone that identifies a core competency, they work at it, they get more energy as they work at it, and they're constantly improving. It's never exhausting to work on your unique ability. It gives you energy.” (18:49—19:14) -Kirk
“There are a lot of people that are now seeking out concierge medical practices. They're willing to pay $2,000, $3,000, or $4,000 for an annual membership for these medical practices because they're craving a personal, customized, comprehensive approach to looking at their health. There are a lot of dentists that are really leaning into that as well. And if you are just throwing mailers out there that say $49 new patient visit, you're not connecting the message of what you're really trying to create. So, that's where stopping and looking at, ‘What are we trying to create here? What type of dentistry are we trying to do here? Who are the people that want that as well that we want to serve?’ and getting the whole team aligned around that really helps you to lean into that conviction and say, ‘We can do this in this way.’” (21:32—22:26) -Miranda
“You also have to identify your weaknesses. There are a lot of things that all of us are bad at. I actually did an exercise where I had to fly to Strategic Coach, if you guys have ever been there. Dan Sullivan has a workshop called the Unique Ability exercise. I actually went and took it, and it was amazing. I came back, and Barb, who was working in our office, I'm like, ‘I just took this amazing course. I found out I suck at a lot of things.’ She's like, ‘You had to take a course for that?’ I'm like, ‘Yes.’ So, you have to list all the things that you love and you loathe, and you basically narrow it down to, you're really good at like four things, and you're terrible at a whole bunch of things. When you are completely honest with yourself, or somebody else is honest with you as a leader, you can start to focus on the few things — and I do mean few — that you're really good at, and you can stay away from your weaknesses.” (23:31—24:23) -Kirk
“You’ve got to build a strategy. You don't have to do this overnight. That's why we're big fans of the EOS Traction system where quarter over quarter we can just do one or two things where we're executing on this strategy, and we're starting to make this happen. A lot of times, people try to go from zero to a hundred on these things. Don't do that. Let's do a few things every quarter. Stay consistent and you'll find, over time, it transforms your practice.” (26:57—27:22) -Kirk
“The second piece of this is you have to identify the operational gaps. Every practice has these. Even the very, very best practices we have ever seen have these gaps, and there's potential that lives in them. There's also profit that's just sitting in there, or it's wasted in these gaps, and there are four of them. The first one is the effort gap, and this effort gap is all of the things at the top before you actually collect a dollar. Let me explain. Their gross production, which I think is one of the worst metrics in dentistry today, I consider it a false proxy. People say, ‘I produce $4 million.’ I'm like, ‘Well, that might be what your computer says, but that's not really what you produce. That's your potential production and collection.’ And let me back up on this. When people say, ‘I produce $1.5 million,’ let's say you have a buddy, and your buddy does $1.5 million, and you do $1.5 million. It's not the same thing. Your buddy might write off 33%, and you write off 10%. It's not the same practice. Those are completely different entities. So, the effort gap is this: it's gross production, it's days worked, it's write-offs, it's write-off percentage, and all of those things. There's a mountain of opportunity there. People come to us with a 33% write-off or more. What that means is you're working one out of every three days for free. And I would argue you're working more than one out of three days for free because you're actually paying everybody and you're not collecting a dime. You just glove up, see all these patients, and give your heart and soul to these people for free. Don't do that. Our coaching team tightens up that gap. So, whatever it is, make sure you tighten up the effort gap.” (27:23—29:26) -Kirk
“There's a second gap called the collections gap. The collections gap is the difference between net production and collections. So, you might net produce a certain dollar amount, like $1.2 million, but you're collecting 95% of that. A lot of people think that's great, and I love how Robin says that on our team. That might be an A in the classroom, but that is a D in practice management. You’ve got to collect 100% of every dollar that is owed to you, and that can be done very easily with the right training and the right systems in place.” (29:53—30:28) -Kirk
“The third operational gap is the overhead gap. Now, overhead is not overhead. Back in the day, people used to say, ‘What's your overhead?’ ‘54%.’ ‘Mine is 52%.’ It's not the same thing anymore. Overhead encompasses everything. It's a function of your collections against your true business expenses, and they ultimately affect your true profit.” (37:08—37:33) -Kirk
“At the end of the day, you have what's called your cash flow gap. That's the last gap. That's the difference between your gross profit and your true profit. What lies in the middle of there are things like loan payments, taxes, and all that stuff. I tell this story, when I first started ACT, I got this line of credit. It was $50,000. I was like, ‘Wow, man! It's cool money I could just transfer into the business account.’ Well, I transferred it to grow and use it, and then I started paying it off. I'm like, ‘Well, I'm paying it off, $5,000 a month. That's tax deductible.’ No — it's not. I argued with my accountant. My accountant was like, ‘That's not deductible.’ I'm like, ‘I'm paying this off.’ He's like, ‘Buddy, you’ve got to learn. That's not a deductible expense.’ The other thing you learn is one of the challenges of improving your profit is that you become a bigger taxpayer. At some point, the government is going to take 40%, 41%, no matter what. Do you know where that money comes from? It comes from your cash. So, that doesn't show up on your P&L.” (37:33—38:36) -Kirk
“Your P&L is one of the worst tools to run a business. It's important — don't get me wrong. But it doesn't tell the story. Cash flow gaps tell the whole story. I want to know where every potential dollar went, from production down into your bank account, and that tells the whole story. These are systems and processes at play every single day in your practice.” (38:41—39:00) -Kirk
“Here's the coolest thing about data. Data is unemotional. It doesn't lie. If I'm a dentist and I'm talking to you, and you're a team member, and we don't have any data, we're just having a conversation, it's probably going to get emotionally charged. We're just having a conversation about how you feel. If we're looking at data, we can talk about what's happening, ‘This is truly what happened,’ and we can come to a solution together. It allows practices to identify inefficiencies.” (46:23—46:52) -Kirk
“You can design what you want your practice to be, the purpose that you're fulfilling, the culture that you're creating for your team and for your patients — but it has to be by design. We don't want to just leave it to chance, and you can't chase every little flashy thing that you see pop up in a chat forum, a magazine, or on Facebook. You have to really stop and reflect on your own self. That will then allow for you to dig forward into differentiation. You can really stop and say, what are the things that we value most? What are the competencies that we want to create here in the practice and the people that we want to serve? And honestly, write it down. Write it down, and create a strategy around differentiation and a strategy that you can share with your team so that you can all align together on what it is that we do differently here that's going to help us thrive when there are four dentists within a three-mile radius of our practice. Then, from there, once we have that differentiation, in order to know if it's working, we have to look at the data. We have to look at those little gaps in the practice and say, what's working and what's not? Where do we need to tweak? Where do we need to focus this quarter? Maybe you need to focus on all four gaps. Well, you can only do one at a time. So, dig in to where you have the most impact. That's where your team homes in for the next 12 weeks. ‘We're homing in on this gap. Here's some data that we're going to talk about, that we're going to track, that we're going to lean into on a regular basis that's going to help us to figure out if we can make an impact.” (49:02—50:44) -Miranda
“Lack of consistency is the signature of mediocrity in dentistry. When you can be consistent, you can use the data, you can improve your practice, you become different a little bit quarter over quarter, you'll wake up one day and go, ‘Wow, we're an overnight success!’ But that took five years. Do you know what I mean? It's crazy how it transforms a practice and a culture. Then, one day, you go to your practice, you get out of your car, and you go, ‘I love this. I don't know how this happened, but I freaking love going to work. I can't even believe we're here. I work 182 days a year, I make good money, my team is happy, we all get out of here at 3:00 and they get to go pick up their kids.’ You say to yourself, ‘This is the greatest profession ever.’ But it starts with you making that decision.” (52:23—53:05) -Kirk
“Just as much as you differentiate yourself as a thriving private practice to your patients, you can differentiate yourself as a thriving private practice to team members. You can create this differentiation that brings people to your team that really want to also serve and take care of people and be taken care of in the way that you are. There are team members that just want to be respected in these roles, and I believe that that happens every day. I see it with the teams that we coach — some of the most fantastic team members and the most fantastic relationships between the doctor-owners and the team members — and it just comes down to differentiation, culture, intention, and designing this place where we're serving a more meaningful purpose. So, I think it carries over into that side too, because Lord knows hiring, keeping, and finding team is hard everywhere right now. I just want to shout from the rooftops to every team member out there that's like, ‘It sucks.’ No — it doesn't have to. There are great practices that are ready for you to come on board.” (57:58—59:03) -Miranda
“You don't think there are good people out there. I hear that, ‘There are no good people.’ There are a ton of them. They're just not working in your office yet. Do you know how you find great people? You don't. They find you eventually, over time, because you're consistent. You get the coolest team members who ask, ‘How do I get a job here?’ I'm telling you firsthand, it's not easy. It takes a long time. But when you get there, you're like, ‘Holy moly!’ You spend 30% of your life at work. You've got to be the ultimate talent magnet for that opportunity.” (59:14—59:44) -Kirk
Snippets:
0:00 Introduction.
2:22 ACT’s BPA, TTT, and Pro Coaching.
5:51 Why this is an important topic.
17:06 Differentiation: Identify your core customers.
18:05 Differentiation: Identify your core competencies.
23:31 Differentiation: Identify your weaknesses.
26:56 Differentiation: Build your strategy.
27:23 Operational gaps: Effort gap.
29:27 Operational gaps: Collections gap.
37:08 Operational gaps: Overhead gap.
38:41 Operational gaps: Cash flow gap.
42:30 Data drives impact.
48:39 Final takeaways.
53:08 More about ACT’s TTT Study Club.
55:13 Last thoughts.
Miranda Beeson, MS, BSDH Bio:
Miranda Beeson has over 25 years of clinical dental hygiene, front office, practice administration, and speaking experience. She is enthusiastic about communication and loves helping others find the power that words can bring to their patient interactions and practice dynamics. As a Lead Practice Coach, she is driven to create opportunities to find value in experiences and cultivate new approaches.
Miranda graduated from Old Dominion University, and enjoys spending time with her husband, Chuck, and her children, Trent, Mallory, and Cassidy. Family time is the best time, and is often spent on a golf course, a volleyball court, or spending the day boating at the beach.