Berning & Affiliates

"Event" Practice Transition Is Dead

I’ll be presenting a lecture at the AAO Annual Meeting in Boston May 1st. One of the points that will be stressed is the increasingly out of step approach that practice owners take when they just focus on securing an associate, considering a partner or planning to sell. I will refer to this old approach as "event" practice transition / succession. What is missing is the pre and post strategic analysis and planning for an effective result. When the sole focus is "I think it would be a good move to have an associate now", the larger picture of what is good for the practice can fade to the background. In fact, our experience is that the larger picture in terms of how the practice will capitalize on the additional professional, how the new doctor will be presented to the community / current patients and what benchmarks will be used indicating a successful integration should be the primary considerations for a Doctor CEO. With practices investing so much in their facilities, staff and marketing event driven transition does not do justice to the overall needs of the transition or practice.

"You Are So Different - In a Good Way"

During a recent practice meeting both the Doctor CEO and key staff reported on a new patient that was very enthusiastic with the care provided. The patient had transferred to the practice from out of the area due to a job change. The direct quote of the patient is the headline for this blog entry. When pressed for more detail the patient wanted to answer but mainly provided broad responses, "you are so friendly", "you seem to care a lot". But then came the specifics, "you helped me to understand what my options were in plain English and educated me", "you gave me the time I needed to make a good decision". Several additional patients were interviewed prior to our development meeting. During our meeting we seized on the various patient stated specifics and explored them. As a result of our discussion it clear that the Doctor CEO had set the tone for the practice and it dramatically influenced this staff. The attributes of the practice were then listed by the group, we are patient, we explain everything, we want the patient to understand why they are making a certain decision and what it means. From these attributes emerged a picture of the strengths of the practice, and just how different they are from what some patients have experienced in other practices. It is these now written and detailed strengths that will help guide this practice’s interaction and verbal discussion with any prospective patient that asks, "tell me about your practice".

Addressing CEO Transition Opportunity In The Current Economy

Given a difficult economy some doctor CEO’s are turning away from plans made over many years to add the next doctor. Others are embracing a good prospect even with the economic turbulence and proceeding to offer a transition opportunity. Specifically, in several instances recently doctors who had planned to add an associate leading to a partner stopped their plans and withdrew their offers. Their instinct told them that with the practices down in production 12-30% it was not the time to continue to add the next doctor. Others in a similar situation are not stopping. Why the difference? In my view it is the doctor CEO’s understanding or not of the context of the practice and the underlying demographics that acts to have one stop and another proceed with a practice transition in this economy. For those practices that have the facility, the staff, and the planning indicating that the practice will benefit, perhaps not immediately but over the intermediate to longer term, they are proceeding to add a good candidate now. For those that have expenditures to make to expand the facility, add the cost of additional staff and in addition marginal demographics indicating the local economy may not recover for a significant period of time, they are the ones not moving forward. Prudent leadership in this economy means basing decisions on facts, including the context of the practice and the underlying demographics.

The Doctor I Was Supposed To Be

During a recent telephone conference a doctor who was working with me to plan the last 5-6 years of his practice reflected on his practice career. He stated he had some regrets about not expanding the size of the facility to better accommodate his practice at an earlier point. He indicated he would have liked to have a partner and to have enjoyed a greater role in his professional society. Then he stated, "I really was not the doctor I was supposed to be. I could have done and should have done a number of things I knew would be good for me, but did not." We talked about his views and then about the importance for younger professionals to hold on fast to what they view as their ideal practice and work to accomplish it. We both agreed there was no reason for any doctor not to be the doctor they feel strongly they can and should be. Important and valuable words to the wise for any doctor, in my book.

Transitional Stages for Doctor CEO

A dramatic meeting this past week served to emphasize a growing perception I have had for the last several years. Namely, with practices growing to accommodate additional staff, a new associate or new partner, and possible new locations, management direction from the CEO can lag or worse. Where once the doctor gave timely and clear direction, as growth sets in actual or perceived fumbling of execution degrades the leader doctor’s ability to execute. In this case the practice had been following the timeline we developed together and acted aggressively to expand. But as the growth hit with new staff, a new associate and a second location the Doctor CEO retreated (that is the best word I can apply) from being a forthright decision making leader. As a result the practice suffered at the very time it should have been hitting high standards. To avoid this occurring, in my view, Doctor CEO’s need to anticipate that their practice growth stages also means that they must make fast and successful transitions to the next leadership capability level or execution and growth will suffer. Reading contemporary leadership texts, such as those on our web site under Recommended Reading List and our performance based coaching sessions are two ways to address this area.

The Guarded Approach

Risk has always been a part of running any kind of business. There is risk for Doctor CEO’s, for example that, aside from clinical skills, a doctor may not be well received in a local area, there can be clinical capability issues for the doctor, the staff or inaccurate perceptions of the doctor by referral practices or the community. There seem to be endless personnel, facility and equipment areas that if not attended to can grow in urgency and pose a risk to efficient and effective practice. More recently, in my discussions with many doctors we see an unprecedented level of personal financial, investing and related liquidity risk. Doctor CEO’s in my view must have a good feel for their risk tolerance and have a personal and practice contingency plan for the financial aspects impacting you and your practice. This should be in place, not just now in this difficult economy but routinely. Right now in my view it is important to get your assumptions and planning about preserving and growing the practice down on paper. My own recent counsel to many of my clients is to adopt a guarded approach. This means, be hyper attentive to all expenses for the practice, careful to let no opportunity to connect with patients and referrals go without follow-up and raising your professional visibility and accessibility to your community. Especially now, use your time and resources wisely.

Communication Resolutions Start The New Year

Most of the doctor CEO administration, personnel and practice transition difficulties that I see troubling practices stem from clarity of communication. Usually, the CEO thinks that she or he has given guidance through their actions or verbal communications when in fact they often leave ambiguity. Many doctor CEO’s know that they must first listen to gain an understanding of the matter a staff or colleague has inquired about. But the problem generally starts right there. With the first statement or question the doctor provides an answer. Often in a hurry the response is out and given and no further thought is given to it as the CEO rushes on. If the CEO took the time to probe, to ask follow up questions of their own and to consider the implications of what their response will be, significant changes would be seen. The first change is that staff and colleagues would anticipate the thorough discussion and prepare for it. The second is that the CEO would more carefully direct the actions and results of his or her team members. I heard a good phrase recently, it was "we are all starved for time". It implies that there is no time for all the things we are trying to do. And yet, for the CEO the precious time they do have for guidance can be best spent in my view, taking a careful, thoughtful approach that ends up saving time in the long run by resolving the matters the first time

A Master CEO

So there I was in NYC working with clients and had a few hours to take in at least one attraction. What caught my eye was an exhibit "Michelango: The Man and the Myth" at the Lubin House a facility of Syracuse University on 61st. An eye opening as well as eye pleasing occasion! This was an exhibit of 14 drawings as well as sculptures, paintings and poems. You read that right, poems! I did not know it but he wrote hundreds of tender love poems. Superb commentary in this small and well focused exhibit helps anyone gain a new appreciation for this man. What caught my attention, in addition to the masterly red pencil drawings 500 years old yet as fresh as yesterday, were the following statements. "He constantly complained about not having any money yet amassed a considerable fortune that kept his family comfortable for two centuries. Though he enjoyed the reputation of being a solitary genius, he directed dozens of assistants, quarrymen, and stonemasons to carryout his work." So there, like some of the best Doctor CEO’s I know, goes Michelanglo building his financial fortress, practicing his art and coordinating his team to produce the results he desired. Truly inspirational!

Avoid Over Confidence

In a recent email a doctor of a larger group practice shared with me that no matter what happens in the economy his practice will always be fine. Looking at his local area demographics and being aware of his new and current patient statistics I could see why he made the statement. I usually encourage Doctor CEOs to be confident and act accordingly and this doctor knew my position. And yet, nothing in our recent economic history is quite like what we are experiencing in this current time. We have all levels of the economic strata effected and consumers tightening their purse strings seemingly across the board, health care expenditures included. So a word of caution for all Doctor CEO’s that may be acting or talking like they or their practice will go untouched. At this time, It is far better to be cautious, to budget carefully, to treat financial arrangements with patients and suppliers with attention to detail than at any time in the recent past. Coming across as over confident, indicating treatment plans or starts without empathy for your patients situation may be exactly the wrong behavior.

AAO Orthodontist As CEO NYC

Five hundred very attentive orthodontists gathered in NYC November 14-15. I was the kick off speaker sharing a perspective on "Performance Based Leadership" with attention to sharing how to achieve consistent high performance leadership for their practices. We explored how practice environment, expectations and vision, when tied to business plan execution can lead to significant advancement of the practice. A key aspect was asserting that doctors given the present financial condition of the country be tougher in controlling overhead and seeking to lead with increased attention to timeline implementation. Other speakers were Paul Zuelke on expenses and overhead, John McGill on accounting and financial concepts and management and Bo Elliot on financing options. To me the format provided for good audience interaction and a panel discussion allowed the attendees to hear each speaker comment on any question asked. My compliments to AAO and COOP for a very good meeting! Two photos from the AAO web site are included below.