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Dr. Marc Cooper of The Mastery Summit, explains what qualities real dentist entrepreneurs need in order to thrive in a changing dental marketplace.
Most dentists are not inherently entrepreneurial. They primarily go into dental practice due to its historical stability and minimal downside risks. Dental practice classically has been a pathway to sizable personal income, immune from radical fluctuation in the economy and safe from being displaced by disruptive technologies. That is, until the last few years.
Seismic shifts in the dental landscape are now occurring. The asset value of solo dental practices is nose-diving due to a flattening of its revenues, increasing costs of doing business, competition for new patients who can pay for dentistry and the increasing restrictions of dental benefits. To make matters worse, student debt-along with a major shift in attitude among younger dentists-is reducing the number of viable buyers for dental practices, further depressing the negotiable value.
As individual practices are struggling more financially, managed group practices are emerging as a dominant force in the market due to their ability to reduce the cost of delivery, handle backroom functions more effectively and less expensively, manage operations and staff, and leverage negotiations with vendors, suppliers and labs. By reducing the cost of delivery and improving access, managed group practices have gained appeal in the market and among other industry stakeholders such as insurers, benefit managers and suppliers.
While solo practices are sinking at 7 percent per year as reported by the ADA, managed group practices are growing at 20 percent. This growth is fueled by the ingress of large capital investors who see dental practices as highly fragmented businesses that can be easily consolidated to increase margins, profits and EBIDTA.
Among all this change, there is a minority of dentists who see such seismic shifts not as a threat but as an opportunity. These are the dentist entrepreneurs. They can envision building their own managed group practices, their own expression in the market, their own brand. They are consumed by what is possible and are committed to converting that possibility into action.
Dentist entrepreneurs are driven not by security but by a vision. They have a grand purpose of building a great business, not simply leading a stable practice that allows them to make a good living. Dentist entrepreneurs are driven by their passion for creating a significant dental enterprise that reflects their values, vision and purpose. They reimagine how dentistry can be delivered.
For the last five years, I’ve worked exclusively with dentist entrepreneurs in our Dental Entrepreneur Programs and the Mastery SUMMITs. I’ve gotten to know these individuals intimately. By working with such inspiring individuals from all parts of the U.S., South America, Canada, the Middle East, Asia, Israel and Europe, I have come to deeply appreciate what distinguishes a dental entrepreneur from the average dentist.
What are those qualities and characteristics that give dentist entrepreneurs the courage to take enormous risks? What allows them to play “all-in”? What inspires them to build dental companies with resource centers, hierarchical management structures with experienced non-dental executives, with continually expanding numbers of dentists and locations? What do they have that others lack?
Up next: Qualities of the dental entrepreneur ...
Dental entrepreneurs are a rare breed. They seize the opportunity in an economy that embraces access, convenience, ease of use, reduced cost of delivery and brand marketing. For those willing to risk their time, money and individual identity, managed group practice offers up the perfect platform for the amalgamation of one’s passion for dentistry and passion for building a great business. What are those key qualities and characteristics that distinguish dental entrepreneurs?
Resolve is the willingness to decide firmly on a course of action. Dentist entrepreneurs clearly have the resolve to produce a successful dental enterprise. They didn’t go into dentistry to give themselves a secure, high-paying job; they went into dentistry for the opportunity to create a great dental business. They love the business side of dentistry, unlike most dentists who simply tolerate the business aspects of practice.
For dentist entrepreneurs, dentistry is the "means" not the "end." They see dentistry as the means to create a unique dental entity. They are steadfast, stubborn and extremely determined to see their business vision become a reality.
It is this resolve that empowers them in the face of the multiple problems that inevitably arise while building a substantial dental company. They just don’t give up. They don’t give in. They’re relentless, tenacious and resolute.
Fearlessness means operating without fear. It isn’t that dentist entrepreneurs don’t get scared or anxious. They do, but what distinguishes them is that they step into the fear and don’t let fear stop them. To do this, they must be courageous-lionhearted. Indomitable, they dare to go forward without knowing the answer beforehand.
Whereas most dentists are frozen by fear, dentist entrepreneurs are intrepid. They don’t play “not to lose.” They play to win. They are not intimidated by being on the edge. This is the antithesis of most dentists, who are intimidated by the task of building a managed group practice.
Passion is a deeply felt emotion. Dentist entrepreneurs are extremely passionate about creating a dental enterprise that is highly effective, productive, and well marketed with growing revenues, strong margins and highly competent non-dental senior executives. Their passion is often expressed with an intense-even overpowering-sense of conviction.
You can hear passion in their speaking. People who hear such passion are often moved to act. The hunger for and the desire and possibility of a new future is palpable in the dentist entrepreneur’s words and behavior.
Most dentists are passionate about their dentistry but not about the business. The business of practice for most dentists is a “have to” not a “want to.”
Next page: How does an entrepreneur approach ambiguity?
4. Acceptance of ambiguity
Ambiguity is the quality of being open to more than one interpretation. Dentist entrepreneurs can endure the uncertainty, the vagueness, the polar opposites that are the result of ambiguity.
Because of this relationship to ambiguity, dentist entrepreneurs can deal much better with the chaos and surprises of growing a company. They can live with the doubt and haziness that comes with any paradox. This is what makes dentist entrepreneurs so unique: They can operate in the uncertainty of not knowing.
This is the opposite of most dentists who won’t act until the plan has been time-tested by others. Simply put, most dentists abhor ambiguity. The want the “answer,” the formula or the recipe that has been well-vetted.
A vision is an aspirational description of what an organization sees as possible to achieve in the mid- and long-term future. A vision serves as a clear guide for choosing current and future courses of action.
Dentist entrepreneurs have an authentic vision. They are obsessive about creating a future that is unique. They understand that a vision is about a possible future, that it is not about them, and that it is possible to achieve. They see their vision when they go to bed every night and when they wake up every morning. In short, they are gripped by their vision.
It is vision that burns within a dentist entrepreneur. The vision is the source of their passion and resolve. Unlike most dentists, a dentist entrepreneur's visions are very real to them, not just some platitude, inanity or cliché. They can see it, feel it and taste it. They are truly on a vision quest.
Adaptability is the quality of being able to adjust to new conditions, the capacity to modify one’s approach in response to change. Given the rapid shifts in the dental industry, adaptability gives dentist entrepreneurs a distinct advantage since it allows them to adapt rather than resist change.
Dentist entrepreneurs accept that change is constant. This understanding enables them not to be positional. They have a much greater capacity to “go with the flow” than resist or get upset by change, which is the ordinary reaction of most dentists.
In the face of change, dentist entrepreneurs remain detached with a greater sense of objectivity, which enables them to make more prudent and effective decisions. For a dentist entrepreneur, there isn’t a right way, there is just the best way right now.
Next page: Risk analysis-the right way ...
7. Risk tolerance
In the context of dentistry, risk tolerance is the degree of variability that a dentist is willing to withstand, his or her willingness to stomach the swings in the value of his or her investments. â¨â¨The definition of risk is exposure to danger. In business, this implies downside risk, meaning the uncertainty of a return on investment or the potential for financial loss. Dentist entrepreneurs have a high degree of risk tolerance, which allows them to move bravely into an uncertain future. They understand there is no clear road map for generating a successfully managed group practice, but they believe in themselves and their ability to find their way.
A strong risk tolerance is needed given the numerous financial and professional uncertainties that present themselves in generating a managed group practice. No risk, no reward. And risk also adds power, resourcefulness and urgency, which generates more effective action.
Most dentists are risk-averse. They are sluggish or even reluctant to change. They try to mitigate risk as much as possible by continuing to do the same things they’ve always done, hoping that it will be enough to sustain them. Their low tolerance of risk keeps them stuck in the past, unable to take the necessary actions to adapt.
Motivation is the desire to achieve. Motivation begins with a strong belief. A tremendous amount of motivation is needed to sustain dentist entrepreneurs through the trials and tribulations of building a managed group practice. If not fully committed, the arduous issues a dentist entrepreneur faces will never be resolved.
Almost all dentists are strongly motivated to improve their clinical knowledge and the level of dentistry they deliver, but few are motivated to build a managed group practice.
Being self-aware is a fundamental and critical component of successful leadership in generating a managed group practice. Self-awareness is conscious knowledge of one's own character, feelings, motives and desires. If dentist entrepreneurs don’t know themselves, recognize their strengths and weaknesses, understand why they react the way they do, they will make poor decisions. As validated by numerous business books, experts and studies, the higher the level of self-awareness, the more potent the leadership and the more successful the enterprise will be.
Most dentists see little value in enhancing their self-awareness. They have little appreciation for self-examination and self-discovery, the pathways to self-awareness. Dentist entrepreneurs are hungry to learn about themselves because that understand that who they are-not what they do-is the ultimate key to success.
Next page: What are your core values?
10. Core values
â¨Core values are the principles that guide behavior and action. Core values help people distinguish between what is right and wrong. They create an unwavering guideline for behavior. Core values help businesses determine if they are on the right path to fulfilling their business goals.
For dentist entrepreneurs, core values don’t exist as platitudes-they exist as the bedrock of the company. When the core values are heavily ensconced in the firm, the culture of the practice will generate high performance and strong relationships.
Rarely is this the case with dentists. The core values for most dentists function as banalities or good intentions, but their commitment to upholding their values is often weak or nonexistent.
â¨Dentist entrepreneurs must be responsible. Successful dentist entrepreneurs hold themselves as the cause of what occurs in their group practice and their lives.
Dentist entrepreneurs understand that blaming someone or something is the antithesis of responsibility. They also understand that guilt and shame are not responsibility, and are only related to defeating moral self-judgement. Dentist entrepreneurs understand they are the source, the head-water, the foundation of the way things are in their enterprise.
Responsibility determines how dentist entrepreneurs see themselves and their ownership of the group practice. Responsibility is the belief that “the buck stops here.” Responsibility is an existential stand that dentist entrepreneurs take no matter what.
Few dentists embrace this level of responsibility.
Dentist entrepreneurs are a unique breed. In my estimate, they represent less than 10-15 percent of all dentists. Dentist entrepreneurs have a driving desire, a passion, an unconditional commitment to building something special, and they devote their time, energy and money to making it so.
As solo practice fades, dentist entrepreneurs will build managed group practices that will dominate how dentistry is delivered. These dentist entrepreneurs will be in their own way the Jeff Bezos, the Howard Schultzes or the Sir Richard Bransons of dentistry. They will bring their own expression, their own dynamic, their heart and soul, and their own vision to dentistry. Dentist entrepreneurs are the future of dentistry.