Scaling up dental group practices with integrity

August 3, 2020

The leadership of Southern Dental Alliance offers insight on how it is navigating the particularities of COVID-19 and the pressures to grow, while maintaining its core values.

It is customary for this column to focus on specific technology and trends in innovation. That is why, when I decided to interview a DSO in this space, it needed to be one that stands out as truly special. I believe Southern Dental Alliance (SDA) clears that bar with room to spare. With 59 practices in 43 locations across multiple states, I’ve been impressed at the personal relationship with individual practices they’ve been able to not only maintain, but prioritize, even as they strive for efficiencies across the SDA network. They’ve proven that scale doesn’t have to mean sacrifice.

I invited Mark Lakis, SDA’s CEO, and John Merandi, SDA’s COO, to join me in a conversation about how they’re navigating this moment in time and what it looks like to put the dentist experience first in the DSO model.

LS: There is much to respect about the SDA approach, but I’ve been consistently impressed at your ability to cultivate—and sustain—personal relationships with the individual practices who come on board.

JM: You’re right! Those relationships are very “un-DSO like,” and that really starts with Mark.

ML: I’ve seen the efficiencies that the largest DSOs can offer, but also the unmistakable quality of care in a private practice. We wanted to build SDA around both by building in meaningful autonomy for our doctors and their teams. We believe that the best care for the patients comes from engaged and happy teams.

We don’t go in and say, “thou must do A, B, C or use X, Y, Z.” We know that there are efficiencies and economies of scale that we need to achieve, but we want to influence rather than dictate. It may be slower, but ultimately results in a stronger company.

We are willing to wait a little on some economics at the front end because in the long run, the key to our business is the doctor and the team and their buy-in to the broader SDA culture. If those partners stay and commit, their teams stay and commit, then the patients do as well.

JM: It is one thing to say it, but another thing to do it and live it. The level of richness in the relationships and level of engagement, partnership, involvement at SDA—it is at a different level.

LS: You allow them to retain their identity rather than force them to become an SDA look-alike. How were you successful in managing your practices’ responses to COVID-19 where there are best practices to implement?

ML: Throughout the crisis, everyone believed that we were committed to keeping our team and their patients safe and pushing hard to get them the resources they needed. This is because of John’s unquestionable credibility and integrity and strong relationships throughout the company.

In dealing with COVID-19 challenges, we worked cooperatively with doctors and teams throughout the company to establish the new, comprehensive protocols. The buy-in that resulted from the cooperative process was critical to achieving the necessary improvements.

Of tremendous importance was the communication that was pervasive throughout the process—from the day we closed, to the day we reopened, and now. The consistent message to our team was that we were going to focus on safety. The best example of that is the $500,000 we spent to install a unique air and surface purification system—that description doesn’t do it justice—so that our offices are even more safe. We told people about it for weeks leading up to the installation, knowing it would help them make the right decision around coming back to work. Our teams were excited to go back to work and we came back strong.

I think that this season has demonstrated the strength of the DSO model and resulted in greater acceptance in the dental community, especially as DSO leadership has played a critical role in getting dentists federal

support and recognizing dentists as essential. That required the kind of organized business expertise that DSOs have more of.

LS: How do you bring that business sense to conversations about innovation? I know you are looking at the market constantly, looking at new technologies and what’s best for the practitioners.

JM: Sears and Toys “R” Us were best of business at one point in time, but each organization took its eye off the market and got swallowed up. I look at that and see that we have good things, but don’t think we have all the answers. We are always looking for what else could benefit our affiliated practices and their patients.

ML: We believe in innovation. You and I have had conversations about innovations in clear aligners and implants and how we bring those into our culture. We’ll get there, but we need to figure out how it works with our practices. Partnering with you and Cellerant has made it easier for us to stay on the lookout for innovative technology that really raises the overall standard of care.

JM: We regularly ask ourselves if our decisions, behavior and actions add to our doctors’ enjoyment of the work, because they have the choice to work wherever they want. I’m proud that asking these questions is an important part of our approach.

LS: Based on the philosophy you bring to managing SDA, what do you see as the main challenges as you continue to grow?

ML: Maintaining the culture is a challenge. It might be more efficient to aggressively force changes in practice management system or standardize pay, but that’s not our culture. Doing that would cost us much more in the long run than we might gain in the short-term. We’ve made mistakes—some of which have cost us money—but we’re committed to finding qualified team members who can adjust to our culture, thrive in it and help improve on it.

JM: Partnering with the right people is critical. For every practice we move forward with, there are a number we pass on because we’re not willing to compromise on culture, choosing to be selective even when there is pressure to grow.

In conclusion, the author adds: As a former owner of a 10-doctor, 25-team member practice, this is an option I would have seriously considered based on the culture you’ve created. Thank you for taking the time to share your story.

ABOUT MARK LAKIS, CEO

Mark Lakis is CEO at Southern Dental Alliance (SDA), which he founded in April 2012 along with Dr. Miguel Hernandez and Dr. Jim Nasim. He has been the leader of two DSOs and a senior executive in a third. The mission of SDA is to assist Founder Doctors with the day-to-day business functions of owning a company, without changing the integrity of their practices.

ABOUT JOHN MERANDI, COO

John Merandi is COO at SDA. Since 2001, he has been working with some of the leading DSOs in the U.S. This experience has allowed him to see firsthand the operations of over 500 practices, over a billion dollars in annual revenue, and what it takes to build long-term successful teams. His specialties include: dentistry, practice management, operations management, leadership, leadership development, and team building.

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