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There are certain indicators that will let you know itâ€™s the right time to add an associate dentist or a partner in your dental practice. Kerry Straine, CPBA, CEO and President of Straine Consulting, explains what those indicators are. In this clip, Straine also stresses what a potential associate dentist or partner must demonstrate before you can even consider them for the roles.
There are certain indicators that will let you know it’s the right time to add an associate dentist or a partner in your dental practice. Kerry Straine, CPBA, CEO and President of Straine Consulting, explains what those indicators are. In this clip, Straine also stresses what a potential associate dentist or partner must demonstrate before you can even consider them for the roles.
Interview Transcript (slightly modified for readability)
“I’m often asked, when is the right time to hire an associate, or possibly bring someone in to become a partner in the practice. Assuming that it’s not due to a retirement or a disability, that time is when there’s enough patient flow and production within the practice so that the addition of an associate doesn’t cannibalize the owner’s production.
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Nothing could be more challenging for the owner than to have hired an associate and not have an adequate amount of patient flow and corresponding patient production to keep them busy, especially when the profitability associated with the practice at that time is marginal. That is, the doctor is pulling out all of the profits and not accumulating working capital, which appears on their balance sheet in the form of money in their savings and checking account.
We look at when that practice is profitable, according to plan, and we have more patients creating treatment that needs to be done than the owner or the seller can keep up with and or more exams, always while maintaining our level of profitability as designed, then we know we’ve got room to bring on an associate without negatively impacting the economic situation for the owner.
Often times, the associate may be able to perform or be willing to perform certain procedures that the owner has referred out, or hasn’t got a chance to get to. That can also compliment the situation.
Again, when there’s excess demand for exams and production according to the supply we have — the time the owner has available – then we know that we’re at a tipping point. One of those options is to possibly bring an associate into the practice, and if not that, certainly move out of network with insurance plans or increase fees, are all ways to relieve some of that stress.
When we’re looking at bringing on a partner, it’s safest to have confirmed that the candidate is the right candidate, having been in an associate’s position for a minimum of four seasons — spring, summer, fall and winter. They’ve shown up to work on time, participated in all of the management process activities of training, huddles and staff meetings, and even maybe have sat in on some of the executive business decision meetings, taken on some responsibilities. Know that they’re going demonstrate – once they’re owners – the commitment level that the original owner has made.
Just because someone buys a practice doesn’t mean they can sit back on the couch and recline and go, ‘Ah, everybody reports to me.’ We have a saying in our organization: Owners have all of the responsibilities and none of the rights. Your team members have more rights than we do, and certainly, our customers — our patients – do as well.
If we can qualify that candidate, not only from their commitment level, the timeliness of them getting their work done, the quality of getting the work done. And the integrity of the individual.
The last critical piece of information that I have found to make for the most successful transition — and we’ve been involved with probably over a thousand team members over the years transitioning into ownership – is that their production level comes within 15 percent of the seller’s before they’re allowed to buy in, because if that associate can’t produce to the level of the owner, then the owner is going to sacrifice some of their income to fund the buy-in.”