This newsletter we will cover:
1) Jon’s wrap up includes website link to an archive article
2) What’s ahead of us
3) Leadership strategies
1) Jon’s Wrap Up
I hope that you are all making progress in regenerating your clinics.
Feedback from you all tells the variable stories and degrees of positive response from your patients’.
Wherever you are positioned in the recovery process, be positive because you will get back to where you were pre Covid19.
Here is a link https://www.refocuseddental.com/post/from-our-archives-dentistry-in-difficult-economic-times to an article that I wrote in 2008 after the GFC. The guidelines are still applicable today with the key point being that everyone recovered.
The timeline for each clinic’s recovery was variable after the GFC but please take strength in the fact that all dental clinics did recover and you will too from this current crises.
The good news this week comes from the Federal Reserve Bank chairman who said that “the crash has been less than we expected.” Good.
He did also predict that we will have another dip as has also been communicated by economists and the major bank CEO’s.
The Boston Consulting Group completed a survey that shows 84% of Australians believe there will be a recession post Covid 19. Only 40% feel financially secure, with 47% abandoning luxury products and 64% saying that a basic level of living will do.
BCG conclude that creating and maintaining consumer trust will be key to ensure we continue our relationship with customers/patients into the future.
However, both Australia and New Zealand are doing great, unlike the rest of the world who have some real battles ahead economically while still trying to gain control over the corona virus.
America – Mr Trump and China are still playing political and economic games which will affect Australia and the western world in their own specific ways.
Sadly, we will be victims of further collateral damage. So, brace yourselves. Be a strong and definitive leader for your team.
2) What is ahead of us
These have become the ‘key phrases’ of this time:
- New world order
- Nothing will be the same again
- Only in America
There are similarities even if it is to a lesser extent for us here in Australia which will have a significant impact on us and the western world.
The question we are asking is “what is this new direction of change coming our way and where is it headed?”
In considering this future change for the dental profession, perhaps we could start with “where have we been and how did we get here? And “what have we learned from the past and what could the new direction of dentistry be in 2020 and beyond?
Allow me, Jon Kozeniauskas to walk you through my journey in dentistry and what has transpired over my career.
This will give you some ideas of how you could be planning for the future.
Jon’s career journey
- Data from the early 1970’s shows the average dentist had a gross income of $70,000 to $80,000
- Practice overheads were $30,000 to $35,000 or 43%
- Dentist incomes were $40,000 to $45,000. This is relative of course.
To put this into perspective – a 5 bedroom house with swimming pool & tennis court in the Melbourne suburb of Toorak was $45,000 (today the same house is approx. $15M) or a Porsche cost $5,000 (today $350,000 to $400,000).
Dentists were financially well off in the 1970’s
- ADA data shows that there has been very little growth in gross clinical incomes for the past 10 years and in fact the last 5 years has seen zero and minus zero growth
- Today in 2020 the ADA data shows that the average dentist has a gross income in the range of $700,000 to $800,000
- Practice overheads are in the range of 70 to 75%
- Dentist incomes average $200,000 to $250,000
If we calculate inflation from the early 1970’s to today in 2020 the average dentist clinical gross should be $1.6 to $1.8M.
Dental incomes have barely kept up with 50% of inflation while the cost of running a clinic has continued to increase at double the pace of income levels.
Why has this occurred?
The answer is complex but an insight into this can be seen from this example.
We have just completed an analysis of a recent client and this is what we discovered:
- The appointment book structure is the same as it was in 1970
- Fees are incredibly low and in some cases some as the same as an insurance rebate and in many case lover than DVA levels
- Time management is the same as it was in the 1970’s
- Clinical procedures have advanced dramatically but the implementation is the same as in the 1970’s
- Research, clinical outcome and efficiencies have not been translated to time effective clinical procedure
- Treatment planning in this clinic is focused on obvious, basic needs rather than a cohesive lifetime planning of a patients’ clinical needs to maintain their dentition for life.
Put simply, what preventative maintenance care program does the patient require to ‘keep their teeth for life?’
This practice could double their income
Our assessment of this clinic clearly reveals that when a practice and the dentists’ encompass these basic lifetime preventative care philosophies and educate their patients’ they will double their income.
Combined with keeping costs at current levels of around 70% then they will become a sustainable business.
3) 10 Leadership strategies
As discussed in our last newsletter, your leadership is a key success factor right now.
We have a more in depth article on successful leadership strategies that you can read for further information https://www.refocuseddental.com/post/successful-leadership-for-now
Here are some key points to work through and or build on your current leadership approach:
1. Learn More About Your Leadership Style
- What are your strengths
- Areas for improvements
2. Encourage Creativity
- Team members’ have to be allowed some creativity, new challenges, with support
3. Serve as a Role Model
- Walk the walk
- Talk the talk
- Model the behaviours you want to see you team members
4. Be Positive
- Genuine passion and enthusiasm
5. Listen and Communicate Effectively
- One on one communication
- Express care and concern for your team members’ - verbally and non - verbally
6. Have a Positive Attitude
- Upbeat positive attitude that is inspirational
7. Encourage People to Make Contributions
- Welcome new ideas from your team
8. Motivate Your Team
- Be genuinely passionate about ideas/goals
- Help team members’ fell included
- Other recognition, praise and rewards
9. Offer Rewards of Recognition
- This can be anything that resonates with your team members’ such as vouchers for supermarkets or department stores. You can use your credit card points to get these at no additional cost to you or if you do purchase vouchers they are fully tax deductible
10. Keep Trying New Things
- It is much more positive to give a new idea a ‘go’ rather than standing still
Dentistry needs to make paradigm shifts in keeping with new clinical care philosophies, clinical research and data.
These paradigm shifts will change the course of your clinical career.
Every clinic is a unique mix of dentist, team and patient ‘pool’. Our experience clearly indicates that everyone can achieve so much more growth and profitability.
Seek your own individual plan and results will follow.
Plan to thrive and not just survive
Kind regards Jon and Erica