This document provides guidance on effective business management strategies, including:
1. Establishing a clear vision and setting SMART goals to support that vision.
2. Analyzing statistics to prioritize successes and challenges, and upgrading systems to achieve goals.
3. Hiring and compensating employees with the needed skills to run systems and achieve the vision.
2. Active Goals Passive Goals
Statistical Benchmarks(The Numbers)
Systems Team KSAs
Vision
3. The Five “Must Haves” are to:
Create a vision that
supports your values.
1
Set “SMART” goals that
support and promote your
vision.
2
Analyze by statistics (not
judgments) to prioritize
successes and challenges to
your vision.
3
Upgrade your systems to
achieve your goals.
4
Hire, train and compensate for
the KSA’s needed to run your
systems and achieve your
vision and goals.
5
4. FacilitiesManagement TreatmentPresentation Financial Arrangements CollectionProceduresAppointmentScheduling
DoctorProductionperday
SituationalFlag
youwill know it by
lookingat the
Appointment Scheduling
If you are having a problem in one of these areas ...
6. I f y o u k n o w W H Y t h e n i t ’ s a l l i n t h e
GOAL SETTINGand STRATEGY Noone number means anything by itself but every number means something.
Create your goals.
Analyze success and challenges along the way.
Insanity is repeating the same behavior.
Don’t “yeah, but” your success.
Involve and then celebrate with your team.
7. Definition: Open Book Management is when businesses share key financial
and strategic details with employees in order to encourage out-of-the-box
thinking, because they feel enrolled and committed to long-term success. In
other words, it creates a culture that issmart about the business of dentistry.
A word aboutOpenBook Management
Hint #2
Give your team the freedom to ACT!
Hint #1
Teach the business of dentistry
(but not theaccounting)
Hint #3
Share thewealth!
8.
9. In the end – it’s all
about cash flow and
future viability!
10. SO WHAT’S THE DIFFERENCE?
Thedifferences between a Profit &Loss Statement and an Operating Statement
Principle plus interest on loans, leases andcredit cardsInterest only on loans, leases and credit
cards
Includes non-cash
expenses–Depreciation
No depreciation
Usually based on collections in the dental
office
Based on production
(Usual, Customary andReasonable fee)
Tax document Cash flow document
“Be true toyourself” —justthe factsCreativity allowed
Profit&Loss Statement Operating Statement
Purpose ofthe Profit andLoss StatementisTo
showthe leastamountof profitpossible
Purpose ofthe Operating Statementis toshow
the profitabilityofyourbusiness
21. Cash and Non-Cash Compensation:
TotalCompensation 25-35% min.
Cash & Non-cash Compensation
25-35%
Ideal Range: GP = 35-45%. Specialist = 45-55%
22. Cash Flow Management Definitions
Break-Even Point
CashFlow Projections
• Forecast of future potential outcomes
• One-year, five-year, 10-year,
20-year increments
• Based on reality and vision for future strategy
AnnualPlan
• Oneyear projection
• Christmas wishlist: budget, schedule
• Back door method
Re-forecast
• Neverchange the goal,
change the strategy
23. Welcome to the Wonderful World of
Statistical Forecasting
Dr. Abe Bundance’s Variable
Expense Forecast for 2019
2
– 10%lab, 6%supplies, 3%collection variance
Dr. Abe Bundance’s Fixed Expense Forecast for
2019
1
– employee, facility, promotions, minors,discretionary &
doctor compensation
Dr. Abe Bundance’s wants to work3
Dr. Abe Bundance’s has 7 days
of hygiene perweek and they are forecasted to work
4
$827,500
19%
172Days
310Days
24. Welcome to the Wonderful World of
Statistical Forecasting
Doctor’s daily production for 20186Hygiene’s average daily production
for 2018
5 $1,075 $3,800
25. Welcome to the Wonderful World of
Statistical Forecasting
Weare looking for 100% of a new production goal that will coverboth fixed and variable
expenses:
1 Fixed Expense Forecast ÷Fixed Expense %
= New Production Goal
2
26. Welcome to the Wonderful World of
Statistical Forecasting
DoctorGoal ÷ ForecastedDays = Forecasted Average Daily
Production Goal
4Total Office Production Goal – ForecastedHygiene Goal
= Doctor Production Goal
3
Take itto Strategy –Ideal Days / Preblocks!5
28. The best definition of profit I ever heard isthat profit is the applause you get for satisfyingyour customers and creating a motivating
environment for your people. Too bad WallStreet doesn’t embrace that definition. The problem is that too many people act like the
onlyreason to stay in business is to make money. Their eye is on the scoreboard rather than on the ball.
If you focus just on financialsuccess and forget your employees and your customers, eventually, your financialsuccess will decline.
– KenBlanchard