Wednesday, May 6, 2015

Considering a change of strategy? Read this first.

In quite a number of practices with which we work, we get suggestions for changes based on comments from patients.  Examples of these suggestions include adding whitening products, change of operating hours or changes to patient flow.
Usually, the suggestions are prefaced with a comment along the lines of “Everyone wants us to…” followed by the specific suggestion.  
Before lurching into major changes and the marketing campaigns that support them, please make sure you keep the following things in mind:

You can’t be everything to everyone
You would love to capture every dollar of potential demand out there.  If patient A wants whitening via professional strips, you want to be able to offer that.  If patient B wants whitening with a laser, you want to be able to offer that too.  The problem is that the cost becomes prohibitive to offer everything that everyone wants.  You need to focus on what best fits into the type of practice you have decided to build.
Let me give you an example from our office in Mexico.  For a time, we wanted to provide service to every single patient that might require a dental service.  So, offices were open 7 days per week and orthodontists, general dentists and other specialists were available in case a walk-in wanted to start right then.  We sold products of all kinds.  Revenue swelled to record levels as a results, but the cost overwhelmed any revenue improvements.  Staff are all salaried in Mexico so we had to have additional people on the payroll to properly staff all of those hours.  Some products just did not sell, but we had to buy them and hold the inventory.  We eventually cut out the unpopular services and products.  Revenue fell, but profit went up and we’ll take that tradeoff every day.

Quantify the demand
When you hear the phrase, “everyone is asking for..” your antennae should go up.  People don’t literally mean everyone, but they may be overstating demand.  Try to drill down on exactly how many people have requested a particular product or service to see if this is something you should investigate further.  
If you hear that patients want you to be open at 6 am, start tracking those requests or asking patients if they would like you to be open early.  If you see 500 patients in a week and 3 of them want the earlier hours, you probably should not make a change to accommodate .6% of your patient base.  But if 100 folks are all for the idea, take a closer look.
Always beware of the Sample of One no matter how vociferous that one may be.  If Mr. Hapablap doesn’t like your check-in procedures, you don’t necessarily need to change everything to satisfy him no matter how loudly he may protest (see the first item above).
Everyday life is filled with samples of one – Person A doesn’t like your sign, person B wants you to use a new practice management system, person C doesn’t want you to advertise on the NBC affiliate because of Brian Williams.  Filter through the noise to get to the most significant suggestions.

Ready, aim, fire
If you come upon a suggestion that is popular and makes sense for your practice, take some time to consider all of the aspects of that change before implementation.
If a lot of patients want you to open at 6 am, think about whether or not staff will be available at that hour, how many slots you want to open, will you limit the available procedures (maybe shorts only during that time) and will you require patients to come during that time slot for a certain percentage of their appointments?  Then, consider how you will advertise the new strategy.  Finally, do a brief analysis to see if the proposed change makes business sense.  
This is important.  Consider the additional cost of any change in strategy and what it might produce.  Let’s go back to the opening at 6 am example.  Let’s assume that you need to have 3 staff people on hand earning an average of $12 per hour for an additional 5 hours per week.  On a monthly basis, that additional cost comes to about $780 per month (3 people * $12/hr * 5 hours * 4 1/3 weeks in a month) before payroll taxes.  On the income side, in this case you should probably not count income from existing patients who show up in the time frame.  If you weren’t open at 6 am, those patients would fit into another appointment slot.  Rather, you need to determine if that 6 am time slot attracts new patients (and it just might).  If you charge $100 per month, you’ll need 8 patients’ worth of new business to make it worth it.
Like all other projections, you are making an educated guess, but before starting, you need to have some way to measure whether or not your new strategy is working.
Once you do all that, go for it.  Proclaim your new plan to the world via every medium you have at your disposal – referral base, social media, TV, radio, carrier pigeon, whatever.


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