Every dental practice is facing a business turnaround. There is a great deal of confusion about certain areas such as where to consistently acquire personal protective equipment (PPE), or how to manage childcare and virtual schooling issues (for both the doctor and the team). Some practices are still trying to figure out loans and loan forgiveness. These are all issues that need to be worked through over time. But suffice it to say that there is a lot of uncertainty right now.
To get some answers about what might happen next in the COVID-19 recovery, we studied the data from the 2008/2009 recession. During that time, practices typically lost about 8% of their patients, 20% of dental hygienists lost their positions, dentists raced to cut expenses to the bone, practices enrolled with new insurance plans in record numbers, and 75% of dental practices declined in production between 2008 and 2011, all according to the Levin Group Data Center.
With that as a precedent, it is reasonable to assume that once the pent-up demand from the shutdown has been served, it will be a challenge to deal with the effects of this recession and still maintain strong production. This may be a trying time for many practices.
There are steps to take to strengthen practice systems and compensate for external negative factors, and outside experts like CPAs, financial planners, and consultants will provide valuable guidance. But some practice owners will still feel a sense of high anxiety as we move through this period.
But there is the one thing you do not want to do. Do not make knee-jerk major decisions to try and “save the practice.” The one thing you want to avoid is making major bold moves without any analysis, thought, or guidance.
What are some examples of giant knee-jerk decisions?
- Racing to enroll in insurance plans
- Racing to drop out of insurance plans
- Purchasing expensive new equipment (or air filtration systems)
- Buying the practice next door
- Merging the practice with another office
- Trying to sell the practice for more than it is worth
- Hiring an associate
- Releasing team members
Don’t misunderstand. Any of these may be the exact right decision for you and your practice. But it should be a decision that comes with thoughtful analysis. Take a breath. Slow down. Take a couple of weeks to think through the decision and accumulate data to determine if it is the right decision.
The One-Page COVID-19 Strategic Recovery Plan
The single most critical and smartest thing you can do is to create a one-page COVID-19 strategic recovery plan. This is what turnaround CEOs do when they are brought in to rescue a business, and it goes a long way toward creating a successful rebound.
Simply take a piece of paper and break it up into four quadrants. Label them:
In each quadrant, determine three or four high-value strategies that focus exclusively on the recovery. List no more than four per quadrant. You then want to focus exclusively on accomplishing this plan. Anything not in the plan is a distraction.
Look at the plan three or four times every day. Live the plan, and make sure everyone in the office understands it. Your team should understand the practice is in recovery mode and everybody counts, everybody contributes, and everybody matters.
The one thing you don’t want to do when you hit declining production is panic and make knee-jerk major decisions. This is more likely to hurt the practice further rather than help. The same decisions can be made in a week or two with some analysis and data behind them once you’ve had time to consult with your advisors.
If you want more information on how to write a one-page COVID-19 strategic recovery plan, go to levingroup.com and visit the COVID-19 Resource Center. You’ll find a template and an example there. Everything is free and meant to be of help.
Dr. Levin is the CEO and founder of Levin Group, a leading practice management consulting firm that has worked with over 30,000 practices to increase production. A recognized expert on dental practice management and marketing, he has written 67 books and more than 4,000 articles and regularly presents seminars in the United States and around the world. To contact Dr. Levin or to join the 40,000 dental professionals who receive his Practice Production Tip of the Day, visit levingroup.com or email firstname.lastname@example.org.