This article, written by Dr. Agatha Bis, Founder of UPB Dental Academy is the second in a five-part series on how to protect your dental practice from a slowing economy. Stay tuned for additional posts in the series, published each day.
Protecting Your Dental Practice In a Market Turndown Key #4 – Build Strong Systems
Worldwide, financial markets are taking a huge hit due to the coronavirus pandemic and declining oil prices. Thinking back on the last two major stock market crises; a 34% drop when the dot-com bubble burst in 2000, and the 2007-2008 recession when we experienced a whopping 49% drop in the markets, there’s no telling how the current crisis will compare. In 2008, dental practices experienced an average of 43% drop in their revenue and took about 4 years to recover from it. But I learned some things from those last two recessions so, in my latest series of blogs, I am writing about five things I learned to help me protect my dental practice and thrive even in the toughest times.
Key #4 Build Strong Systems
What is money? What is the purpose of money? Why does everybody want more of it and when is it enough? How do you know? It may be different for you than for me, and it’s different for different people. But there is one thing that’s fundamentally true for everyone: without money, you experience all the negative emotions that we are all trying to get away from. Stress, fear, anger, jealousy, sadness, overwhelm, anxiety, despair, disappointment, and frustration. Now of course, even if you have an abundance of money, you can still experience all those feelings. But without money, they are guaranteed. So it becomes important, no, crucial to any person, to any business owner, to ensure that money is respected, money is protected, and money is used intelligently. And especially when we are in an uncertain environment when the world is going crazy, markets are tumbling down, and everyone is panicking. But what do most people do when trying to figure out what to do next?
What many of us do is look in the rearview mirror. What do I mean by that? We look at last year’s financial statements to see how to behave today. We look to our accountant and our Profit & Loss Statement. And if it’s good, we hope that this trend will continue even if the economy is crumbling; or if it isn’t so good, we panic and hope we can get through this year without more suffering or pain. But I want to help you change that. I want to help you look into the future, and recognize trends, and understand your current situation easily and clearly so that you make the right decisions for your business AND you have ways to manage unexpected issues or emergencies that cost money and stress. Especially now because of our uncertain times, it becomes even more important than ever to predict and plan for the future that’s coming rather than living in hope based on the past.
So how do we do that? Well, first of all, let’s all turn forward when driving and look at what’s ahead rather than what’s behind. What happened last year has nothing to do with what’s coming at you now. And the best way to plan, to protect, and to respect our business, our money is through some key systems that are designed to help you grow, manage, and move calmly forward based on what’s happening now rather than what happened last year.
The first concept to truly understand here is that you cannot spend more than you have. Now I know I know, we are all a generation that relies on credit cards, lines of credit, and overdrafts and don’t worry, I am not going to mess with what you already have. What I want to do is, moving forward, I want you to remember that the goal of this business is to grow it, make a profit, and build it to be strong long-term so in the end, you can sell it at a profit and reduce and eliminate debt over time, if you have any. So moving forward, I am going to get you focused, and get your team focused, to NOT spend more than the allocated amounts based on ONLY the money that’s coming in. Does that make sense?
Creating systems around money allocation and spending can be a tough thing to do for some because you really don’t know what you should be spending or what you’ll be making; all you know is what you made or spent last year and the year before. But remember when I said, stop looking in the rearview mirror? So I want to get you to learn to allocate and spend based on what’s happening in your practice today, and teach your team the importance of doing that as well so you all learn to understand what needs to happen and how. In our Ultimate Systems program, we talk about the allocation system, how to do this in your practice and how to know and teach your staff to understand what needs to happen each and every day in order to take care of the business, take care of the numbers, and get everyone driving in the same direction. In that program, we also show you how to create, implement, and ensure consistent delivery of various systems into your dental practice so you can strengthen, protect and grow it in any environment.
Systems are the answer. Systems are the SOLUTION to how to turn a regular business into an extraordinary business, regular people into performers. Great businesses do NOT search for extraordinary people. They find good people and leverage them with extraordinary systems. You don’t want to wait and hope for that one person to come and save you. You will die waiting every time. And even if you don’t, if you are lucky enough to find that superstar, what if that superstar decides to leave you? Been there.
So you must take CONTROL!!! Check out our Ultimate Systems program, to help you grow and protect your dental practice and thrive in this uncertain environment.
Check back tomorrow for the last article in this series of 5 Key Elements to Protecting Your Dental Practice In a Market Turndown.