8.31.07 - Issue # 286 Forward This Newsletter To A Colleague

Giving Raises
by Sally McKenzie CEO
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“Doctor, I need to speak to you.” Don’t you just dread those words. Your first instinct is to run immediately in the opposite direction and avoid what is likely to be one of three unpleasant conversations: 1) The employee is about to give notice. 2) The employee is going to bend your ear for an hour about another team member and wants you to step in. Or 3)The employee is about to ask for a raise.

And you don’t want to be within 200 yards of any of those discussions. But there you are Mr./Ms. C-E-O ; the maker of the decisions – good and bad. We’ll cover conversations one and two another day, for now let’s tackle #3 that ubiquitous issue that can drag down the strongest of leaders and the most cohesive of teams – employee raises. What do you do when employees want more money?

First, what not to do: Don’t become defensive. Don’t tell them that you cannot afford it right now, or say that it would not be fair to the other employees, or say you’ll think about it and get back to the employee knowing that you never will. And DO NOT say “Sure, no problem.”

Your objective at this moment is to keep the good will of the employee and the financial standing of the practice fully in tact. Instead, of feeling pressured to give a “yes” or “no” answer on the spot, involve the employee in the process. Take this approach: Erin, to help me make an informed decision, I would like you to provide me with sound business reasons for paying you more. I would like a written list of the contributions you have made to the practice. The purpose of this is to educate staff on the fact that raises are not an entitlement. They are a direct result of practice productivity.

Erin should be able to document a list of recent problems or critical issues in the practice that she has resolved. She should also be able to point to new responsibilities that she has taken on since her last raise. In addition, she should be able to spell out what she has done to increase practice revenues and/or cut costs or save time. For example, has Erin taken the initiative to get patient treatment out of the files and into the schedule? Has Erin instituted a patient education program to inform patients about new or existing treatments that may benefit them? If Erin is the collections coordinator, what proactive steps has she taken to reduce accounts receivables and ensure that collections are at 98%?

Similarly, Erin should be able to expect a few things from you, doctor. Number one: a clear, results-oriented job description. If Erin is your dental assistant, her job description should include things like attending beginning of the day meetings, completing case presentations, reinforcing the quality of care delivered, directing the doctor to check hygiene patients, completing post treatment care calls, converting emergency patients to new patients, turning the treatment room around promptly, etc.

Erin should also know what quantifiable measurements will be used to gauge her performance. For example, she needs to know that you expect her to give a daily report on her post-treatment calls, that she should be converting 75% of emergency patients to comprehensive exams, and that she should be able to keep the cost of dental supplies at no more than 5-6% of practice collections. In addition, you should be able to see the distal of the cuspid on every bitewing X-ray, you should never have to reach for an instrument on any setup, and the models Erin pours should be free of defects. Get the idea? When you and Erin both know what is expected you can better assess if Erin is just doing her job or truly making a difference in the practice.

The other critically important factor in giving a raise is determining if the business can actually afford it. Wages should be in the 19- 22% range of gross collections, not including taxes/benefits, which is typically another 3-5%, or the doctor’s salary.

Next week, steps team members can take to show their worth.

Interested in speaking to Sally about your practice concerns? Email her at sallymck@mckenziemgmt.com.

Interested in having Sally speak to your dental society or study club? Click Here.

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