9.20.13 Issue #602 info@mckenziemgmt.com 1-877-777-6151 Forward This Newsletter

What’s Your Compensation Culture?
By Sally McKenzie, CEO

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Take a moment and think about each person on your payroll. Consider the individual and ask yourself a few questions: Does this person contribute to the success of the practice? Does s/he consistently deliver an excellent attitude and a quality product? If so, what examples come to mind? Does this person help the practice to be more profitable and successful, or is this person a source of frustration and discontent for you and your team? Be honest.

Next, ask yourself this important question: Do employees feel “entitled” to an annual pay increase, or do they understand that it’s performance that drives the dollars? Now it’s time to turn the mirror on yourself: What have you done to help each person become a fully contributing member of your team? Examples that should come to mind include, training, ongoing feedback, clear job descriptions, performance reviews, assistance with goal setting, etc.

Your responses are an indicator of your “compensation culture.” Let me explain. In many small businesses, including dental practices, there are those employees who are star performers and those who are merely doing their time and investing the minimum effort. And then there are those who are somewhere in between.

They see the star performers working hard and the poor performers hardly working, yet both get the same annual raise each year. The star performers are “rewarded” with more work piled upon them because they will get it done, until they burnout and move on to another job. Meanwhile, the poor performers do just enough to get by. Where’s the incentive to make the effort? Almost without exception, doctors who scan their employee lists and see “troublemakers” and/or “chair warmers” on their teams have an entitlement culture, which drives their compensation culture. Worse yet, it fuels high overhead and torpedoes production.

It’s time to tackle your compensation culture, starting with a clear compensation policy.  The policy explains when raises can be discussed, under what circumstances they will be given, and spells out in no uncertain terms that they will be based upon employee performance. The policy must be clearly explained to current staff, detailed in the employee handbook, and discussed with new hires. Next, take steps to measure employee performance. If you don’t have performance standards, now is the time to establish them. These determine raises. Best of all, when you have clearly articulated performance measurements, performance reviews become something that you actually look forward to, rather than dread.

Performance reviews are one of the most effective tools in creating a total climate of success in your practice. They provide an objective and neutral means of leveling the playing field for the entire staff. While resistance is common initially, employees rated against objective measures will place more trust and confidence in the process. They also see the direct relationship between their performance, the success of the practice, and ultimately their potential for individual achievement – a pay raise. Moreover, systems based on individual jobs that are focused on specific job-related goals and how those relate to improving the total practice are the most effective.

With input from the employee, develop results oriented job descriptions and expectations. For example, your dental assistant’s job description should include points such as attending beginning of the day meetings, completing case presentations, reinforcing to patients the quality of care delivered in the practice, 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. Avoid the common yet dangerous pitfall of overlapping job duties. Instead, cross-train so that each area has coverage when the point person is out ill or is unavailable. If you overlap duties, employees are given tasks but not responsibility.

Next, establish individual performance goals that complement practice goals, such as increasing collection ratio, improving accounts receivables, expanding production, reducing time to prepare treatment rooms, increasing clinical skills, etc. Present job expectations and performance goals in writing, and rate the employees on those. Help employees develop a strategy to achieve their goals, and if necessary provide professional training. Remember, your employees’ ability to meet their goals goes hand- in-glove with the practice’s ability to meet its goals. Review job expectations and performance goals twice a year. Doing so helps doctor and staff to stay on top of issues that might arise. And provide constructive feedback regularly.

For more information on this topic, visit my blog: The Lighter Side

Interested in speaking to me about your practice concerns? Email sallymck@mckenziemgmt.com
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