6.13.14 Issue #640 info@mckenziemgmt.com 1-877-777-6151 Forward This Newsletter

4 Rules for Effective Compensation
By Sally McKenzie, CEO

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Is it time to increase pay in your practice? According to PayScale.com, 88% of employers set their sights on increasing pay this calendar year, and the average pay increase is expected to be 4.5%. But rest assured, the majority of those increases are determined based on careful planning and consideration. In fact, more than 73% of respondents indicated that their businesses use a formal compensation strategy.

It is that last point that dental practice owners would be wise to take note of - a formal compensation strategy. In many dental practices the “compensation strategy” typically involves an exchange between the doctor and the employee that goes something like this:

Employee: “Dr. Tom, could I talk to you for a moment?”
Dr. Tom: “Of course, what would you like to talk about?”
Employee: “Well, I really like my job and everyone here, but I am having trouble making ends meet. I was hoping that you might be able to give me just a small increase in pay, maybe just $2 more an hour?”
Dr. Tom: “Well that hardly seems like an outstanding request, and you are quite an asset to the team. I’m sure we can make that happen for you.” 
Employee: “Thank you so much Dr. Tom! “

Dr. Tom means well, but he has absolutely no idea how much the employee’s change in pay will impact his bottom line. Certainly, creating a “fair” system for compensation can be challenging in any workplace that is dependent upon teamwork and trust, which would be virtually every dental practice. Reward some and you seemingly punish the rest. Reward all and you send the message that average effort pays the same as excellent. It’s a management minefield for most dentists who struggle with balancing the financial needs of the practice with the financial desires of the staff. How do you navigate this tricky issue? With clear leadership and specific salary guidelines.

Effectively handling the matter of money with your staff requires that you manage their expectations from the outset. It starts on day one - not six, eight, or twelve months after the employee comes to work for you. Explain when raises will be discussed and under what circumstances a raise will be given. Implement the following four rules of staff compensation and start managing payment expectations immediately. 

Rule #1 – Establish a Clear Compensation Policy
Based on the market, identify the pay range for each position in the office. Explain to every team member exactly how the compensation system will work, how much is available to the employee, what formulas are used, what it takes for them to earn more money, and how much more they can earn in that specific position.

Rule #2 – Conduct a Salary Review
Before you convince yourself that another buck-fifty an hour isn’t going to break your bank, check the balance sheet. My Salary Review Form that we use with our McKenzie Clients is a clear and simple mathematical tool you can access immediately to determine exactly how much more money you’ll need to collect each month to cover that seemingly insignificant pay increase. It ensures that you are making an informed rather than emotional decision when it comes to salary increases. Your goal is to follow compensation benchmarks, which means wages should be in the 19-22% range of gross collections, not including the doctor’s salary or taxes/benefits.

Consider this example: If your current monthly collections are $48,325 per month and your existing salaries are $9,353, then a $2 hourly raise from $15 to $17 for your assistant who is working a 36 hr. week will increase existing salaries to $9,665, which is within the 20% industry benchmark. However, if your current monthly collections are $39,000 and existing salaries are $9,353 that puts you at 24% of gross production and well above the standard.  

Rule #3 – Develop a Plan
As a team, discuss ways to make more before you spend more. Every salary increase, no matter how seemingly small, has a direct impact on overhead. For example, consider new strategies to boost hygiene production and treatment acceptance. Take a close look at collections, and make one employee accountable for collecting money, generating accounts receivable reports, and following up on delinquent accounts. The financial coordinator should achieve a daily collections rate of 45% or higher. In addition, expect full payment for all procedures under $200. Provide patient financing through CareCredit, and require insurance patients to pay the portion of their payment responsibility at the time of service.

Rule #4 – Develop Job Descriptions
Results-oriented job descriptions should be created for all staff. Involve each team member in establishing his/her own performance objectives that are consistent with overall practice goals, such as scheduling to meet production goals, keeping the hygiene schedule full, etc. Offer professional training for employees to help them succeed, and provide constructive and instructive feedback regularly. Finally, hold employees accountable for their systems. And remember, pay increases should reward excellence and dedication to advancing the practice, not another year on the calendar.

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
Interested in having McKenzie Management Seminars speak to your dental society or study club? Click here.
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Nancy Haller, Ph.D.
Leadership Coach
McKenzie Management
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Build-in Summer Fun
By Nancy Haller, Ph.D.

The official start of summer is next week. For me it triggers memories of being a kid. Splashing around in a plastic pool on the lawn. The smell of freshly mowed grass and Coppertone sunscreen. Being outdoors at dusk waiting to see the lightning bugs come out and sparkle. No homework.

As a responsible, achievement-minded professional it's likely that you've lost touch with all  the joys that summer used to bring you. There aren’t enough hours in the day to get everything done. How are you supposed to find room for fun? Your dental office is a place where people need to accomplish work. It isn’t supposed to be an eight-hour-long play date.

Yet research shows that the most productive employees are the ones who enjoy being at work. Having fun at the office isn’t always appropriate, and it certainly doesn’t jive with everyone’s style, but the benefits are plentiful. Improved patient care and service. Increased job satisfaction and employee loyalty. Creativity and profitability! Happy employees are more likely to accept ownership of their responsibilities, and much more inclined to go the extra mile and do whatever it takes. Attracting patients is easier in an environment of hospitality.

You CAN create a more jovial office environment and still mean business in real terms. As with most things, leaders need to set the example - so get back in touch with your inner child and build-in some summer fun. Here are some ways.

Lighten Up
People look to you to set the tone for the office. You have the power to decide whether you're going to be a catalyst for positive energy. Too many leaders fall victim to "professionalism" - a formal and aloof demeanor, serious facial expression, a no-nonsense approach to work. You can learn to take yourself lightly and still take your job seriously. Laugh at yourself. Demonstrate your humanity and openness. Encourage others to do the same.

Appreciate Good Humor When It Happens
Funny things happen all the time, but if you are obsessed with left-brain analytical thought you'll miss those moments. Laughter increases oxygen, endorphins, and blood flow to the brain. Employees who are in good spirits think more clearly and make better decisions. They are more accepting of others. Laughter creates a bond that brings people together. 

Circulate Fun and Funny Things Daily
Collect and share your favorite cartoons and jokes. Create a Joke Board or a Humor Newsletter. Put fun things and activities in the staff room. This allows people to take their mind off the seriousness of the job for a short period, so they come back to work with a more positive and balanced perspective. Stock the staff room with “fun” toys such as Silly Putty, building blocks, Slinky, Nerf balls, foam darts, a basketball hoop, butcher paper and crayons or markers.

Plan a Fun Office Activity at Least Once a Month
There’s no substitute for spending time together. Schedule affordable social events. Go to a bowling alley during lunch. See a movie. Organize pot-luck meals, arcade outings. The camaraderie will spill over into the job. If possible, include family members in some of these types of activities. 

Let Patients Know That You Are a Fun Dental Office
Organize fun events, dress-up theme days, share funny things with patients. Give employees tools to create a fun relationship with patients - stickers for children, dog biscuits for their pets, humorous buttons with your practice logo. This makes work more fun plus it strengthens patient loyalty. Print fun greeting cards for employees to give to patients and vendors.

Spruce Up the Office
You don't need to do a big renovation to increase the appeal of coming to work. Fresh flowers and live plants bring the outside in. Nature has a calming influence on us. Flora in the workplace promotes creativity as well as empathy. Consider the power of pleasant scents. Our sense of smell is linked to our limbic system...and that has an impact on what we feel, what we buy and how we act.

Be Sincere
If you show up Monday morning with a transplanted Robin Williams persona, staff will be cynical about your newfound attempts to lighten the office mood. Be yourself. Practice your own brand of humor. Start slowly with a few activities and communicate your desire to create a more relaxed workplace. Don’t expect things to turn around overnight. 

Still, beware: As silly as it sounds, on-the-job fun needs to be taken seriously. It's good only in moderation and in appropriate form (non-sexist, non-racist, non-religious humor). Taken to extremes, it can hinder productivity. But if you put fun into your practice wisely, you’ll build some joy into your day. And the results will have you laughing…all the way to the bank.

If you need a ‘fun injection’ for your office, contact me at nhaller@mckenziemgmt.com

Dr. Haller provides training for leadership effectiveness, interpersonal communication, conflict management, and team building. If you would like to learn more contact her at nhaller@mckenziemgmt.com

Interested in having Dr. Haller speak to your dental society or study club? Click here

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Jean Gallienne RDH BS
McKenzie Management
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Setting a Standard
By Jean Gallienne, RDH BS

In many dental offices, it is common practice to hold a working interview when hiring a new hygienist. Dentists often assume that if this working interview goes well, then the new hygienist will be able to jump right in and do everything the same way your practice currently does it. However, the result is often that the hygienist and hygiene department are being set up to fail.

In most businesses, regardless of education and experience, employees will go through a training period. How long that training period may be depends on the policy set by that business and what they expect from their employees. So, why is it that dental offices think they do not have to take the time to train their employees?

Yes, hygienists are trained in college to clean teeth and perform root planing. If you are lucky, the hygienist you are considering hiring may even have experience on the software you are running. However, every office that I have worked with utilizes their software in different ways. Where certain notes go within your patients’ charts may be completely different from what your new hygienist was taught in school or at another office.

What information does your office policy require? I have seen notes in charts as simple as “prophy, fl2 and went over brushing”, where other offices choose to utilize the default template set up by the computer company. Some practices use custom templates set up by the hygienists…templates that the doctor may not even know the hygienist designed! Custom templates may not have all of the information needed for future hygienists and doctors to know exactly what is going on with a particular patient. Does the template provide details that will help the front office to get the insurance company to pay, thus allowing your patient to maximize their benefits? These are just a few of the little things that we take for granted, but are very important to the success of your practice and employees.

Does your practice use route slips? If so, how does your office use those routing slips? Is everyone on your team trained to use them in the same manner? Many employees are not aware of the range of information that routing slips can provide. This is really important, especially if you are a chartless office. Many routing slips not only provide information about that patient, but also about other family members on that account. This can prove very important at a morning meeting when there are last minute cancelations on the voicemail, as you can see family members who are due for their hygiene appointments. The routing slip is the communication process between the front office and back office. It is important that it’s filled out correctly and that the receiver reads everything on it.

The two examples above are only two forms of communication in the office, and we all know how important communication is. Employees should be trained on what is expected in your practice. And what about the actual appointment - what are the procedures expected of the hygienist from the minute the patient walks in the front door until the appointment is over? Does your practice do fluoride on adults? What types of fluoride does your practice use and how long do they need to be applied? Which patients use fluoride? What determines the need for fluoride in your practice? Where is the fluoride kept? It’s the little things that may make or break the stress level in your practice.

Who charts periodontal disease in your practice and what determines the need for root planing? What is the office protocol for a root planing appointment? Are all of the hygienists really providing the same quality of care to the patients, or are you just assuming they do? Patients want continuity of care within a practice. They will notice if there is no continuity, and they will run faster out the back door than they ever walked through your front door.

All employees need to know how to answer the phone correctly, greet patients as they enter, and what is expected when it comes to performing their job duties. Employees also need to know what to expect from you as the leader. If no time is spent training your employees on the systems in your practice, how can you expect your staff to be consistent? A highly trained team will help your office to be less stressful and not only lead to long-term employee retention, but also to long-term patient retention and future referrals. Training every employee on office protocol and policy is important.

Interested in improving your hygiene department? Email hygiene@mckenziemgmt.com and ask us about our 1-Day Hygiene Training Program or call 877-777-6151

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