How to row your lifeboat: Recovery strategies for coping with COVID-19 (Pt. 3)
In parts one and two of this three-part series, we reviewed 10 high-value strategies that can help any practice recover faster, better, and deeper. This third and final part of the series will explore strategies 11–18. We urge all dental practices to add these strategies to their COVID-19 recovery plan.
Strategy 11: Weekly cash-on-hand analysis
Every week practices need to know exactly how much cash is currently on hand, as well as what is projected to be available in the future. The best way to get this information is to project weekly expenses and weekly receivables. Then, each day, the cash analysis can be updated. In a business turnaround, cash is one of the four most critical factors impacting successful recovery. Knowing the amount of cash that the practice has every day will create a clear understanding of the practice’s financial position and how well it is recovering.
Strategy 12: A fortress of protection
When COVID-19 hit, 90% of dental practices had less than one month of cash on hand. Of course, this was not enough to keep them protected throughout the crisis. Practices that want to survive this season of economic downturn must have adequate cash on hand to create a fortress of protection around them. With this in mind, your goal should be to accumulate and reserve three to four months of cash over the 24-month recovery timeline. This amount should be sufficient for any future situations that may arise. Keep in mind that any unused cash reserve can always be converted to income.
Strategy 13: Rally around a common purpose
The team you had prior to COVID-19 is not the same even if it consists of the same people. Staff members, like everyone else, have been deeply affected by the COVID-19 crisis and have serious concerns for their health, family, and finances. One of the best strategies for getting your team back on track is to create a common purpose for the team going forward. We suggest focusing on recovery. A good leader will help his or her team understand the practice’s new challenges (e.g., lost revenue, infection control, lower patient volume) and why everyone must rally together for a successful recovery.
Strategy 14: Communicate, communicate, communicate
Soon, staffing will be one of the biggest challenges facing the dental profession. One way to improve the situation is through regular communication. Effective communication will be key because solid communication makes any team stronger, and your team will be your most valuable asset in recovering from the downturn. During the shutdown, Levin Group recommended that dentists stay in close communication with team members. Those who did typically had a higher return rate of staff than other practices. We encourage dentists to meet with each team member at least once every two weeks for five to 10 minutes just to do a check-in. It shows compassion and it gives people an opportunity to speak directly to the boss. It also allows you to clearly communicate any new practice changes or modifications and gives everyone an opportunity to express ideas or ask questions.
Another way to improve communication in the face of the COVID-19 turnaround is to have two meetings per day. The morning meeting should focus on critical daily actions needed to create production, revenue, cash, and income. The afternoon meeting should be a review of eight key performance indicators (KPIs) that will be covered in the next strategy. Daily information is important in a business turnaround so that you can make modifications quickly when necessary.
Strategy 15: KPIs
It may seem counterintuitive, but in a business turnaround you should focus on fewer items than you would normally. Typically, Levin Group tracks 25 KPIs in a practice. However, during the recovery, only eight of them are critical: production, collection, revenue, cash, doctor income, number of active patients, number of overdue patients, and expenses. By analyzing these eight KPIs daily, you’ll know how the practice is performing and what modifications need to be made.
Strategy 16: Teledentistry
Is teledentistry a fad or the future? Early in the COVID-19 crisis, I thought teledentistry might be more of a fad, but I’ve now shifted my opinion and think it will become a permanent part of dental practice. Not a huge part, but a contributing one that will help maximize productive chair time. Teledentistry can be used to provide quality engagement for certain appointments that do not have production or revenue associated with them. These appointments may include postoperative exams, and certain consults and case presentations. For example, the no-show rate of postoperative exam patients is often as high as 50%. Chair time for these patients can be used for more productive procedures. While teledentistry was a last-ditch solution during the shutdown, it can now be considered an effective scheduling strategy.
Strategy 17: Infection control fee
Early on in this crisis, there was a great deal of debate as to whether practices should charge an infection control fee. The cost of infection control and PPE has skyrocketed, creating increased practice expenses at a time when patient volume has decreased. Therefore, we believe that unless insurance companies are willing to provide reimbursement, practices should charge an infection control fee. Most businesses understand that if they experience an increase in expenses, customers must absorb that increase for the company to maintain profit margins. We encourage practices to think of this fee as a simple business decision, and to put some thought into the amount they feel comfortable charging.
Strategy 18: Team accountability
Keeping your dental team focused and motivated is one of the most important jobs that you have as a leader, especially in a crisis. One way to do this is to ask every team member to identify three priorities that they will absolutely achieve within the next 90 days. These priorities should be posted in the staff room, along with the three priorities of each dentist, and should be reviewed at least once a week. Reviewing everyone’s priorities together will help the team generate ideas, work together better, and make real progress. This will go a long way toward creating both an individual and a team focus on practice recovery.
Summary
COVID-19 has changed dentistry, throwing practices into rough seas. It may seem hopeless, but it’s possible to save your practice and even help it grow. Use the strategies contained in this three-part series to create a lifeboat for your practice to successfully navigate every challenge that comes its way.
I wish everyone health, safety, and practice success.
Editor’s note: This is the third article in a three-part series. Part one appeared in the August issue of Dental Economics; part two in the September issue.
