Imagine your practice without turnover—happy and hard-working employees producing record-breaking numbers annually while you work progressively less, focusing on family, friends, and patient care. This, even in the worst economy in 70 years as revenue has been desiccated for the majority, is what many of you are accomplishing. You grasp that overcoming a few key misdemeanors of management reduces low morale and poor results.
It is broadly accepted that poor results come from having the wrong person, having the right person in the wrong role, or having the right person in the right role being managed poorly. I call these three key mistakes the “three felonies of management.” The goal is to find the best people, place them in their idyllic role within the organization, and treat them positively and with dignity.
What are the misdemeanors of management to evade, which in aggregate equate to a true management felony?
MISDEMEANOR 1) HIRING FOR THE WRONG REASONS
One advantage of the current official unemployment rate exceeding 9% is the throng of highly qualified individuals looking for work. Indeed, the right team member precedes the right role. Real estate is said to be about “location, location, location.” Practice growth is about “people, people, people.”
How often have you heard a successful executive say that he succeeded because of his ability to surround himself with the best people, not because of his inherent talents? Oprah Winfrey, for example, has said, “Surround yourself with only people who are going to lift you higher.” Unfortunately, too many doctors hire practice managers and patient consultants (sales staff) for incorrect reasons.
Below are some common rationales employers mistakenly offer when selecting employees that result in lower profitability and team morale. Each are composed of philosophies and suggestions for factors that are, in actuality, paramount when selecting the best candidates:
“She has years of experience.”
Experience is not a bad thing. Unfortunately, those with experience habitually bring their wrong ways with them, as well. It is experienced people who too often mistakenly state, “This is the way I have always done it,” or, “It worked before, so it will work again.”
Jon Gordon, author of Soup: A Recipe to Nourish Your Team and Culture (John Wiley & Sons; 2010), encourages his readers to “think like a rookie. Rookies don’t have experience. They don’t know about the way things were. They have no knowledge of the good ole days. Instead, rookies create their good ole days right now. Rookies put their head down, work hard, stay positive, live fearlessly, and are naïve enough to be successful.”
In sales, there are myriad people who are pushy or close deals based exclusively on price, or sell better in a business-to-business environment and not to consumers. Technically speaking, they have “experience.” Others have worked in several cosmetic surgery offices but have acrimonious attitudes, perhaps because they are burned out (or learned this behavior from former coworkers) and have no “rookie” mentality, or have no formal training in sales or management.
Ask yourself, “How many physicians do I know with a highly trained, superior consultant and not somebody essentially self-taught?” Most of you may have trouble thinking of more than one. It follows that hiring a self-taught worker, with no formal training, who already may not have succeeded elsewhere, might not be an ideal fit. There are exceptions, but experience alone does not equate to results.
The key is to look for talent first. There are no shortcuts to hiring and growing people. In our offices, about 70% of our patient consultants—individuals who work with patients from the moment an information request arrives through consultation, price presentation, and ultimately scheduling of the procedure—and office managers have no formal experience in a surgical office. We selected these individuals for their capacity to learn the skills necessary to couple with their natural talent.
Talented, proven salespeople and managers tend to succeed in any business-to-consumer marketplace because the industry-specific knowledge (ie, plastic surgery) is learned, while the sales or managerial talent translates innately.
For example, our foundation, Foundations for Hair Restoration and Plastic Surgery (FHRPS), in Miami and New York, employs a former high-end cutlery salesperson who was ranked Number 4 out of 40,000 salespeople at his previous company, where he sold sets of cutlery to homeowners for as much as $3,000 per set. Three of our other salespeople were a former Miss America finalist (who knows how to sell herself and handle rejection daily), an area sales manager for a cosmetics company (who knows our clientele and can teach salespeople to sell—an excellent indication that she can sell), and a real estate agent with millions of dollars in homes sold.
Each of these employees currently sells between $1 million and $4 million per year for our organization. They each succeed, despite differing backgrounds, because they have inherent natural talent. Admittedly, it took time to train each person, but now they are mostly self-sufficient as skills can be taught. Talent is intrinsic.
Correctly, some—if not most—physicians articulate that they do not have natural sales or business skills to train or identify an impressive salesperson or manager. Understand that this hiring decision may have more influence on your success than any you will make for years.
Invest in a consultant or practice-management company, and pay fair market value to that company to ensure the right individual is selected and trained properly. Think about it: An investment, for an established office, of tens to hundreds of thousands of dollars to get an extraordinary patient consultant or office manager is money well spent, particularly if the consultant or management company can hire, train, develop, and manage the “face” of your business. The investment pays for itself many times if the consultant, due to proper selection and training, can schedule even a small number of additional procedures each year.
Just within the FHRPS, I have seen this approach work in each practice we have worked with, with growth rates of at least 75% to 125% in the very first year—even in these challenging economic times.
“They look great, and so they will sell,” or, “They have had cosmetic surgery.”
This is perhaps the most common mistake I have heard in offices that perform cosmetic work. Some of you want to believe that the greatest selling point in your office is the office manager or consultant who is very attractive and/or has had work done, who is available to meet with prospective patients.
Professional appearance is important, as is the ability for an employee to relate to a patient, but this only helps if the individual has the other intangibles, as well. Amusingly, in one of our first FHRPS offices none of the sales staff had had a procedure (to our knowledge), and yet they combine for well over $6 million in sales annually with schedule rates rivaling the best in the country. The math explains it: Would you prefer the best staff from a city of 3 million people or from a small group of previous surgical patients?
When looking for an appropriate replacement or addition to the current staff, many physicians list as their first priority, “I want someone who looks great and likely has had good work done.” It is important for you to remember that there are more important qualities to consider first. For example, impressive verbal and written communication skills, the ability to contact 100 patients per day without sacrificing quality or service, impeccable computer skills, professionalism and honesty, specific experience related to daily duties and not necessarily the industry, work ethic and hunger to succeed, and so on.
Personally, it is hunger to succeed I search for above all other factors. Mark Twain wrote, “Hunger is the handmaid of genius,” and so it has been for myself as well as my staff through our innate assiduous constitutions.
“They were recommended highly by a friend.”
Referred resumes can often be the best way to find the finest candidate for a new position. A referral, however, should help the interviewee obtain a first-round interview only. Often, you may feel obligated to give excess weight to the interviewee provided via a friend. We suggest letting the referrer know, “Your recommendation alone is greatly appreciated and means I will meet with him or her for an initial interview, as I trust your judgment. Thereafter, as I am sure you can understand, we will select the person we feel is the best fit out of those remaining candidates.” The referrer respects your candor, and you can now feel comfortable moving forward with the superlative, not the most connected, candidate.
“They were inexpensive,” or, “They made a lot of money elsewhere and so are likely worth it.”
If you overpay an employee, especially in this economy, profits will plummet. If you underpay in this economy, the employee may stick around out of loyalty and comfort, but it is only a matter of time before an offer comes along that the employee cannot turn down. Their work will suffer, too, as people, even if their intentions are positive, rarely maintain motivation for long periods if they believe they are being underpaid.
The largest possible loss of profitability comes from unwanted (not wanted or natural) turnover. People get married and move, while others have mammoth opportunities arise. This is good turnover, inevitably, and if promoted and recognized positively around current team members it will create an environment of retention and family that will be repaid to your practice in spades.
When people simply quit, however, you lose expertise and the time taken to develop that expertise, forfeit unhappy clientele tied in to that employee, and create negative ambiance in the office as others question why. All this, plus you must make time to hire and train a replacement.
For these reasons, it is imperative, regardless of the economy, that you commit to fair pay. It should consist of base pay and upside for impressive results, be comparable to your peers in the market, and be reviewed at least annually. Fair pay is perhaps the greatest factor—following the practice of treating people with respect and dignity—to keeping and cultivating the team your practice has assembled.
MISDEMEANOR 2) NOT KNOWING WHEN TO SAY GOODBYE
The first misdemeanor should help you avoid the second misdemeanor—waiting too long to get the wrong person off the team. Many of you, however, already have an office manager or patient consultant who influences results more than any team member, including you.
In Good to Great (HarperBusiness; 2001), which is perhaps the most influential book I have read on management, author Jim Collins talks relentlessly about getting the right people “on the bus,” and a prerequisite to that goal is ensuring that the wrong people are off of it.
A preponderance of practices, based on experience working with dozens, have at least one “bad apple.” Without fail, this individual wields much of the power, often more than the physician staff or owner, and has a negative influence on all facets of the practice. True to form, one bad banana rots and spreads rapidly through the whole fruit basket. And yet, when this is brought to the physician’s attention, the management company called in to help usually hears, “Yes, you are right. However, we cannot make a modification because
“She has been with me for years.”
Loyalty is important. Devotion, however, is a two-way street. If your employee is consistently bringing down team morale, is underperforming and costing your organization revenue, or has a credibility issue, loyalty at least allows for a conversation clearly addressing concerns. Anything less than this grant of clemency would be unfair to a long-term, loyal employee.
It is then, however, the employee’s decision to improve and remain loyal or to ignore the effort to reach out. If the latter is chosen, then you owe it to the rest of your team to work with another person.
When a team member is the right apple, it is very clear. You should be impressed daily with the individual’s attitude, aptitude, and results. If you cannot clearly see this most of the time, it may be time to have a conversation with that employee, out of loyalty and belief in the ability for growth.
“I don’t want to have to train somebody new.”
The conundrum between keeping a trained but average employee and working harder to develop an untrained superstar is easily resolved. Remember, this is the person who affects your overall livelihood and future more than anybody but himself. Flip the page and reread Misdemeanor Number 1.
“I don’t want my people to see turnover.”
This is a legitimate concern. Trust, however, that your people are resilient. Employees can feel your intentions, regardless of actions, and understand the natural vicissitudes of running a business over a period of years. If the turnover is appropriate, your employees will respect your decision.
In addition, trust that if you see the problem, even though you are in surgery half the week, your people experience the problem tenfold. They usually will not be surprised, often will be elated, and, most important, will realize nobody is “sacred.”
We do recommend ensuring—according to Maslow’s hierarchy of motivation (see Part 2 in this series on practice growth, in the September 2011 issue of PSP)—that people must feel safe and know their jobs are not also threatened, but there is no harm knowing they must continue to achieve results constantly.
Jon Hoffenberg is executive vice president at Foundations for Hair Restoration and Plastic Surgery, based in Miami and New York. He can be reached at (305) 666-1774.