Spring 2006 Table of Contents
     
The Levin Report
Methodology as a Tool for Change
 


Roger P. Levin, DDS


























By Roger P. Levin, DDS

In the same way that dentistry is a precision-driven science, business management consulting also has a scientific basis. There are methods that businesses use to be successful that have been studied extensively in universities and research settings as well as in the business world. Dentistry can only benefit from incorporating these methods into practice.

What is a Method?
The word method appears very prominently in many Fortune 500 consulting company brochures and on Web sites. The word means a specific approach to dealing with any activity. In the case of dental practice management, method refers to a specific set of systems to be introduced into the practice. Each system contains information that is essential to advancing to the next step in the method. If the method is followed and outcomes are generally
successful, then it is proven.

A method approach to dental practice management means that the approach has been well thought out and tried and tested numerous times before. A method approach probably would not be appropriate for the once-in-a-lifetime situation that requires specific creative thinking. However, a method of dental practice management will allow the dentist or a consultant to clearly understand the practice in depth and to provide expert solutions that have a high percentage of success for that practice.

The Anatomy of a Method
The Levin Group Method™ has been created to help the vast majority of dentists understand how to run the business side of their practices. Its components are described below.

Data Collection
The first step in approaching the business side of any dental practice is to evaluate its current situation. There are approximately 100 factors, or key performance indicators, that need to be evaluated statistically in order to understand the nature of the practice. Some of these key performance indicators are:

  • Production
  • Collection
  • Production-collection ratio
  • Accounts receivable
  • Profitability
  • Service mix
  • Insurance participation by percentage
  • Insurance participation by plan
  • Insurance participation reduced fees relative to the usual and customary fees of the practice
  • Other key performance indicators are overhead components, such as:

  • Staff labor percentage
  • Rent
  • Lab
  • Gas and electric
  • Debt
  • Leasing
  • Number of available doctor chairs
  • Number of available hygienist chairs
  • Once these statistics have been evaluated, a composite snapshot can be formulated, allowing the doctor, office manager or consultants to clearly understand the current status of the practice.

    Development of Best Models
    Once the data has been collected, the next step is to see how it relates to a best model framework. A best model refers to an ideal way of operating a dental practice, taking into account its size, condition and performance in an overall statistical analysis. The development of a best model sets benchmarks between the ideal model and the current situation of the practice. In some cases, the best model is closely aligned with the practice, but in many other cases, it is significantly different. The farther apart the best model and the current practice model are, the more likely it is that the practice does not have ideal systems either for the business side of the practice or for the comfort level of the doctor and staff.

    The development of best models can only occur after evaluating hundreds of dental practices and comparing the collected data. Certain common denominators are shared by the most successful practices, which form the basis of best models. Thereafter, all practices can be benchmarked against them.

    The goal however, is not for every practice to adopt the ideal best model, but to customize the best model to the circumstances and goals of the individual practice.

    Best models create an opportunity to understand the best way of running any business. One example would be a franchise such as McDonalds or Starbucks. These businesses constantly refine their business models, and other businesses in similar fields replicate their highly efficient and effective operations in order to avoid wasting time and making errors.

    Customization
    No method should be applied without understanding the unique conditions of each practice. For example, a practice could have many excellent systems in place but the doctor might still be working much too fast, feel rushed and believe that he or she is not producing the highest quality dentistry possible. The doctor might be physically and/or mentally fatigued, and also feeling bad about the overall quality of treatment being offered to patients. A simple procedural time study would likely reveal that the doctor needs a bit more time for certain procedures, which would allow the situation to be resolved.

    Any ideal model has to be customized for each situation. Otherwise, the approach is merely a cookie cutter one that will not properly fit each individual practice. Following data collection, additional factors need to be taken into consideration. For example:

  • Doctor’s vision for the practice
  • Longevity of the practice
  • Socioeconomic background of the patient base
  • Competitive practices in the vicinity
  • Associateships/Partnerships
  • The customization phase has to look at all the unique factors of each practice even down to the level of staff training and staff efficiency to understand what can be accomplished. This analysis will also reveal what areas are available for improvement. The customization phase is critical for each dentist to reach high levels of professional satisfaction.

    Implementation
    Any method has a strong chance of failure unless it is implemented properly. That is why all methods should be developed with successful implementation as the final measurement of success. In the method described above, data is collected, a best model is built for the practice, significant customization of the model takes place based on key objectives for that practice and then the new systems comprising the method are implemented. The method is not about addressing one point here and one point there, but is rather a system-wide, overall approach to improving all or part of the practice. Dental practices should focus on methods that allow for specific systems to be replaced by more ideal systems that have been customized in areas such as:

  • Scheduling
  • Hygiene production
  • Case presentation
  • Practice financial management
  • Patient financial options
  • Customer service
  • Staff hiring-training-motivation-retention
  • Inventory control
  • Budgeting
  • The Benefits of a Method
    One of the major benefits of implementing a method is that it can be benchmarked against other practices as well as measured over time. Each system in the method should have a clear checklist of planned activities. Furthermore, the doctor will have the opportunity to review performance without resorting to micromanaging. The systems that are implemented using the method described above will be highly customized for that practice and will only break down if not followed by the doctor or team. While there are always exceptions to any system on any given day, it is important for the systems to be implemented using the described method and followed as closely as possible. Deviation from the systems will always reduce overall performance. Therefore, the higher the level of deviation, the lower the level of performance. Keep in mind that exceptions always want to become the rule because they are typically easier to implement even though they are less efficient and less effective over time.

    A method approach to business or dental practice is more critical now than ever before. The method described above will allow the practice to implement new systems that are in the best interest of the doctor, team and patients. Only by following a method approach will the practice have the opportunity to achieve a comprehensive implementation of operational systems that allow it to operate with the lowest stress and highest production while maximizing quality of patient care.