Creating a Strategic Plan
Do dental practices really need one?
Roger P. Levin, DDS
In the business world, "winging it" rarely works. In order to be successful, most companies engage in some level of strategic planning. This type of planning is essential in helping companies identify the direction that they want to go in and what new concepts, expertise, and skill sets will be necessary to head in that direction. Unfortunately, many dental practices engage in strategic thinking, but they rarely transform that thinking into planning. And although I can appreciate the demands that keep busy dental practices from taking the time to plan, I know that achieving real success will require them to do it.
Regarding business, most dentists have a very limited education and background. They have not been exposed to strategic planning, and their teams, although committed and dedicated, haven't been exposed either. The good news is that any practice can develop a strategic plan that provides a clear blueprint of its future and what it will take to achieve the goals to get there. Elements to consider when drafting a strategic plan include the following:
A vision statement is a declaration of where you want your practice to be in the future. When I'm working with executive coaching clients, I usually recommend projecting about 5 years ahead. Anything beyond that becomes too difficult to predict. Craft your vision statement around the "what" and "why" for everything that you intend to be doing in the next 5 years. For example, "Within 5 years, we will have three practices, and insurance reimbursements will account for only 30% of our practices' total revenue."
Unlike a forward-looking vision statement, a mission statement describes your practice's purpose today. It often focuses on your core business, the identity of your customers, and/or how you serve your customers. Most dental practices have a fairly easy time establishing their mission because they are providing patient care day in and day out. For example, "We deliver the highest quality dentistry to our patients in a comfortable setting with 5-star customer service. Our practice is committed to providing leading-edge services by constantly updating our treatment offerings through continuing education and the adoption of new technology and best practices."
Core values describe your deepest-held beliefs and the behaviors that are derived from those beliefs. These are the things that you and your team believe will enable you to achieve your vision and your mission. Some sample core values include the following:
Teamwork. Everyone contributes to improving our practice every day.
Accountability. Team members always do what they say they are going to do.
Customer service. We provide 5-star customer service to every patient, every day.
A SWOT analysis examines the strengths, weaknesses, opportunities, and threats related to the continued success of the practice. I have personally reviewed thousands of SWOT analyses for practices, and I believe that this is one of the most powerful and meaningful exercises in which you can engage. Taking a realistic look at the state of your practice through a SWOT analysis will help you to create a more viable strategic plan. A wide variety of factors could potentially be identified in a SWOT analysis, including the following:
Strengths - skill set of team, longevity of team, location of practice
Weaknesses - customer service, loss of patients due to insurance participation, limited hours
Opportunities - open a second location, hire a highly trained office manager, purchase the patients of a retiring dentist in the community
Threats - new competition from small group practices, lower insurance reimbursements, several team members nearing retirement
A SWOT analysis should be performed twice a year by the doctor and include the entire dental team. It's important that everyone understands the internal and external factors that affect the practice in order to be able to set appropriate objectives and take action. When everyone understands the strengths, weaknesses, opportunities, and threats associated with the practice, the doctor and team can make decisions today that will protect them in the future.
Dentistry is becoming increasingly competitive and less stable as a profession. The SWOT analysis can be used regularly as a way for the practice to reevaluate its business principles relative to internal and external factors. By analyzing the implications of the changes necessary to help the practice, you have an opportunity to act earlier and achieve better results. Failure to perform SWOT analyses can result in the practice being caught by surprise when challenging situations arise.
Goal setting is the tactical aspect of strategic planning. This is where you establish what you want to accomplish in the next 12, 24, 36, 48, and 60 months. Once these goals are established, you can then begin to create timelines and action plans for accomplishing each goal. For example, "Within the next 12 months, we will hire a new assistant, implement new technology, change practice management software systems, and increase hygiene production by 20% for product sales."
This is where the detail work begins. You've established your strategic plan and what you want to accomplish. Now, you have to sit down with your team and determine the steps for achieving each goal and make sure that they align with your vision and mission. The action plans must include details about how each objective will be achieved and establish milestone deadlines. Oftentimes, it's advantageous to form relationships with outside advisors who can walk you through the process of creating action plans to ensure that it is progressing in a logical and organized manner. Don't underestimate the power of action plans. Remember: having a vision without action plans almost always results in failure to achieve the vision.
Commit to Your Success
Strategic planning is one of the most important processes in which any business can engage. Dental practices-whether solo, small, group, or larger-should engage in annual strategic planning to ensure that they are on the right path for success.
About the Author
Roger P. Levin, DDS, a third-generation general dentist and the founder and CEO of Levin Group, Inc., is internationally recognized as a prolific writer, advisor, educator, and dental business consultant.