How to Educate Your Team Members About Dental EconomicsJul 15, 2021
How much do your employees really know about the business side of your dental company?
When teams have greater clarity about what it takes to run a dental company, they work better. But often, employees are in the dark about business fundamentals, and leaders struggle to communicate these in meaningful ways (while keeping details to a minimum).
In this post, we’re sharing why educating your employees about your company’s economics is a great way to create harmony within teams. We also share the best way to do it.
Keep reading to learn more or press play to watch our Visionary, Eric Roman, explain.
Why your team should know more about your business
Your employees see thousands of dollars come in through the doors every month. But do they know what happens next?
In our company research, we learned that teams have a limited view of what that revenue goes towards. In fact, they don’t always think it ends up in the right places!
If you educate your team about the business side, it helps everyone understand a little bit more about what really goes into running a dental company. This clarity can help team members rethink their misconceptions and bring greater harmony to your team overall.
How to educate your employees on dental economics
So, if your team lacks some fundamental knowledge about how dental businesses actually work, how can you educate them?
For a previous company, we put together an entry-level training session, Dental Economics 101. The aim was to explain the economics of being a dentist and fill in the most common knowledge gaps.
A training session, presentation, or one-on-one like this can then be used as a guidepost. It can create more understanding and get everyone aligned with the basics of what it takes to financially manage a dental company.
Now, you may not want to go into specific details with all of your employees ¬– and you don’t have to! But giving them an idea of your various outgoings through percentages, for example, is a great way to communicate the economic commitments that come with running a business.
What most surprised employees
When we ran this training session, we realized there were three key areas employees had little to no idea about. So consider including some of these in your session.
1. The cost of dental education
Dental education can cost in excess of $300,000 – the same price as a really nice house! This leaves many dental group or practice workers with debt payments that can take years to pay off.
2. How much it costs to buy a dental practice
An operating dental practice can cost anywhere between $800,000-$1.5m. The monthly debt payments for this can come as a shock!
3. How much goes back to the employees
As much as 60% of all the money that comes in the doors each month goes towards paying your employees. Payroll is a high-pressure commitment, as teams can’t go unpaid. So what happens when you don’t make your revenue targets?
Employees were also surprised to find out that when dental companies operate at a loss, their paycheck often comes straight out of the owner’s bank account. Communicating all of this to your employees can help them better understand the financial pressures your company is under.
No margin, no mission
Dental companies operate within several worlds, the public health world, community service world, and the business world. These worlds have to all work together so that you can realize your vision. If there’s no profit, then fulfilling your goals and serving people becomes unsustainable.
There is the potential of a reward when taking a risk. Starting a dental company can help you achieve your mission, but the reality is, sometimes you’ll need to make hard financial choices in order to keep the doors open.
When your team is more aware of this risk, it can help get everyone on the same page with what it really takes to serve your patients each month. So consider educating them about how the economics of your business works and how you’re investing that money to fulfill your vision!
To find out more ways to bring harmony – and joy! – to your team, check out our people management services: https://joyfullpeople.com/