Introduction

Business Competencies for Contemporary Dental Practices

Calvin S. Lau, DDS

Copyright 2001 Journal of the California Dental Association.

The business side of dentistry is oftentimes learned through trial and error. Yet, just as there are fundamental dental concepts, there are fundamental business concepts, which apply quite readily to contemporary dental practices. The underlying assumption is that dentistry is a business that must sustain itself by continuously incorporating sound business concepts into its everyday operations for long-term success.

This issue of the Journal of the California Dental Association will explore some of those concepts. The authors are all working health care professionals. In addition, four are second-year students in the Executive Masters of Business Administration Program at the Marshall School of Business, University of Southern California.

Business uses numbers and data to gauge performance. So, too, should dentistry. We as a profession tend to focus on the clinical aspects of dental care -- techniques, procedures, equipment, and materials associated with dentistry -- at the expense of running a sound business. After all, those of us in clinical practice spend the vast majority of our office time doing what we were trained to do, that is, perform clinical dentistry. If we can pay the bills and support our chosen lifestyle, that is our heuristic measure of success. Is there another perspective that we can apply from the business world? Is being in business about making the most profit? No, that is not the real lesson in today’s business world. Rather, it is maximizing shareholder (owner/dentist) value while creating value for all the constituencies a dental practice serves. Those constituencies include staff, patients (customers), laboratories, suppliers, and manufacturers.

The term competencies is used here as a description for knowledge and performance at the minimum desired level. The intent is to identify areas where standards can play a key role. This is different from best practices and benchmarking, which are at the other end of the knowledge and performance spectrum, and are topics for future development.

Using the competency framework implicitly, the authors identify key business concepts in four distinct areas and describe how they apply to dentistry. There is an additional article that describes appointment scheduling as a vehicle for increased productivity. This shows the synergies that can result from blending areas, which are described below.

We start this issue with a view of strategic planning. In our haste to do "real" dentistry, we may shortcut or bypass the planning stages. This is akin to doing clinical dentistry without having gone through a thorough process of diagnosis and treatment planning. What is the dentist’s role in all of this? How much can be delegated within the office team? When should the outside expert, the proverbial consultant, be engaged? What are we doing to build the practice through marketing? This article is a starting point for the business cycle.

Rich Hirschinger, DDS, explores the scope of digital dentistry. We are in a digital age. Information technology is the great enabler for the conversion of numbers and data into information from which management may make decisions and monitor progress. The more integrated support systems in a dental practice become, the better we’ll be able to serve our patients through efficiencies, analysis of inter-relationships, deliberate changes in policies and procedures, and improved management methods. How much high tech is needed to practice dentistry today? Is more better? While it is important to plan introduction of technology, some of the consequences are not foreseeable. The observant and prepared leaders will grasp the significance and leverage knowledge into greater value. Internet-based systems are already affecting the business world. Dentistry in the near future will have the integrated software applications to make the World Wide Web more than just an e-mail vehicle for the typical dental practice.

Michael Mulvehill, DDS, sheds light on the infrastructure, or operations management, that supports a well-functioning dental practice. Matching the capacity of an office and its resources for optimum performance can be a daunting task. There are ways to analyze the capacity of a system, identify constraints, structure productivity around the bottleneck, and utilize resources more efficiently. Labor, equipment/facility, and material resources are major aspects of a dental office. How can the work flow be improved? What systems will have the most impact on the bottom line? Set-up time, inventory, control systems, and scheduling all fall in the realm of operations management.

Putting these concepts together, Brenda Goldstein, MPH, shows how combining the preceding can synergize the outcomes into a better and more dynamic result. One of the keys to the profitability in a dental practice is the productivity of the appointment schedule. Being busy is a readily accomplished goal; but being busy, efficient, and productive is another matter. What kind of profits do you expect to generate each year? Is there a way to systematically achieve profitability? Applying the concepts of strategic planning, digital dentistry, and operations management can potentiate efficient use of resources to maximize productivity and profitability.

A discussion of business would not be complete without an ethical component. Alvin Rosenblum, DDS, reminds us about the inter-relationship of ethics and business. This is a contemporary discussion, yet traditionally based. The principles are immutable. Their application to the contemporary world sometimes becomes subordinated to the profit motive in mutually exclusive ways. While that decision will ultimately rest with the individual practitioner, this article suggests that there is a way to find harmony.

The business side of dentistry includes much more than practice management. From the business world, there are tools that can help today’s practitioner to be better positioned for the future. Having a clear sense of purpose, utilizing technology, developing efficient systems, and having a strong ethos are all important competencies of a contemporary dental practice. There must be a balance of technical skills, business skills, and performance for today’s dental practice to thrive in the future. By masterfully incorporating these concepts, a dentist will be able to start this century with a clear advantage in a successful career journey. Will the dentist choose to thrive or just survive? It is ultimately an individual decision.

Contributing Editor

Calvin S. Lau, DDS, maintains a private practice in Los Angeles and is a clinical professor at the University of Southern California School of Dentistry. He is a member of the American Academy of Dental Practice Administration and a former member of the ADA Council on Dental Practice. He is also a student in the Executive MBA Program at Marshall School of Business, USC, class of 2001.