Managing director at DPAS Dental Plans, Gary Anders, takes a look at how dentists can best adapt to and manage external changes that affect the way in which their practices run.
From the beginnings of time, all organisations have had to cope with change. But in recent years, a whole theory and methodology of how to react to and embrace change has grown up to help businesses deal with changing external factors and the subsequent effect on internal business structures.
One of the difficult aspects of managing change in any organisation is that much of the change is enforced by external factors over which one has little or no control. We can see this very clearly in the dental market which is currently experiencing some severe external pressures.
The after-effects of the recession continue to have an impact on some patients’ habits with regard to visiting the dentist, particularly for routine examinations or hygiene visits. This change in habits has altered some dentists’ businesses for ever and the way in which practices have reacted, has to some extent at least, determined whether they have recovered their position to pre-recession levels.
Uneven playing field
The increasing corporatisation of dentistry is also creating a different and increasingly competitive marketplace, which many high street dentists consider to be an uneven playing field. Unlike traditional owner-occupier practices, the corporates are built to benefit from economies of scale and in some cases are providing a very aggressive pricing model to attract patients away from their existing providers. The ability of corporates to more effectively tender for UDA contracts is also providing a challenge for traditional practice organisations.
The delay and prevarication about the new contract continues to intensify the instability of the whole dental market, causing some principals and managers to become nervous about the future. It is possible that in the next two to three years, this unpredictability will become a force for change in its own right, causing dentists to consider whether they have a future within the NHS, whose reform remains unclear.
The increasing competitiveness of the dental market is also being driven by a growth in digital communications which many dentists feel they need to react to in order to maintain their position in the market. Digitisation is opening up the world of communication to ordinary people who are now able to comment, both positively and negatively, to the treatment and care they receive. In fact, such feedback is positively encouraged by healthcare institutions and the government via websites such as NHS Choices and through the Friends and Family Test.
Managing change appropriately
With such a variety of external forces impacting on a practice, it is unsurprising that dentists feel the need to react in some way, but understanding whether these factors represent an opportunity or a threat is vital if the business is to react in the optimum way. The need to amend internal structures or processes in order to counteract or make optimum use of external changes will determine the outcome and is crucial if practices are to manage the change appropriately.
This type of control is known as ‘change management’, which refers to an approach that transitions individuals, teams, and organisations using methods that redirect the use of resources, business processes, budget allocations and other modes of operation, helping to reshape the organisation.
Change is an unavoidable fact of life and although it is often treated with suspicion and even fear, it’s important that businesses learn to react to change in a positive way
Change management requires thoughtful planning and sensitive implementation, and above all, consultation with, and involvement of, the people affected by the changes. If you force change on people, normally problems arise and it’s important to avoid the perception that you are ‘selling’ change, as this is an unsustainable strategy.
Generally, when people listen to senior managers or owners talk about ‘change’, they are often cynical and although outwardly they may appear to be compliant and in agreement, often internally they feel manipulated. Once these feelings take hold it can be very difficult to get teams to comply and plans for change can be met with resistance and obstruction.
‘Nudge Theory’
To counteract this problem, Thaler and Sunstein (2008) developed what they refer to as ‘Nudge Theory’. This powerful methodology provides an insight into how and why people think the way they do and make the decisions they make. It provides guidance as to how managers can gently shift people’s thinking processes and decision making, ultimately affecting their behaviour. Using these tactics it is possible to gently ‘nudge’ your team into a mind-set where they approve of the action being taken and are therefore more compliant and positive.
Introducing a dental payment plan is a perfect example of a strategy that a practice might employ to combat external changes. Depending on the environmental conditions, a dental plan can make the practice more flexible and revenue streams more predictable. But regardless of the rationale for its introduction, the responsibility for promoting the plan often falls to the reception team who are asked to manage and discuss plan options with patients.
If the underlying reasons for introducing the plan are not explained fully and the team does not ‘buy into’ and understand how the plan can benefit the whole practice, the plan launch is likely to be less successful than it might otherwise be.
It follows that by using tactics that help the team understand the underlying challenges faced by the practice and the way in which the introduction of a dental plan will help them be more successful, principals and managers can better manage the communication process and improve uptake rates.
The critical success factors for most practices include good service, efficiency and patient loyalty, while business owners must also consider cash flow, attracting new patients and predictability of revenue. By smoothing out the peaks and troughs suffered by some practices heavily reliant on fee-per-item patients, a dental plan can help maintain regular monthly income, which is essential for business stability.
Although not making a practice immune from the consequences of external factors, such predictability puts dentists in a more certain financial position enabling better planning for future investments in new equipment, expansion or perhaps conversion from NHS to private practice.
A clear proposal
For dentists considering the ultimate ‘change’ from NHS to a mixed or private practice, there must be a plan to transition the business from one sector to another. Creating a clear proposal of how to manage this change by outlining strategies and tactics that will help to maintain patient levels and effectively communicating this to the team, will help alleviate some of the natural fears of those who may be nervous about the future.
Change for change’s sake is rarely positive, and ensuring that internal changes are introduced for the benefit of all stakeholders – practice, staff and patients – is key to successfully managing the change. Introducing new initiatives, such as patient marketing campaigns, new services or a dental plan for instance, are all strategies that should be implemented for a specific reason and not used as ad hoc, temporary solutions. Each of these elements, for example, can be used to build loyalty and attract new patients, but they can also be used to lessen the negative effects of external changes by making the future more predictable.
Change is an unavoidable fact of life and although it is often treated with suspicion and even fear, it’s important that businesses learn to react to change in a positive way. Change is not necessarily a bad thing and if managed effectively it can be a force for self-analysis and improvement. If treated in the right way, change can provide an environment that enables a business to take advantage of opportunities in ways it might otherwise have never thought possible.
Reference
Sunstein C, Thaler R (2008) Nudge: Improving decisions about health, wealth and happiness. Penguin, UK
To find out more about DPAS call 01747 870910 or visit www.dpas.co.uk.
