How to Hire, Train and Maintain “10” Employees

Mark Opperman, CVPM

• If you want to attract good employee then you have to be the employer of choice.  Never think that there are no good people to choose from.
• So what is a “10” employee?
• A “10” is the employee that is a real asset to your practice.  A “1” is someone who doesn't show up to work and nobody notices them.
• You can make an “8” or a “9” into a “10”, but anything lower than an “8” will never be a “10” in your practice.
• To HIre a 10 you need to FIND a 10
• Create a resource pool - maybe in-house, employee referral program, steal them from another practice, internet ads (www.vetmedteam.com for example), schools and associations.
• vmc@vmc-inc.com/pvc this is a site that will be up for 30 days and is specific for this meeting.
• Internet ads should be as specific as possible.  That will weed out the people who are not tailored to your job.
• Receptionist - multitasking, social skills, smart.  You can meet these kinds of people in everyday life so be ready to hand out a business card when you meet them.  
• The interview process
• Application - have them come in to fill it out.  It will allow you to see them (dress, grooming, etc.) and their personality and their handwriting/spelling.  If you don't like them then be sure to send them a letter that says that you are not considering them any longer.
• Initial interview - 5 to 10 mins only.  Just get an overall impression.  You can dump half your pool by doing this.
• be sure to take notes during the interview.  Use a standard form.  
• Second Interview
• 30 to 45 mins.  Take tour of the hospital.  This allows the employees to see if them will like the new person.  It allows you to see their body language.  DISCUSS THE JOB DUTIES IN DETAIL (a tech was let go because she was not friendly and she went to the labor board and won saying that being friendly was not in the job description).  Narrow down pool to 2 or 3 people.
• Working Interview
• Have them observe the position that they will do.  Have it be no more then one day (8 hours).  This will be voluntary, so you don't pay them.  Then interview them after the end of the day to see what parts of the job they think they will be good at and what areas they will need training.  Pair the interviewee with one of your employees.  Then ask your employee what they thought of that person.
• If neither of the working interviewees was a 8, 9, or 10 then don't take any of them.  START OVER.
• Before you hire do a reference check.
• www.hrplus.com, a background check costs about $40.  You have to get a release form signed by the prospective employee.
• Pre-employment drug tests.  (60% of people that apply will probably have drugs in their body).  If they do anything wrong and you did not test for drugs then you may be responsible.  Think about it, you have drugs and money sitting around the hospital.  Not a good idea to have a druggie in the hospital.  The consent form for this should be part of the initial application so that people that are using drugs won't even apply.
• Training Employees (”10” employees put family first and look for job satisfaction more then money)
• If you don't train a person then you are not allowing them to become a “10” in your practice.  THERE MUST BE AN ORIENTATION PROGRAM INVOLVED.
• introduce the new employee to EVERYONE in the hospital.  Go over the benefits, salaries, hours, etc.  Do paperwork (I9 and W4 have to be filled out yearly).
• Assign the new employee to a “10” in the practice.  Allow your “10” to show them the ropes so that you get two “10's” out of it.
• Have a check list of things for them to learn during their training period (usually 3-4 weeks).  Pull these tasks from the job descriptions.
• Use Phase Training - basically build up the new employee's skills in organized steps so that it is not just coming in a haphazard way.
• Be sure to have 30 and 60 day “how are you doing” meetings
• HAVE AN EMPLOYEE PROCEDURES MANUAL
• This will contain OSHA info.  The employee signs that they learned all about it so when you get audited then you will not be fined.
• This manual contains all the policies and practices of your hospital.  It can be seen as the go to text if there are any questions about how something should be done. (drug testing, fire, accident, pay days, time cards, overtime, etc.)
• Employees MUST sign their time cards, it is federal law.
• This manual will help employees know that you respect their time.  The employee will also respect your time (actually working during the time that you are clocked in)
• Give employees their birthdays off.  It is a nice little perk for them and then you are not wasting time celebrating it at work.
• Have a policy on blogging about things that go on at work.
• A good idea.  Put a bunch of tasks that would take about 30 mins in a fish bowl.  When an employee has some free time they can pull out a task and do it.  They sign the back of the card with the task on it and place it in another fish bowl.  Have a drawing at the end of each month for $100.
• The Employee Procedures Manual should be reviewed and updated at least once per year.
• Employee Incentives
• Targeted Incentive Program
• ie. if we up the # of fecals then everyone gets an extra $50 bucks
• Mark Opperman doesn't like this kind of goal.
• General Incentive Program
• Choose a specific time period in the past and compare it to the current time period.  Take a percentage of the increase (always gross and not net, because net isn't something that a staff member can help) and set it aside in an employee incentive fund. 
• Do employees do an evaluation.  Adjust the score based on the number of hours that the employee works.  This will break the funds into 100 equal parts.  This will make it so that each employee gets a percentage of the fund.
• The evaluation will allow each member of the staff to know what they can do to grow the practice.
• Dolphin Theory of Management
• Once the dolphin has jumped through the hoop you have to raise the hoop.  So once an employee does well on an evaluation period then make the evaluation more challenging.  This is how you grow a “10” employee.
• ONLY DO THE THINGS THAT ONLY YOU CAN DO (that is a motto to live by in practice so that you can be efficient) 
• A paper will be coming out in a few months in Veterinary Economics saying that each FTE vet doesn't charge for $64,050 each year.
• Firing
• DON'T PROCRASTINATE.  If you know you are going to let someone go, then do it now!
• Document the reasons that you are letting them go. (verbal, written, then fire)
• By firing someone you are doing them a favor.  You are giving them a chance to be a “10” at some other place of employment.
• ALWAYS HAVE AN EXIT INTERVIEW

Tips for New Grads

• Write down where you see yourself in 5 to 10 years.  The most important part of this idea is actually WRITING IT DOWN.
• Revisit these goals, either to remember them or to adjust them to your new lifestyle.
• Paths of life are not straight.  It is okay if you don't go exactly the way you want right when you planned it.  In other words, be as flexible as you can be and exam each opportunity.
• Assess yourself (questions to ask new grads so that their first job is a pleasant experience)
• Strengths and Weaknesses, stress tolerance, tolerance of risk
• Interests
• Personality
• Recent Accomplishments
• Communication Skills and Work Ethic are most important to a practice owner, much more than medical knowledge.  This is the opposite of what new grads think.
• The 2 things that new grads look for at the quality of medicine and the compensation they receive.  These are what bring vets to your practice, but respect regular hours and increase in pay is what keeps them.  
• How to Increase Productivity
• You have to know what you are worth.  Know your skills and knowledge.  MONITOR WHAT YOU GENERATE, even if you are not being paid on production.  This while help to justify your existence in the practice.
• Salary is just a part of your compensation
• other parts are insurance, fringe benefits
• Remember that the employer is taking the RISK on you.  If you leave then it is no skin off your back.  The owner has paid for the practice, equipment, etc.
• As a new associate your job is to make it worth while for the owner to have brought you on to the team.  You are supposed to make a profit from your work and so should the owner.

Marketing the Uniqueness of Your Practice

Dr. Christine Merle

• Products = Service, goods, ideas.
• Clients won't complain about a Product being expensive if they feel it was a value, meaning their expectations were exceeded.
• Make a good impression, but don't set the expectations too high.  That will just set you up for failure (example of blood work getting back sooner than expected)
• You can't measure customer satisfaction with complaints since 95% of people will just stop coming and not even complain.
• The purpose of marketing is to make and maintain a relationship.  Great way of looking at it.
• If you don't offer a certain service then be able to suggest to the client a place they can go based on their expectations.  This is as good as providing the service your self.
• When you decide to open a practice you can use the AVMA to determine the need (number of animals in the area) but that does not show the demand/want.  So is it better to buy an ultrasound machine or make the waiting room more inviting?  You have to know the area you are going into.  Find what the market wants and fulfill the need.
• How do you differentiate your practice?
• Don't use cliché statements when describing your practice.
• Four P's
• Product = Your practice.  You can't be everything to everyone.  That is not a way to differentiate.
• Price.  Low price and high quality don't mix.  Walmart doesn't offer the best quality, but that is ok, they aren't trying to hit the high quality market.  Don't have average prices.  Either go high or go low.  People equate expensive with high quality, use that to practice high quality medicine.
• Promotion.  Is your place clean?  Staff in uniforms?  Smiling faces? 
• Place.  Are you in a convenient place?  Do you have good hours?
• Marketing Concept
• Have a well defined market so you can hit that target. (There has to be interest, income and access) (Social secrurity dependent people spend 3 times the amount then a baby boomer family with kids) 
• Monitor client satisfaction
• Know your target! (www.esri.com, look for community tapestry).  This allows you to find the people who fit your uniqueness.  Census records and future predictions (www.firstgov.com).  Potential Rating Index by Zip Markets (PRIZM)
• To build a good core customer base you should try to get them to come into your practice as often as possible so they can remember why they like coming to you.  The core people are the ones that trust you enough to do the dentals or the senior care programs.
• The people most likely to come to your practice are not those people with families.  It is single people or two person households.  Best prospect are caucasian women between 40-50.
• Only 30% of humans go to the dentist.  So getting people to have the dog get a dental is hard to push.
• If offered VPI is the most common add on to work perks at people's jobs.
• Focus on the majority not the minority, despite the fact that the minority is making the most noise.
• Put yourself back into the shoes of a pet owner.  Know their perspective.  Take off veterinary glasses.
• Focus Groups (take a good sampling of clients, both old and new)
• Determine Client's unspoken needs (email reminders, text messages, drive-thrus, etc.)
• all of these ideas will not work for everyone, try a few of them out and see if they work.  The more in touch you are with your clients the better you can serve them.
• Why not bill them monthly for monthly drugs?  It is easier to swallow a $30 a month than $360 once a year.   Not for every practice, but something to think about.  The client would just see it as a monthly bill like cable, heat, etc.
• Practice Management software is your friend if you use it to get to know your clients.
• If you know the breeds of dogs your clients have then you can tell the owner about breed predilections.  Example: Chips and Hips at 6 (For large breeds at 6 months when the animal comes in for spay/neuter you give microchip and x-ray the hips.)
• Make sure that every person in the hospital knows their roll in making the client satisfied.  In the animal is not happy then the client is not happy.  The owner and animal are linked.  VALUE = EXPERIENCE>EXPECTATIONS
• Staff have to believe in something or you can do all the marketing in the world and it will never work.
• Monitor Client Satisfaction
• If you are making a profit, then you are probably doing a good job, but you can always do better.
• Ask them a simple question at check out.  
• on a scale of 1-5 how would you rate your visit today?
• Tap into all groups
• Don't ask about things that you can't change?
• Don't ask if they like the part of town you are located in if you have no intention of moving.
• Make them measurable.
• A service driven practice is a successful practice.  EVERYONE IS A RECEPTIONIST.
• High quality service is efficient service
• Leverage the skills of your staff and clients.  Make sure that both groups are well educated and your job will be much easier. 
• KPMG MegaStudy - Price was #9.  Vets think that price matters the most, not the client.  The other 8 above price all had to do with customer satisfaction and communication skills.
• Staff and vets should do personality workshops.  This will allow everyone to get along with in the clinic and also handle clients.
• Go over situations with staff.  For example, how should you act during a euthanasia?  Do you ask to hug, just touch shoulder/knee, offer kleenex, etc.  If you haven't talked about it before this could be a very awkward at a very bad time.
• It is okay to use the medical lingo, but be sure to explain what it means.
• Nicholas Boothman's book “How to make people like you in 90 seconds”
• Don't tell people more than 3 things.  They won't remember.  That goes for clients, vets and staff.
• Repetition is good as long as you don't repeat it in the same way.
• Always leave the exam on a positive note. 

I will be blogging the things that I glean from this conference each night after I get home.  The Conference runs June 21st to the 24th, so check back each day for new info.  So far it has been great!

Secrets of High Performing Vet Practices

Fritz Wood, CPA

The State of the Profession

• Basically the profession has grown, but not at the rate possible.

Veterinary Fees

• Income minus Expenses equals Profit (that simple) (gotta shrink expenses or increase income, increases in income is much better to work on)
• Non DVM salaries should be 18-22%, if lower then Dr. is not seeing enough patients. Higher performing practices are more like 24-28%. If you are at like 12% then you are understaffed or you are not paying staff enough.
• Expenses in 2 groups
• Fixed (75%) - stays the same no matter how many clients you see (Vet Med is a fixed expense business which is why discounts never work)
• Variable (25%) - increases with more cases (this is good cost since you are selling what you buy for more then you paid for it. The higher the better. The cost gets passed on to the client. Is there a point at which it is too much?
• Vets are inherently frugal so the problem is that they are not spending enough (not reinvesting in the practice or the staff)
• There is a strong link between cutting expenses and quality of care (most data is from Human Med.)
• Implications of a Fixed Cost Business
• Maximize Capacity (Dr.'s time, good use of space, using equipment) (Average Vet sees 8 clients a day)
• There are 4,ooo human hospitals in the USA, 22,000 small animal hospitals (and there are half as many dogs and cats as there are people!)
• 20% of overhead makes 80% of profit and 80% of the overhead makes 20% of profit. The Sx room is the most expensive room along with Radiology. In a small clinic you are operating equipment and rooms that are only found in huge human hospitals.
• Look back at your records and try to boost income during the slow months, the strong months (the summer). Why do you think that pet dental health day is in February?
• Reminders of coming in during the slow months.
• There is a relationship between the face time with the vet and the amount of money they will spend. So spend more time with clients in the slow months so that they will spend more money. You are not that busy anyway. CDC asks that pets be dewormed quarterly, use that to get people to come in during the slow months.
• Gross Income - Average Charge Transaction (ACT) times Number of Transactions. To increase the income you have to increase the number of transactions or increase the average charge.
• Increase ACT
• Make sure you charge (Mark Opperman says $45,000 goes lost per vet a year). Have an assistant take care of the charges since vets will forget about that. Put chart on the cage, you are more likely to write down charges if you have to touch the record to get to the animal. For each $50,000 of services given away (the national average for 3 DVM practice) you need to gross $250,000.
• Charge more for the services rendered. A plumber or electrician charge 2 times what a vet charges for a physical exam just to show up at your door. Neither of them have 8 years of college to back them. People are more attached to their dog then their pipes in their home.
• Perform more services
• Improve compliance.
• Increase # of Transactions
• Delegate services to non-DVM staff. Practice in Alaska out in the boonies, 1 DVM and 12 staff (FTE) is doing 2.7 million a year.
• Hospital Hours (more is not always better, better hours are better)
• The Goal is 20-25 new clients a month per DVM.
• 66-68% of patients are seen from one year to the next. That means that 1/3 of your clients are not coming back. That is a huge hole in the boat. This is just about the most important number to judge a practice (ask about this in your interviews for a job). It basically says that people like to come to your practice.
• Over the years people pay more if they keep coming to the same practice. year 1 - $248, year 2 - $360, year 3 - $443 (this is the average amount an established client pays per year over time (from conerstone) (trust is a huge factor here) (clients need to hear things over the years before they will do anything)
• Improve compliance (notice that this is the only one on both sides of the equation.)
• Perception of Value
• Client experience divided by Client Expectations (you want to have the numerator larger then the denominator). If you get a whole number then you can charge higher fees. You can control the numerator but not the denominator. Think about the difference between Jiffy Lube and the “ol' garage.” Jiffy is much more expensive, but the service there tends to be much better and they have clean bathrooms.
• Make it easier for the client. Anytime you can deliver treatment through food do that. The fewer treatments the better. People want the problem fixed the first time. Time is much more valuable then money to most clients.
• Moment of Truths (all 3 are by the receptionist, so hire a good one) (Receptionist should be called the Director of First and Last Impressions)
• Very first interaction (usually via the phone). The client will judge you as a Surgeon by that first phone call, even if that person is the secretary.
• Very First live interaction
• Last interaction (where money changes hands).
• If someone has a good experience they tell 25 people, if you just meet their expectations they tell no one, if you are below expectations they will tell 50 people.
• Hire for attitude not for technical skills. Ask staff members choose something related to vet med that they are interested in and become the expert on that matter.
• Read the book “If Disney Ran Your Hospital”
• If you have any employees are less then an 8 out of 10 then you should get rid of them, they are costing you money, maybe 10's of thousands. Your practice is no better then your worst employee.
• People like McDonalds not for the taste, but because you know exactly what you are getting any place in the world. You may not get the best food or price, but you know what you are getting before you even get there.
• Six Principles of Persuasion
• Reciprocation (give candy to kids and the mom will pay for that blood test) (bottled water given at the door and Fritz bought an $800 office chair.)
• Commitment/Consistency - you have to weigh in each week with weight watchers. Get people to commit to being good owners.
• Social Proof - you don't want to be the first or last person on the block to have a certain product or procedure.
• Liking - People buy from people that they like and trust. People will buy from people that are similar to them.
• Authority - Use the weight of your knowledge. Don't let the client make choices about animal health. Your job is to offer the best only.
• Urgency - help people to realize that weight loss is important now and not a year from now. Help them to realize that a dental will help save their pet's life.
• Fees are more of an ART than a SCIENCE
• People associate high prices with quality (Entrepreneur, September 2005)
• NCVEI - it has a wish list (great way to come to a practice and show them what to charge to be able to hire you)
• Check and see how much VPI is willing to pay for certain procedures. Many don't charge as much as an insurance is willing to pay them!
• To stay in business you either have to have the lowest price or you have to be DIFFERENT (Michael Porter) If you are different then you can charge a premium price.
• KPMG Mega-Study - no correlation between owner wealth and how much they are willing to spend on pet. According to Jim Wilson if you don't offer the best because you think that the owner can't afford it. You are risking malpractice.
• Vets only get 0.2% of people's income. People don't care how much a house cost or a car costs, but rather how much it costs a month. Vets are asking for year's worth of the money (0.2%) all at once, unlike a house or car payment.
• A 10% increase in fees will increase your profit by 50%.
• $100 gets up to $110. If the expenses stay at $80 then your profit jumps from $20 to $30. A 50% increase.
• The average family of 4 will pay $313 to go to a sporting event (football game, baseball game, etc.). That is more than that same family spends on their animals. The less money a family makes the more TV channels they have...
• People can afford anything they want, just not everything they want.
• A 10% increase in fees will always increase profit.
• Discounts are bad. There is no way you will make that up in new clients.
• Practices that charge more will make more money and work less hours.
• 40% of clients (over $300) give 60% profit, 35% ($101-$299) give 35% of profit, and 25% (less then $100) of clients give 5%. So 25% of your time is spent on worthless people. They will be the ones who will jump ship due to price.
• There has never been a clinic that has priced it self out out of business.
• Peter Drucker said 25% of clients should be complaining about your prices.
• Clients have no idea how much medicine should cost, so a fee increase will almost never be noticed.
• If a client says you are expensive then tell them that quality medicine is expensive. Then ask why the client thinks others are not charing more???
• Discounts do not increase client satisfaction and satisfaction is all people remember about their trip to the vet.

Leverage and Delegation

• Good Clinics use non DVM staff to do work. That way you (the vet) can get paid to what you were trained to do.
• 2 Dr. practice $700,000. One Dr. dies and then the practice goes up to $800,000. The remaining Dr. started using the staff better.
• Delegation helps a Dr. not get bored with the job.
•  

Capturing Everyday Opportunities

• Lab work is not more than 10% of gross income. It should be more than 30%
• You should require all pets to have a preanesthetic exams. Wellness exams should always be offered. The lab work brings in money and any diseases that are unmasked also bring in money and help the pet.
• Senior Care is a serious issue. People are used to the idea of visiting the Dr. more when they get older so it will make sense to them that their pet needs to do the same thing. About 50% of your client base are geriatric.
• Long term drugs. There are lists of drugs that need to have serum profiles. You should be sure to send out reminders to clients if they are on long term drugs to be sure that you are covered if the pet dies, keeps pet healthy and makes you money. Win, win, win.
• Dentistry. 85% of animals need it. It is linked to systemic diseases.
• Obesity. Purina study shows that fat dogs die 2 years earlier. Make sure you are talking to people about that (prescription drugs), or you might get sued if a fat dog dies. You have to have it in the record that you told them about weight-loss food.
• Pet food is an untapped resource. Pets eat everyday, so even though a food has a lower mark up, there is tons of it sold so you can make a good chunk of money. Average clinic will bring in $100,000 net income extra by selling food. Client comes in many times a year for food which means that they will most likely be up on vaccines and physicals.

Compliance

• 20% of what people hear they retain, 40% of what they read and 70% of what they read and hear.
• Core vaccine compliance is 87%, which is better then vaccines for children.
• The biggest problem is lack of recommendation and follow up. Remind, Remind, Remind!
• By not recommending you are not saving the clients money, it will cost them more later.
• If you are in a multi-Dr. practice, make sure that all the Drs. are on the same page with protocols. This will make sure all clients get the same treatment and your staff will see that it is important.
• Hire teens to go through records to find animals that need reminders. They teens will more then pay for themselves.
• HAVE A PROFESSION OPINION. THINK ABOUT FLIGHT THAT LANDED CUZ PASSENGERS VOTED ON IT!!!