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About This Series
>In this economy, working faster, smarter, better is the key to riding out the storm. Here are 6 easy-to-implement...See more tips that can lead to a leaner, meaner, more efficient laboratory operation. ###Problem: I feel like my staff is very fragmented, especially between departments. I need some strategies to inspire my technicians to act as a team. Strategy: Have some fun. Encouraging your employees to have fun together and to develop relationships is an excellent way to foster mutual respect and teamwork. People who enjoy one another usually have a greater loyalty to each other and to the laboratory. "The power of having fun at work should never be underestimated. People simply are more productive and motivated if they are having fun...it's just the way we are wired," says Derik Mocke of the Sustainable Employee Motivation website. While some laboratory owners have gone all out--treating employees to wine tastings, boat trips, ballpark outings and golf tournaments--you can achieve the same team-building results with low-cost activities, too. Think chili cookoffs' potluck lunches, barbecues, movie nights at the lab, or even "make-your-own sundae" days. ###Problem: I have several technicians who have really gone above-and-beyond during the last couple of months. While I can't give significant raises or bonuses in this economy, I want to recognize their accomplishments. Strategy: It doesn't always need to be an elaborate reward to recognize employees' achievements and show pride in your staff. Many times, it's the recognition itself that will motivate people to keep up the good work and let them know you value their contributions. When employees go the extra mile in their daily routine, consider awarding movie passes or other gift certificates immediately. Or, you can give raffle tickets as a reward and hold a monthly or quarterly drawing for prizes or gift certificates. If your laboratory is large enough to have department managers, it's important to get them in the habit of demonstrating their appreciation, too. Encourage them to report back to you with employee recognitions each week, and empower them to give out gift certificates on the spot. ###Problem: To get our new technicians up to speed, I rely heavily on over-the-shoulder training, but it takes a lot of my time. I need more resources to support their education. Strategy: Have new employees work with experienced staff members who act as mentors. Not only does this distribute the training effort and take the entire responsibility off you, but it's also good for the technicians who are doing the training. "It shows we value their skills and we have the confidence they can train someone else," says Greg Thayer, Owner of Thayer Dental Laboratory, Mechanicsburg, PA, who has been using the mentor approach for over 20 years. "It also helps current employees accept a new technician more quickly because they're getting a chance to show him the way things are supposed to be done." Thayer also relies on DVDs from PTC: Simplified Posterior Anatomy and Simplified Anterior Anatomy. "These are especially good for inexperienced trainees to familiarize them with the language used in a dental laboratory and the different anatomical parts of each tooth," says Thayer. "Every one of our technicians, sales people and administrative people--no matter their experience level--complete these two modules when they join the lab." Other resources: build a library of books and DVDs that you can loan out to trainees, and look into the growing online education opportunities and other courses offered by manufacturers and suppliers. ###Problem: I want to promote one of my denture technicians to lead the removable department but I'm not sure who will be most effective in a management role. Strategy: As most laboratory owners will tell you, managerial skills don't always go hand-in-hand with technical skills so promoting the best technician is not always the answer. Start by defining the leadership skills the manager needs and use them to evaluate each candidate. For example: • Attitude. You can't train someone to have a better attitude. Consider his work ethic; does he have an innate desire to do his best? • People/communication skills. Look for the technician who wants to share his knowledge with others--not the one who wants to be the best at the expense of others in the department. Also, can he effectively communicate techniques and ideas? Is he a good listener? • Stress management skills. Is the technician capable of handling stress or disharmony? You need managers who can stay calm, focused and positive under pressure. Feeling stressed is understandable; it's how he handles the pressure that you need to evaluate. • Organizational skills. Look for technicians who know how to plan their day's workload, set deadlines for themselves, and seek out ways to increase efficiency. These skills will make it easier for them to juggle the varied responsibilities that come with a management role. • Ability to prioritize and use good judgment. A manager needs to be able to assess what comes first and what can afford to be put on the back burner without jeopardizing the work--or cash--flow of the lab. ###Problem: My laboratory has grown over the last several years and we're at a point where we need to put some defined policies in place. But developing an employee manual sounds overwhelming. Strategy: Just over half of all dental laboratories have a written manual; it doesn't need to be long, but it can help eliminate the inconsistencies and misunderstandings that result from verbal communication. "A handbook that is read and signed is the best tool for keeping good employees--it holds everyone accountable, employee and employer," says William Grill, Owner, Thompson Suburban Dental Lab in Timonium, MD. To get started, look at some sample manuals online and consider getting input from managers and key technicians. Involving employees in the process shows them you're interested in developing policies that balance your interests with theirs and may alleviate anxiety about having "formal" policies in place. Policies you should detail in the manual include time off, such as sick time, holidays and vacation; probation periods; overtime expectations; benefits and insurance; the performance review process; safety practices; and grounds for termination. Some laboratory owners have also started incorporating guidelines regarding the use of the internet, cell phones and MP3 players, as well as food, drink and personal items at the bench. Be sure to also include these two items that human resource and legal experts say are a must: • A disclaimer stating the manual is not an employment contract and employment with the lab is "at will" and can be terminated at any time. • A comprehensive policy that prohibits sexual harassment and discrimination based on race, gender, age, physical ability and religion. Once you've drafted a manual, have an attorney review it for legal compliance. ###Problem: I know that cross-training technicians would afford more flexibility in my small laboratory, but it's hard to fit into the day when we're all focused on production. Strategy: Investing in cross-training not only gives you flexibility, it also fosters teamwork and helps employees see how their responsibilities interrelate. Consider having a brief meeting every morning to discuss the day's workload and if a technician doesn't have a full day, schedule him for training in another area. Or try arranging training based on typical workflow fluctuations. For instance, if your model and die technicians usually have less work on Tuesday and Wednesday, schedule training sessions on those days. If you can't consistently schedule time in advance, take advantage of training opportunities as they arise. For example, if you have a slow morning and have been wanting to train your model technician to build porcelain, consider helping him pour models so he is free during the afternoon to work with you at the porcelain bench. You can also give employees who are eager to advance their skills the option of working an extra hour or two to learn a new technique. In this case, determine in advance how the employee will be compensated. For instance, you might pay him for an extra hour during the training or promise a small increase once he's mastered the skill.
3 Faster, Smarter, Better Customer Service Strategies to Boost Your Business: What Are Your Secrets For Excellent Customer Service?
>In this economy, working faster, smarter, better is the key to riding out the storm. Here are 3 easy-to-implement...See more tips that can lead to a leaner, meaner, more efficient laboratory operation. ###Problem: I want to find a concrete way to reward customers who have remained loyal to us and haven't been lured away by lower prices in this economy. Strategy: Consider a loyalty rewards program; many laboratories have programs that award dentist-clients cash, credit or even travel credits equal to 2-5% of their total volume. In 2009, Doug Egts, Owner of Esthetic Dental Creations in Rawson, OH, was spurred by the challenging economy to implement the loyalty program he had been considering for a few years. He awards clients 3% of their monthly volume in "Creation Credit Points." Doctors can then use each point for a dollar off future lab work or 50 cents in cash back. "I always think it's unfair when businesses give new customers all the perks, while it's the loyal, long-term customers that keep a business alive," says Egts. "I couldn't be happier with the program; it's a great way to thank my clients, some of whom have been with us for 25-plus years." ###Problem: I've been working on ways to re-energize our customer service effort and I need to get my employees as fired up about it as I am. Strategy: Before you can expect your customer service ethic to be embraced, you must be sure that you are servicing your internal customers--your employees--effectively. If low morale is rampant in your laboratory, it's going to be difficult to rally the troops. On the flip side, employees who feel valued and are shown how their work contributes to the success of your business are more likely to "buy in" to service goals and supply the enthusiasm you need to fire up your service effort. But even the most motivated, eager-to-please employees need some guidance. For example: • Give employees "the big picture." Share your goals for the business and explain how the renewed concentration on service can help achieve them. For example, are you focusing on added-value benefits to combat the loss of clients to offshore laboratories? Are you striving to be seen as a technical resource to encourage more customers to transition to digital dentistry? • Share customer feedback. Keep employees motivated by letting them know customers have noticed and appreciate their efforts. • Empower your staff. If you own a larger laboratory that employs customer service representatives or other front-line staff, you must allow those employees to make decisions or offer solutions to customer problems. Set guidelines for employees to follow and be sure they understand how their decisions affect the laboratory's profits and work flow. This avoids putting off a customer and shows him that service is a matter of course at your laboratory. It also gives your employees a chance to "own" making a customer happy. ###Problem: I picked up a few new customers last year but lost two of them within a short time. Neither of them gave me a concrete reason but assured me it wasn't due to quality or price. Strategy: Always roll out the red carpet for new customers. The first few cases are a precarious time because the client is trying something new and watching results very closely. Plus, he's not yet invested in your laboratory so the smallest detail can turn him off. Be sure you know his preferences inside and out. Whether it's with a technical preference questionnaire or simply a phone call, develop a clear understanding of the new client's expectations. Does he like tight contacts? What style of laterals does he prefer? What about occlusion? Laboratory Owner Jeff Hucek uses his introductory phone call to not only cover technical and esthetic preferences, but also business-oriented expectations. "We establish a game plan, which includes topics like whether he wants the case back one week or one day before the seat date, does he prefer UPS or FedEx, will statements be paid by check or credit card...those kinds of things," says Hucek, Acorn Dental Ceramics, Crivitz, WI. "During that 'settling in' period, you don't have the luxury of assuming a single thing."
Faster, Smarter, Better: 6 Financial Strategies to Boost Your Business. Share Your Money Saving Tips Here!
February 2012-- ###Problem: My lab is tight on cash and I'm looking to better control my inventory costs. Strategy:...See more Keeping a tight reign on your inventory and not stocking a lot of extra materials can be a great idea--especially when it comes to high-priced metals and implant components. On the other hand, you can also save money by buying in bulk--especially for frequently used items like acrylic or ones that have a long shelf life, like teeth. Other strategies to save on inventory costs include combining multiple orders into one to lower shipping costs, taking the time to shop around for the best prices and requesting bids from various manufacturers/suppliers before placing orders. Another way to save money on products and materials is to maximize your buying power by co-oping with local labs to purchase products in bulk. Perdue Dental Laboratory, Sarasota, FL, often partners with the C&B lab with whom it works on combination cases, and the labs save between 5% and 10% on orders of common consumables like plaster, stone and teeth. ###Problem: How can I ensure I'm getting the best deal from my service providers? Strategy: Renegotiate. From shipping costs to service contracts, ask your providers if you're getting the best rate possible. "In these times, they all want to keep the business they have and you might be surprised at what they'll do," says Doug Baker, Director of Professional and Industry Relations for National Dentex Corp. For instance, when Baker compared the cost of a local pick up and delivery service to hiring a driver and buying a car, he found he could spend less money each year than what the lab was currently paying using the delivery service. "I called the owner of the delivery service, he dropped his prices $1 on every package touched and we saved over $5,000 a year with that one phone call," says Baker. Similarly, over the last three years, Leon Hermanides, CDT, President of Protea Dental Studio, Inc. in Redmond, WA, has twice renegotiated his rent with his landlord by offering to extend the number of years on his lease. The result? He's saving $1,200 a month! ###Problem: I'm getting ready to sell my laboratory and need to ensure that all of my financial records are in order for potential buyers. Strategy: Work with your CPA to "recast" your financial statements so that a buyer gets the most realistic view of your laboratory's profitability. If you're like most closely held private companies, you do all you can to limit taxes by reducing profits; however, when preparing for a sale you need to recast the profits and remove the perks you take from the business. For example, if your salary is inflated, it should be substituted with an amount that's more realistic if you were to hire a replacement. Also look on your P&L statements for one-time costs such as legal settlements, fines or severance payments that can detract from your profitability and identify them as such. During the due diligence phase, buyers will want to examine income statements, balance sheets, income tax returns and aging reports, as well as your sales history for at least the past three years. ###Problem: How do I use my income statement to get a better handle on costs? Strategy: When analyzing your income statement, it's important to look at the percentages rather than the dollar figures. Dollars will change from period to period but the goal is to achieve or maintain consistent percentages. By comparing current and past percentages, you can determine where costs are increasing or decreasing in relation to all expenses. There are some industry standard percentages that laboratory owners strive for: • Direct labor and benefits should be between 30 and 35% of sales; if you combine all labor and benefits, this percentage might go as high as 50%. The extensiveness of your benefits package will affect your labor percentage. • Material percentages are usually between 8 and 15% of sales; this may vary depending on the size of your laboratory. For instance, a larger lab might have a lower material percentage because it has more buying power than a smaller lab. Keep in mind that these percentages can vary depending on how you keep your books and allocate expenses. For example, if you work at the bench, the time you spend fabricating restorations should be a direct labor cost whereas your "non-producing time" should be a general and administrative expense. ###Problem: I have a good client who has recently run up a large balance. I know I have to address it, but I'm not sure how to approach him. Strategy: Start with an honest conversation. If the client truly wants to pay off his debt but is having financial difficulty, you may be able to establish a payment plan or come up with another option. For example, Marc Daichman, Owner, Asteto-Dent Labs, Maplewood, NJ, once had a long-time customer who was having financial issues and ran up a large balance for the first time. "We let it go for 90 days. When we still didn't receive payment, we told him in a very upfront, polite way that he needed to decide whether or not he wanted to maintain his relationship with our laboratory," says Daichman. "As a result, he took a loan from his pension in order to pay off his balance." If the client is unresponsive or becomes belligerent, Daichman takes him to small claims court as long as the amount owed is under $2,000 (the small claims limit in his state). It costs about $20 to file a suit and, he's found that many times, a doctor will choose to pay once he receives the summons rather than spend a day in court. ###Problem: Given the current economic situation, I'm uneasy letting new clients who have no history with our laboratory run a balance. Strategy: Cut potential losses; set a credit limit for new customers until you're comfortable with their payment habits. "We simply let the client know that, until we've established a history, we have a credit limit of $2,000; once he hits it, he needs to send a payment or we will only deliver new cases by COD," says Dale Chandler, CFO, Maverick Dental Laboratories, Export, PA. "It can get awkward, but we have to ask ourselves, 'how much is too much to lose?'" Usually, if a practice demonstrates over a three-month period that it has control of its finances and pays on time, the lab incrementally increases the credit limit.
The Daily Bite
Are your clients considering chairside CAD/CAM? Some laboratory owners feel dentists aren't getting an accurate picture of the expenses involved with chairside systems. Educate them on their investment, including the cost of equipment, maintenance, porcelain blocks, milling burs and the most important thing: time.
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