Philip Welscher, MD, and Kari Larson-McMurtrey, MBA
At some point in the dermatology practice lifecycle, there will inevitably arise this thought: I wonder what a practice consultant would say about this (insert question)?
Practice Performance Issues
It may be during a period of succession, such as adding another dermatologist, partner or employee, or downsizing prior to a move, retirement, or change in lifestyle. It may be when considering alternative practice options such as leaving an employed position, joining a different type of entity (government, military, industry, etc.), or starting or leaving an academic position. For many dermatologists, contemplation of retaining a practice consultant will revolve around practice performance, specifically growth management.
Growth Management
Growth, it seems, is inevitable in virtually every dermatology practice. So the question is not if there is growth, but how much, how fast, in what direction, and at what cost (personal, financial, family, etc.). Also to be considered are the ultimate goal, and even the exit strategy at some point in the time horizon. Because growth is, at least in part, unpredictable, and seemingly always a bit chaotic when viewed from the inside, managing growth is a lot like the army managing a retreat: It is a lot harder than it looks from the outside. While optimism and excitement are the watchwords of growth — stress and (financial) insecurity are the bywords.
So, it is with this scenario of a dermatology practice considering, engaging in, or dealing with the effects of growth and the transition envisioned, that the concept of practice management consulting is examined.
What’s the Point?
Perhaps the most difficult step to take is simply coming to the decision point of accepting that there may be value for you in retaining a consultant. After all, you have already proven yourself to be an adept practice manager: You started the practice, built it into what it is today, and have been richly rewarded for doing so, both personally and professionally.
What could a practice consultant tell you about your own practice that you don’t already know? Well, to begin, maybe nothing at all. In fact, one of the best uses of a consultant is to validate your plans, ideas, direction, strategy and tactics. The consultant can become a powerful external sounding board for everything you have done and plan to do in the future. So relax, it is not always about what you have missed, lost or need to re-examine; sometimes it is about feeling good about what you have accomplished.
Choosing a Consultant
Prior to retaining a consultant, it is important to learn something about whomever you are considering. Consider this: If you were to establish a relationship with another physician for some health concern, how would you go about choosing your “health consultant”?
Chances are, you would first learn as much as possible about your concern, and then choose someone with the skills, knowledge, education, expertise, reputation and availability to properly address those concern(s). Regardless of the type of concern, you would follow the same basic mental checklist and arrive at the same well-thought-out and reasoned decision. So why would you do anything different when it comes to a practice management consultant?
For some of us, it may be because we delegate the task to someone else in our office (i.e., a practice administrator), or we depend on a referral from a professional associated with our business, such as the practice accountant or attorney. For others, it may be that the laser or other device we purchased comes with a “free” practice consultation worth many thousands of dollars. Then there may be a casual suggestion from a friend or colleague, based on his or her own needs and experience, which may very well not coincide with yours. (Just imagine this: “I saw a proctologist and it helped me a lot. You should see one, too.”)
Probably most of us think about it for a while, check out some ads in a professional journal, stop by a booth at a meeting, or respond to a direct mail piece.
All of these scenarios — with apologies to our proctology colleagues — may in fact be effective and just what we needed to get our questions answered and our concerns allayed. However, for most of us most of the time, the decision is a bit more complex.
Keep These Points in Mind
Let’s begin with some assumptions concerning your practice needs. First, the easy stuff: Not every practice is the same. Not every practice is at the point in its lifecycle when it could benefit most from a consultant, just as not every dermatologist is created equally with regard to business skills, experience and interest. And, finally, not every practice has the same resources to draw upon for business decision-making.
Now, the harder stuff: If you don’t know what questions to ask, you probably won’t get the answers you are looking for; if you can’t generate the data necessary to answer the question, you will likely not get the right answer; and if you don’t have the time, energy, drive and determination to do your own internal practice assessment before engaging in an external consultation, you probably won’t like or respect the information you will get.
Internal Practice Assessment
The internal practice assessment is a most valuable tool and exercise to engage in prior to retaining an external consultant. Quite simply, it is the methodical assessment and reassessment of the current state of affairs of the ongoing organization. It could begin with an employee retreat, utilize known resources, be comparative with regard to financial and performance trends, identify and build on strengths, reinforce weak areas, and match resources to goals.
The internal assessment lays the vital groundwork to identify areas where those conducting the external assessment can provide valuable information. It enables these experienced outside consultants to draw conclusions based on objective observation. The internal assessment also serves to to validate your directions, decisions and resource allotments.
External Practice Assessment
The external assessment then logically continues beyond your efforts — perhaps in a narrowly defined scope concerning a specific set of questions, or perhaps in a broad-based extensive and exhaustive top-to-bottom review of all facets of operation. Regardless, the value of the information gained is largely dependent on the framework in which it is requested. That means simply this: If you are planning to put your arms up in the air in frustration, and yell “help”, and expect to get all the answers you need from a consulting visit, you will most certainly be disappointed.
However, if you instead approach the identification, selection and retention of a practice consultant in a logical manner, and understand that what you will get is a mix of perspective, advice, some answers, more questions — and probably some information that you will not like, then you will probably not be disappointed.
The Consulting Specialties
As in medicine, business consulting has specialists, which should come as no surprise, given the nature of progress in the world.
While there are “generalists” just as in medicine and at times these type of consultants may be the best choice (for example, when opening a practice after finishing residency), consulting has given way to increasing sub-specialization for the evolving dermatology practice.
Because the value of the information received is dependent on the skill set of the consultant, making the right choice for your needs is the single first best step to obtaining both reward and satisfaction from the process.
One way to analyze the consulting marketplace is to imagine a world of medicine where there are three specialties (indulge me): surgery, medicine, and diagnostics (radiology, pathology, etc.) You have a choice to cut, prescribe, or diagnose.
Now, in dermatology office practice business consulting, you have three broad choices: strategic planning and economic analysis, management and human resource development, and market development. Each of these broad areas of specialization will of course overlap the others to some degree, yet they are distinctly separate in their primary intention.
Strategic Planning and Economic Analysis Consultants
Strategic planning and economic analysis is perhaps the consulting niche with the broadest overview of the total practice. These consultants will look at both internal and external factors affecting the practice. This includes the market, the mix of people involved, the revenue streams, profitability, costs, charges, information and monitoring systems. In addition, they examine relationships with professional support functions such as legal, accounting, real estate, etc.
They not only look at where you have been and where you are going, they assess how you plan to get where you’re going (or not) and the route you are taking. They also assess your resources, capabilities and commitments to see if there is a reasonable chance of attaining your goals, and if not, why not.
Their typical focus is to become deeply and intimately knowledgeable about the economic performance of your practice and how that compares with your vision and goals, and the external marketplace in which you practice.
These consultants are especially valuable for practices in poor financial health, for those experiencing rapid growth, for those wishing to adapt to emerging market trends or for those which lack focus or direction and are looking for a path to follow.
These consultants are frequently trained in finance or accounting, and commonly have direct experience in practice or hospital or healthcare administration and management. They are usually highly educated (MBA) and frequently work in teams to share specific expertise. They usually don’t participate in monitoring or implementation, but rather present specific sets of information, usually financial, and advise on overall direction and strategy in the marketplace.
Then they let you absorb their advice, choose which parts of it you will accept or reject or modify to fit your needs and desires, and let you take the lead. Typically, these experts don’t sell any ongoing services or products, although they usually have specific contacts and make referrals for suggested improvements.
Management and Human Resource Development Consultants
Management and human resource development consultants are the modern-day version of the office efficiency experts. They bring expertise from training, experience and exposure.
These consultants will tackle the dysfunctional office environment like a bull in a china shop and let you know in no uncertain terms what is wrong, where, who is responsible — be advised, it may be you — and how to fix it. You may not like what they say, but more often than not they are correct.
They bring particular value to assessing the operational aspects of the practice including such things as job duties, staffing, hours, compensation, traffic flow, schedules, and cost control. They frequently are used when it seems like the “front office” is out of control, or when there is high employee turnover, poor morale, sub-grouping or an “us-versus-them” mentality.
They can bring value to a review of employee benefits, retention programs, and performance of the current office management structure. When a practice experiences rapid growth or contraction or a substantial change in structure, they can provide useful insight into management and staffing challenges, and smooth the transition process.
Commonly, they have backgrounds and education in office administration, benefits, HR, organizational psychology or employment law. These types of consultants commonly suggest and participate in monitoring and implementation strategies and may offer services such as newsletters, regular performance meetings, retreats, etc.
Marketing, Advertising and Communications Consultants
The third group, market development, is also known as the marketing, advertising and communications (MAC) group. A very different approach from the other two, these groups are usually contacted, or make contact, with the intention of offering, selling or brokering services. These services are usually wrapped around some type of external message development, frequently termed “branding” and include media relations, internal and external advertising, practice promotional activities, media training, and all of the activities that revolve around “exposure”, including those of the “publicist”.
Typically MAC consultants will offer services on a retainer basis, where a monthly service fee is agreed upon. In addition, there may be ad-hoc add-on services which are billed over and above the monthly fee.
Frequently your “investment” in the retainer will buy you access to print and broadcast media (getting you, not your competition, the interviews), help brand you as the local, regional or even national expert on some topic (so you want to be on Oprah?) and position you via “meta-messaging” to your audience.
These consultants are usually very media savvy, frequently having backgrounds in journalism, reporting, anchoring, public relations, graphic design and consumer psychology. They typically don’t have any focus on finance or accounting (although they can spend your money quite well) and the HR issues are only of consequence when they impact promotional activities.
MAC groups hope for long-term relationships, and will commonly not engage in representing two competing groups, offices or dermatologists as this could/would present a conflict of interest.
The Right Choice and the Right Approach are Key
This discussion should make one thing clear: Choosing the right type of consultant may well be more important than choosing to use a consultant at all.
To recap, all consulting starts with the dermatologist and the internal review process, which helps to frame the questions that need to be answered. Once this groundwork has been laid, the next logical step is to determine your needs, which logically leads in the general direction of type of external practice consultant required. Following this approach allows you to search much more effectively for the right fit.
Many consulting resources are located close to home, and can be more cost-efficient, productive and rewarding than leaving your geographic community in search of the “world’s expert.” Specific resources for dermatologists include the AAD, with its vast assortment of programs for the internal assessment; and the Allergan Practice Consultants, who are generally recognized as having the best benchmarking financial data sets in the specialty for external assessment.
Remember, however, that asking tough questions can result in some tough-to- swallow answers. In the consulting world, there is always a fear of a “shoot-the-messenger” response in which the client (you) is so upset with the information delivered that the focus is shifted from the problem (you, your practice, your staff, your manager, etc.) to the messenger with unfortunate results for everyone involved.
So, my advice is to stay open-minded, non-judgmental and take a deep breath before making any hasty decisions. Remember the advice when a patient codes: Take your own pulse first.
Dr Welscher is associate clinical professor of medicine and dermatology at the University of Washington, and section chief of dermatology at Sacred Heart Medical Center, Spokane, WA.
Ms. Larson-McMurtrey is currently a business manager for a national hair restoration clinic.
Philip Welscher, MD, and Kari Larson-McMurtrey, MBA
At some point in the dermatology practice lifecycle, there will inevitably arise this thought: I wonder what a practice consultant would say about this (insert question)?
Practice Performance Issues
It may be during a period of succession, such as adding another dermatologist, partner or employee, or downsizing prior to a move, retirement, or change in lifestyle. It may be when considering alternative practice options such as leaving an employed position, joining a different type of entity (government, military, industry, etc.), or starting or leaving an academic position. For many dermatologists, contemplation of retaining a practice consultant will revolve around practice performance, specifically growth management.
Growth Management
Growth, it seems, is inevitable in virtually every dermatology practice. So the question is not if there is growth, but how much, how fast, in what direction, and at what cost (personal, financial, family, etc.). Also to be considered are the ultimate goal, and even the exit strategy at some point in the time horizon. Because growth is, at least in part, unpredictable, and seemingly always a bit chaotic when viewed from the inside, managing growth is a lot like the army managing a retreat: It is a lot harder than it looks from the outside. While optimism and excitement are the watchwords of growth — stress and (financial) insecurity are the bywords.
So, it is with this scenario of a dermatology practice considering, engaging in, or dealing with the effects of growth and the transition envisioned, that the concept of practice management consulting is examined.
What’s the Point?
Perhaps the most difficult step to take is simply coming to the decision point of accepting that there may be value for you in retaining a consultant. After all, you have already proven yourself to be an adept practice manager: You started the practice, built it into what it is today, and have been richly rewarded for doing so, both personally and professionally.
What could a practice consultant tell you about your own practice that you don’t already know? Well, to begin, maybe nothing at all. In fact, one of the best uses of a consultant is to validate your plans, ideas, direction, strategy and tactics. The consultant can become a powerful external sounding board for everything you have done and plan to do in the future. So relax, it is not always about what you have missed, lost or need to re-examine; sometimes it is about feeling good about what you have accomplished.
Choosing a Consultant
Prior to retaining a consultant, it is important to learn something about whomever you are considering. Consider this: If you were to establish a relationship with another physician for some health concern, how would you go about choosing your “health consultant”?
Chances are, you would first learn as much as possible about your concern, and then choose someone with the skills, knowledge, education, expertise, reputation and availability to properly address those concern(s). Regardless of the type of concern, you would follow the same basic mental checklist and arrive at the same well-thought-out and reasoned decision. So why would you do anything different when it comes to a practice management consultant?
For some of us, it may be because we delegate the task to someone else in our office (i.e., a practice administrator), or we depend on a referral from a professional associated with our business, such as the practice accountant or attorney. For others, it may be that the laser or other device we purchased comes with a “free” practice consultation worth many thousands of dollars. Then there may be a casual suggestion from a friend or colleague, based on his or her own needs and experience, which may very well not coincide with yours. (Just imagine this: “I saw a proctologist and it helped me a lot. You should see one, too.”)
Probably most of us think about it for a while, check out some ads in a professional journal, stop by a booth at a meeting, or respond to a direct mail piece.
All of these scenarios — with apologies to our proctology colleagues — may in fact be effective and just what we needed to get our questions answered and our concerns allayed. However, for most of us most of the time, the decision is a bit more complex.
Keep These Points in Mind
Let’s begin with some assumptions concerning your practice needs. First, the easy stuff: Not every practice is the same. Not every practice is at the point in its lifecycle when it could benefit most from a consultant, just as not every dermatologist is created equally with regard to business skills, experience and interest. And, finally, not every practice has the same resources to draw upon for business decision-making.
Now, the harder stuff: If you don’t know what questions to ask, you probably won’t get the answers you are looking for; if you can’t generate the data necessary to answer the question, you will likely not get the right answer; and if you don’t have the time, energy, drive and determination to do your own internal practice assessment before engaging in an external consultation, you probably won’t like or respect the information you will get.
Internal Practice Assessment
The internal practice assessment is a most valuable tool and exercise to engage in prior to retaining an external consultant. Quite simply, it is the methodical assessment and reassessment of the current state of affairs of the ongoing organization. It could begin with an employee retreat, utilize known resources, be comparative with regard to financial and performance trends, identify and build on strengths, reinforce weak areas, and match resources to goals.
The internal assessment lays the vital groundwork to identify areas where those conducting the external assessment can provide valuable information. It enables these experienced outside consultants to draw conclusions based on objective observation. The internal assessment also serves to to validate your directions, decisions and resource allotments.
External Practice Assessment
The external assessment then logically continues beyond your efforts — perhaps in a narrowly defined scope concerning a specific set of questions, or perhaps in a broad-based extensive and exhaustive top-to-bottom review of all facets of operation. Regardless, the value of the information gained is largely dependent on the framework in which it is requested. That means simply this: If you are planning to put your arms up in the air in frustration, and yell “help”, and expect to get all the answers you need from a consulting visit, you will most certainly be disappointed.
However, if you instead approach the identification, selection and retention of a practice consultant in a logical manner, and understand that what you will get is a mix of perspective, advice, some answers, more questions — and probably some information that you will not like, then you will probably not be disappointed.
The Consulting Specialties
As in medicine, business consulting has specialists, which should come as no surprise, given the nature of progress in the world.
While there are “generalists” just as in medicine and at times these type of consultants may be the best choice (for example, when opening a practice after finishing residency), consulting has given way to increasing sub-specialization for the evolving dermatology practice.
Because the value of the information received is dependent on the skill set of the consultant, making the right choice for your needs is the single first best step to obtaining both reward and satisfaction from the process.
One way to analyze the consulting marketplace is to imagine a world of medicine where there are three specialties (indulge me): surgery, medicine, and diagnostics (radiology, pathology, etc.) You have a choice to cut, prescribe, or diagnose.
Now, in dermatology office practice business consulting, you have three broad choices: strategic planning and economic analysis, management and human resource development, and market development. Each of these broad areas of specialization will of course overlap the others to some degree, yet they are distinctly separate in their primary intention.
Strategic Planning and Economic Analysis Consultants
Strategic planning and economic analysis is perhaps the consulting niche with the broadest overview of the total practice. These consultants will look at both internal and external factors affecting the practice. This includes the market, the mix of people involved, the revenue streams, profitability, costs, charges, information and monitoring systems. In addition, they examine relationships with professional support functions such as legal, accounting, real estate, etc.
They not only look at where you have been and where you are going, they assess how you plan to get where you’re going (or not) and the route you are taking. They also assess your resources, capabilities and commitments to see if there is a reasonable chance of attaining your goals, and if not, why not.
Their typical focus is to become deeply and intimately knowledgeable about the economic performance of your practice and how that compares with your vision and goals, and the external marketplace in which you practice.
These consultants are especially valuable for practices in poor financial health, for those experiencing rapid growth, for those wishing to adapt to emerging market trends or for those which lack focus or direction and are looking for a path to follow.
These consultants are frequently trained in finance or accounting, and commonly have direct experience in practice or hospital or healthcare administration and management. They are usually highly educated (MBA) and frequently work in teams to share specific expertise. They usually don’t participate in monitoring or implementation, but rather present specific sets of information, usually financial, and advise on overall direction and strategy in the marketplace.
Then they let you absorb their advice, choose which parts of it you will accept or reject or modify to fit your needs and desires, and let you take the lead. Typically, these experts don’t sell any ongoing services or products, although they usually have specific contacts and make referrals for suggested improvements.
Management and Human Resource Development Consultants
Management and human resource development consultants are the modern-day version of the office efficiency experts. They bring expertise from training, experience and exposure.
These consultants will tackle the dysfunctional office environment like a bull in a china shop and let you know in no uncertain terms what is wrong, where, who is responsible — be advised, it may be you — and how to fix it. You may not like what they say, but more often than not they are correct.
They bring particular value to assessing the operational aspects of the practice including such things as job duties, staffing, hours, compensation, traffic flow, schedules, and cost control. They frequently are used when it seems like the “front office” is out of control, or when there is high employee turnover, poor morale, sub-grouping or an “us-versus-them” mentality.
They can bring value to a review of employee benefits, retention programs, and performance of the current office management structure. When a practice experiences rapid growth or contraction or a substantial change in structure, they can provide useful insight into management and staffing challenges, and smooth the transition process.
Commonly, they have backgrounds and education in office administration, benefits, HR, organizational psychology or employment law. These types of consultants commonly suggest and participate in monitoring and implementation strategies and may offer services such as newsletters, regular performance meetings, retreats, etc.
Marketing, Advertising and Communications Consultants
The third group, market development, is also known as the marketing, advertising and communications (MAC) group. A very different approach from the other two, these groups are usually contacted, or make contact, with the intention of offering, selling or brokering services. These services are usually wrapped around some type of external message development, frequently termed “branding” and include media relations, internal and external advertising, practice promotional activities, media training, and all of the activities that revolve around “exposure”, including those of the “publicist”.
Typically MAC consultants will offer services on a retainer basis, where a monthly service fee is agreed upon. In addition, there may be ad-hoc add-on services which are billed over and above the monthly fee.
Frequently your “investment” in the retainer will buy you access to print and broadcast media (getting you, not your competition, the interviews), help brand you as the local, regional or even national expert on some topic (so you want to be on Oprah?) and position you via “meta-messaging” to your audience.
These consultants are usually very media savvy, frequently having backgrounds in journalism, reporting, anchoring, public relations, graphic design and consumer psychology. They typically don’t have any focus on finance or accounting (although they can spend your money quite well) and the HR issues are only of consequence when they impact promotional activities.
MAC groups hope for long-term relationships, and will commonly not engage in representing two competing groups, offices or dermatologists as this could/would present a conflict of interest.
The Right Choice and the Right Approach are Key
This discussion should make one thing clear: Choosing the right type of consultant may well be more important than choosing to use a consultant at all.
To recap, all consulting starts with the dermatologist and the internal review process, which helps to frame the questions that need to be answered. Once this groundwork has been laid, the next logical step is to determine your needs, which logically leads in the general direction of type of external practice consultant required. Following this approach allows you to search much more effectively for the right fit.
Many consulting resources are located close to home, and can be more cost-efficient, productive and rewarding than leaving your geographic community in search of the “world’s expert.” Specific resources for dermatologists include the AAD, with its vast assortment of programs for the internal assessment; and the Allergan Practice Consultants, who are generally recognized as having the best benchmarking financial data sets in the specialty for external assessment.
Remember, however, that asking tough questions can result in some tough-to- swallow answers. In the consulting world, there is always a fear of a “shoot-the-messenger” response in which the client (you) is so upset with the information delivered that the focus is shifted from the problem (you, your practice, your staff, your manager, etc.) to the messenger with unfortunate results for everyone involved.
So, my advice is to stay open-minded, non-judgmental and take a deep breath before making any hasty decisions. Remember the advice when a patient codes: Take your own pulse first.
Dr Welscher is associate clinical professor of medicine and dermatology at the University of Washington, and section chief of dermatology at Sacred Heart Medical Center, Spokane, WA.
Ms. Larson-McMurtrey is currently a business manager for a national hair restoration clinic.
Philip Welscher, MD, and Kari Larson-McMurtrey, MBA
At some point in the dermatology practice lifecycle, there will inevitably arise this thought: I wonder what a practice consultant would say about this (insert question)?
Practice Performance Issues
It may be during a period of succession, such as adding another dermatologist, partner or employee, or downsizing prior to a move, retirement, or change in lifestyle. It may be when considering alternative practice options such as leaving an employed position, joining a different type of entity (government, military, industry, etc.), or starting or leaving an academic position. For many dermatologists, contemplation of retaining a practice consultant will revolve around practice performance, specifically growth management.
Growth Management
Growth, it seems, is inevitable in virtually every dermatology practice. So the question is not if there is growth, but how much, how fast, in what direction, and at what cost (personal, financial, family, etc.). Also to be considered are the ultimate goal, and even the exit strategy at some point in the time horizon. Because growth is, at least in part, unpredictable, and seemingly always a bit chaotic when viewed from the inside, managing growth is a lot like the army managing a retreat: It is a lot harder than it looks from the outside. While optimism and excitement are the watchwords of growth — stress and (financial) insecurity are the bywords.
So, it is with this scenario of a dermatology practice considering, engaging in, or dealing with the effects of growth and the transition envisioned, that the concept of practice management consulting is examined.
What’s the Point?
Perhaps the most difficult step to take is simply coming to the decision point of accepting that there may be value for you in retaining a consultant. After all, you have already proven yourself to be an adept practice manager: You started the practice, built it into what it is today, and have been richly rewarded for doing so, both personally and professionally.
What could a practice consultant tell you about your own practice that you don’t already know? Well, to begin, maybe nothing at all. In fact, one of the best uses of a consultant is to validate your plans, ideas, direction, strategy and tactics. The consultant can become a powerful external sounding board for everything you have done and plan to do in the future. So relax, it is not always about what you have missed, lost or need to re-examine; sometimes it is about feeling good about what you have accomplished.
Choosing a Consultant
Prior to retaining a consultant, it is important to learn something about whomever you are considering. Consider this: If you were to establish a relationship with another physician for some health concern, how would you go about choosing your “health consultant”?
Chances are, you would first learn as much as possible about your concern, and then choose someone with the skills, knowledge, education, expertise, reputation and availability to properly address those concern(s). Regardless of the type of concern, you would follow the same basic mental checklist and arrive at the same well-thought-out and reasoned decision. So why would you do anything different when it comes to a practice management consultant?
For some of us, it may be because we delegate the task to someone else in our office (i.e., a practice administrator), or we depend on a referral from a professional associated with our business, such as the practice accountant or attorney. For others, it may be that the laser or other device we purchased comes with a “free” practice consultation worth many thousands of dollars. Then there may be a casual suggestion from a friend or colleague, based on his or her own needs and experience, which may very well not coincide with yours. (Just imagine this: “I saw a proctologist and it helped me a lot. You should see one, too.”)
Probably most of us think about it for a while, check out some ads in a professional journal, stop by a booth at a meeting, or respond to a direct mail piece.
All of these scenarios — with apologies to our proctology colleagues — may in fact be effective and just what we needed to get our questions answered and our concerns allayed. However, for most of us most of the time, the decision is a bit more complex.
Keep These Points in Mind
Let’s begin with some assumptions concerning your practice needs. First, the easy stuff: Not every practice is the same. Not every practice is at the point in its lifecycle when it could benefit most from a consultant, just as not every dermatologist is created equally with regard to business skills, experience and interest. And, finally, not every practice has the same resources to draw upon for business decision-making.
Now, the harder stuff: If you don’t know what questions to ask, you probably won’t get the answers you are looking for; if you can’t generate the data necessary to answer the question, you will likely not get the right answer; and if you don’t have the time, energy, drive and determination to do your own internal practice assessment before engaging in an external consultation, you probably won’t like or respect the information you will get.
Internal Practice Assessment
The internal practice assessment is a most valuable tool and exercise to engage in prior to retaining an external consultant. Quite simply, it is the methodical assessment and reassessment of the current state of affairs of the ongoing organization. It could begin with an employee retreat, utilize known resources, be comparative with regard to financial and performance trends, identify and build on strengths, reinforce weak areas, and match resources to goals.
The internal assessment lays the vital groundwork to identify areas where those conducting the external assessment can provide valuable information. It enables these experienced outside consultants to draw conclusions based on objective observation. The internal assessment also serves to to validate your directions, decisions and resource allotments.
External Practice Assessment
The external assessment then logically continues beyond your efforts — perhaps in a narrowly defined scope concerning a specific set of questions, or perhaps in a broad-based extensive and exhaustive top-to-bottom review of all facets of operation. Regardless, the value of the information gained is largely dependent on the framework in which it is requested. That means simply this: If you are planning to put your arms up in the air in frustration, and yell “help”, and expect to get all the answers you need from a consulting visit, you will most certainly be disappointed.
However, if you instead approach the identification, selection and retention of a practice consultant in a logical manner, and understand that what you will get is a mix of perspective, advice, some answers, more questions — and probably some information that you will not like, then you will probably not be disappointed.
The Consulting Specialties
As in medicine, business consulting has specialists, which should come as no surprise, given the nature of progress in the world.
While there are “generalists” just as in medicine and at times these type of consultants may be the best choice (for example, when opening a practice after finishing residency), consulting has given way to increasing sub-specialization for the evolving dermatology practice.
Because the value of the information received is dependent on the skill set of the consultant, making the right choice for your needs is the single first best step to obtaining both reward and satisfaction from the process.
One way to analyze the consulting marketplace is to imagine a world of medicine where there are three specialties (indulge me): surgery, medicine, and diagnostics (radiology, pathology, etc.) You have a choice to cut, prescribe, or diagnose.
Now, in dermatology office practice business consulting, you have three broad choices: strategic planning and economic analysis, management and human resource development, and market development. Each of these broad areas of specialization will of course overlap the others to some degree, yet they are distinctly separate in their primary intention.
Strategic Planning and Economic Analysis Consultants
Strategic planning and economic analysis is perhaps the consulting niche with the broadest overview of the total practice. These consultants will look at both internal and external factors affecting the practice. This includes the market, the mix of people involved, the revenue streams, profitability, costs, charges, information and monitoring systems. In addition, they examine relationships with professional support functions such as legal, accounting, real estate, etc.
They not only look at where you have been and where you are going, they assess how you plan to get where you’re going (or not) and the route you are taking. They also assess your resources, capabilities and commitments to see if there is a reasonable chance of attaining your goals, and if not, why not.
Their typical focus is to become deeply and intimately knowledgeable about the economic performance of your practice and how that compares with your vision and goals, and the external marketplace in which you practice.
These consultants are especially valuable for practices in poor financial health, for those experiencing rapid growth, for those wishing to adapt to emerging market trends or for those which lack focus or direction and are looking for a path to follow.
These consultants are frequently trained in finance or accounting, and commonly have direct experience in practice or hospital or healthcare administration and management. They are usually highly educated (MBA) and frequently work in teams to share specific expertise. They usually don’t participate in monitoring or implementation, but rather present specific sets of information, usually financial, and advise on overall direction and strategy in the marketplace.
Then they let you absorb their advice, choose which parts of it you will accept or reject or modify to fit your needs and desires, and let you take the lead. Typically, these experts don’t sell any ongoing services or products, although they usually have specific contacts and make referrals for suggested improvements.
Management and Human Resource Development Consultants
Management and human resource development consultants are the modern-day version of the office efficiency experts. They bring expertise from training, experience and exposure.
These consultants will tackle the dysfunctional office environment like a bull in a china shop and let you know in no uncertain terms what is wrong, where, who is responsible — be advised, it may be you — and how to fix it. You may not like what they say, but more often than not they are correct.
They bring particular value to assessing the operational aspects of the practice including such things as job duties, staffing, hours, compensation, traffic flow, schedules, and cost control. They frequently are used when it seems like the “front office” is out of control, or when there is high employee turnover, poor morale, sub-grouping or an “us-versus-them” mentality.
They can bring value to a review of employee benefits, retention programs, and performance of the current office management structure. When a practice experiences rapid growth or contraction or a substantial change in structure, they can provide useful insight into management and staffing challenges, and smooth the transition process.
Commonly, they have backgrounds and education in office administration, benefits, HR, organizational psychology or employment law. These types of consultants commonly suggest and participate in monitoring and implementation strategies and may offer services such as newsletters, regular performance meetings, retreats, etc.
Marketing, Advertising and Communications Consultants
The third group, market development, is also known as the marketing, advertising and communications (MAC) group. A very different approach from the other two, these groups are usually contacted, or make contact, with the intention of offering, selling or brokering services. These services are usually wrapped around some type of external message development, frequently termed “branding” and include media relations, internal and external advertising, practice promotional activities, media training, and all of the activities that revolve around “exposure”, including those of the “publicist”.
Typically MAC consultants will offer services on a retainer basis, where a monthly service fee is agreed upon. In addition, there may be ad-hoc add-on services which are billed over and above the monthly fee.
Frequently your “investment” in the retainer will buy you access to print and broadcast media (getting you, not your competition, the interviews), help brand you as the local, regional or even national expert on some topic (so you want to be on Oprah?) and position you via “meta-messaging” to your audience.
These consultants are usually very media savvy, frequently having backgrounds in journalism, reporting, anchoring, public relations, graphic design and consumer psychology. They typically don’t have any focus on finance or accounting (although they can spend your money quite well) and the HR issues are only of consequence when they impact promotional activities.
MAC groups hope for long-term relationships, and will commonly not engage in representing two competing groups, offices or dermatologists as this could/would present a conflict of interest.
The Right Choice and the Right Approach are Key
This discussion should make one thing clear: Choosing the right type of consultant may well be more important than choosing to use a consultant at all.
To recap, all consulting starts with the dermatologist and the internal review process, which helps to frame the questions that need to be answered. Once this groundwork has been laid, the next logical step is to determine your needs, which logically leads in the general direction of type of external practice consultant required. Following this approach allows you to search much more effectively for the right fit.
Many consulting resources are located close to home, and can be more cost-efficient, productive and rewarding than leaving your geographic community in search of the “world’s expert.” Specific resources for dermatologists include the AAD, with its vast assortment of programs for the internal assessment; and the Allergan Practice Consultants, who are generally recognized as having the best benchmarking financial data sets in the specialty for external assessment.
Remember, however, that asking tough questions can result in some tough-to- swallow answers. In the consulting world, there is always a fear of a “shoot-the-messenger” response in which the client (you) is so upset with the information delivered that the focus is shifted from the problem (you, your practice, your staff, your manager, etc.) to the messenger with unfortunate results for everyone involved.
So, my advice is to stay open-minded, non-judgmental and take a deep breath before making any hasty decisions. Remember the advice when a patient codes: Take your own pulse first.
Dr Welscher is associate clinical professor of medicine and dermatology at the University of Washington, and section chief of dermatology at Sacred Heart Medical Center, Spokane, WA.
Ms. Larson-McMurtrey is currently a business manager for a national hair restoration clinic.
