practice management done right

Successful Practice Management that leaves you sane

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Managing a practice is difficult to do well. And doing the right sort of successful practice management is challenging. There are so many things to juggle, each with a level of importance. In this post, I look at the most troubling areas of practice management, the areas that cause managers to lose sleep.

This post applies equally to whether one is a psychologist, social worker, mental health counselor, or marriage and family therapist. It looks at the 6 areas especially exhausting to practice managers. Furthermore, we look at how to do successful practice management that leaves you sane.

Money worries in your private practice

Practice managers and owners worry a lot about money. More than anyone else in an organization they have the greatest responsibility for the financial welfare of the organization. So, of course, they carry the burden.

There are really two types of money issues, threats, and glitches. Let me define:

  • Financial threats challenge the organization’s existence. These are downright scary and must be addressed in order to succeed. Failure here is often fatal to the organization’s life.
  • Financial glitches are irritating and cause temporary inconvenience. But these do not threaten the viability of your organization. The biggest danger with glitches is that your staff may lose faith in your leadership abilities whether the glitch is really your fault or not.

Some examples? Threats would be things like: loss of staff, key referral people moving away, key insurance payers disappearing for one reason or another, or when your expenses are outpacing your income. These are serious and can threaten your organization’s health.

Glitches, on the other hand, would be things like computer issues that affect billing, collections, or phone calls, staff who fall behind on their responsibilities but do not let you know, or key office people leaving. These are upsetting and disruptive, but probably not fatal to your organization.

Both need to be taken care of but threats are far more serious.

Dealing with threats and glitches to your private practice

Threats are usually harder to fix and may require new initiatives such as a new marketing plan or even a change in the benefits you offer employees. (See Walking our staff through a crisis for a description of a financial crisis we had to deal with which seemed threatening at the time. Obviously we survived.)

When facing threats, successful practice management probably means putting several heads together either from within your group or with consultants. Threats are serious and any practice manager wants to get it right the first time.

Glitches are simpler and may not require structural change. We can ride out computer issues or train staff on how to handle things when overwhelmed. And we could hire replacement staff for those who leave. These certainly create hardships but usually do not sink the ship.

Managing personnel issues

For every practice manager, the greatest number of sleepless nights are about issues with employees. Most of us never thought much about the process of hiring, managing, and firing employees yet these are big parts of the job.

I have written several posts on these topics because of the importance of getting this area right. See these:

Most of these posts focus on finding the right balance between enough structure and guidance without overdoing it.

Successful Practice Management means finding the right employees and managing them well. It is perhaps the biggest challenge a practice manager faces. And not doing it well means facing an endless revolving door with lots of leaving and then hiring. Not ideal.

When your private practice is growing too much

Many issues arise out of doing the right things. For example, growth will at some point require the updating of your branding and marketing strategies. (See Growing pains: Outgrowing your branding). As your organization changes size, your organization will have a different relationship with your community. That means changing your methods.

And in mental health, we may face the issue of waiting lists, a good problem but a bad one if not handled well. If this is a chronic issue, then we should be considering adding staff to cover the demand, even if that means adding space for our services as we discuss in the next section.

Growth also constantly challenges us to adjust how we keep people informed of what is going on in the organization. At various points in our history we used tools like these:

  • Regular meetings with various configurations of staff (see How we used regular meetings to build our culture)
  • A monthly newsletter is written by me to the staff. (We still have a version of this but no longer written by me.)
  • We created an “intranet” that was used only by our staff. It has a secure login, a place for documents and policies, a secure messaging system, and a calendar of meetings that were individualized for each person.

We started with none of these methods but over time as our staff grew we had to find new ways to build connections. By my retirement, we had 40 clinicians and 10 support staff. There was no way for me to individually talk with each of them each month. Consequently, we had to come up with other tools.

Running out of space

This is really an offshoot of “Growing Too Much” but the topic deserves its own consideration. “Growing” eventually means “outgrowing” your existing space. While this is a wonderful sign of doing lots of right things, adding space is one of the most expensive and therefore risky things to do.

FYI, over my 38 years of owning and managing an organization, we move to or took on 13 new spaces. Each transition had unique demands and challenges. In the end, we worked in 3 locations and had 42 therapy offices, 3 play therapy rooms, 5 waiting rooms, and 3 business offices. Obviously this took loads of time and resources to get built out and furnished. But it is what happens as one continues to grow. Also see: Eight steps to adding office space in psychotherapy practices and Grow hire, run out of space, repeat . . . forever.

So what is the trick to knowing when it is the right time to expand?

The time to expand is when you no longer have the capacity in staff and resources to take care of the demand you have created for your services. This is a good thing. It means we have done many of the right things required to let your community know you have a valued service to offer. And we want to take care of that demand. (See Dilemma of success: Do it myself or delegate for more on this challenge.)

The formula for increasing income is pretty easy to understand: more offices x more staff = more income. But does that mean more profit? It should . . . eventually. But it takes time to hire the clinicians, train them, and get them busy enough to pay back the costs for the additional space. And yet the cost for that space must be paid from day one.

Deciding on the right time to add space

The decision to expand really takes an analysis of many factors:

  • How strong is the demand for your services in that location?
  • If you can find the space you need, what is the ROI (Return on Investment)? In other words, how long will it take to recoup the costs for taking on the new space? The costs include the build-out, the furnishings, and adding the needed technology to expand your existing systems. And as I said, many of these costs begin before you can use the space to generate income.
  • How easy will it be to find the new staff that will fill your new spaces?
  • And how long will it take for them to be productive enough to contribute back to the organization?

Taking the steps to add space

The steps I used when making these decisions about space are these:

  • Maximize the use of the space I have first
  • Then think about the community’s demand for your services and how you would meet that demand with more space. (See The benefits of creating demand in your community for more on creating demand.) If your demand is high enough, then it comes down to hiring the new staff and getting them up to speed as soon as possible after taking possession of your new space.
  • Then we need to find the right space at a price we can afford. (See Finding your community: The location and space for more on this topic.)
  • Then we need to build out the space. This is an expensive part of the process. Rarely were we able to walk into a space and have it suit our needs.
  • The focus when you take on new space is aways to grow, grow, grow, and as fast as you can.

Obviously it would be nice to know exactly when that return on your investment will pay off. You can do some rough estimates but it will never be exact. There are just too many unknowns.

When your private practice is growing too little

Not growing enough is of great concern. If we are not seeing the growth that we hoped for, we need to look at a range of possible interventions. We may need to examine these areas:

It is sometimes hard to take an honest look at our practice and see it’s limitations. If you need help, hire a practice consultant. I have done that for many practices and the owners seem to appreciate the feedback and the ideas on how to improve the client experience.

Getting overwhelmed as a practice manager

Managing a practice in the right way means managing myself well. It is not unusual for managers to become overwhelmed by what they face. As I mentioned earlier we have little or no training in this area. I have written several posts on managing oneself.

See if one of the above doesn’t get you pointed toward doing successful practice management right.

Successful practice management that leaves you sane

Successful practice management done right is the goal. And as difficult as it is to do it well, it can be done. In my view, it boils down to managing these six areas well.

Also see:

https://growingourpractice.com/ultimate-guide-to-managing-growth/

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