practice | MANAGEMENT
Pathway to prosperity: A dentist’s guide to wealth creation Part 2 By Dr Jesse Green In this second in his article series, dentist coach Dr Jesse Green shifts gears and invites practice owners to consider the pathway to prosperity using their practice as the vehicle for the journey. With practical tips for dental business owners wanting to create real wealth, Dr Green takes you through the Savvy Dentist Value Model and the key elements needed to move beyond a profitability focus for your practice to a wealth creation mindset that underpins enduring prosperity.
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here’s a certain predictable, reproducible growth journey every practice takes if the owner wants to achieve the pinnacle of the Savvy Dentist Value Model - wealth creation and freedom. But how do we get there when there is so much conflicting advice and we’re flat out running a practice. In the Savvy Dentist Academy, we coach literally hundreds of dentists that the practice owner’s journey to prosperity starts with a business vision and working through the Savvy Dentist Value Model, one level at a time, so let’s cover that first.
Step 1 on the pathway to prosperity: A profitable business he first layer of the model is focused on creating a profitable practice and cash flow. The currency at this level is money and all efforts are directed at creating a repeatable, sustainable flow of cash into the business. When your practice operates at this level, efforts are focused on systems that generate revenue and manage
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84 Australasian Dental Practice
cashflow. The key question: How do we ensure we’re addressing all the financial aspects of the business? Why? Well, cash flow is the oxygen that keeps the business alive. If cash flow is poor, things aren’t right and need to change. A profitable business is a good thing, but at this level, a practice owner exerts
“A profitable business is a good thing, but at this level, a practice owner exerts enormous effort, yet has very little leverage. You’ll know if you’re here because you’ve basically created a job for yourself. Now, many practice owners stay at this level. They are comfortable with being the main source of revenue...” enormous effort, yet has very little leverage. You’ll know if you’re here because you’ve basically created a job for yourself. Now, many practice owners stay at this level. They are comfortable with being the main source of revenue for their business and aren’t interested in moving up the value model. That’s okay, so long as you understand the limitations. For business owners interested in a pathway to prosperity, however, there is more to be done if less personal involvement and more leverage is what you’re after.
Step 2 on the pathway to prosperity: A scalable business scalable business requires that we cross the leverage line and start implementing systems, developing a selfmanaging team and shift our mindset from owner-operator to now leading a business. When you achieve leverage through systems and a high performing team, your currency is time. Instead of choosing between money and time as you do in a profitable business, you enjoy the benefits of money and time. But as a scalable business, we’re only part way along the pathway to prosperity. As we progress up the model, we cross another leverage line into new territory again. It’s where we can truly enjoy the return on our efforts and investment as our business becomes a valuable asset.
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Step 3 on the pathway to prosperity: A valuable business he third level in the Savvy Dentist Value Model involves creating a valuable business, an asset that has value. In that type of practice, we’re no longer thinking like an operator or owner. Instead, we’re thinking and acting like an investor. Getting to valuable means crossing another line; one I call the enterprise line. This means understanding the drivers of value in a dental practice. One challenge I see for practice owners is not having embedded and consolidated the elements needed at the profitable level. Unfortunately, there isn’t a fast track that leapfrogs you from start up to super star.
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May/June 2022
