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BLOG: Planning and planting your practice garden, part 2
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This blog installment picks up where we left off about the importance of development planning for your practice.
It might help if we all thought about growing your practice as being more like landscaping and less like constructing a building. A landscape architect draws a plan that’s nearly as formal and measured as a building architect, but the outcomes are much less certain. What you plant in the ground either grows or withers. The surest bet is to plant and maintain pretty much what everyone else does — being overly exotic increases the odds of failure.
I thinks this analogy is helpful. Your practice rises and falls with the seasons, and depending on the season takes more or less work. Competing pests (other aggressive doctors, pesky health plans) eat your fruit if you do not fumigate regularly. And periodic frosts (like the looming downturn in the economic climate) may threaten the whole project. Your practice is more a living thing than a machine. It is organic, and as such, not entirely predictable. Luck and a green thumb are critical to success, more so today than ever before in most settings.
Carrying on with the landscaping analogy, there are four basic steps to every elaborate horticultural project. First comes the planning, then demolition and installation, and last the all-important maintenance. (If you are reading this right now, you already have an existing practice “garden,” which may be well-tended or a field of weeds.)
Step 1 : Planning
About the only time that ophthalmologists take the time to write down a formal plan for their business is in a start-up phase or on those rare occasions when they need to substantiate their plans to a lender. This lack of planning is understandable in small solo practices on a plateau, with modest aspirations for future development. The depth of your planning should obviously be related to the degree of improvements you desire, just like the blueprints for a contemplated building project.
You certainly don’t need much of a business plan if you work in a two-surgeon practice with minimal competitive threats, when the only development you want to undertake in the next decade is to build a carport in the back of the office for the doctors. At the other extreme, if your 10-doctor, debt-laden practice is surrounded by competitors, and you’re going to add a surgery center, an optical and three satellites in the next 5 years, you need to fill in a lot of details.
But don’t go overboard. You don’t need a 100-page graduate thesis. Ten pages or less of narrative copy and a few pages of financial projections will do. Any managing partner should be able to hole up with their senior staff over a long weekend retreat and emerge with a cogent plan. If you’re stuck, engage your accountant, management consultant or other business adviser to validate your hunches and facilitate the discussion.
Like any writing project, the first draft is always the hardest. Here is a simple jumpstart. Fill out the table below for the most recent year and what you desire for the next 4 years
After you’ve completed this table, write out as specifically as you can just how you’re going to bring your projections to life. What strategic resources (capital, work intensity, marketing, staff expertise, subspecialty coverage, etc.) are you missing? What obstacles are in your way?
Remember, we’re in an extremely fluid environment today, both within ophthalmology and the global health care delivery system, and in the national and world economic context. Your planning should include contingencies for positive and negative changes in the environment. This point was driven home for surgeons whose retirement plans were set back by the Great Recession. The next shoe falling could descend on those surgeons who have assumed they could retire on the income or sale proceeds from their practice office buildings or from the sale of the now-too-large family home. Any Japan-like deflation of the current relative real estate bubble could scratch these assumptions.
We’ll continue this planning discussion with the next installment of this blog.