Here’s a question for you.
When running a dental/medical clinic, do you manage your practice as the CEO or the investor? Both these jobs require different skills and business acumen. It’s important to balance the roles of being both a CEO and investor. You cannot make do as one over the other.
As business owners, doctors need to operate their practice as both CEO and the investor.
Most assume the two are one and the same. However, there are fundamental differences between the roles, with each contributing critical components to the overall success of a profitable clinic.
Let’s start with the CEO role. As Cheif Executive Officer, you manage the overall resources and operations of your clinic, making major business decisions, and acting as the main point of contact between other stakeholders/partners, staff, and your patients.
The CEO role must be played effectively to ensure that operations and production are delivering in profitability as well.
Cornerstones of an Effective CEO include:
- Focusing on the present - the today/now
- Ensuring operations are profitable
- Developing strategies to increase production
- Minimizing Schedule gaps
- Maintain a staffed-up clinic
- Keep track of Profit & Loss reports, and expenses
- A successful CEO will build and run an efficient profitable business
However, the problem is, if you focus too much on the today/now, you will lose sight of the long term, which in turn can translate to stunted growth for your business.
That’s where the investor’s mindset comes into play. If CEOs operate based on the microcosm of the business, Investors look at the macrocosmic side - in other words, the bigger picture. They tend to lead with a “costs today, rewards tomorrow” mentality. They understand that investing in critical components of a clinic may impact profitability for a short-term duration, but the long-term benefits come with reaping the rewards later.
Cornerstones of a Successful Investor:
- Focusing on the long term - this means developing a five, ten, and 20-year business plan
- Sacrificing profits/cash flows to invest in expansions, upgrades, staff retention, etc, for a bigger gain later
- Investing in the latest technology to increase long-term efficiency
- Forecasting expected industry changes and adapting accordingly
Ultimately, investors have to think about where their industry is headed, and how they can double-down now to put themselves in a position of leverage for later. Meanwhile, CEOs are in the position they're in to evaluate what's happening in their market today, not to spend hours thinking about what could potentially be happy down the road.
Key Takeaways It's not just about the title. It's an approach to the work being done. What it really comes down to is prioritizing goals, and evaluating opportunities. The style of many CEOs is to be risk-averse, whereas investors tend to be more willing to embrace risk. Primary owners of clinics have to juggle both roles as needed to ensure both the immediate and long-term success of the practice they run.
Shift Accounting works with over 80 successful clinics across Canada. We go beyond basic book-keeping, providing a range of financial and administrative services, as well as consulting and CFO contracting. We are invested in your success. Contact us today for more information on how you can take the next step to grow your practice and build a more profitable business.