Empowering Women Chiropractic – Your Exit Strategy – Dr. Janice Hughes

Hello and welcome to this week’s show, Growth Without Risk. My name is Dr. Janice Hughes, and I’m one of the hosts, and excited to this week be presenting something really unique and interesting for you. Before we get started, I would love to thank ChiroSecure, who obviously sponsors this entire series, multiple hosts, different facets or aspects of practice.

One of the things that I bring to this show, the Growth Without Risk, is that I like to think in terms of what I call practice management, practice growth, practice coaching, things that help you increase and enhance your business. With that, I really want to feature and spend a lot of time talking about today’s person, guest that I get to interview. I have known this individual, Dr. Stephen Levine for probably… And maybe he can clarify. I’m going to say probably 15 years, 17 years, something like that.

And the reason I’m excited to interview him today and chat with him is we really, really want to talk about this concept of how do you expand your business with the concept of associates, with the concept of planning your own exit strategy. Steve, welcome to the show and I definitely want you to spend a minute before we get started with some of my questions, just introducing yourself, telling sort of the ChiroSecure nation a little bit about you, your practice, and the length of time that you’ve been in practice as well.

Right. Well thanks for having me and thanks for inviting me on board. I practice in South Orange, New Jersey. I’m in practice 35 years. And being part of management groups like you, we’ve learned so much and adopted so many principles and practices that have grown our practices. And sometimes it’s not comfortable taking the journey alone and it’s nice to take someone with you. And I think we were taught years ago, that success is bringing someone up the ladder with you.

Yes.

And finding that right person and helping share the success and share the excitement of changing the world one spine at a time.

Yeah. And let’s dig into that a little bit. Why is it… Because you’ve had a lot of associates, so even before you and I knew each other, you had had associates. But then what is the mindset, or what begins to shift as you look for the different kind of associate, or think about your own exit. Just describe that a little bit. Why did you realize that you needed some different kind of associate in your practice?

Having associates in the past, sometimes two or three at a time, and some would come and go. Some would come and get information, learn from you, and transition into their own practice. I always thought, wouldn’t it be great to have someone to partner with? To have two people with the same mindset, to say let’s all achieve the benefits and grow a singular business together, and make it rewarding, make it a win-win situation, so someone would stay. Someone would stay and help assume the responsibility and share responsibilities, and then have kind of assignments or working arrangements, which each person can master. And you can not only train them, but train them to maintain the standards that you developed that attracted a large practice.

And if they reap the rewards. And I think that’s one of the questions you have to find out is what motivates somebody, and do they share in your vision? And by having a vision that’s big enough to let someone be attracted to you, and then you can inspire them with your practices, your philosophies, your principles, and then share those rewards, I think it makes it attractive, as opposed to just having an employee. And you’ve got to find that right personality that has that leadership capability and potential, we want to groom somebody.

Well, I think that the interesting word that you described is thinking about the business. Because I think for a lot of you listening, whether you are an associate, whether you’re a lead doctor, if we’re not careful, sometimes the concept of associate is about a technician, bringing someone in to be able to adjust, to give you some flexibility, but not necessarily being opened up to being a partner or being an owner.

But if you think about the business, I want to keep coming back to that. Like what happens, for example, if you suddenly can’t adjust? What happens if heaven forbid that you’re ill? Steve, you and I know a number of chiropractors that happened to. If you think in terms of the business and the consistency and longevity of the business, I think that’s what has you start to enter into this differently.

Right. I think you think differently. And thank god I had a partner in place when I hurt my shoulder and I was out for 10 months and couldn’t adjust. And I think if you plan, you plan to leave… You’re prepared to leave your business. If you prepare to leave, you already got a plan in place, or thinking about the plan, and this way the exit plan doesn’t choose you on. It’s not on your timeframe. But wouldn’t it be nice that you can choose your exit plan on your timeframe? And it doesn’t mean you have to leave, like we talked about earlier. You don’t have to leave. You can still be there and you can stagger that partnership coming in on any timeframe that you want. But you have to have… Going back to the business, you want to take care of the business because that’s the entity, and you want to do your homework. You want to know… Have your team in place, your attorneys, your accountants, your business appraisers, your coach, and are you developing a business that you’d want to buy yourself?

Right.

Right.

Yeah, so let’s go back. For the listeners, I’ve known, again, Steve for a long time, and I was really honored to be a coach in an organization Steve was a part of. But you and I had some really interesting conversations because you tended to hire associates in a certain model, and then describe a little bit of the mindset that had to shift for example, you’re now a partner, Mark, you were still in the beginning, you don’t hire a partner, you still hire an associate.

But how did we get your mind to shift to think differently? Do you remember back to that, and what were a couple of things you can share with some of the chiropractors listening?

Well, I think what we did was, we set it up to see if we had the right person. How do you know you have the right person, and what’s their motivation, and are you willing to teach them and lead them where you can set goals? And my goal was always to help the doctors make their goals. All right? And if they made their goals, there were rewards for it. We put in the hard work, we went from the… Took the end in mind, went backwards. What are the steps that we have to do for marketing? What are the goals we want to see for volume? What are the goals we want to see for services and income? And then back up and how do we achieve that? And then show that there is a reality to it, it’s not just a pipe dream.

As the lead doctor, knowing how to make things happen, but having another committed individual or two individuals to work with, you work as a team, now you have to lead your team to the end point, and then keep pumping the goals up, and then they reap the rewards. And if they’re all-in, and they’re players, then you see if you have your potential. As to someone that is not interested, maybe does not have financial interests, does not want to stay late, or come early, or does not want to put the extra effort, and is not interested in marketing, or speaking, or doing screenings. There are things that we did all along the way, and now as having a partner in place, we do that consistently.

I have an outside lecture tomorrow that we were invited to, and I’ll do it, and meanwhile he’s going to run the show. We can go on vacations and take time off and doesn’t stop running. The machine keeps going.

Right. The consistency in the practice. And so for a lot of you listening, again, what we’re talking about is in terms of how do you find that right person? I tend to really like, obviously the way you interview, and you’re looking for a certain personality. But then you are still going to test that, even if you think you’ve got that right person.

Some of you, you’ve got somebody that was a patient that is now coming back to the area. Went to chiropractic school and is coming back to the area. You think that you can identify that right quality in someone. You’re still going to put them on an associate agreement. But again, this idea of building in performance metrics, or building in things that you’re describing, Steve, of rewarding them for hitting certain goals.

But also for some of you that are associates listening, realizing why you want to do that is it’s like a dress rehearsal. Are you treating this like your practice? And so you saw in Mark different… You were leading him slightly different as we got your mindset around the time and the grooming, and what that did take for you to lead. You shifted your leadership a lot, and then Mark really did step up. And so then what begins to happen? Now he was there two years, two, three years. And then what kind of conversations did you have to move him into basically like a junior partnership?

Right. And conversations went around getting a piece of the action, of buying in, coming in as a percentage owner, and then continuing the reward model, so that if someone bought in as a partner, they got a percentage of distribution of profits. And if that was good enough… And I think it’s important for the lead doctor to make sure that your business is structured right, that you just can’t put in, say I’m going to give you a bonus, or I’ll let you buy in. What are you buying into? Is it a practice that you could sell? Do you have systems in place? Does it manage itself well? Are your finances in place? Or do you have a lot of debt? Are you debt free when someone buys in? Are you getting valuations for your practice to see what is it really worth, not what you think it’s worth?

Exactly.

Because there’s an emotion tied to… If you’ve actually restarted your practice from scratch, when it was just you and one staff person, and now we have a staff of 15, and there’s three of us here, and we’re looking for another doctor. But the systems are built. And I think if you’re thinking about that mindset to bring in somebody longterm, and that partnership that you’re going to create can magnify.

Or I think when I brought in a partner, we doubled our practice. More than doubled the practice. Because then we’ve got two hardworking entities to make it happen, and you make sure the reward is in place. But you’ve got to do your homework first and see what that practice is worth. And do you have a training system? Do you have a system for staff when they come in new? How do you train your associates? Is there a nine, or a ten, or a twelve week break-in period? Do they teach them how to do exams? Can you teach them how to have conversations with patients? What about accepting rejection? And what are your response when the patient says, “I’m done or I’m finished, or I’ll call you”? They can’t be dumbfounded, so you have to have that training process and have that one-on-one conversation, and set the goals, and make sure your business is structured right. Is it saleable? I think is the key point.

Yeah. I really watched you go through a whole new level of leadership with Mark. And as Steve was around great coaches and mentors and people that were helping with this process, it was really the leadership of the entire business, like you really enhanced the business.

For some of you listening, that’s why kind of one of the sub points I talked about for this show is, what is that five to ten year plan? And how do you lead that and how do you guide that, and have everyone benefit? And so part of what I watched with you, Steve, is that it was, as Mark came in and was now the partner, and you continued to groom him, and he took over certain things. Eventually then, that’s where the pipeline continues, because it’s not like your time was done, if anything it extends your time and your role within the business. But then it was up to both of you to now start to bring in even the future successors.

I’ve just watched you with some great coaching, do that very effectively and it definitely takes a different level of leadership, doesn’t it?

Yeah, it does. And I think you’d have to think out of the box. I think coaching is critical. I’ve always had it. It’s always nice to have a sounding board. Sometimes you don’t think clearly in your own head.

Sometimes you don’t even like your coach. Right?

That’s right. You don’t like the things you’re told because you have to get out of your comfort zone. Right?

Right.

But there’s also tolerations, because if you’re used to running your own show, you take responsibility and it all falls on you and you do it your way. You’ve got to kind of let those failures happen, so that they can grow from it. And let someone fall, so that you can let them understand why they fell, and how they can not fall next time. And sometimes you got to watch the mistakes, and that’s how people grow. And like I said, no one’s going to be you. You want someone maybe similar in a work ethic, but you also want someone that’s not exactly you because you want to attract different people as well.

Yeah. Add a new dynamic to the business. And that’s the thing is I’m going to reinforce again, I mean, obviously we could talk about this for hours. I love this concept. But let’s talk about some real keywords. You noticed that I really zoomed in on defining it. Like this is a business, this is an asset. Another key I heard you talk about was the valuation. Not enough people are getting a really clear and true valuation of the practice.

Also, what’s out there is the model. I know a lot of people say, well your practice is never worth 1X, and I completely disagree after spending time out in the startup world, the model that you’ve done that I think is so effective, this idea about building this 10 year exit strategy, I want people to understand that actually adds value to the business. You then have it worth more than 1X. You have it worth like the true value of the entity as well.

Those are definitely some things that I’m picking up in the keys that you’re talking about. In our last couple of minutes here, share with all the listeners, whether they’re chiropractors, health practitioners running one practice or multiple practices, what would some keys be related to getting started at looking at building a model like this?

I think when you look at your business, and I’ve mentioned it before, is it saleable? Do you have a track record? What kind of reputation have you built in the community? Can you show… If I lay my numbers out, I can show you that there’s growth and consistency. It’s not a rollercoaster. And is that something that someone’s going to buy into? And how did you create that structure or that consistent growth where it’s not good month, bad month, good year, bad year, but steady.

And so what creates that? And that’s stability. And did you build cash value into it? Do you have equipment that’s modern? Is in an office that’s attractive? Is it something that’s going to have longevity and sustainability?

So many times you’ve seen doctors that put a practice up for sale, and you go and you look at it, and it’s 10 years past due of what the place looks like, and there’s no systems in place, and there’s one person that’s maybe calling people to come back in. It’s not automated so to speak. And I think that’s important. I think getting your house in order and making it attractive, that if someone came in as an associate, and saw the inside and said, “Wow, this place is run well and this is something I want to be part of, and it seems too difficult to create this on my own. How do I get in?” And I think anything that you’re selling, it has to be attractive.

Yeah, that’s great.

And it has to be salable.

Yeah. Fabulous tips and ideas. Again, this concept, this topic, I think has not been talked about enough. I think it’s really overdue. I think that this is so important for practitioners, even if you’re a startup doc that has listened this far into the show, recognize that if you can think in terms of build this kind of an entity, build this kind of a business, so that you can then transition that down the road. I think that this is powerful for everyone.

I definitely want to say thank you. We can continue these and I will probably bring you back again to ask a whole bunch more questions about it. Just even some of the ways that you systematize things, because I really honor, Steve, that you have done this very, very well.

Thank you, Janice.

Again, I want to take this time and thank Dr. Stephen Levine for spending the time with me today. More importantly, I want to thank ChiroSecure. ChiroSecure provides these kinds of resources to you, to the practitioners, to helping you build your business, build this entity, and do it really effectively and really safely with great protection. ChiroSecure has supported myself, I know Dr. Stephen Levine, and a lot of other people through some of the entities that I’ve coached with for years, and been around for years, have really, really benefited from the support. Definitely want to thank Dr. Stu Hoffman and his entire team.

On that note, I would love to wrap up for today and share with you that next week, joining us for her segments of Growth Without Risk, is Dr. Sherry Mcallister. I look forward to having you join her and thanks for joining today. Bye now.

Bye-bye.

(silence).

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