10 reasons why you need to develop your people

I can’t think of a profession where it is more important to develop your team than the private practice physiotherapy industry. I will give you my 10 reasons why:
1. Let’s consider the model of our industry. Our Australian health system is hurtling towards the USA model of “user pays”. The amount of government support for outpatient style care continues to drop, and third parties eg DVA and Insurers (not to mention the private health insurance industry) are increasingly profit driven, which means smaller rebates and more regulation for our industry.
Realistically this says to me that the growth in our industry will be through private patients.
Private patients exchange money for value. That is what you and I do when we spend our money. Untrained or poorly trained physios struggle the transmit the value proposition which private practice can offer. They have no sales skills, they are not trained to handle difficult people and difficult conversations, and many of them will stick their head in the sand when you suggest they need to learn anything about business. Being poorly trained is your responsbility, when you hire them.
2. Secondly, whether you like it or not, we are competing against the unregulated “wellness” industry. They have agility, sales skills, the ability to advertise any way they would like, and despite what you may feel about their credibility, the general public has a reasonable idea about what they are going to get when they see a chiropractor, naturopath, myopractor, or homeopath. Patients do not make decision with facts, figures, RCTs and association promotion. They make decisions on emotion, using the primitive reptilian brain. Will your reptilian brain lead you to someone who has hundreds of success stories talking about how great they feel, or the health profession who uses methods proven by evidence and research with poor sales skills?
3. Thirdly, I don’t see any new hospitals popping up in my region, despite the numbers of physio grads being pumped out by Unis (especially since deregulation of university numbers in 2014). Surely this means that private practice will only continue to grow at a rapid rate. Our profession is going to become even more dog eat dog and competitive as the years pass. Our industry is going to be flooded with grads, and unless we improve how we train them then we are creating a generation of young physios with booksmarts, who have never laid eyes on a patient in private practice prior to starting their first job. This scares me – I surveyed 4th year students at my local uni, and more than 2 in 3 of them WILL NOT have a private practice prac placement in their 4th year – yet our industry employs more than 2 in 3 of them. Pardon me for saying this but this situation really gives me the sh!ts and we need to do something about it ASAP.
4. These grads can choose to open their own clinic as soon as AHPRA pulls their finger out and gives them a provider number. If they do not see value in working for someone else they will literally walk into their local medical centre and strike a lose/win agreement with their opportunistic local GP clinic owner, and they will become your competition. I remember when I started my clinic in 2003 I was the smallest physio clinic out of 3 in my region of 50 000 people, I am now the largest of 12 – 400% increase in competition in 14 years, and growing!
5. Chances are you are a physio first, and a business owner second. Unless you have done a business qualification at uni, owned a business prior to owning your physio clinic, of have done some pretty serious business education over a 5+ year period. If you are a physio first then what is your skillset? Treating patients. What do you struggle with? Mentoring your team. We have already seen that competition for the best physio employees is fierce, and if you are not giving your people exactly what they want and need, then they will walk – usually for a better offer, which you may not be able to compete with.
6. The model of private practice physio dictates that the person the patient will form the closest bonds with in your practice is their physio. Your revenue and profits are almost entirely at the mercy of your clinicians and admin team. Any shortcomings they have in terms of output, productivity and client results show up in one place more than any other – your profit and loss statement. Underperforming team = an unprofitable business. Sometimes as a clinic owner you make up for a lack of profit by treating loads of patients, but this can only last as long as your patience, sanity and ability to multi task can hold on for.
7. Why should they stay? When profits are as challenging to grow as they are in the private practice physio industry, it is rare our physios will earn salaries that their mates who are accountants, lawyers, doctors, engineers and even construction and mining workers earn. This can create envy, and I believe is one of the main drivers for them to leave your clinic and start their own. When they leave to start their own clinic there is generally one factor they haven’t considered – business expenses. They imagined that when they were working for you that out of the $200k they were bringing in annually, every cent they didn’t take home went into your back pocket. Now they have learned that physio profits are rarely more than 25% of revenue, but there is nothing they can do about it. Should they have stayed with you? Well, that is a moot point now because they are in too deep and they have burned their bridges with you.
8. As a business owner who isn’t trained in business, what is the difference between what we are doing as business owners, and people without a physio degree practising as physios? Aside from the fact this isn’t possible and they can’t get registered, what gives us the right to think we can step into the cutthroat business arena, with no skills or experience, and assume we are going to change the world one patient at a time? Realistically you are not qualified to be able to hire staff, because apart from teaching them to be good physios, you don’t really know what to do with them. Big businesses have HR departments for a reason, don’t they? When I ask business owners what their biggest problems relate to, more than 8 out of 10 of them say “staff”.
9. The physios business model is a high number of transactions, low cost per transaction business. I often think about businesses that can create their entire business model around have a handful of high value clients, and doing a really great job to look after them. We need many thousands of clients to have a sustainable business. This means that our employees need to be able to effectively treat people with any condition that comes through the door, to a high standard, for 8+ hours a day, and hang around for more than 2-3 years without becoming somewhat disillusioned. Physios do hard work, and a lot of work, to earn the same money that some people earn driving a truck (and more often than not physios earn less money than people who drive trucks). Why do people who are so intelligent and aspirational when they are young, and have a burning desire to help people, get burnt out after such a short amount of time? The answer below:
10. The harshest and most final realisation is that we are a profession without any logical career progression, yet the rigorous nature of our training means that many young people who could have been doctors, lawyers, engineers and accountants choose to become physios instead. And for some of them, now the harsh reality of stagnation begins. Don’t quote me on this but the last stats I remember seeing states that the average career span of a physio is 7 years. It may just be my observation but, let’s say the average grad finishes their degree at age 23, then 1 in 2 physios don’t make it past 30 without quitting to “follow their dream”, or just take on another 10 years of HECS to study medicine. The thing that keeps human beings going (at least on this hedonistric treadmill we call employment) is progression. Student->physio->clinic owner. This is the only logical progression in the private practice world. If you are a physio, the drive to become a clinic owner is created by the desire for progression. The mature, experienced, physio employee who is happy in their job is the “unicorn” of our profession. We would all love to have them working for us, but do they really exist?
So that’s enough negativity and home truths for one post.
How do we address many of the problems above?
1. Improve our leadership credentials, so that we are equipped to deal with the problems I have detailed about
2. Learn to harness the power of your team. Create an environment of high performance. Make them want to stay. Your clinic can be bigger than just you.

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