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"You have turned my life around"
 

I am 87 years old, with a problem of the prostate gland. Before I met Dr. Baum, I went to the bathroom every 30-60 minutes. After Dr. Baum's treatment on my prostate, I go only 5 times per day and only 1 time at night! You turned my life around. I am so very grateful!

-Sidney Daigle


I want to thank you for your due diligence. You saved my life. I highly recommend you!

-Dwight Bastian


Thank you Dr. Baum! Because of you I'm back in the "rodeo"!

-Gerald Wallace

 


Introduction
It seems that business consultants are everywhere -- performing their magic as modern day alchemists. In 1983 U.S. businesses spent more than $3 billion annually on outside consultants . A decade later, 1993, 80,000 consultants sold $17 billion worth of advice. Now these consultants are offering their services to the health care profession. This article consists of an interview with Mr. Lawrence Gardner, President of Lawrence Gardner Associates in Troy, Michigan, and an expert in consulting who will provide advice on how and when to select a consultant for your practice.

Part of this proliferation of consultants has undoubtedly been caused by the downsizing (re-engineering) of large corporate America. Anyone without a job, willing to spend $20.00 on printing business cards, demonstrate an ability to be unencumbered about the details of your practice, can be called a consultant. One client thinks of consultants as being occupational plumbers: "fix-it people who come in to fix a business' leaking problems --- including the toilets." The consultant is there to instruct the practice on how to clean up the mess they find themselves in because the physicians and office managers don't believe they have the necessary repair skills. With all the wizardry of pro forma projections and dazzling color graphics to back up the consultant's conclusions and recommended action steps, how does the physician decide how much is pure sorcerer's advice from the Middle Ages or how much is expert financial management demanded at different times depending on the practice's problems and market circumstances?

When calling on outsiders to help with your decision making process, and then evaluating their respective cost/benefit recommendations to achieve positive results, practices must first know when and how to choose consultants, and then how to use them. There is generally a 5-step process with each step critical to the success of the specific consulting engagement:

  1. Determine the specific need.

     

  2. Choose the best qualified consultant.

     

  3. Mutually develop the proposed working relationship and specific goals. [Lack of open communications is at the root of most practice's problems.]

     

  4. Implement recommendations. [The single most important mistake is excluding the consultant from helping with the prioritization and implementation of the recommendations and assigned responsibilities.]

     

  5. Measure ongoing performance by establishing measurable goals and time frames.

Determining the Need
Physicians usually rely on their own ideas and instincts and the camaraderie of their colleagues to create a successful practice. But every physician has limits in his or her level of expertise resulting from a work environment that grows increasingly complex. Opportunities for improvement or the need for crisis management may be recognized, but our office staffs are so involved in putting out daily fires caring for patients and most of us lack the necessary specialized skills, that the practice may benefit from receiving outside advice.

Knowing when you need to hire a consultant is crucial. The process however is usually prompted by an immediate crisis that triggers the need, akin to waking up with signs of appendicitis and figuring out that you really do need a doctor vs. the pain will eventually go away. But hiring a consultant for the wrong reasons, or hiring the wrong consultant for the right reasons, can be disruptive and unproductive and expensive. Therefore, if you are considering hiring management consultants, recognize specific needs which Mr. Gardner classifies into 8 reasons:

  1. Provide an objective appraisal of existing plans or conditions and identify options. [Many times practices are bound by older physicians that still have a "peg board mentality" and can think of only collections, expenses and account receivables.]

     

  2. Reconcile differences of opinions within management, especially partners and employees.

     

  3. Serve as trouble shooters to determine unperceived weaknesses, and propose unbiased corrective action steps without getting bogged down in political ramifications.

     

  4. Provide specialized technical know-how in areas outside the practice's expertise or that require more time than available.

     

  5. Act as a catalyst to get something done fast or cause things to happen that otherwise would be delayed because of finger pointing and lack of accountability. This sometimes involves confrontational communications between key employees to candidly discuss problems and required solutions.

     

  6. Teach management and staff a new skill.

     

  7. Perform unpleasant chores, such as cutting wages and benefits, getting rid of excess toys and perks such as expensive and excessive cars, plane fares, jobs for relatives, travel and entertainment, etc.

     

  8. Help convince the physicians that change is necessary. [It is very unfortunate that many of the consultant's eventual recommendations have already been made by the office manager or other employees but have not been deemed credible -- awaiting only the advice from the outside "expert."]

Knowing when to use an outside management consultant is important as opposed to the typical defensive posturing of stating "We've been running our practice for years. What makes you believe that as an outsider, you can come into our practice and tell us anything that we don't know!" The bigger problems, however, are both in finding the "right" consultant, and obtaining the "promised" results.

Choosing A Qualified Consultant
The experienced consultant brings tested approaches to look at problems and find solutions. Finding a consultant with good interpersonal skills is critical to the implementation process of effective change. Avoid hiring the "hip-shooting" consultant with pat responses without regard to your individual problems. The latter can result in a Band-Aid approach without resolving longer term issues. As a company grows and changes, so must the financial expertise of the practice. At the beginning of establishing the physician's practice, in-house bookkeeping expertise for maintaining internal records and an outside accountant for providing monthly and year-end statements is all that may be required. At some point, there may become a need for a broader base of financial understanding including internal controls and an evolving banking relationship. Controlled growth may require the medical practice making the change to more sophisticated financial management with the hiring of a qualified controller or part-time CFO (chief financial officer). The experienced consultant can help provide the necessary financial management blueprint -- not just stay content with dispensing Band- Aids.

 

  • Step #1: Establish what the consultant(s) has done before.
    Management must decide if the practice needs a generalist or a specialist (i.e. very specific technical skills) for the envisioned tasks at hand. For example, in a cash flow situation where the practice's banker is considering accelerating payment on all loans and hence cutting the lifeline of the practice, establish (1) if you need to interview a finance specialist; or (2) if other major management (partnership) problems are behind the financial problems, broader-based consulting skills are needed.

    Depending on the specific needs, find out if the consultant is familiar with your specific medical practice (industry) and its characteristics, i.e. an orthopedic practice staffed with 20 physicians and support staff in a self-owned medical building facility is totally different than a sole practician dental office.

    Beware of the senior consultant partner (often oriented towards business development) who comes to pitch your business, but afterwards you are besieged by junior, less-experienced consultants who use your practice's problems as a training ground. Their work is usually reviewed by senior partner(s) thereby escalating the work product cost.

    Determine if the consultant views himself or herself as a coach and educator during the consulting process. The consulting job is not just to help solve the problems but rather to teach people in the medical practice to do what is necessary and most important of all, to help them implement the recommendations in a manner that will result in action with the least disruption of the primary goal, patient care. Like the National Basketball Association, there are a lot of big superstars whose basketball teams flounder during the play-offs, not because they lack talent, but because they're not playing as a team. In a rebuilding effort, the turnaround process may occur over an extended time process and the consultant/coach must understand what tasks to prioritize to best reach the ultimate goal of profitability and positive cash flow (akin to winning the championship!).

     

  • Step #2: Checking out the consultant's or consulting firm's references.
    Respectable consulting firms will gladly furnish a list of clients to be contacted. Below are several key questions you need to ask:

     

    1. Was the project finished on time?

       

    2. What were the consultant's strengths and weaknesses?

       

    3. Would you use this consultant again or were there hostile feelings in spite of a good job (especially with regard to attitude and interpersonal skills)?

       

    4. Did the consultant help with the implementation of the plan?

       

    5. Did the consultant deliver as promised and did the results warrant the cost?

       

    6. Does the consultant have experience in the health care field solving problems similar to ours.

     

  • Step #3: Determine what the consulting firm envisions doing for you.
    Any proposal should have a clear statement of the proposed work product, tasks and responsibilities, timelines, scheduling of management time, and approximately how long it will take to complete the job.

    The consultant should not be trying to "build a home for himself," but should work his way out of a job, leaving behind process documentation and policies to carry on, and management and staff sufficiently trained to handle most problems. Ultimately the goal is to help change the way the practice thinks and assist the team better at solving their own problems in the future. This means that if the consultant does his or her job right, his usefulness usually diminishes.

     

  • Step #4: Understanding when not to bring in a consultant. While consultants can bring you expertise that may be unavailable internally, they are not always the best way to solve problems. Reasons for doing the work internally include:

     

    1. The needed technical expertise is an ongoing requirement.

       

    2. The project timing is not critical and thus other personnel can be trained and have the required objectivity.

       

    3. There is not a specific job with clear-cut objectives.

Summary
Mr. Gardner's final advice: " don't hire a qualified consultant unless you objectively plan to listen to what the consultant has to say and are prepared to act on a significant proportion of the recommendations." Consultants are not effective when they leave you with a beautiful spiral bound notebook containing their recommendations that sit on the shelf of your office manager. They are only worthwhile when you have determined that you need a consultant and that you have hired the proper one, and then implement and take action on their recommendations or as the Nike commercial would suggest, "Just Do It!"

There is a cliche that defines a consultant as "someone who borrows your watch to tell you what time it is and then charges you." However humorous, someone must look at the watch to know what time it is. If the physician cannot or will not, the consultant must. These warnings alone won't guarantee success of the specific consulting project, but their absence may result in pre-determined failure.