I was reminded in conversation yesterday of a belief developed with my friend and business partner Dr. Tim Thackrah back in the late 90’s (and just as relevant today).
As the owner of a dental practice, you wear Four Hats, for each of which you are entitled to remuneration:
- As a Clinician – you are entitled to a commercial percentage of your production;
- As a Managing Director – you are entitled to a salary for your time;
- As a Landlord – you are entitled to rent from the premises;
- As an Investor – you are entitled to interest on your capital investment.
A common mistake is to ignore this and simply collect whatever change is left in the till at the end of the trading year.
The rationale is “that is all that cash flow will allow” but what this encourages is a false view of how well (or otherwise) your business is performing.
To believe you have a good business, when in fact you don’t and, therefore, to deny the need to do anything about it.
If you handed one or more of the Four Hats to someone else they would get paid wouldn’t they?
Wearing all the Hats and not getting paid for the 70 hours a week that requires (to “save money”) is the worst of all possible scenarios.
My role as a business coach is to
- help you decide which Hats you want to wear
- help you recruit the Hats you are missing
- help you design a business that can afford to pay all the Hats