Compensation Best Practices in 2020

It would be so simple if practice owners could open a fortune cookie for each one of their employees and find the method by which to fairly compensate them.  While there are commonly accepted methods of compensation, their implementation in veterinary practices varies because different entrepreneurs have different business goals.  Also, “fairness” is a relative term that introduces variability into an equation that might otherwise be consistent from practice to practice.  This article describes the factors that practice owners should consider when determining compensation for veterinarians and paraprofessional staff.

Benchmarks

Below is a table that provides a snapshot of current key indicators available for small animal companion practices.  It is not meant to be all-inclusive, but rather to provide some guidelines that enable managers to take the practice’s compensation pulse. They can then determine if the practice is on track for the next year or needs to perform some diagnostics to prevent a fiscal derailment.

Veterinary Compensation

            Many periodicals and books discuss the factors one should consider in establishing a compensation policy for veterinarians. Of particular importance is the question of whether compensation should consist of a fixed salary, a percentage of the revenue generated by the veterinarian and collected by the practice (i.e., commission-based), or a combination of the two. If a commission-based component is present, it is also important to consider how the revenue figure will be calculated. Will it be limited to revenues generated from professional services, or will it include revenues generated from items like over-the-counter medications and foods?    Percentages can also vary in relation to the magnitude of the revenue number that is generated.  Implementing compensation systems in practice requires attention to the details of production calculation and timing of payment. The key to remember is there is NO one size fits all when determining the appropriate compensation for veterinary and non-veterinary staff.  There are numerous factors that go into assessing the actual method used for compensation, which often requires the assistance of an advisor. 

National starting salary information is generally published annually in the Journal of the AVMA. (See: Employment, starting salaries, and educational indebtedness of year-2013 graduates of US veterinary medical colleges, October 1, 2013, Vol. 243, No. 7, Pages 983-987; Employment of male and female graduates of US veterinary medical colleges,  JAVMA October 1, 2011, Vol. 239, No. 7, Pages 953-957.) See also the latest biennial edition of the American Animal Hospital Association’s Compensation and Benefits-An In-Depth Look and the AVMA’s Economic Report on Veterinarians and Veterinary Practices (Wise, J., Center for Information Management, AVMA, Shaumberg, IL (Tel: 847-925-8070). Two periodicals, Veterinary Economics and Veterinary Hospital Management Association Newsletter, also regularly publish helpful articles. In addition, Wutchiett Tumblin and Veterinary Economics published Benchmarks 2019 Well Managed Practices.

Paraprofessional Compensation

Paraprofessionals are often compensated on an hourly basis and the industry has yet to develop widely adopted performance-based compensation models. Paraprofessionals generally report low job satisfaction and high turnover rates. In the 2016 NAVTA Demographic Survey, 38% of veterinary technicians left the practice due to insufficient pay, 20% due to lack of respect from an employer, 20% from burnout and 14% because of the lack of benefits. Full time technicians reported a salary between $15-20 per hour, while part-time technicians reported $14-16 per hour. After taxes, even the well-paid veterinary technicians are only slightly above what is considered the poverty line for a family of four in the United States ($24,300).

According to the United States Bureau of Labor Statistics, the median pay for veterinary technicians was $16.55 per hour in 2018. By comparison, a JAVMA published study on Jan. 1, 2016 of certified veterinary technician specialists reported that the weighted mean pay rate in 2013 was $23.50 per hour.

In AAHA’s 2020 Compensation & Benefits survey, average veterinary employee turnover was 23%.  Turnover was 32.5% for receptionists, 23.4% for veterinary technicians, 10.3% for managers, 16% for associate veterinarians, and 32.9% for all other staff. To compare with the national workforce, Compdata’s Annual Compensation Survey showed that national average turnover was 15.9% in 2010 and 19.3% in 2018.  The chart above can be helpful to calculate a practice’s turnover expenses. Turnover is a pervasive and expensive problem that can be mitigated by learning how to properly motivate employees. 

Welcome, Generation Z

Originally Published in Today’s Veterinary Business October 2019

Millennials are often in the news—and they have been for quite some time now–with countless articles discussing their impact in the workforce. But what about Generation Z? This is the group of people born between about 1995 and 2010. They’re also in or entering the workforce, and their perception of the world and their participation in the workplace is definitely different from that of the Millennials who came before them.

Gen Z, as they’re called, is about 57 million strong in the United States. Other names include Post-Millennials, Founders, Plurals, the iGeneration, and the Homeland Generation. This article will describe, overall, what they value and how they perceive life, with the understanding that not everyone in this generation (or any other generation, for that matter) ever thinks exactly alike.

Core Values & Behaviors

An in-depth survey of this generation conducted by McKinsey & Company determined that Gen Z has several core behaviors in common, each of which center on their search for truth. They avoid labeling; opting to focus more on individuality, honesty and competence of people. Thus, making them more willing to understand different types of people; enabling them to differences of opinion and interact with organizations that don’t match their personal values. They want to spend their energy on causes that matter, such as homelessness, poverty, world hunger, identity, human rights, and gender equality. They want brands to behave in ethical ways, being transparent, and having actions match what company officials say.

As such, it makes sense that diversity is considered the norm by this generation, to the degree that Gen Z often don’t readily think about the demographics of a group, whether that means racially, or religious preferences or sexual orientation. To put this into perspective, Business Insider and Axios predicts that by 2045, the United States will be majority minority; meaning, this may be the last generation where the majority of people in the United States identify as white and, for much of Gen Zs’ lives, the president identified as a black man.

Additionally, Gen Z expresses a desire to be financial stable; this, combined with their aforementioned appreciation for diversity and the changing demographics in the United States, likely attributes to their overall mix of beliefs and can include fiscally conservative points of view combined with socially liberal ones.

Overall, Gen Z can be considered pragmatic, practical, and analytical; believing that most conflicts, including global issues, can be solved through effective uses of communication. Through simple conversations, they are able to learn, strategically gather information, and make highly informed decisions about what their next step(s) should be.

Workplace Values

About 36 percent of Gen Z will be in the workforce by the year 2020. According to statistics quoted by HR Magazine in November/December 2018, 58 percent of them hope to own a business someday (and 14 percent of them already do).

When looking for employment, here’s what matters to Gen Z:

  • Good salary: 35%
  • Enjoyable work environment: 26%
  • Flexible schedule: 14%
  • Opportunity to create new products: 11%
  • Chance to learn new skills: 8%
  • Community focus: 7%

Most have been exposed to the internet and social media their entire lives, making Gen Z very comfortable with the virtual world and with seamlessly crossing from online to “offline” experiences. This ease will certainly have an impact on how technology will continue to evolve in the workplace.

More specifically, Gen Z have always lived in a world where information comes at them, fast and furious: they’ve learned to rapidly process information but may not have long attention spans. They multi-task, shifting from one activity to another, often in a way that people from previous generations may find distracting.

Transforming the Workplace

Millennials have done an excellent job of shedding light on the high costs of higher education plus the student loan debt incurred from the pursuit thereof. From this observation, many from Gen Z may choose to not pursue traditional educational pathways. People of Gen Z may, instead, opt to go straight into the workforce, attend classes online, pursue entrepreneurship, or choose paths that vastly differ from the paths ventured by previous generations.

Assuredly, Gen Z will have a significant impact on the development of workforce, as companies need to manage complex, multi-generational teams consisting of younger Baby Boomers, Gen Xs, Millennials, and Gen Zs. Each generation has different values, workplace expectations, life goals, and more. For example, people of Gen Z have a strong desire for work-life balance and appreciate developing personal, and maintaining, technological connections. In fact, AdWeek recently reported that Gen Z are 1.3 times more likely to buy products if their favorite celebrity advertises it on social media. This is important for companies, as company branding and marketing primarily occur on social media and, as such, if your company has no social media footprint, then your chances of reaching Gen Z diminishes; this represents a significant shift from strategies enacted by past generations’.

In light of this, companies must find strategic ways to take advantage of the human resources they currently have. For instance, employ a strategy that combines mentoring and reverse mentoring; where those who are from Gen Z can educate those from other, older generations and vice versa. Thereby preventing, and potentially wholly avoiding, generational gaps and conflicts that damage productivity, efficiency, and workers’ value.

Alternatively, you can cater to Gen Z’s interest in forming a personal connection. When they work for a company, Gen Z has been shown to prefer regular, in-person feedback from their supervisors; this feedback can be short and sweet, as long as it’s prompt and regular. They also want to interact directly with managers often, even multiple times daily. This shouldn’t be surprising, given that they are used to texting, conversing on social media, and so forth, which can be considered real-time conversations.

When Recruiting

When your practice is recruiting new employees, it can help to think of it as a brand, and then demonstrate your brand visually to attract Gen Z job candidates. Think about what makes your practice unique, what makes it interesting. How can the candidate you’re interviewing contribute to your practice? Make that clear.

People of Gen Z typically read online reviews about companies before they interview with them, and they are attracted to reviews that show how the workplace can be a fun place to be, even when working hard at the job. Flexible schedules and paid time off are attractive to many Gen Zs.

Young adults from this generation often make great employees; especially because Gen Z has the ability to adapt to change in the way that would make most people from older generations uncomfortable. You can consider them to be “radically inclusive”; wherein they value individual expression and don’t readily distinguish their online and offline experiences in the way that other generations do. They don’t differentiate between their friends in the physical world and those they’ve only known online. This is likely true, at least in part, because of the rapidly changing technology that’s always been part of their lives which likely contributes to their ability to quickly learn, their comfort levels with technology, and how much they can contribute to a company’s bottom line.

Although they bring strengths to the workplace, they may need guidance and training on soft skills that previous generations possessed so readily possessed. These are skills like how to handle clients calling your practice and how to respond to them via email, to name a couple. You’ll have to think of other ways to truly address these areas that caters to their inherent abilities like instructional videos, role-plays with co-workers, or even one-on-one training could be appreciated by this tech-savvy generation.

Four Benefits New Employees Want Today

In today’s times, employers are finding that they need to make their workplaces as appealing as possible to recruit and retain employees. In the past, it may have worked reasonably well for a company to advertise for employees, interview candidates, select the best ones, and then tell them what benefits were available.

Today’s reality is quite different, with new employees now having certain needs and desires that aren’t necessarily the same as those valued by Baby Boomers. Although employers are still interviewing job candidates to find the right person to hire, quality employees are also using the interview process to decide which company is the best fit for them.

This may be even more true in the veterinary industry than in the overall workforce, as the shortage of veterinarians, nurses, and technicians becomes even more acute. Here are insights into four benefits being desired today.

Life-Work Balance

Although quality employees are still willing to work hard, today’s graduates greatly value life-work balance. One recent Gallup survey indicated that 53 percent of employees today place a premium on this kind of balance and, as new graduates continue to come into the workplace, that number is likely to continue to increase. Because this balance was found to be even more valuable to females, this benefit is especially important to note in industries that are often female-dominated–such as the veterinary industry.

Because of this shift in values, practices that want to attract an all-star team will need to consider how they can incorporate flex-time schedules. This can feel challenging, given that patients typically need to be treated in the same room as the veterinary professionals, making it difficult to allow employees to simply telecommute.

Instead, practices may need to provide more flexibility within the jobs themselves. For example, practice managers can focus on matching up job responsibilities with the interests of each employee. Or, it could mean allowing employees to swap positions on certain days to give them variety in what they do, which can help to strengthen teamwork.

One of the most desired ways to offer flexibility, though, will be to help employees accommodate their personal schedules and needs within a workweek. For example, how can you facilitate shift switching in a way that covers the needs of your practice but allows employees to meet demands from their personal lives? How can you adjust start times or lunch breaks to accomplish the same objective?

Is it possible to rearrange schedules to allow employees to have four-day workweeks? That’s another perk that’s increasingly in demand today.

A 2015 Workplace Trends study showed that flexibility was named the most important benefit by 75 percent of employees. Organizations who help to provide that flexibility have benefited in the following ways:

  • improved employee satisfaction (87%)
  • increased productivity (71%)
  • retained current talent (65%)

Plus, 69 percent of the workplaces surveyed use flex-time options in their recruiting, with 54 percent of them believing this had a positive effect on recruitment.

Learning Stipends/Continuing Education

Learning stipends are cash benefits offered to employees that they can use for professional development or continuing education. Many employees today want to continue to learn—with one study showing that 87 percent of Millennials consider the opportunity to continue to grow and develop a key benefit. In turn, this lifelong-learning, more educated workforce can provide significant benefits to the veterinary practice.

Encouraging a learning mindset in your practice culture, and helping to provide educational opportunities not only helps your employees to grow personally, but also in a way that makes them even more valuable to your practice. If providing learning stipends to employees isn’t practical for you, then find out what employees feel they want to learn more about and provide workshops. One example of this option would be organizing lunch and learn events at your practice.

Mentorships Matter

As a related desire, employees today often want to know that they will be mentored by an experienced person in the industry. This can mean someone who will help to navigate the new hire through the workplace culture, and/or to understand policies and procedures. Each person may have slightly different needs when it comes to mentoring, but it’s an in-demand benefit, one that can boost the strength of the practice when handled well.

Mentoring helps transition new employees into a particular workplace and, the more quickly that a new hire feels comfortable and part of a team, the more likely that he or she will want to stay at that job.

Also, consider incorporating reverse mentoring, where the new hires help to mentor more established employees in areas of their expertise. This concept was created in 1999 in General Electric, with many other prominent companies adopting the program.

One of the key benefits experienced by one such company is that they experienced a 96 percent retention rate for the Millennials involved in reverse mentoring. These employees felt valued for their contributions to the company, and this gave them a chance to work more closely with senior employees. This can also help to create a more diverse workforce and pipeline of incoming human resource talent.

Finally, though reverse mentoring, younger employees can help more established ones to stay on the cutting-edge of technological opportunities that may benefit the practice. One large insurance company pairs older IT employees with new ones to discuss best practices and key trends, and to otherwise maximize potential of the company.

What’s important to think about is how reverse mentoring might benefit your practice. Reasons may not be the same ones as those at the large companies being referenced in this article—and they may not be the exact same ones as the veterinary practice down the street. It’s important to think about your business and workplace culture needs, and then create corresponding pairings and reverse mentoring structures.

Appropriate Technology

New employees in the veterinary industry will likely perk up their ears when they hear that a certain employer has invested in or has access to the best technology to treat their patients. Tech-enabled workplaces are simply more appealing to many of today’s job candidates. And, the use of technology to recruit and retain star employees can go way beyond the technology used to care for patients, helping to create an engaged workforce.

You could, for example, provide quality continuing education through the use of online courses or a training and development center that employees can self-access. Gamification in training may well appeal to the younger generation at your practice, creating a fun way to raise the bar on what employees are expected to know.

With gamification, training is provided in an interactive, engaging way that uses elements of games to help users immerse themselves in the experience. If this idea is new to your practice, this ties back into a previous strategy to use; you could ask your new employees to reverse mentor the team on the use of gamification e-learning.

Technology can help employees to collaborate and communicate, with conversations stored for future reference. You can use the power of your website to share your workplace culture with potential employees, letting them see how you understand their needs and focus on finding ways to fulfill them as, collaboratively, you build the best veterinary practice possible.

Conclusion

To maximize your practice, it’s important to stay in tune with what new employees desire. This can happen by reading industry reports, reviewing human resource surveys and studies, talking to your current employees, and using your interviews of new employees as opportunities to also learn more about what benefits and workplace cultures are important to them.

You will likely find that work-life balance, continued learning, mentorships, and technology are discussed. You may also discover new ways to effectively recruit and retain the ideal veterinary team that will allow you to compete in the industry and provide quality patient care.

Six Elements of Successful Telephone Etiquette in Veterinary Practices

People like to feel as though they’re worth your time and attention. It’s only human nature, right? When clients or potential clients call your veterinary office, they want to hang up feeling as though their cats and dogs are important to you.

Here are six strategies to help you secure and retain clients through how your practice handles those telephone conversations.

Personalize Calls and Establish Relationships

If you’re a manager, your role in this can be to help ensure that people who answer the practice’s telephones have enough time to focus on the calls they take. You don’t want them to get overwhelmed by having to put too many callers on hold, or become distracted by having to do other tasks.

How many phone calls does your practice get on an average Monday? An average Saturday? At what times throughout the day does your call volume tend to increase? Have you adequately staffed for these times? If someone on your team points out that he or she can’t give adequate attention to callers, how do you respond? Is that response effective?

If you are someone who answers the phones for your practice, quickly find out who is on the other end of each call. Get the name of the caller and their pet(s) and use those names throughout the conversation. Let’s say, for example, that someone calls and wants to know how much you charge for a first-time visit for a kitten, including shots. You could respond by saying that it can be so exciting to get a new kitten, and then ask them for their name and their kitten’s name. In that one simple response, you’ve already set a friendly tone and obtained the information that you need to start to personalize the call.

If you ever feel as though you don’t have enough time to spend with each caller, let your manager know. Ideally, you can brainstorm effective solutions together.

Clarify Client Needs and Provide Appointment Information

During a phone call, find out information such as the pet’s age, how long the person has had the pet and the breed. Use language that’s clear and easy to understand, avoiding industry and medical jargon.

If the caller starts out by asking about the price of a service, let him or her know that you would be happy to provide them with that information, but you need to clarify a few details first. This gives you a chance to bond and build rapport, while ensuring that you’re providing the potential client with the information that he or she really needs. If you simply answer the question with a dollar figure, the caller may just end the call at that point.

Picture this scenario as an example. Let’s say that someone wants to know how much it will cost to neuter a male kitten. Through your conversation, you discover that the caller intends to adopt at a shelter tomorrow where that service is provided in adoption fees. You could then walk your caller through what a typical appointment is like for a kitten just adopted from a shelter and help to book an appointment.

Every situation is different but, in each case, clarifying the client’s needs is a crucial step in providing the best service possible to the callers.

Ask About Other Pets

Let’s say a client calls to make an appointment for his or her dog. While updating the records, you notice that the client’s cat is overdue for a checkup. Kindly remind the client of this information and offer to make appointments for all the animals during the same phone call. Ask what days of the week are best, whether morning or afternoon works better, and so forth, and the client will likely recognize how much effort you put into making the situation as stress-free as possible.

Then, offer two choices. “OK, so Thursday afternoons are good for you. Would you prefer 2 p.m. or 3 p.m.?”

Side note: Although the two-choice rule can be highly effective in this situation, it is best to avoid many of the types of questions that can be answered “yes” or “no”. For example, “Do you want to make an appointment?” makes it far too easy for a caller to say, “No.”

Be Aware of the Language You Use

Compare and contrast these sets of examples:

  • “Georgie needs a rabies booster shot” versus “I recommend that Georgie get his rabies booster shot”
  • “I’ve fixed your bill” versus “Your bill should be okay now”
  • “The doctor plans to call you today to answer that question” versus “The doctor is really busy but will call sometime today when she can”

In each case, the first response is more confident and helpful, while the second one is more wishy-washy. And, in the second two examples, the latter responses can be insulting to clients, perhaps making them feel that they aren’t important to your practice.

Be Knowledgeable, But Not Scripted

Clients and potential clients alike appreciate when the person answering the phone is knowledgeable about schedules, services offered at the practice, and so forth. Having said that, authenticity is what connects people and makes people want to engage with you, so an overly scripted presentation can turn people off.

Here’s another caution: as receptionists gain experience and knowledge, it can be tempting for them to guess what their veterinarians would say, and provide information to callers. Even though experienced team members may be correct with their advice, it’s not wise to provide answers to medical questions without getting the information from the doctor.

For example, a client might call and say his dog is lethargic and doesn’t want to go outside. A receptionist might respond with, “Well, it is pretty cold outside. Maybe you could wait to see how Brutus does tomorrow. I know my dog doesn’t like really cold weather, either.” That receptionist may be exactly right, or Brutus could be having a significant medical problem. If the latter is true, this opens up the practice to legal liability.

Be Friendly but Also Efficient

Friendliness and kindness can play significant roles in obtaining and keeping clients. For example, if you realize that there is no way for you to avoid putting a caller on hold, doing so in an empathetic way will make it much more likely that the caller will understand and be willing to wait, rather than if you sound frazzled or even irritable. This concept will hold true in virtually everything you do at the practice.

Having said that, efficiency is also important for many reasons. First, the person calling in may be busy; second, efficiently handling calls opens up more receptionist time for the next caller.

Conclusion

To help ensure that your practice provides quality telephone service and etiquette, here are four tips:

  • When hiring, consider soft “people” skills alongside the more resume-driven ones.
  • Thoroughly train people who will answers phones, providing them with solutions to deal with typical challenges that arise.
  • Provide enough resources so that receptionists are not forced to hurry. Efficiency is good; hurrying often leads to frazzled employees and dissatisfied clients, as well as potential clients who go to the practice across town.
  • Managers and receptionists should communicate whenever a problem arises and work together to brainstorm solutions that work well for everyone involved.

Auditing Your Company’s Mission Statement

Although no two mission statements are alike (nor should they be), it’s important to regularly audit yours—perhaps when you do your annual policy review, overall—to determine whether or not the statement is still relevant and actually being put into practice. Here is a helpful checklist.

  • Is your mission statement still relevant? If not, why not? What needs changed?
    • Is your purpose still the same?
    • What about your core values?
    • Do you offer different products and/or services, ones that have caused your mission statement to need to evolve?
    • What makes your business unique? Is that clearly indicated?
  • Can your entire team recite your mission statement?
  • When you ask each member of the team (or, if at a large company, a sample of them) what the mission statement means, how consistent are the answers?
    • How closely do they match what key staff believe the statement to mean?
    • If there are gaps, where do they exist? How significant are they?
    • In your policy manual, have you included concrete examples of how the mission statement could be put into practice? If not, would that be helpful?
  • How do you explicitly communicate your mission statement to your customers or clients?
    • Through signs that state it?
    • In your website and printed materials?
    • In your advertising?
  • In company meetings, how often do you discuss the mission statement?
  • When your company faces challenges and/or difficult choices, do you consult your mission statement when reviewing possible solutions? How is it your benchmark?
  • When you create new policies, do you ensure that they mesh with your mission?
  • How often do you review your policy manual to make sure that what’s included dovetails with your mission? As just one gut-check example, how well does your disciplinary policy match your mission statement?
  • You can also review the following for matches and mismatches:
    • Your organizational chart
    • Job descriptions
    • Forms
    • Any other employee handbooks or manuals
  • Take a look at how you reward employees. Are you rewarding them for phrases contained in your mission statement? If, for example, your statement includes “providing compassionate care,” do you actually reward and promote based on that value, or are your rewards based on how well a person increases revenues or reduces expenses?
  • What processes do you have in place for employees to report when they feel that procedures conflict with the mission statement? How are those reports handled?
  • What procedures do you have in place to update the mission statement, when needed?
  • As you read through this checklist, what items would be important to add or edit to match your business’s unique needs? Who will spearhead that initiative? What is the deadline?