Everyone becomes involved in a negotiation at some point in their career, whether or not they initiate it. A negotiation is a process in which two or more parties attempt to resolve differing needs and interests through a series of communications. It is a fact of life, especially in business, that people have conflicts that need to be resolved through a sometimes uncomfortable discussion, but there are strategies that can help you through the process.
Why Are Negotiations Needed
An employer may want to offer someone higher wages, but needs to consider the overall profitability of a practice. Meanwhile, an employee may understand and support the need for a thriving practice, but also needs to earn a certain wage to support his or her family. Employers and employees negotiate because they each have what the other one needs, and they believe they can obtain a better outcome through the process than if they simply accept what the other party is offering.
Sometimes, negotiations occur because the status quo is no longer acceptable for one or both parties. Negotiations take finesse because, besides dealing with specific tangible points (wages, insurance benefits and workplace perks, as just three examples), emotions play a part and ongoing relationships are involved. The parties are choosing to try to resolve their different positions through discussions, rather than arguing, ending the relationship, having one person dominate the relationship or taking the dispute to another party with more authority.
Negotiations can take place in different forums and choosing the right forum can be a critical factor in a successful negotiation. These forums are not mutually exclusive and the value of each depends upon different factors, including the location of the parties, the time available for negotiation, and each party’s comfort level with negotiating. One of the most effective methods of negotiation is the face-to-face negotiation. This is particularly true if the parties are sophisticated and experienced negotiators. The advantages of negotiating face-to-face include that the parties can devote all or most of their attention to the negotiation without distraction; being in the same room increases the urgency to achieve a resolution, and savvy negotiators can read the body language and facial expressions of the other party, which is very useful in negotiation. A face-to-face negotiation is often not possible if the parties are in different jurisdictions or cannot commit a block of time to negotiations.
If the parties are unable or unwilling to meet face-to-face, negotiation can be done by telephone, email or text. In this day and age of increasing technology, this is how most negotiations take place today. As a side note, video conferencing can have many of the same benefits of face-to-face negotiation if the parties are in different locations. One downside of these non-face-to-face negotiations, especially email or text, is that it is often difficult to explain fully a party’s position on an issue with these methods, which can lead to misunderstanding and distrust, two characteristics that can be poisonous to negotiations. It can also take longer to complete negotiations as the parties can respond at their own pace to emails and texts. A savvy, sophisticated negotiator can use these delays to their advantage by preying on the insecurity and anxiousness of an inexperienced negotiator, who will often feel pressured or hurried into making a deal to avoid losing the opportunity.
Using the example of wages, employers and employee alike have a target point, which are the wages they would like the other party to agree to. The difference between what an employee wants to be paid and the employer wants to pay is the bargaining range. Meanwhile, the resistance point is where a party would walk away from negotiations; if too low of a wage or raise is proposed, an employee may begin job searching or a job candidate may decline an offer; the employer also has a point at which he or she will reject a wage request and end negotiations.
When the buyer (employer) has a resistance point that’s above the seller’s (employee), this situation has a positive bargaining range. The employer, in this case, is willing to pay more than the employee’s minimum requirements, so this situation has a good chance of being satisfactorily resolved. With a negative bargaining range, though, one or both of the parties must change their resistance point(s) for there to be a possibility of resolution.
In a wage negotiation scenario, either the employer will offer a starting wage or raise, or an employee or job candidate will request a certain dollar amount; the first person to name a dollar amount is making the opening offer. If at least one of the parties has a BATNA – best alternative to negotiation agreements – then he or she will probably approach the discussions with more confidence, having another alternative. So, if an employer offers someone a job, but has another excellent candidate waiting in the wings, the employer has another alternative and can set a higher and/or firmer resistance point. Conversely, if an employee or job candidate has a unique set of skills that are needed in today’s practices, that person probably has more options in the job market – perhaps even other pending offers. The quality of a negotiator’s alternatives drives his or her value by providing the power to walk away and/or set a higher and/or firmer resistance point.
There is more than one type of bargaining style. One way to differentiate them is to divide them into distributive bargaining and integrative bargaining.
In distributive bargaining, parties’ needs and desires are in direct conflict with one another’s, with each party wanting a bigger piece of a fixed tangible such as money or time, so these negotiations are typically competitive. Parties are not concerned with a future relationship with the other person. A slang term for this type of negotiation is “playing hardball” or “one upping” someone. Strategies often include making extreme offers, such as an employer offering a very low wage or a job candidate asking for an exceptionally high one. Tactics include trying to persuade the other party to reconsider his or her resistance point because of the value being offered – in this example, the job candidate might say that a high salary was required because of his or her abilities or an employer could say that lower wages would be compensated by a great work environment.
With integrative bargaining, though, the goal is win-win collaborations that will provide a good opportunity for both parties. The employer would acknowledge the employee’s value and need for a decent wage, and negotiate accordingly, while the employee or job candidate would recognize the value of working at a particular practice as well as the fact that the employer has numerous other financial commitments to fulfill. They recognize that they need one another to maximize their respective opportunities and negotiate from a place of trust and integrity, with a positive outlook that recognizes and validates the other party’s interest in the transaction.
Here’s an interesting psychological truth. Negotiators are more satisfied with final outcomes if there is a series of concessions, rather than if their first offer is accepted; that’s because, in the latter, they feel they could have done better.
To successfully negotiate, it’s crucial to clearly define the issues involved, and to prepare for the negotiations. Each party should be clear about his or her target point, opening offer, resistance point and BATNAs.
Multiple negotiation styles exist, each on the spectrum of assertiveness and cooperativeness. Here are summaries of common styles:
- Competing (high in assertiveness, low in cooperativeness): these negotiators are self-confident and assertive, focusing on results and the bottom line; they tend to impose their views on others
- Avoiding (low in assertiveness and cooperativeness): these negotiators are passive and avoid conflict whenever possible; they try to remove themselves from negotiations or pass the responsibility to someone else without an honest attempt to resolve the situation
- Collaborating (high in assertiveness and cooperativeness): these negotiators use open and honest communication, searching for creative solutions that work well for both parties, even if the solution is new; this negotiator often offers multiple recommendations for the other party to consider
- Accommodating (low in assertiveness, high in cooperativeness): these negotiators focus on downplaying conflicts and smoothing over differences to maintain relationships; they are most concerned with satisfying the other party
- Compromising (moderate in assertiveness and cooperativeness): these negotiators search for common ground and are willing to meet the other party in the middle; they are usually willing to give and take and find moderate satisfaction acceptable
As long as both parties are committed to the business relationship and believe there is value in coming to an agreement, negotiations can typically proceed. If one or both parties, though, are unreasonable, uninformed or stubborn – or listening to advisors with those characteristics – negotiations can fall through. Other challenges exist when one party doesn’t necessarily need the deal, isn’t in a hurry or knows that the other party is without other options and/or in a time crunch.
You may dread negotiation. If so, you’re not alone. Common reasons for this include:
You have not yet solidified your position: in this case, more preparation is clearly needed.
Fear of looking stupid: nobody likes looking foolish, so some people will avoid negotiations altogether rather than taking the risk of not negotiating well.
Liking people and wanting to make them happy (but perhaps not being able to give them what they want!)/not wanting to affect someone else in a negative way: if you are interviewing for a promotion at a practice, say, and you really like the practice manager, you may worry that negotiations will upset the manager or put her in a difficult position.
Fear of failure: some people would prefer to not negotiate at all, rather than making an unsuccessful attempt.
Feeling uncomfortable with money: some people were taught that it wasn’t polite to talk about money!
Some people have an aversion to conflict, overall, and so they avoid the potential of it by not negotiating. Yet, others feel vulnerable when negotiating. People tend to feel more confident during negotiations when it focuses on an area of their expertise and/or where solid evidence exists to back up the negotiations.
Women in particular are reluctant to negotiate, with only 7 percent doing so. They suffer the costs associated with not negotiating because they tend to have lower expectations, fear being considered a “bitch” and being penalized for negotiating. As a solution, women can consider framing their wants into the value that they will bring to the other party, and share how they can solve the underlying problem of the other party.
Areas where negotiating may not feel as intimidating include:
- Negotiations for resources, whether it’s asking for more equipment or for a practice to hire more people
- Negotiations about how to use resources; with a common purpose, solutions can be reverse engineered fairly easily
- Negotiations where you have expertise
- Negotiations with big companies where nothing is personal
- Negotiations where you have evidence to support your position, including facts, data and logical reasoning
Salary and Benefits Negotiation Tips
Even though the examples given so far have focused on monetary compensation, when negotiating, don’t focus solely on wage or salary. Also discuss benefits offered and workplace perks – meaning the entire package. This can include, but is not limited to, health care coverage, life insurance, retirement programs, vacation time and flextime. If you’re job hunting, investigate what companies are offering. Where do you think the place you’re interviewing falls on that spectrum? What is the minimum pay level that you’re willing to accept? What is your preferred wage? What benefits are important to you?
If you want to work at a particular practice, but the pay rate isn’t quite what you want, ask if you can have a salary review in, say, six months. This doesn’t mean accepting a salary that is clearly sub-par, nor does it mean that you should try to put more pressure on a potential employer who is already offering you a good deal. It is simply something to consider in relevant circumstances.
What workplace perks might be desired? Would a company cell phone help you? Better equipment or software? If so, you could consider accepting somewhat lower pay if you get more tools to do your job.
Although telecommuting is seldom an option for veterinary staff, outside of perhaps financial or other purely admin functions, you could negotiate coming in half an hour later so that you can take your children to school or schedule a lunch break that coincides with when you need to pick them up. If you bring crucial skills to the negotiating table, you’re more likely to get these concessions than if you are entry-level.
If relevant, ask about practice policy if you become pregnant. How acceptable is the policy to you? How important of a negotiating point is this for you? What about if you are injured in the workplace? Educate yourself on your workplace rights before negotiations occur, as well as company policy. If you are valuable to the practice, perhaps you can negotiate some additional flexibility.
Who should be the first to make an offer? Some experts believe that, if you allow the other party to provide a starting dollar figure, he or she has shown his or her hand. But, research indicates that final figures tend to be closer to the original number stated than what the other party had originally hoped.
Negotiating with Corporate Consolidators
Your negotiations today are likely to be with a representative of a corporate consolidator. These individuals typically have business background, training and experience, often in banking or private equity. They are sophisticated negotiators. Be aware of the psychology involved in these types of negotiations, as these negotiators will tell you what you want to hear to gain your trust and confidence, and then will provide you with a written agreement that is vague and broadly written. This will work to their advantage as corporate consolidators have “deep pockets,” with experienced and tenacious lawyers on their side who are not averse to litigation. This alone can act as a deterrent to someone with fewer resources and less time to fight back. If you ask for more specificity in the agreement, they will say, “Trust me, things will be as I said.” They also may use pressure, either subtly or overtly, to get you to agree to their terms. For example, they will say that, if you do not sign this contract by a certain date, we will pull the offer and go with another candidate we are considering.
As mentioned above, a key element of an employment agreement that must be negotiated carefully is the restrictive covenant. This is even more critical when a corporate consolidator is the employer. In these instances, the covenant is typically broader and even more restrictive. One way this is done that is often not readily apparent on its face is in the definition of the location of the facility for the measurement of the geographical scope of the covenant and the definition of employer with whom you cannot compete or solicit employees, clients or referral sources. Since the corporate consolidators often have multiple locations in a geographical area, they try to measure the geographical scope from all of these locations, even though you may not be working at all of them. This can broaden the restriction greatly. Similarly, the definition of “employer” often includes the specific practice at which you will be working as well as the parent company, affiliates and subsidiaries of such practice. This is particularly troublesome with non-solicitation covenants, as you may not know the clients, employees and referral sources of all of these companies and thus could inadvertently violate the non-solicitation covenant. These tactics require careful negotiation on your part to limit the restrictions to the location where you will be working at and to your employer only.
Employment with corporate consolidators may seem attractive because of the many benefits they can offer. However, often these benefits are illusory. The employment agreement will typically provide that the employer can change any of these benefits at its sole discretion at any time. When negotiating this provision, the employer’s ability to change benefits should be limited to those provided to all employees, such as health insurance or retirement plans, and not to individually-negotiated perks such as paid time off, signing bonuses or payment of membership dues and licenses.
Although entering into an employment agreement with a corporate consolidator may give you the peace of mind that you have a secure and stable job, the reality is often different. Most employment agreements with these employers are for “at will” employment, meaning that the employer may terminate your employment at any time for no reason or advanced notice. Furthermore, while you may have limited job security in this scenario, you are even more at risk because you would be subject to the restrictive covenants upon termination. Attention should be paid to trying to limit the term of the restrictive covenant to the term of employment if less than one or two years. You could also try to negotiate that the restrictive covenant does not apply if you are terminated without cause. This may be difficult to achieve. You also want to negotiate a reciprocal termination right so that you are able to leave your employment without penalty upon notice to your employer.
For Best Results
Success is achieved when you first:
- Determine the interests of the other party.
- Embrace compromise.
- Observe the Golden Rule, treating others as you would like to be treated: fairly and reasonably, without defensiveness.
- Be prepared, both in factual information and in strategy.
Terms to avoid using during negotiations:
- “Between” – giving a range tells them how low you would go.
- “I think we’re close” – a savvy negotiator will recognize “deal fatigue” on your end and stall in the hopes that you’ll concede.
Following these guidelines will empower you to successfully negotiate for yourself with finesse. This will help you to resolve differences with whomever you are dealing with down the road, in all areas of your life.
The Veterinary technician profession has been subjected to variability since birth. Today, it faces a new, and hopefully positive, change with discussions about modifying the profession’s title to “veterinary nurse”. A movement lead by the National Association for Veterinary Technicians in America (NAVTA) has illuminated differing opinions between those in and outside of the profession.
Veterinary Technician History
The profession began in 1908 when the Canine Nurses Institute made its first organized effort to train English “Veterinary Assistants”. Over the next eighty years, the profession grew. First, the American Association of Laboratory Animal Science created three different levels of “animal technician” certifications at research institutions. Next, the US Army, Purina, and State University of New York (SUNY) established “animal technician” training programs in the 1960’s, which the AVMA then began regulating in 1967. The AVMA waited until 1989 to adopt the term “veterinary technician”, feeling until then that people would be confused with the “veterinary” modifier.
Michigan State University and Nebraska Technical Colleges were the first animal technical educational programs accredited by the AVMA. There are now 230 AVMA accredited veterinary technician education programs. Of these, 21 offer four-year degrees and nine offer distance-learning (online) options. Even before the AVMA adopted the term, the North American Veterinary Technician Association (now called the National Association of Veterinary Technicians in America) was formed in 1981. It works alongside the AVMA to protect the profession and encourages veterinary technician specialty developments. However, the profession has not grown uniformly across the United States.
In the United States, 37 states have established “veterinary technician” licensure, 10 states have non-profit organizations that implement voluntary credentialing, and 5 states/territories do not have any credentialing systems. This means that being a veterinary technician today could mean that either the state government regulates your credentialing, you are privately credentialed, or someone gave you the title “veterinary technician” when you started working at a veterinary practice and there is no credentialing system in your state.
Pros of “Veterinary Nurse”
The profession is fragmented by more than their state’s accreditations. Depending on their location, Veterinary technicians currently have varying titles. There are 19 states that use “certified veterinary technician”, 15 states that use “registered veterinary technician”, 14 states that use “licensed veterinary technician”, and Tennessee uses “licensed veterinary medical technician”. With this amount of fragmentation within the profession, how do we as veterinary professionals expect the general public to understand or trust a veterinary technician’s job description? As such a close-knit profession, we forget the foreignness of our commonly-used terms. Most clients underestimate the value of their veterinary technician simply by not knowing the education process. In fact, in a NAVTA survey to human nurses, 71% did not know the difference between veterinary assistants and technicians. Yet, we are baffled when we find that credentialed veterinary technicians are repeatedly unhappy and facing low income, compassion fatigue, lack of recognition and career advancement, underutilization of skills, and competition with individuals trained on-the-job. Due to this culture, the profession has incredibly high turnover rates despite its increased demand by the growing veterinary industry; veterinary technicians are projected to grow 30% by 2022.
How can we, without spending incredible amounts on advertising, uplift our veterinary technicians in the public (and practice’s) eye? Many have suggested using the familiar and applicable “nurse” title. The word “technician” implies an individual who has mastered veterinary science and technology, while “nurse” incorporates caring for animal patients into the description. Heather Predergast, RVT, CVPM, SPHR, a specialist with Patterson Veterinary Supply, Inc., discussed the need to abolish the profession’s fragmentation. She noted that “there has long been a need for common credentialing in this area. The responsibilities and job tasks of a veterinary technician have evolved over time and are inaccurately described by the term ‘technician’, implying a definition of their identify based on technical tasks. The term ‘veterinary nurse’ will incorporate the art of caring for patients from a patient-centered perspective, in addition to the science and technology.”
For these reasons, NAVTA has launched the Veterinary Nurse Initiative in an action to unite a single title, set of credential requirements, and scope of practice. This movement would hopefully provide recognition to the profession and elevate its credibility by requiring further education. Like human nurses, differing titles would recognize individual’s efforts for further education. To distinguish associate and bachelor’s degrees, NAVTA has proposed designating Registered Veterinary Nurse for associate degrees and Bachelor of Sciences in Veterinary Nursing for bachelor’s degrees.
Australia and the United Kingdom have already changed the name to “veterinary nurse” with large success. As the movement poses potential in the States, many academic institutions and corporations, such as Purdue, Midmark Corporation, and Patterson Veterinary Supply Inc. have published endorsements for its change; however, the initiative does face fair opposition.
Cons of “Veterinary Nurse”
Many veterinary technicians still opt to keep their current title. When questioned in a 2016 NAVTA survey, the majority of veterinary technicians (54%) favored the term “veterinary nurse”, over a third (37%) wanted to keep the title “veterinary technician”, and the remaining surveyed were undecided. Most of the pro-technician responders attributed their answer to disbelief that it will be possible to change the title. Some current veterinary technicians have voiced unease at their unsure futures after working their entire careers in a state that does not require licensure. Another similar situation arises for those that have passed the veterinary technician national examination but have not graduated from a school accredited by the AVMA committee.
While, ideally, this veterinary nurse initiative works to unify the profession and ensure quality standards, we must realize that we may be alienating a population of technicians at the end of their careers that would be offended if required to pay for an accredited teaching program and learn alongside new, inexperienced future technicians. Another important consequence to consider is liability. Currently, liability for veterinary technicians falls to the veterinarian on all cases; however, human nurses have their own liability to practice under their license governed by a separate board. This is a consideration essential to address as we raise the accountability of veterinary nurses.
The Veterinary Nurse Initiative has faced opposition outside of the profession as well. In fact, the veterinary technicians initially opposed to changing the name also noted conflict with human nurses in any past attempted title changes. The Veterinary Nurse Initiative investigated this further by sending a survey to three nursing groups. Two of the three declined to even acknowledge the survey, potentially indicating apathy for veterinary-related topics. Of the one group that did complete the survey, 66% did not object to “veterinary nurse”; however, regardless of whether or not they were opposed to the title change, almost all of the responders incorrectly assumed a veterinary technician’s educational requirements. An analysis of the opposed responses to the nurse title found that the objectors believed technician education was subpar to human nursing and the title was not deserved by veterinary technicians. It suggests that the human nursing profession worries about maintaining the quality of its own title and hopes to avoid misrepresentations.
In the past, other professions, not similar in scope to human nurses, have attempted to claim a “nursing” title. For example, a Christian medical community attempted to title their “spiritual healers” as “nurses”; however, they did not share nearly the same amount of education rigor. When confronted with a potential title change in the veterinary profession, human nurses mistakenly worry that the term “veterinary nurse” will also encompass veterinary assistants. This confusion highlights the need for public awareness of technicians – if the closest human counter-part profession does not understand a technician’s role or certification, how can we expect the general public to know any differently? The veterinary profession must raise awareness to the public about the differences between its assistants and technicians.
Currently, as the veterinary nurse initiative gains a foothold in Ohio, the Ohio Nurses Association and its 170,000 members have fought its new legislation, arguing that the state legally defines the term “nurse” as caring for humans and that no other person or profession may insinuate that they practice as a nurse. With similar nurse title protection in about 24 other states, the veterinary nurse initiative is likely in for its fair share of conflict as it continues to grow.
The debate over the title of veterinary technicians remains controversial both in and outside of the veterinary community. As with any impending change, it is important to recognize its potential benefits and shortcomings in order to formulate the best strategy to improve the profession. If the Veterinary Nurse Initiative ends up being successful, the change will likely empower today’s veterinary technicians and reduce the profession’s current high turnover rates.
Originally Published in Today’s Veterinary Business October 2018
Although mentoring is not a new concept in the workplace, modern partnerships are not necessarily like those in the past. According to HR Magazine, formal mentoring relationships in previous eras would have typically lasted at least a year. Informal ones? They could last a decade. In today’s workforce, though, these relationships are often shorter and more specialty-oriented than before.
Because of this shortened timeframe and accelerated pace, lines between mentoring and coaching can be blurred. Increasingly, mentors are no longer necessarily higher on a company’s organizational chart. In fact, reverse-mentoring now exists. In reverse-mentoring situations, newer staff members are teaching older, more experienced ones about new technology, as just one example. As one scenario, a Millennial employee may be teaching her Baby Boomer supervisor about how to effectively use social media and crowdsourcing, while also sharing insights into new ways of thinking about business.
According to a survey taken by the Association for Talent Development in 2017, 29 percent of organizations have a formal program in place for mentoring, with 37 percent of them having an informal one. Mentoring opportunities are also available through professional organizations, either online or in person.
A skilled mentor can help the mentee become his or her best possible self. This happens when a mentor takes the time to really understand the person he or she is mentoring, including where the person is in a career path – and where he or she wants to go, career-wise. Once this is discerned, then each of the actions by the mentors should help the mentees participate in the types of behaviors that allow them to become aligned with their own best selves.
Now, here are seven keys to creating the best possible mentor/mentee relationship.
Key #1 Be very clear about the goals established for the mentoring program.
Are there specific job-related skills that the mentee needs to gain? If so, what are they? Is the mentor guiding someone to an understanding of a practice’s culture? Perhaps the mentee worked for a private practice that was recently bought out by a corporate one, and the mentor is serving as a guide and sounding board to an employee during a transition period. Whatever the goals are, make sure they are clearly defined and understood by all involved parties.
Key #2 Make sure the two participants are well matched.
Synergy and mutual commitment fuel mentoring relationships, so it’s crucial to put the right pairs together. As mentioned above, mentoring is no longer limited to an older and/or more experienced person at the practice mentoring someone younger and/or newer. The goal of this evolving process is to have one member of the team fill in gaps of the skills and/or experiences of another employee, so form your pairings for that purpose. It can be tempting to put together people because they’re so much alike that they’re sure to get along. They probably will get along, but that alone doesn’t fulfill the purpose of mentoring. Remember: fill in experience and skillsets through mentoring opportunities at your practice.
Key #3 Mentoring usually takes significant time and energy, so don’t expect quick results.
There are exceptions to this rule, of course. If a Millennial is paired up with a Baby Boomer to teach the use of Instagram, this can all come together rapidly. If, though, that same Millennial is paired up with that same Baby Boomer to help transition the mentee to a telecommuting role at the practice, this can take time and energy for mindsets to evolve.
Key #4 Multiple mentors sometimes make sense.
Some companies pair up a mentee with a primary mentor and are then open to people having numerous more informal mentors to boost the diversity of the learning experience. It can be very helpful, even enlightening, to have mentors from different demographics – whether that’s age, gender or something else. Being exposed to different points of view from thoughtful members of the practice can be quite beneficial.
Key #5 Mentors should provide guidance rather than setting strict requirements.
Your practice will create an overall structure for its mentorship program and, yes, participants should follow the structure you set. But, a mentor is not there to enforce rules or to lecture. Rather, a quality mentor may spend more time asking questions and listening to answers than speaking, offering advice rather than rock-solid answers. Mentees should be encouraged to listen closely to what a mentor has to say and then carefully evaluate how it fits into his or her life and career path.
Key #6 Mentees should prepare and ask questions.
The best mentoring relationships are two-way streets, with the mentee being an active partner in the relationship. Passive listening will only go so far in helping a mentee develop skills and gain knowledge. Instead, engaged mentees should share what has been helpful, what gaps exist in his or her knowledge base and skill sets, and so forth. In a sense, being mentored should also empower the mentee to pass on knowledge to the next person in the practice who needs assistance.
Key #7 Effective mentoring focuses on relationship development.
Near the beginning of this article, we shared how modern mentoring resembles coaching, at least more so than in the past. But, at its core, mentoring has been and should remain relationship-oriented. The mentee should feel safe and nurtured as he or she learns professional skills through mentoring. Although this knowledge will likely enhance the mentee’s ability to perform tasks, mentoring is not as task-oriented as coaching.
Mentoring should help employees at your practice become more self-confident and able to juggle his or her work/life balance. While coaching can be performance-driven, mentoring focuses on developing the employee, both to improve his or her skills and knowledge today and to prepare him or her better for the future.
Starting a Mentoring Program at Your Practice
Be very clear about what you want to achieve through this program and have a plan in place to measure its effectiveness. Determine who can participate, both as mentors and as mentees. Can someone, for example, volunteer or will you select them? Decide how formal or informal the program will be, how often you expect partners to meet and so forth. Explain the program to your team, adding specifics to the employee manual, and strategically pair up mentors and mentees. Invest enough resources to allow the program to be successful, be available to mentors if they need guidance, and use this program to develop your team in a way that dovetails with practice goals and dreams.
Link to the article on Today’s Veterinary Business: https://todaysveterinarybusiness.com/modern-mentoring/
Whether an owner is transitioning a practice to an associate, colleague or corporate entity, the process of onboarding can be complex. This article intends to outline the medical, financial and staff transition steps to follow, post-sale, along with the challenges each presents.
Although mergers and acquisitions (M&As) typically begin with high hopes of success, not all do succeed. Below are some statistics about practice sale shortcomings:
- 65% of all M&As do not achieve objectives set forth by deal architects
- 83% of mergers do not increase shareholder value
- 50% loss of key managers and technical employees is experienced within 12 months
- 50% of failures are due to cultural clashes
Most failures are attributed to operational, financial and/or customer relations problems. Within these broad categories, common reasons for M&As failing to achieve their objectives include the parties not doing one or more of the following:
- thoroughly consider all types of value critical to the practice
- establish priorities for integration
- identify and address risks that inhibit integration
The buyer may, for example, expect the seller’s personnel to integrate themselves, which may not happen. In other scenarios, the buyer has an integration program, but it does not run efficiently or see things to fruition. No matter the specifics, the ultimate result of poor integration is that morale drops, revenue diminishes, and objectives are not met.
In a full half of M&As, key managers and technical employees leave. This is typically an indication that a new owner has failed to implement an organizational and leadership structure that is emotionally satisfactory to employees, at least not in a timely manner. As a result, talented staff leave for better-run practices.
For a successful transition to occur, timing is key. A prolonged transition period distracts leadership from the mothership of the business. Gaps in communication contribute to a drop in customer service, which is reflected in reduced client retention—effectively leaving the practice vulnerable to veterinary competitors in the area.
There are three main areas to consider in regards to the medical side of the transition.
As part of a transition, medical records must be carefully reviewed to ensure they contain all information and documentation as required by state and federal law. Generally, the physical medical record is owned by the veterinarian or entity responsible for compiling and maintaining the medical record. To ensure no lapses occur in accessing or adding to existing medical records, the owner and buyer should clearly define how such files are to be transferred and managed.
It’s important for the buyer to have access to job descriptions of all the seller’s staff, along with the practice’s standard operating procedures. Often, sellers may propose changes to increase synergy and efficiency. For example, sellers may overhaul product or service offerings to enhance compatibility with the existing clientele or attract new ones. The operational documents created, however, should outline job descriptions and standard operating procedures—and the infrastructure required to execute them—as they currently stand.
Maintaining Medical Standards
Upholding the medical standards of a practice is intricately entwined with retaining key staff members who execute those medical processes. If the practice associates and staff intend to continue working post-sale, employment agreements should be created that include staff roles, responsibilities, and terms of agreement. The owner can suggest that the buyer wait six months to implement any significant changes, and then to do so gradually.
The first steps in planning a financial transition include to generate an expense budget, profit and loss statement, and statement of assets and liabilities. The author recommends creating an expense budget based on the latest edition of Veterinary Economics’ Benchmarks: A Study of Well-Managed Practices. A typical expense budget includes (at minimum) projected and actual values of revenue, cost of goods sold, staff, rent, equipment leases, utilities, office supplies, bank fees, and owner salary.
A profit and loss statement features year-to-date comparisons of items such as fees for professional services, laboratory services, vaccinations, pharmaceutical imaging, grooming, and dental services, as well as food and retail sales. Additionally, it lists year-to-date data on costs of goods sold, along with staff, equipment, and administrative expenses. Finally, it calculates a net income. On average, this statement should take about five to ten hours per month to generate.
A statement of assets and liabilities functions as a balance sheet for the practice. It lists both current and non-current assets; the latter is not easily converted into cash and can include buildings, equipment and motor vehicles. Current assets include money in checking or savings accounts, accounts receivable, and inventory, among other possibilities. An example of a non-current (long-term) liability is a loan taken out to buy the practice; current liabilities include accounts payable and other amounts expected to be paid in the current financial year.
In generating financial analyses of the practice, it may be important to hire an accountant. In general, accountants cost about 0.5% of gross annual revenue. Moreover, owners should consider hiring a dedicated practice manager, which will cost about 0.4% of gross annual revenue.
As a tool to help owners further interrogate data, practice management software allows owners to track gross revenue in multiple ways, perhaps weekly, monthly, and quarterly. Average transaction charges should be tracked hourly; if not, then daily, and then periodically.
Cultural clashes are defined here as differences in human elements between merging companies. For a practice to be successful, these clashes must be identified through an audit and then successfully addressed. A cultural audit would examine factors such as core values, policies and practices, work processes, leadership styles, and human emotions. More specifically, examinations in human emotions should include people’s uncertainties surrounding job security and their fear of change. The importance of an audit of staff emotions cannot be understated, as one survey suggests a 26% increase in successful mergers if human elements are resolved in pre-deal stages.
The buyer must determine the health of the seller’s practice’s human capital. Metrics helpful in determining this include rates of employee retention and/or turnover, the effectiveness of internal channels of communications, and past lawsuits, among others. Specific issues that need to be addressed with staff include any changes in benefits, pensions, compensation packages and reward and recognition programs.
To successfully transition the staff to new ownership, it’s important to plan the integration 60 to 90 days ahead of the target closing date. The buyer must define, in writing, the mission, values, leadership style, and philosophy of the new company. Additional tasks include to:
- identify potential barriers to integration
- craft strategies and solutions to overcome barriers
- prioritize work-streams, especially those that are synergistic
- assign leaders to monitor specific progress parameters
- outline predictable reward and recognition programs for employees that are driven by performance
- solicit employee input so that job descriptions are clear (this is crucial for them and the practice overall to meet expectations)
- create process maps and tools to facilitate career development
- groom potential replacements
- invest in high-potential employees year-round
- retain key employees using personal, one-on-one communication
- clearly point out channels of communication and feedback mechanisms to address employee concerns in real time
- host integration activities between the merging staffs.
If this seems overwhelming, given all the work that needs done, consider hiring a third-party professional cultural auditor. Senior executives are often too involved in the practice vision to fully assess workplace culture. Furthermore, employees may be more forthcoming with sharing their problems to an impartial outsider. Such auditors can offer different perspectives without regard for their own job security, resulting in a more objective cultural examination.
Five Things Not to Say
- “We don’t anticipate making any changes.” On the contrary, changes are to be expected, post-sale; it should be viewed as an opportunity to make improvements. Besides, when changes do occur, they will be attributed to the transition whether they are related or not.
- “This is a merger of equals.” Pre- and post-sale teams are never truly equal in authority.
- “We plan to take the best of both worlds.” This phrase is, at best, subject to the opinions of the pre- and post-sale teams.
- “It will continue to be business as usual.” Practice sales often fundamentally change the psychological tone of a clinic as it transitions to new ownership.
- “The culture of our two companies is very similar.” Although this may be true, people will focus on differences, which will bring unwanted attention to areas where expectations were not met.
Although positive outcomes cannot be guaranteed, owners can take definitive actions to help their team transition operationally, financially, and culturally. Through careful preparation and clear communication, many problems in transitioning a practice to new ownership can be prevented or at least significantly minimized.
Originally Published in Today’s Veterinary Business, August 2018
Although plenty of businesses talk about change, and although many of them devote significant time to change management, too many efforts are still failing. An article in HR Magazine titled “Why Change Efforts Fail” analyzes why this is happening and offers suggestions to help make your next change management strategies take root.
The article cites a new study by Prosci that shares how 86 percent of 1,778 change leaders expect change initiatives to continue to increase over the next two years, with 55 percent expecting them to significantly increase. But, a spokesperson cautions, 73 percent of them also shared how their organizations are either approaching, at, or past change saturation, reaching the point where it’s difficult to absorb any more changes.
Tips to help prevent change initiatives from failing in this age of saturation include remaining visible and active throughout the entire process. Sponsors of the changes can’t abdicate responsibility if they want them to succeed. And, while it’s important to communicate the nuts and bolts of proposed changes, it’s also crucial to discuss adjustments that will need made and otherwise work through the emotional components of change. This will help to reduce resistance.
Share the rationale behind the changes because, when people hear why something is happening, it’s easier for them to adjust. And, be sure to model the behavior you expect from your team. If, for example, you want more collaboration to take place among team members, demonstrate that yourself first.
In 2018, one-way, top-down communication isn’t typically effective. So, communicate changes to your team as early in the process as possible, provide time for discussion, and don’t try to do too much at once. Prioritize initatives to help prevent saturation.
A July 2017 article in Forbes, titled “1 Reason Why Most Change Management Efforts Fail,” echoes the dangers of saturation, calling it “change battle fatigue.” Citing a McKinsey and Company study that shares how 70 percent of all transformations fail (with that percentage believed to be increasing), the article details how and why battle fatigue can set in. They include past failures that plague employees’ memories (“Oh, no! Not THIS again!) and the impact of sacrifices made through an “arduous” process. Discouragement further weighs down the process and, when transformation is poorly led, efforts are even more likely to derail.
When workplaces go through significant changes, employees can become fearful, especially when past attempts at transformation failed and perhaps led to layoffs or other negative consequences. When people are worried about their careers, they aren’t as open to learning or able to think as well. So, the article points out, right when management needs the team to be at their best, they are distracted, less productive and unable to focus as effectively.
Suggestions to break this cycle include the identification of early successes, and taking time to celebrate them, as well as ensuring that the vision continues to be supported. And, to effectively identify and then celebrate early wins, milestones and timelines need to be clearly defined. When a milestone is met, people responsible for this success must be acknowledged from the top. This will help to validate the transformation vision, keep the team energized, and spur the momentum on even further. Plus, careful monitoring of early milestones will highlight if and when the plan needs to be adjusted, and how.
To continue to support the vision, it’s important to determine what aspects of your workplace culture support it, as well as which ones don’t – and which ones don’t have a significant impact, either way. What do you keep? Only those elements that support the vision. As one example, the article shares how a company had a vision for collaboration. Yet, when you went into their offices, it was an “ocean of cubicles” with people listening to headphones. Although this setup may be effective in some workplaces, it does not support the vision of collaboration. After the office space was revamped, people stopped communicating via Google Chat to someone who was only two cubicle spaces away, and they began to communicate in person.
This challenge is not new. In fact, the Harvard Business Review identified reasons why change management fails in a well-thought-out article back in 1995. Titled “Leading Change: Why Transformation Efforts Fail,” the article lists eight different reasons, the first of which focuses on not establishing a significant enough amount of urgency. More than 50 percent of transformation failures observed by this expert were caused by this factor.
Other errors include not creating strong enough transformation leadership, a lack of vision and under-communication of the vision by a “factor of ten.” Some companies, the article notes, fail to remove obstacles standing in the way of the transformed vision. Obstacles can include the way the workplace is organized, poor compensation that causes people to focus on their own self-interest over the new vision – and, worst of all, the expert says, “bosses who refuse to change and who make demands that are inconsistent with the overall effort.”
Other errors noted include not creating short-term wins or declaring victory too soon. The article states that, while celebrating a win can be a plus, declaring all to be won can be “catastrophic.” Over the first five to ten years, it’s easy to regress to old ways, while the new vision is still fragile.
Finally, this Harvard publication notes, it’s important for leaders to consciously demonstrate how the new approach is improving performance. Don’t make the team members make those connections on their own (or not make them or misinterpret them). And, it’s crucial to ensure that top management continues to implement and use the new vision and approach. The article ends with this thought: “In reality, even successful change efforts are messy and full of surprises. But just as a relatively simple vision is needed to guide people through a major change, so a vision of the change process can reduce the error rate. And fewer errors can spell the difference between success and failure.”