Dental Practice Heroes

The Associate Illusion: Why Most Owners Lose Money (and How to Fix It)

Dr. Paul Etchison Episode 610

Ever fantasized about bringing on an associate to handle all those difficult cases while you kick back and watch the profits roll in? That seductive vision—what I call "the associate illusion"—has lured countless practice owners into disappointment and financial stress.

The harsh truth is that associates rarely outproduce the owner, and without proper systems in place, adding another doctor simply amplifies your practice's existing problems. It's like adding more rowers to a leaky boat; you're still taking on water, just with more people watching it happen. Many dentists are shocked to discover they actually made more money as associates than they do as owners after hiring their own associates.

For the associate model to work effectively, four critical elements must align: cultural fit, longevity, production capability (minimum $650/hour), and case acceptance skills. The responsibility for creating this environment falls entirely on you as the owner. This means implementing scheduling templates, training your team on case presentation, and—most critically—providing consistent mentorship. I learned this lesson the hard way, watching my first two associates thrive under my guidance while subsequent hires struggled when I mistakenly assumed the process would run itself.

When done right, however, associates truly unlock freedom and scalability. Imagine working just 1-3 days weekly, focusing only on procedures you enjoy, and having the flexibility to adjust your schedule without six months' notice. I've built a $6 million practice working just one day weekly through systematization and associate development—not magic, but methodical implementation.

Ready to transform the associate illusion into reality? Start by auditing your patient demand (you need at least 35 new patients per doctor), systematizing operations, committing to mentorship, and considering junior partnership models that create long-term retention without sacrificing control. Visit dentalpracticeheroes.com to discover how we can guide you through this transformation and help you achieve the practice freedom you've always wanted.

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Speaker 1:

Have you ever dreamt what it would be like to have an associate in your practice, have somebody doing all the dentistry, dealing with all the difficult cases and doing all of that hard work, while you just sit back in your office and collect your profits? Would you like a practice just like that? I'm sure you would. So would I, and if only it were that easy. I hate to break it to you. It's not, and that's what we're talking about today. We're going to talk about what I call the associate illusion, which is the idea that all your problems go away if you just add an associate. And for most owners it's really not like that, but lucky for you. I'm going to teach you exactly how to make that illusion a reality. Now you are listening to Dental Practice Heroes, where we teach you how to turn your practice into a true dental business so that you can have more freedom, work less and take great care of people while you're doing it.

Speaker 1:

I'm your host, dr Paul Etchison. I am the author of two books on dental practice management, a dental coach and the owner of a large group practice in the south suburb of Chicago, and I'm only practicing three days each month. So if you want a dental practice to run like clockwork, that you don't have to be at all the time. You have come to the right place. Let's get started Now.

Speaker 1:

I want to share a story with you. This is from one of my previous coaching clients and this guy you know. He came to me because he was frustrated. His practice seemed like it was running well. Everything felt like it was going really good. From the outside in it looked amazing. But then when you looked at the profit and loss, it just didn't add up and honestly, this person was making more money as an associate than he was as a practice owner. So we look at that and we say what's going on? He's got an associate, he's got four hygienists. What is the problem and this is what I'm talking about with the associate illusion? You would think with an associate and four hygienists it's got to be profitable, but the fact of the matter it's not. If you don't have your systems dialed in, it's like having a leaky boat. I love this leaky boat analogy. If your boat is leaking, it doesn't matter. If you add more rowers, the boat's got holes. More rowers is not going to fix the holes. You've got to fix those holes.

Speaker 1:

So why might you as an owner, think that an associate is the answer to all of your issues. I get it, you're overworked, you might be burnt out, you might be capped in production and you keep grinding harder and nothing's changing. But you got things coming at you so often that you're just stacking up one after another and then you feel like, well, if I can just get to the point where I hire an associate, then all my problems are solved, because I won't have to do the things that stress me out anymore. Or since I'm not seeing patients so much, I'll have time to take care of the things that stress me out more.

Speaker 1:

Now we've often heard this idea. Maybe you've heard three and free. Have you heard of three and free? That's the idea that if you can get three associates working in your practice, that you can often go completely non-clinical. And that is true to an extent, and I can tell you that from experience. I'm practically non-clinical right now, working two or three days each month.

Speaker 1:

But the only way that the three and free thing works is if those associates do four things. They've got to fit in with your team. They've got to stay on your team because sometimes associates leave. Actually, often they do leave, especially when you get a really good one, the really good ones. They want to go open their own practice, you know, and they have to produce enough. They have to produce at a level that is profitable, otherwise they're just wasting time and becoming another expense. And they've got to get solid case acceptance because if they don't get that case acceptance then they can't produce. So that brings me to what essentially is the harsh reality that most of those four things those are on you as the practice owner. These are things that you have to do to create an environment where an associate can work profitably in your practice and create that profit so that you can practice less. Because the thing is, if your systems are broken at the practice, the associate doesn't help that. It just scales that dysfunction that you already have. The associate doesn't help that it just scales that dysfunction that you already have. If your culture is weak or negative, associates can feel unsupported and not really enjoy being at your practice and eventually just leave.

Speaker 1:

And one of the worst things for having an associate-driven practice is associate turnover. I promise you it's one of the absolute worst things. To try to train new associates, bring them on your team, get them onboarded and get them to fit in with everybody your team and patients alike and when you don't do it right, the associates actually cost you money. Something we often forget is that associates very rarely will outproduce the owner. I don't know why it is, but it's true. They rarely outproduce the owner. And the thing is, a lot of us dental practice owners at least I know a lot of us that listen to this podcast we are high producing owners. So think about this If you're going to cut your clinical days back, you are going to take a big drop in production because it's going to be hard to replace your level of production with an associate. And the fact of the matter is is associates, they almost never match your production and your profitability starts to dip as soon as you bring them on. Now there are ways to do this where we can bring on the associate. That's very structured so that we don't take a profitability dip, and then we make sure that everything stays high production so that we can be profitable. That's exactly what we teach in our coaching programs and in all of our trainings. That's the seven phase omnipractice system that I'm always talking about in here. So I'm not saying it's not possible, but I'm saying it's on the owner to do it.

Speaker 1:

So what really needs to be in place before you have an associate? Well, first of all you've got to have the systems. Remember that leaky boat. We don't want to bring more rowers on that leaky boat. We've got to have the systems, we've got to plug those holes. So one of the things that I find the most effective to making sure that your associates can produce at a level that's profitable is having scheduling templates. You've got to create a DPH block schedule. You've got to set up the appointments, the right amount of appointments, the right dollar values so that associate will hit a bare minimum dollar per hour. In my practice that's $650 per hour. That is adjusted production. Now you also got to have the systems for your patient flow, your efficiency, so that you can work through the schedule fast enough to stay with that dollar per hour. You also got to have the training with your team to help with case acceptance Because, let's face it, I mean a lot of the case acceptance is on the communication with the it. I mean a lot of the case acceptance is on the communication of the doctor, but there is a significant portion that has to do with the team and most of us dental owners. We don't train our teams at all on that. We don't train the front end on financing how to properly present like a treatment coordinator would. These are all things we want to train our team on. Now, if you've got those systems going, you've got the block scheduling in place, you've got the team efficiency so that your team is trained to handle these things, to handle a bunch of different procedures, to do them efficiently, you have to realize that when you bring this associate on, they need mentorship from you, they need guidance, not just a chair.

Speaker 1:

So I think back to my first two associates. They were amazing and I said, dang man. Some people said this associate thing is hard. I just made it look really freaking easy. I must be really good at what I'm doing. So let me tell you what I was doing. I was mentoring my associates. I was talking with them a lot. I was sitting in the hallway listening to them do exams. I was recording my exams, recording their exams. We were working together. I was mentoring them.

Speaker 1:

Okay, let me tell you what happened with my third associate. It didn't work as well, and you know why? Because I didn't mentor at all. I thought it was easy peasy, lemon squeezy, and I didn't think I had to put in the work. And then, because I didn't put in the work, I didn't get the results. So we had to replace that associate. Guess what we did? I did the same thing with the next associate. Same thing didn't mentor, had issues, couldn't get this person to work with the culture of the practice, couldn't get this person to get along with the team, couldn't get this person to produce in a way. So we lost that associate too. And then I had another associate and by then I was starting to actually wrap my brain around. This is that associates work out much better when I onboard them with mentorship.

Speaker 1:

Now, the great thing about associates is you don't have to do that. You don't have to put as much effort into it as you get going. But right at the beginning you have got to. You've got to put in that time, you've got to onboard them and you've got to be there to mentor them because they have to fit in with your practice. Think about it You've created this practice with systems that works really well for the way that you do dentistry, but you bring this other person here that has not had the same training as you has not been working within your systems. You've got to show them how to do that.

Speaker 1:

Now. I talked about the associate illusion that all your problems go away when you bring on associates. It's not true. But let me tell you what is possible. Let me cast a vision for you. When you do this right, the associates completely unlock the freedom and the scalability of your practice. If you can get multiple doctors producing at high levels, you can easily have an income greater than it ever would be when you were a solo doc. And you can do it while you step away from your procedures. You can step away from the practice clinically and a lot of you docs say well, I don't want to step away clinically completely. Most docs don't. But here's what you can do. You can limit yourself to the procedures you like. You can stop doing exams. You can stop seeing general new patients. You can become more of a specialist inside your practice. So this is the type of freedom it unlocks when you have associates that are producing at a high level.

Speaker 1:

Now let me tell you one of my favorite things about having an associate-driven practice is that I don't check hygiene and I don't see new patients in hygiene, so you know how usually when you're taking time off, you've got to get it six months ahead so that somebody's there to check hygiene. I don't have to do that anymore, so I can just change my schedule with two, three weeks ahead. If need be, we can reschedule patients. It gives you ultimate freedom. So if you have something come up and you want to go to it, you want to take some time off, you can easily do that when you've got associates in there and you've limited yourself in what your contribution to the practice is, at least clinically. And that's the thing we hear people talk about how to do this. I have lived this. I've done this. This is not just theory for me. This is what we do at Dental Practice Heroes and this is what we teach other dentists to do. We've been teaching dentists to do this for six years. We've got this down. We know how to do it.

Speaker 1:

So let me give you some practical takeaways here. Here's what I want you to do. I want you to look at your practice and I want you to audit the demand before even thinking about an associate. Do you have enough demand that you can have enough patients coming in that you can feed yourself and another dentist. I think that you need to have at least 35 new patients per doctor Now, with the caveat that the owner doctor doesn't typically need to see as many patients, but you gotta have a certain level of demand.

Speaker 1:

Now the second thing is is you've gotta systematize everything. If you don't have everything systematized and you bring an associate on, you will amplify every problem in your practice and it'll just get worse and it'll be much harder to fix when you do that. So you got to get your system dialed in. You got to get them set up, you get them documented and you get them working well. So you do those two things and you bring out an associate. You've got to mentor them. You got to train them. You got to train them to practice at your standards.

Speaker 1:

Don't just hope they're going to figure it out. I'm going to tell you from experience. I've tried to do this. They don't figure it out. I went back to mentoring and then I went back to seeing if they would just figure it out. Again, they don't figure it out. It is not possible. You need to be there for them. And then, when they're working, you've got to track their profitability. You got to make sure they're hitting the production goals for you that allow you to be profitable. I can tell you, if you've got an associate producing $300, $400 per hour, that is not going to be profitable for your practice at any level. It is a waste of time. You're worse off with that associate. You got to get them practicing $650, $700 per hour and I want you to play the long game with these.

Speaker 1:

Often we're hoping that we can get a lifetime associate that would never leave and we don't want to give up any equity in the practice. But this is what I love about the junior partnership idea. I used to truly believe that no one would ever buy equity into my practice unless it was a 50-50 partnership. But think about this when you have a junior partnership that you can sell to your associate, you are giving them the opportunity to stay long-term, make a commitment, pay a little bit of money into the practice and make way more money on their career and own part of an asset that's appreciating, all while somebody else runs the business for them. So they become a junior partner. Maybe they own 5%, maybe they own 15%, maybe as high as 20%, but the benefit to them is they will make more money but they don't have to run anything. They can pretty much just behave like an associate. So it's win-win.

Speaker 1:

And when you do this, you're playing the long game. You're keeping your associates at your practice so that each night, when that head hits that pillow, you're not worrying about what would happen tomorrow if your associate put in their notice. So in closing, I want to reaffirm the associates they're awesome, but they are not magic wands. If you do them wrong, they will drain you and they will make your life miserable, but if you do it right, they unlock total freedom. So I want you to reflect on that this week.

Speaker 1:

If you hired an associate tomorrow, would you be setting them up to succeed or would you be setting them up to struggle? What would happen if you brought an associate into your practice tomorrow and if you don't think you're ready? Figure out why and start making steps to get your practice to a level where it can bring an associate on. And if you can do this, it becomes so much easier to replicate and scale. The first associate is always the hardest, the second one's easier, the third one's even easier. Now I built a $6 million practice. I worked just one day a week and it was by building systems and developing associates. It wasn't just because it happened, and that's what we teach with Dental Practice Heroes. So if you're looking for help or you want someone to guide you through this, teach you how to do it, please go to our website, dentalpracticeheroescom, so we can find a way to work with you to get you to the goals that you want. Thank you so much for listening and we will talk to you next time.