Who are the managers and what are they for?
IN AN ARTICLE published on the National Commission of Veterinary Economic Issues (NCVEI) website, Neal Wasserman reported that data collected by the US organisation had shown that veterinarians were more efficient, and earned significantly more money, when they hired practice managers. In so doing, veterinary practitioners are able to focus more on medicine, therefore, generating more income.
He goes on to say that “we know that practice owners, especially sole practitioners, often think they can’t afford to hire an extra staff member; however, NCVEI data shows that they can’t afford not to”.
The short answer is that while the NCVEI conclusions are likely to also be true this side of the pond, we can’t be sure without a good deal of statistical data, which is, regrettably, simply not yet available in the UK.
What is required is comprehensive, valid, up-to-date financial benchmarking data concerning the financial performance of UK practices linked with a study of the impact on practice performance that can be achieved by practice employees skilled in the use of modern business management tools. That is, tools designed to help businesses offering professional veterinary healthcare services to also achieve the commercial objectives required by practice owners and investors.
During the past 15 years or so, there has been a steady growth in practice management employment and training opportunities, spearheaded by the VPMA, a number of management consultants and advisors and a wide range of CPD opportunities related to many of the non-clinical activities essential for practice success.
The time is now ripe to take a closer look at the management role in practice and to take the first steps in a longer-term process to determine whether there is a clear link between the use of better business tools and techniques, the employment of individuals skilled in their use, and improvements in practice performance, both clinical and commercial.
In short, the question is: who are the managers, what are they for and what are they worth?
The first stage was to conduct a webinar (an internet-based seminar). This was moderated by the author and presented by Anna Wardle (a joint owner and practice manager and recipient of The Veterinary Business Journal Practice Manager of the Year Award 2007), John Bower (past-president of the BVA, BSAVA and VPMA and a former practice owner and employer), Mark Moran (director of Vets in Business Ltd and a management consultant to the profession), and Jane Terry (principal of Darwin Consulting and a management consultant to the profession).
The speakers discussed the purpose of business (rather than clinical) management in a veterinary practice and considered the current range of management tasks and job descriptions for practice managers and administrators in the UK.
The webinar addressed the costs of the management role and the financial and service delivery benefits that can result from the use of modern business techniques and tools by management staff, trained and experienced in their use.
Those who participated were asked to complete an online survey and the results derived from 58 completed questionnaires are considered here:
|Figure 1: The type of practices that took part and their size by annual revenue. |
Figure 1 shows the type of practices that took part and their size by revenue.
The majority of the practice managers held business qualifications, including various NVQs, business diplomas, business and other degrees, Certificates in Veterinary Practice Management and MBAs. One of the vet owners held a Diploma in Management Studies and one held a Certificate in Veterinary Practice Management. The other 14 owner vets held no formal management qualification.
The average working week for the practice managers was 39 hours, with a range of “more than 40 hours” (12 respondents), “30 to 40 hours” (17 respondents) and “21 to 30 hours” (four respondents).
The 16 owner vets spent an average of 18 hours per week on practice management tasks,
with a range of “less than 10 hours” (four respondents), “10 to 20 hours” (seven respondents), “20 to 40 hours” (four respondents) and “more than 40 hours” (one respondent). The four non-veterinary owners spent an average of 30 hours per week on
their practice management roles.
Remuneration for their management role
The remuneration package for practice managers ranged from less than £15,000 to £60,000 or more in two practices generating in excess of £1m. The average salary paid to practice managers was £28,115.
|Figure 2: Salary range of practice managers taking part in the survey. |
Figure 2 shows the range of salaries for practice managers.
Remuneration for the non-vet practice owners for their management role ranged from £15,000 to £50,000, with an average of £35,000.
Remuneration for the vet practice owners for their management role ranged from £15,000 to £60,000, with an average of £16,500.
The management role and responsibilities
For the purposes of this survey, the management tasks in the veterinary practice were allocated into six categories as follows:
HR responsibilities, including:
- staff training;
- staff appraisals;
- recruiting support staff; and
- recruiting professional staff.
Marketing and service delivery responsibilities, including:
- clinical and other reminders;
- promotion of healthcare and over-the-counter sales;
- client and/or patient advocate;
- handling complaints;
- PR and practice image; and
- practice standards scheme.
Practice assets, including:
- equipment and facilities;
- stock control; and
- IT hardware and services.
Financial responsibilities, including:
- cash control and banking;
- credit control;
- data retrieval for accountants, etc;
- preparation and distribution of management accounts;
- review and amend operational policies; and
- pricing and fees.
Business strategy, including:
- vision and mission;
- business leadership;
- business planning; and
- strategic decision making.
Respondents were asked to identify the specific management tasks and responsibilities they were responsible for and the results are summarised in Figures 3, 4 and 5.
|Figures 3, 4 and 5: The specific management tasks undertaken by (from left) veterinarian owners, non-veterinarian owners and practice managers. |
Conclusions and observations
Readers will no doubt draw their own conclusions from the results of the survey and may wish to review the current arrangements that apply to their own practices.
My own broad observations are as follows:
The list of management tasks in veterinary practice is not claimed to be exhaustive, but it may help practice managers and owners to review tasks that are being carried out effectively in their own practice and those needing attention.
They may also ask who is responsible for each task and whether they are being handled
effectively, efficiently and economically.
In her presentation during the webinar, Jane Terry reminded us that the management tasks in
practice can be broadly divided into two categories. Firstly, are those she described as “looking after the pennies”, such as managingthe existing business, ensuring that systems and policies are implemented, that efficiency is improved, that waste is controlled and that productivity is enhanced. These tasks require hands-on attention to detail and general administrative, management and people skills.
The second category includes those tasks concerned with moving the business forward.
They include business analysis, strategic planning, seeking new and innovative opportunities for top-line growth, improving profits and developing the practice team.
It might have been expected that the practice owners would have allocated many of the
tasks in the first category to one or more of their employees, while concentrating their own
management efforts on the second category, otherwise intervening only where their employees fail to meet performance standards or where corrective decisions are required to address significant deviations from budgets or other plans or policies.
The results suggest that more than 50 per cent of the managers and more than 80 per
cent of practice owners include these responsibilities in their job description.
Effective decision making in any business depends on the availability of valid, up-to-date management accounting and other data and one of the concerns highlighted in this survey is that only 11 per cent of practice owners and 56 per cent of practice managers regard the
design, preparation and distribution of such data as being one of their responsibilities.
Could this mean that many of the decisions about such matters as pricing and fees, operational policies, budgeting and business planning are made on the basis of inadequate data?
More than 50 per cent of the practice managers and more than 20 per cent of practice owners
do not include client and/or patient advocacy as one of their responsibilities.
More than 30 per cent of the practice managers have little or no responsibility for such matters as cash control and banking, data retrieval, pricing and fees, promoting healthcare and over-the-counter sales, stock control and book-keeping, and more than 40 per cent do not include management accounting data in their list of management responsibilities.
Of course, these tasks may be handled by the owners or by other administrative or clinical staff, but there is a sense that a significant number of veterinary practice managers in the UK do not have access to much of the financial and other data that is essential if they are to achieve the top-line growth, the cost savings or the enhanced profitability that would ensure that their employment represents value for money for practice owners.
What more do we need to know?
This study has been concerned with looking at the role of individuals and their role in management in veterinary practice. No consideration has been given to any other individuals who may be responsible in each of the practices for some of the other management tasks not covered by the respondents in this survey.
It has also not been possible in this review to examine the impact of practice managers and their use of business tools, skills and techniques on practice performance – however it may be measured.
What is needed is a detailed study of data from a significant number of veterinary practices as
businesses rather than with the individual managers they employ.
We need to understand what management tasks are handled well, poorly or not at all, the costs of the management role and the impact of an investment in better management on clinical standards, service to clients, staff motivation and return on investment.