Article Date: 3/1/2008

Staff Salary Insights
staffing solutions

Staff Salary Insights

Hard learned lessons about employee compensation.

BY BOB LEVOY, O.D.

It's no secret that staff salaries account for most optometrists' highest operating expense. At the same time, staff is your most valuable asset.

Consider these hard learned lessons:

► More than anything, your investment in support staff is likely to pay the highest dividend. You need to think of staff as just that — an investment, rather than an expense.

► If you underpay your employees, you'll attract either less competent people whom you'll probably dismiss or those who are just starting out will learn all they can, gain some experience and move on to better-paying jobs. Either way, your salary policy will generate more staff turnover than loyalty.

► Better performing practices tend to have more staff than the norm, not fewer. More support staff can mean you're better able to focus strictly on patient care. Better patient care, in turn, leads to great patient satisfaction, referrals and practice growth.

► "Too many doctors trying to cut costs don't care about staff. They just want a warm body standing there," says Vicki Seibert, administrator for a solo medicine and gastroenterology practice in Clearwater, Fla. "It's important to keep good staff long-term, no matter what it takes in terms of salaries and benefits."

► "A cash-only incentive plan generates mercenary loyalty, not emotional loyalty," says Dianne Michonski Durkin, author of "The Loyalty Advantage: Essential Steps to Energize Your Company, Your Customers, Your Brand." "In the long run, people will not stay if the culture and environment are not congruent with their values and beliefs."

Underpayment attracts less skilled people.

► "Don't give raises to marginal employees," says practice-management consultant Jeffrey J. Denning. "Raises never motivate workers to improve. To the contrary, a raise in pay signals the employer's satisfaction with status quo. Further, if the employee is terminated and sues, she has simply to point to the history of pay raises to show she was doing a good job. Judgment for the plaintiff."

► "… In a healthy market an unhappy employee will bolt the company for a 5% pay increase, but it will take at least an increase of 20% to compel a satisfied employee to jump ship," says W. Michael Kelly, director of research at The Saratoga Institute, a division of PriceWaterhouseCoopers. "Of course, pay is more important to some than others. We know that many employees who struggle to pay their bills can understandably be enticed to leave for increases of less than 5%."

► "Many doctors are overly concerned that one or more of their top employees has reached or surpassed some arbitrary ceiling for their position," says practice-management consultant, Dr. Charles Blair, of Mount Holly, N.C. "We're more concerned with the effectiveness of individual employees in helping the practice grow profitably and thus focus on the ratio of staff payroll costs to practice gross income. As a result, we often find that paying top dollar for truly stellar employees can result in a more profitable practice."

► " … Realize that salary and benefits alone are only a small part of an employee's 'value equation,' says Michael Lowenstein, managing director of Customer Retention Associates in Collingswood, N.J. "Employees want enrichment. They want inclusion. They want communication and participation. They want training. They want recognition. They want to have pride in where they work."

► Coddle your employees. Without them, you may not have a practice. OM


BOB LEVOY'S NEWEST BOOK "222 SECRETS OF HIRING, MANAGING AND RETAINING GREAT EMPLOYEES IN HEALTHCARE PRACTICES" WAS PUBLISHED BY JONES & BARTLETT PUBLISHERS. YOU CAN REACH HIM BY E-MAIL AT B.LEVOY@ATT.NET.



Optometric Management, Issue: March 2008