Dental practice ‘team bonuses’ in 2019 and beyond
Back in the 00’s bonuses for the dental team featured heavily in dental practices across the UK, practice owners caught on from fellow peers that this was a sure fire way to motivate team members and keep them playing their “A Game”. The language in the last sentence may allude you to the origination of the dental practice bonus!
This culture was taken from the many American practice management consultants that were present in the UK in the early noughties.
The concept is great and I have personally benefited from bonus systems financially and emotionally. But in 2019 it is a different story with many practices no longer providing bonuses or having changed the bonus structure – some removing cash incentives entirely.
I will never forget the day I went to the bank to organise a new mortgage and they told me they would only accept 50% of the bonus income into their figures. My heart sank. I was earning more in bonuses than my basic salary. This was 2005.
Since then I have encountered team members who have lost benefits, had to pay back into the system and many other examples because of the bonuses they had.
The next problem being, as we all know, bonuses are not paid every month.
The bonus culture
Bonuses can also create a business culture you may want to avoid:
- Money hungry people
- Moody people – when the target is not achieved
- Demotivated people – the target is unrealistic, the bonus amount doesn’t make a dent in their pocket after tax so it was not worth the effort.
- 9-5 people
Without a doubt the money hungry people are the worst to create, I really cannot stand greedy people, I am sure we have all worked with or know at least one person like this in life!
However the 9-5 people are the most concerning group of all and if you think you may create these types of people then do not introduce a bonus system.
These are the team members you most likely do not pay the going rate for, you pay them lower than expected in your area for your type of practice. These team members know this and know that you are using the ‘bonus’ instead of increasing their hourly rate, they understandably dislike this and therefore do the exact opposite of what you excepted them to do (become motivated) and they just come in, do their job, go home. They are often emotionally attached to you as an owner and take this as a huge insult so decide that if you do not care about them they will most definitely not go the extra mile for you. Do not get me wrong they will do their job well but they will not pull any extra energy out of the bag for you.
Can bonuses work in 2019 and beyond?
The answer is yes but there is much more work to do behind the scenes. Here are my top tips:
First things first – make sure that everything is right and fair in your practice. You pay well, you provide a nice uniform, the team receive their breaks. Also make sure your HR knowledge and team training is hot, on fire hot! You need to be dealing with anyone not performing their contracted duties as they should not be receiving a bonus.
Next look at the team – what type of people are they? In what ways would they like rewarding? Days out such as the races, spa days, track days. They might be much better for your team than a financial reward.
The size of your team is important – if you have a larger team with over 10 employees providing a cash bonus is harder work.
NHS / Private mix – the higher the NHS percentage of income the lower the bonus pot will be – so will a financial reward work? Will the target be achievable and realistic?
Diary zoning, courses and holidays – if, currently as I type, you have a huge influx of families and children due to the school holiday, how are the team going to achieve the target if you do not have diary zoning to ensure you can still meet your daily target? If you are the main earner and you are off for two weeks in the month how will the team meet the target and what is the solution to keep the team motivated?
The target – needs to be SMART. Firstly take the figure of the expenses for the last year, work out the profit you wish to make and then set the target from there. Start slowly to build it up.
The pot – is a percentage of the net profit, not the gross. 5-8% is advised.
How much? – You are looking at a full time team member taking home at least £100 a month after tax. For the higher end practices aim for £200 take home after tax.
When to pay it? – pay monthly; so if the target is achieved in August the payment would go into the wages at the end of September 2019. Trust me, quarterly, bi-annual and annual bonuses do not work. It is paid pro-rota for hours including overtime hours.
How to award it? – this needs to be solely on attitude and commitment to the business and team and patients. The A team players attitude and level of energy is what you are looking to replicate. If someone is not performing their contracted duties as they should then they should not receive a bonus as they should be in capability or disciplinary. If someone has a bad attitude even once in the month the bonus is gone.
Who? – only dental nurses, front desk, TCOs and managers. Many always think the hygienists should receive ‘something’ but when they earn on average £30/£40 an hour that is a no from me. Even the very best PMs are on £16-18 PH so the hygienist is often earning double. Employed or not they do not receive the bonus.
T&C – this does not go in anyones contract ever. You have the right to withdraw and refuse the payment of the bonus, or to change any part of it at any time.
We never used to award the next payable bonus to anyone who had an unplanned day off. Simply because the team would have had to work so hard to support that absence, but many practices do a two strike rule in a rolling 12 months to be a bit nicer!
I hope this helps you and if you have any questions at all please send them over so we can answer them for you on our podcast!