Owning a business is tough.
Owning a business that is heavily regulated by the government is
tougher.
Owning a business that is reliant on government reimbursement
schemes is the toughest. Especially if the largest percentage of
your revenue, cash flow and profits is beholden to that source.
Therein lies the plight of most in the HME/DME world.
So what can be done? Don't just own your business, lead it!
That's right, ownership and leadership are very different. The
primary difference is that ownership is a financial circumstance.
Leadership is a strategic decision. Ownership is simply a result of
fiscal responsibility and structure. Leadership requires emotional,
psychological and financial commitments.
Leadership is about taking control. It is about deciding to
steer your own ship, not simply going where the winds and currents
choose. It requires power, perseverance and an unrelenting passion
to muster all that is within your reach to overcome the travesties
of governmental meddling.
Regardless of your size, product mix, or whether you're in one
of the first MSAs for competitive blundering (uh … bidding),
here are five ways to start leading:
- Decide to Be In or Out
This is fundamental. It begins between your ears.
Are you committed to your business or do you want to bail? Hint:
the time for bailing (at a good price) has come and gone. You're
about three years too late. So you might as well do whatever you
can to improve your business and build its value so that in another
three years or so, you'll be in a stronger position to court
suitors.
If you think it's too late for that, then it probably is. So try
to find a buyer who'll give you whatever they will for your years
of investment. For those who are willing to fight for the survival
and success of your business, read on.
The true paradox of transitioning from owner to leader is the
ability to take care of the day-to-day problems that need fixing
while looking ahead at building the company. In time, a general
manager is a wise solution. This person takes on the daily
operations issues and frees up the owner's time to explore
alternatives for the business' strategic future.
The owner must not only rely on the internal talent of managers
and workers but also engage the services of outside professionals.
These people can bring experience and expertise of their own
disciplines as well as those of their clientele.
While any final decisions regarding the direction of the company
is solely in the hands of the owner, taking advantage of new
insights and perspectives from outside the business (and even the
industry) may prove a wise investment in creating a distinct
plan.
Sadly, the boss' office is always the most comfortable place to
hide (I mean sit and control the empire). Yes, it can be safe for
the boss, but hazardous to the company's growth. You must leave the
office, cross the bridge over the moat and travel the lands.
Meeting with vendors, suppliers, lenders, neighbors, shakers and
movers and other community leaders offers a reality check for you
and your business.
Getting out allows you to exchange ideas, brainstorm and, most
of all, take the pulse of the marketplace and be visible in it.
It's an opportunity to get involved in clubs, organizations and
community initiatives that will position you as involved and
committed to the success of more than just your business.
In the process, you can become a value resource for information
to those in need. After all, everyone in the community is or will
be a prospective customer or influence decisions made by a loved
one.
In a world of competitive bidding that reduces all products and
services into a “cheapest commodity provider,” the one
thing that separates your business from every other is your
people.
You deserve to have the brightest, most enthusiastic,
hard-working, honest, dependable, courteous workers possible. That
is a daunting task. You must ask better interview questions;
discipline and reward consistently and constantly; communicate and
manage effectively. Between generational differences, turnover and
competition, finding and keeping talent is tough.
What issues should be at the forefront of every leader's
thinking? Finding and building more leaders. Every successful
company is made up of people who exhibit leadership skills at every
level of the operation. They take on a pride that permeates all
they do, and they develop into the next generation that will enable
the business to continue growing.
By now you've probably eliminated as many expenses from your
business as possible, so now what? It's time to look at:
Alternative revenue streams
Alternative business ventures
Product mix
Payer mix
Territory expansion or reduction
Market niche expansion or reduction
Alternative business models
Retail sales
Improving cash flow
Exploring alternative packaging and delivery
Examining return on training dollars
Fostering expanded sales/distribution networks and
relationships
Acquisition and/or merger alternatives
Exploring disease association linkages
Leveraging buying group contracts and individual vendor
terms
Managing existing lender relationships and/or seeking out
others
Succession planning for turning over the business
Clearly, recent CMS reimbursement schemes are yet another reason
either to diversify out of the government business or maximize the
possibilities for a profitable relationship with CMS. There's not
enough space to explore all of the tactics here, but suffice it to
say “business as usual” is going to shut your
doors.
Average owners will continue to whine. HME/DME leaders will find
some way or, perhaps several ways, to turn their business' future
into their hands, not the government's.
This industry is not unlike others in turmoil. Automobiles,
airlines, restaurants, hotels, home builders and others are facing
changing regulations, buying habits, profitability pressures,
talent drain, increased competition, etc., etc.
This sector just seems to be such an easy target because a
growing percentage of our citizenry thinks health care is an
entitlement and should be a government-run right. Without getting
into political debates, consider what the government has done to
health care so far, and then imagine the entire system from
delivery to operations being run by Washington.
Leverage your dollars and volunteer efforts to support those
organizations that make sense: AAHomecare, your state association,
VGM, The Med Group, NAIMES and any other collective body that is
able to muster the kind of political and fiscal clout to take on
the legislators.
In the meantime, mind the store and look to the future. You
can't do it all or know it all, so find ways to use your dollars,
time and energies wisely. Find people who have the expertise to
accelerate the thinking, strategies and action necessary to get
your business headed into a more desirable future.
And by now if you aren't accredited, shame on you! It's a
tremendous process that helps formalize the dimensions of your
business that will not only allow you to participate in national
competitive business but help you tighten up on many of the
day-to-day functions and document the workings of your company.
One of the obstacles to going from owner to leader is the
inability to have others carry on in your absence because policies,
procedures and processes are in your head and not written and
available to the staff.
So what's your next step? Determine whether your business needs
transition or transformation. Transition means looking at doing
things differently. Transformation means doing different things.
They both come with risk, rewards and uncertainty; however, they're
better for your future than the government's current plan.
As with all legislative changes, the pendulum will swing. There
will be a backlash, revisions and ongoing remedies, as evidenced by
the trials and tribulations thus far in simply getting MSAs
identified, start dates announced and the accreditation and rules
of national competitive bidding confirmed. So you must take the
lead in deciding what you want your business to look like and how
you're going to be a “value-added choice” for families
in need.
You are not only a supplier of home medical equipment; you are a
critical link in the continuum of U.S. health care. You are a
resource to families that enables and empowers them and their loved
ones to live to the fullest, as independently as possible, with as
much dignity as possible, in the place they call home.
Revisit the true meaning of your business and the impact it has
on the lives of the neighbors in your community. Re-energize your
efforts to lead, not just own your business.
Leadership means knowing what to focus on and what not to. Take
control of what you can. Take your business, your employees and
your customers to a new level of trust, quality and service.
And in spite of the statehouse, CMS and the Washington gang, you
can profit.
Vince Crew is the creator the HME Power Management
Success System (VGM 2005). He provides confidential advisory
services to owners and executives on strategic growth issues and is
the author of several books on leadership, staffing and strategy.
Visit www.REACHdevelopment.com for
additional information.
