The Rush Case Dilemma
Posted Feb 25, 2014 in Management
Rush cases create a conundrum for many lab owners. In our lab, we made a definitive decision to accept rush cases for an extra fee but to make that work, we had to make some changes internally.
This management decision couldn’t be made in a vacuum; we needed to build a consensus with our team of technicians. This involved very frank discussions about why I believed accepting rush cases represented a growth opportunity for our lab, and addressing the staff’s very real concerns about working on them.
I believe providing rush services helps distinguish our lab from our competitors. It helps us get a foot in the door with a lot of new dentists and, once these dentists experience the value of the work we deliver, we can earn their non-rush business as well. On the other hand, my staff was concerned with disruptions to workflow; as rush cases became the priority, other work had to be put aside. And, because many of my technicians were paid via piecework, they had to either work more hours to maintain their compensation level or earn less pay if they didn’t.
Based on these meetings (and there were many), we decided to change the way we pay our technicians and, today, 80% of our staff is paid via an hourly wage. They are guaranteed to be paid for a set number of hours per week and paid overtime when necessary. By guaranteeing our technicians a certain compensation level regardless of production, the cost burden shifted to operations and away from our technicians.
Now, we accept all rush cases and evaluate the financial value of each account to determine how much we’ll charge for the case. For instance, a lower-volume client usually pays more than a higher-volume client because it takes us longer to recoup the cost of lost revenue that results from a disruption to normal production.
We also started actively promoting our rush services through our website, email campaigns, printed literature and sales presentations. This year, this business strategy is directly responsible for three new clients who collectively bill about $10,000 each month. That’s more than $120,000 per year in business because we said “yes.”
To dentist-clients, faster service is, in fact, better. If you can turn around a crown in four days that’s comparable in price and quality to another laboratory that offers it in seven…you have, in fact, provided greater value. For us, that value is worth at least $120,000 this year alone.
© 2015 LMT Communications, Inc. · Articles may not be reprinted without the permission of LMT
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