Engineering Your Practice for Success

Why building a robust business is like building a bridge

On 1st July 1940 the Tacoma Narrows Bridge in Washington State was opened to the public. Just over four months later, it collapsed into the water below. 

Nicknamed 'Galloping Gertie' during construction for the way it flapped around in the wind, engineers knew there was something wrong even as it was being built, and were working on a solution up until the bridge came down. Drivers using it described feeling as though they were on a roller coaster, seeing cars in front of them disappear as the road dipped and then reappear as it rose up again. Fortunately no human lives were lost in the collapse, but a dog called Tubby went down in a car that was left on the bridge, after refusing all attempts to rescue her.

In the aftermath of the collapse, it was determined that the high winds in the area created an effect called 'aeroeleastic flutter' which ultimately caused the structure to fail. Engineers worked this out by doing something they should have done from the outset - they built a scale model of the bridge and wind-tunnel tested their calculations. By subjecting a model of the bridge to various simulated real-world scenarios, they were able to see where their assumptions were found wanting.

What has this got to do with your practice?

While it may be true that running your own independent optometry practice can make you feel as though you are being buffeted by the elements, that part of the metaphor is unintentional!

The point is this - the Tacoma Narrows Bridge collapsed because there was information missing.

Information is the key

When it comes to the survival of anything that we build, we need as much information as we can get to ensure success and longevity.

The more information you have, the better you can engineer a bridge. And the same goes for business. You can't change the elements around you. Instead, you need to engineer your business, using the information you have, to a standard that will help you withstand them. So it makes sense to have as much information as you can get.

This is where business modelling can help. Business modelling really involves going through the financial aspects of your practice with a fine-toothed comb, analysing each element and investigating how it is affected by others.

For example, if you think you can convert 50% of your consultations into sales of frames, lenses, etc., how many consultations do you need to perform per day to make the kind of profit you'd be satisfied with? Or say you want to take on another optometrist to help you grow your practice. How will the cost of his or her salary affect your bottom line, and what kind of growth would you need to see to make it worthwhile? What about discounting - should you discount your product to keep up with the bigger players, or might another marketing strategy be more effective? If you can analyse every component of your business, and then monitor the actual performance of your practice against your plan, you can adapt to change much more quickly. You can identify those things that are working well for you and prepare for upcoming threats in a way that is far more timely.

It would be nice to have a business that just works. One where we have a cash cow that just continues to produce money. One where customers just come looking for us. A lot of entrepreneurial 'success stories' can make us feel like that's how business should be. Why isn't this happening for me?! The reality is that for most of us, business is competitive and, at times, trying. But it can also be extremely rewarding. It just takes a lot of work.

I didn't go into business to be an accountant!

We're probably the only profession that doesn't get to say that! It's something we hear a lot from people in small-medium business and to be honest, we get it. It can be tough. There is so much more that is demanded when operating your own business, beyond simply being good at what you do. But the bottom line is that if you just want to do what you do and nothing more, the life of an employee awaits!

You don't actually need to be an accountant, but you do need to understand how to measure and manage what you do. And the better you can do it, the greater your chance of success. Some businesses just have great ideas at the right time, and others may do everything right and still fail because of external factors that simply could not be helped. These are the extremes though. Most businesses will succeed or fail based on the amount of work that is put into engineering them.

No one else knows your business like you do

Imagine the guys that were doing the maintenance on the Tacoma Narrows Bridge. If anyone could have seen what was going on, it would have been them - showing up for work day-in, day-out, walking out across that undulating surface over and over again, climbing the towers and feeling it move. If anyone could have understood the gravity of the situation, it would have been those that lived with it every day. Now imagine if those guys also happened to have what you have - access to all the data that went into building it, the ability to interpret that data and the power to make changes.

No one else has the kind of day-to-day, 'at the coal face' access to your business that you do. You can 'see' what is going on and 'feel' how it is performing as it's happening. But if you're armed with the right tools, you'll empower yourself to do more than simply watch on helplessly. You'll have the data you need to analyse your business performance, test various scenarios for capitalising on strengths and improving weaknesses and respond to external influences sooner. In short, if you have all of the information you need, you can engineer your business to withstand almost anything.

A model specifically designed for optometrists

We have worked with ODMA to develop a model that will help you analyse all of the financial components of your optometry practice and test any number of scenarios for adaptation and growth. It can even help you determine confidently whether independent practice is a journey you should start out on.

Whether you are looking to start your own practice or have been operating for a while, good engineering involves planning how your practice will work from the ground up, in such a way that you know what you want it to be, how it will operate, what it will do to withstand external pressures, how it will grow and innovate and what it will do to distinguish itself from the competition. Our model can help you identify and gather the information you need to engineer a strong, successful practice.

View a demonstration of the financial model in action

Call us on (08) 8291 7900 or email enquiries@dewings.com.au for a free consultation to run your own numbers through our business model.

For independent practices, we'll even give you a copy of the model with no obligation (for personal use only), compliments of Dewings and ODMA.