From the Ground Up: Building a Business in the Mental Health Field – Pitfalls and Suggestions to Think About – Time and Money Hint: (They're the Same)
If you are a clinician who gets paid for your clinical time, then you know this better than most, if you are not seeing clients you are not getting paid. However there are things that need to be done that are not clinical. There are session notes that need to be written, there are clients to call back, there are networking events to go to, the list goes on and on. It is important to know how much time you are spending on your business that is not generating revenue.
If I am charging $150 an hour to my clients, seeing 15 clients a week, and spending an additional 30 hours a week on all the other business activities, it turns out that I am not making $150/hr, but actually am really only making $50 per hour of my working. This can get frustrating when you add up all of the time that you spend on mundane activities in your practice.
I will give an example, when we first started building our practice, our CEO and founder had been in private practice for nearly 30 years. She understood how to run her practice, and it was simpler for her to just keep doing many of the tasks that needed to get done. However, she recognized that to really grow the business, she needed a way to diminish the number of hours she spent on admin type activities, and spend more time, getting and seeing clients. For her, she spent probably 10-20 hours a week on administrative type functions, call backs, filing, etc. She realized that if she brought on an admin for about 10 hours a week, this would save her 10-20 hours a week of busy work. To cover the cost of that she needed to see one extra client a week, and that still gave her 9-19 extra hours to spend networking, marketing, seeing clients, and doing activities that would generate revenue.
This is just one example of how both time and money are important to consider. The same can be true of speaking. Let’s say a clinician’s hourly rate is $150/hr and she gets asked to speak at an event that will pay her $300 for an hour talk. That may sound like it is a great rate, but it really isn’t twice her normal rate, in fact, when you add in everything from travel time, to preparation, to downtime at the event, you may be looking at the neighborhood of 10+ total hours of work for that one hour of speaking. This is not saying she shouldn’t do it, it can have benefits far beyond just the dollars when it comes to branding and marketing, but we have to be careful to look at all the time that things require, and not just the basic starting amount.
I know a chiropractor who has found a way to hire people for just about every single non, paying task that must be done in his practice. He literally does nothing except for evaluations, consults, and adjustments, the things that make money. He is able to see a very large number of clients per day, and so doesn’t have to work quite as many days a week to have the lifestyle he wants, and he can keep the rates affordable since the volume is higher.
This is the essence of understanding your time and money. YES, you might be able to do certain things in your practice, and it will cost you money to hire someone to do them, but look at the cost/benefit analysis of each activity, understand that where you spend your time matters. If our CEO and Founder spent all of her time focused on seeing clients, she could probably see one and a half to two times the number of clients per week. That would increase the revenue that she generates directly drastically, BUT, it would take away from the time and energy she has to spend training employees, marketing and networking, and all of the other activities a CEO would need to do to grow the business.
This is the struggle of growing as a business, but it is also the beauty. YOU as the owner and founder of your own practice get to decide what is important, and how much time and money to devote to it. YOU get to decide where you place your energy. If you are really going to be successful and have the practice you want, then you can’t waste time, or money, and to do that you have to understand what exactly your time is worth to you and your business.
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- Jeremy Larsen
Business Development and Practice Manager
Coherence Associates Inc.