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Apr 06, 2016

Staying Small to Grow Big

I’m on the phone with a gentleman (lets call him Dan) who owns a counseling practice in the Midwest.

He starts the conversation by describing some of his operational problems: “Anthony, recently some of my best counselors have left the practice. I have issues with notes not being completed. Our culture and team morale are low. We have lots of new clients schedule, but most don’t come back. And I’m losing money...”

After hearing his pains, I ask him about the size of his operation.

He says, “It’s a big practice! I have three location, 18 therapy rooms, 20 counselors... .”

I then say, “Dan, the number of employees and locations you have are only ‘vanity metrics.’ How many clients is your company helping a week? That is— how many sessions in total?”

Dan says, “About 165.”

“Okay, that means your practice is the equivalent of 5 full-timers.”

“... — Yeah. I guess so.”

I see this mistake all the time. Practice owners pay attention to “vanity metrics,” but they’re blind to the figures that matter. Dan and I spent the next 30 minutes exploring how the challenges he’s experiencing in his practice are directly related to his supernumerary size. I used one of my own practices as an example. Thriveworks Counseling Atlanta, for instance, started with a small number of providers to help stay efficient.

This month, as a nod to keeping things small, I’m going to keep my advice short and concise. Below are two areas were practices tend to grow too big, too quickly.

1. Counselors: Hire as few as you need to serve your incoming clients.

  • Your practice’s success is greatly dependent on the counselors you hire, and how you manage and train those counselors. Hire excellent clinicians who can be coached to exceed their own expectations.
  • Employing fewer clinicians means you can train your team well, manage well and keep administrative costs down.
  • As you cultivate high performance, you’ll have the ability to pay your counselors higher wages. This increases morale and reduces turnover.
  • Part-timers tend to be less dedicated to the company. They’re also more difficult to coordinate with for meetings, performance management and ongoing training.

2. Space: Keep your space as small as possible.

  • More office space is an expensive consequence of success, not a symbol of success.
  • A single therapy room can often accommodate in excess of 40 sessions a week.
  • If space is getting tight, consider expanding hours into Saturdays (and Sundays?) before you expand your office.
  • Maximizing office space is easiest when you have fewer counselors that are working more (and more consistent) hours (see above).
  • Opening a second location is often about vanity. When additional space is needed, first try to expand at your current location.

Regarding Dan, even at 165 sessions a week, his practice is a clinical liability that’s losing money. However, if he can right-size his operation, he’ll be able to improve patient care, monitor notes and billings, build a stronger team culture, increase pay to his staff and even pay himself for his labor.

Which counseling practice would you rather run — one with three locations and 20 employees, or one with one location and five employees that’s helping the same number of clients?
________________________________________________________________________
Anthony Centore, Ph.D., is private practice consultant for the ACA, founder of Thriveworks Counseling (with locations in 9 states), and author of the book, How to Thrive in Counseling Private Practice. Anthony is a licensed counselor in Massachusetts and Virginia. Find him on Twitter at @anthonycentore or @Thriveworks

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