by Lynn Grodzki, LCSW, MCC

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The Storm

Late Sunday afternoon, after two weeks of a record heat wave, we had a violent thunderstorm. The bad news: electricity went out and 400,000 homes and businesses went dark. The good news: once the storm passed, the sun came out and so did the neighborhood.

I get so busy with my life, it seems it takes an act of nature to remind me that I have a neighborhood of people I appreciate. I sat on my deck for hours as the afternoon waned and the sun set, and waved to people as they walked by, people I hadn’t seen in years.

I reflected on the topic of community and its importance.

During this time of economic uncertainty, I am reminded each day of the scarcity of resources.

But the resource of connection — with community — is free. Having a strong professional community can build your practice, but sometimes attending a professional group feels like a waste of precious time.

So I wondered: What is the best strategy to finding or creating a community that really supports your life and your work?

Communities of Practice

Since time and energy are precious resources,  I only join communities that offer me meaningful opportunity and learning. This type of community is defined as a Communities of Practice (CoP.)

According to cognitive anthropologists Jean Lave and Etienne Wenger, a Community of Practice is a group made up of like-minded individuals who share an interest, a craft, and/or a profession. Key to the success of these communities is the process of sharing information, learning, and developing opportunities.

In order to be a CoP, the group needs to accomplish the three criteria. (If you have been attending a professional group or association that feels like a poor use of time and energy, chances are one of these criterion is missing.)

1.    Commitment

A CoP requires commitment from its members. This devotion and willingness to show up is based on a deep interest in the topic or experience delivered at each meeting.

When a CoP is focused around  an area of passion or intense interest, it  provides value for all. As members develop a deep connection to the group and get a lot, they give a lot in return — sharing their thoughts, ideas, and even talents with each other.

Too often, we belong to professional groups that are superficially interesting or we think should be important, and then end up disappointed and bored.  The  group lacks dedication, or the topic is not one we feel passionate about, and too little learning and sharing occurs.  CoPs are exciting and inspiring to attend.

2.    Competence

CoPs are groups of equals who are skillful and talented. They have something to offer each other. You join to learn, help, and share — not to compete. As a result, the members often develop longterm relationships that matter.

While members of a CoP do not necessarily work together on a daily basis, when they do meet it is often memorable: They discuss, challenge, wonder, argue and usually laugh together.

A classic example of a CoP might be Parisian artists in 1870’s, the Impressionists, who formed loose associations of café communities to talk, share, learn from, paint with, and inspire each other.

3.    Practice

CoPs are places of learning because the members are implementing ideas, not just ruminating about concepts.

As Wenger explains, “A CoP is not merely a community of people who like certain kinds of movies, for instance. Members of a community of practice are practitioners. They develop a shared repertoire of resources: experiences, stories, tools, ways of addressing recurring problems—in short a shared practice. This takes time and sustained interaction.

“A good conversation with a stranger on an airplane may give you all sorts of interesting insights, but it does not in itself make for a community of practice.”

(http://www.ewenger.com/theory)

CoPs in My Life

If you would like to find or create a CoP, you might use this article as a blueprint to create a group that meets this definition. Let me offer you a few examples of CoPs to which I belong, so you can understand how they work for a me — and can be a resource for you, too.

* * *

One CoP I attend is the faculty forum of a coach training organization.  (Some CoPs exist within associations and organizations.) We (the faculty) meet by phone for an hour, once a month. The group is led by our creative training director who is explicit in her respect and appreciation of the faculty who call from around the globe.

Each month she poses a different, thoughtful, open-ended question for us to consider and discuss. This group has been meeting for years and I am continually motivated and engaged. It keeps my coaching skills on the cutting edge and gives me a virtual connection to a group of very accomplished colleagues.

* * *

Another CoP is one I helped create years ago – a group of women therapists who met monthly for 8 years. Our sharing was intimate and supportive, often more personal than professional, but always fascinating. It generated longterm  friendship, shared collegiality, new ideas, and of course, the occasional referral.

* * *

A third CoP I eagerly await each month, is an intuition study group. A half-dozen doctors, healers, and therapists meet for 2 hours a month, in person, to work together in our pursuit of better understanding and utilizing the way we apply intuition in our practices. We experiment, do blind readings, practice, read and research — sharing our results and questions. We have met for years and each meeting is inspiring, has benefited me personally, and enhanced my professional work on many levels (including becoming a rich resource of referrals for all involved.)

Where to begin

If you are looking to create a Community of Practice, here are some tips:

•    Start with a clear area of personal or professional need (What would you love to learn, practice and share with a special group of others?)
•    Start small and grow over time (it’s easier to manage)
•    Define clear goals and boundaries for the CoP
•    Invite others who can commit to its success
•    Celebrate contributions and appreciate each other regularly
•    Be prepared to adjust the group and goals as you develop and learn

I know that this recession has legs and many of you are feeling its effects in a lower client count, less income, or just working harder to stay even.

In my new book, Crisis-Proof Your Practice, I show readers a simple yet effective 4-step plan to keep a private practice strong in a down economy.

My idea was that since time is a factor in a recession, I could help others to get moving and adjust to a changing marketplace before it took its toll on a small business.

Unfortunately, some of us in private practice are slow to respond when it comes to changing the way we do business. Many of my colleagues tell me that making change in business is hard and it’s taking longer to adjust than they wish.

Some rationalize that they can operate as before and ride things out.

It’s Time to Take Action

The recession is going to stay with us for a while. The time to make necessary  change in your practice is now.

It’s ironic that we change agents find it so difficult to change our own practices — but we know from the research in the field of brain science that this resistance to change is universal for a reason. The human brain hates change.

Holding to the tried and true gives us a false feeling of security, and competence, even if our income is slipping away.

So often I hear the owner of a practice say, “I know what I need to do but I can’t get myself to do it.” There is a reason we procrastinate. You need to take action steps, but first you may have to work with your mind.

If what stops you from being more successful in the business of therapy (or coaching, or consulting) is a factor of your mindset, specifically, your willingness, then its time to ask yourself: What do you understand about your own mindset when it comes to willpower?

Willpower in Short Supply

Most of us procrastinate, but not because we are bad, lazy or crazy.

Recent studies about the brain show that willpower is not abundant or plentiful. Instead, for most it is a rare, often limited quantity that we need to learn to cultivate.

Once you understand the limitations of willpower, you can actually boost it up, so that you can take small, consistent action steps to keep your practice strong over time.

The Business of Change

Now, like many of my readers, I am in the business of helping others to make change – both large and small. I have worked as a therapist for over 20 years (and still maintain a therapy practice) and as a business coach for a dozen years as well.

I often get surprised by who changes and who doesn’t.

There is an X factor to change, and I think it is willingness.

As a business coach, I have worked with men and women of all levels of professional experience, and as best as I can tell, who prospers and advances their practice and who does not doesn’t correlate to gender, age, or years of experience.

Instead, it has to do with a person’s desire and courage to make things happen. Willingness is a precious commodity.

You need to understand how it works in your brain and then spend your limited willpower “budget” wisely.

Training Your Brain

Sandra Aamodt, the editor in chief of Nature Neuroscience, and Sam Wang, an associate professor of molecular biology and neuroscience at Princeton, explain that the brain’s store of willpower is quickly depleted.

People who successfully accomplish one task requiring self-control are less persistent on a second, seemingly unrelated task.

Aamodt and Wang posit that willpower can grow with practice, but it requires body resources to grow – specifically blood sugar.

Neurons in the frontal cortex, which is responsible for planning behavior, or in the anterior cingulate cortex, which is associated with cognitive control, use blood sugar more efficiently after repeated challenges.

But there is also a use it or lose it component to willpower.

Like a muscle, you need to keep exercising willpower to have access to it in your life and work.

Here’s Where It Gets Interesting.

I want to show you how to work with willpower in your brain and in your practice.

Boosting Your Willpower

Aamodt and Wang explain that like a muscle, willpower can grow in the long term, if you use it more and more and if you understand that you need to “feed” your brain and body between uses with rest and nutrition.

Like a muscle, willpower seems to become stronger with use.
Aamodt and Wang suggest that what limits willpower may be blood sugar, which brain cells use as their main energy source and cannot do without for even a few minutes.

Whereas most cognitive functions are unaffected by minor blood sugar fluctuations over the course of a day, the functions of willpower – such as planning and self-control — are sensitive to such small changes.

“Exerting self-control lowers blood sugar, which reduces the capacity for further self-control. People who drink a glass of lemonade between completing one task requiring self-control and beginning a second one perform equally well on both tasks, while people who drink sugarless diet lemonade make more errors on the second task than on the first. Foods that persistently elevate blood sugar, like those containing protein or complex carbohydrates, might enhance willpower for longer periods.” (“Tighten Your Belt, Strengthen Your Mind” New York Times, 4/2/08)

Willpower in Action

Think of exercising your willpower as both a boon to meeting your goals as well as a training process, like business boot camp, where your overcome one challenge as a way to become stronger in general.

For example: If you know that referrals are down in your practice, and you have been reading past newsletters or my new book, you know the steps to building a larger and more potent community around your private practice.

How willing are you to make this happen?

Will you plan for the actions (that I spell out in detail in the new book) and take the time in your busy life to accomplish the steps?

To do this you will need to:

1) Focus on actions one at a time (limited supply of willpower)

2) Rest after each series of actions and “feed your brain” with healthy food to boost your blood sugar.

3) Repeat to build your willpower “muscle” over time.

Factor in your willingness to every business strategy. This is the secret ingredient that will help you to better manifest your goals and empower your action plan.

You may need more support. Accountability helps.

Hire a coach, form a circle of like-minded peers, or ask a trusted friend to track your progress. Your support system needs to be positive and accept your agenda.

You need people to cheer you on for every step you take in the right direction, and hold you accountable for your commitments when you are procrastinating.

It’s normal in business to have a support system of this type in place. Once you have it, and master the willingness factor, there is little in business (and in life) that you can’t achieve.

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One problem with a private practice is just how private it can become.

Many therapists, coaches, consultants, and other helping professionals who offer valuable, important services remain an unintended secret to those who could benefit from them most.

Today, many service providers face two market challenges: the recession and competition. In a recessionary or down market, it is essential that you become visible. If you are dealing with competition, you need to stand out from the crowd.

If You Hate Marketing

Marketing may be the most hated word in private practice. Most of my clients tell me that they can’t stand marketing their practices. For them, any marketing is synonymous with push marketing — shameless advertising, overpromising, promoting, or seducing — the direct opposite of the healing relationships they are trying to build. They don’t want any part of it.

But you can leverage your marketing efforts (leverage = learning to do a lot with a little) by applying two steps:

1) Find the need in the market
2) Stay within your comfort zone.

Here’s how:

First, Find the Need

During difficult economic times, people purchase based on need.

Who needs your help? My colleague Ben Dean, founder of MentorCoach suggests the following considerations, amongst others, when assessing your market. (“Niche criteria for a successful coaching practice” by Ben Dean, 2000. Read the full article at: http://www.mentorcoach.com/coaching/niche-criteria.htm)

•    Burning need. If there is an intense, perceived need for the niche in the minds of your prospects, the more quickly will the niche respond to your efforts.
•    Underserved. All things being equal, a practice will grow faster in an underserved industry than in a highly developed one that has many vendors trying to meet the given need.
•    Precedent. Are there already successful businesses operating in this niche? Some of the risk is reduced if you know there are others that are successfully targeting the niche on a local level.
•    Be first. Take a successful concept and narrow it further, to be seen as first in the field.
•    Discretionary income. Can your prospective clients pay for your services out of pocket? Does your niche fall under the list of services that sell, even in a down market? (See chapter 6 of Crisis-Proof Your Practice for a list of services that sell.)
•    Coherent group. If members of your proposed niche feel they belong to a coherent group you’re more likely to have niche members forward your promotional material to others and generate word of mouth marketing.

Stay in Your Comfort Zone

Unlike other business marketing coaches, I never want you out of your comfort zone when you are presenting your practice to others. Being frightened, or any version of a deer caught in the headlights, is not a good look for you when meeting the public.

Instead, do what comes naturally.

I know many may feel that no marketing strategy is natural for them. But after working with thousands of your colleagues, I have seen that if you stay within your normal behaviors and just learn to stretch a little, you, too, can be very successful in becoming more visible and better known within your community.

What do you do naturally to connect with others? If you can talk, write, listen, ask questions — then you can be very successful marketing your practice. In other words, you only need to be yourself as you build more connections with those outside of your office walls.

Small steps really do count.

Here is one simple strategy that has helped others based on a gardening metaphor.

Seed Relationships

Be a gardener of relationships and plant marketing “seeds” in your community that will flower, over time, into a rich diversity of networks, opportunities, and client referrals. Here is how this works:

One psychotherapist moved to a small city 2500 hundred miles from her previous practice and had to start over, rebuilding her practice, knowing no one.

She used the garden model by deciding she would meet a new professional in her community each week for one year, for a total of 50 new contacts.

How to begin this task? She made a list of 50 types of professionals that she wished to add to her rolodex — a careful printer, a wonderful acupuncturist, an experienced massage therapist, a noted financial planner and, by asking around to friends and family, filled in one name for each profession.

Then she made it a point to meet each person on her list, one at a time, by phone, sending a letter, or face-to-face.

She introduced herself, explained that she had heard about the professional’s good reputation, and wanted to build a strong rolodex for future clients who might need additional services or referrals. Each professional was flattered to be added to her rolodex, and by the end of the year she had seeded fifty relationships, who were now part of her new network – and of course many of them wanted to know about her practice as well.

With time, 10% of this group (five) became very good referral sources. This is a good result, to get a 10% return on time and effort for a practice.

More Marketing Strategies

In my new book, Crisis-Proof Your Practice, I show you how many strategies to use in this economy to:
•    Keep your practice visible.
•    Make the value of your services explicit.
•    Convert effectively. All marketing is basically a numbers game: the conversion rate (the difference between the number of potential clients who may hear about your services versus those who will follow through and become actual clients) is at best 5 to 1.

In the new book, I show you exactly how to do this and more! Read the first chapter here.

I get lots of great questions by email — each newsletter I will try to answer one.

Q: I find myself bogged down or lifted up weekly simply by the number and quality of clients. One week new clients contact me and everyone shows up. Next week may be cancellations, no shows and no new prospects. I hate the roller coaster ride …any advice?

Lynn: The ups and downs of uneven client count is normal, but sometimes hard to stomach. Some of us are not good sailors and when we feel the rolling of rough seas, we get nervous and worried.

Seasoned business owners and sailors know how to ride out these bumps and stay focused on the destination or big picture.

Here are two tips recommended by a sailor-friend which can help you stay resilient and keep your practice feeling that it is on an even keel, even during inevitable ups and downs.

1. Make your practice seaworthy: When sailing in rough waters, our friend the sailor checks that gear is simple and uncluttered onboard. When you hit rough water, it’s best to have less to attend to. Getting uncluttered mentally and physically in the face of business turmoil makes good common sense.

Make space daily for mental downtime. Clear your brain. Relax with a hot bath. Take a walk. Schedule time for office uncluttering. Get as organized and efficient as possible, to help you feel some internal degree of control. Clean out files; collect unpaid receivables; don’t procrastinate.

Then you can feel calmer and in control of that which is controllable. You can’t control the flow of business, but you can control the internal state of your mind and your practice.

2. Heave to: When my friend is sailing in very rough waters and the ride is getting uncomfortably bumpy, sometimes she sets the sailboat to a “heave to” position. She holds a set course, but allows for some natural drift to occur.

Here’s how to adapt this for private practice. Focus on your goals, but anticipate and tolerate some drift.

For example, what is your desired client session and/or income goal for the year? Where is your practice each week in relation to these goals?

One of my clients determined that to meet her annual goal she needed to see an average of 20 clients a week. Some weeks she has 30, some weeks she has 10.

As long as she is tracking her progress over time, she can stay assured that she is going in the right direction.

Anticipate the drift. Clients come and go. The practice is bursting and then there is draught. You can minimize the ups and downs by having cancellation policy and a marketing plan that tries to keep the client count steady, but you can’t eradicate this completely because nothing is wrong. This is simply how a small business behaves.

All that is needed, for those of us who want to be in private practice, is to develop a strong stomach and flexible sea legs!

(These strategies are adapted from those in my book, The Business and Practice of Coaching by Lynn Grodzki and Wendy Allen, WW Norton, 2005).

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In last month’s newsletter, we examined the concept of leverage. Leverage, at its purest sense, means using something that multiples the outcome of your efforts – as though you were using a lever to lift a heavy rock.

For those in a private practice, leverage implies that you know how to do a lot with a little.

Today, many of us in practice either need more clients or more ideal (better) clients. But finding good clients often takes significant time, energy, and expense.

This is a good place to use leveraging, so that you can find clients with the least expense possible.

Today’s Best Strategies

Most marketing consultants think that the best strategies for finding ideal clients are ones that you may already be using: the Internet and Networking. But are you leveraging these solid strategies for finding clients? (If not, I will be showing you how to leverage these two traditional strategies in the May and June newsletters.)

But in order to use these strategies, there is one piece of preparation I need you to consider first. I want you to define your Strategic Focus, the “sweet spot” of your practice.

Essential First Step

If you play tennis, you may notice that there is a spot in the center of the tennis racket, the sweet spot, which can return the ball furthest, with the least effort from you. The term is now used in other fields to indicate any solution where a combination of factors produce a favored outcome.

Your practice can have a sweet spot – your strategic focus — that represents the best balance of your business. Finding your strategic focus is the first step before developing your leveraged marketing plan.

Finding Your Sweet Spot

Jim Collins, author of Good to Great (2001), offers a simple exercise to help you find the strategic focus for a small business. I adapted his exercise in my new book (see below) to help my readers set a clear, quick, and powerful vision for their practices during a time of economic uncertainty.

It works by clarifying what you do best, what you are known for, along with what is most profitable. Your strategic focus helps you to keep it simple by doing one big thing well, as you ride out a difficult market.

Take a minute and complete this exercise:

1. Draw three equal-sized circles that overlap or intersect with a common center: a Venn diagram.

2. Assign colors or letters to each circle to keep them separate

Identify each circle by color and purpose:

Circle A is the soul of your practice: Inside this circle, list those services that you’re passionate about offering.

Circle B contains your brand: Inside this circle, list the aspects of your practice that connote your expertise, reputation and excellence.

Circle C is your economic engine: Inside this circle, list the services or products that are consistently profitable and generative.

3. The point where the three circles intercept — where passion, brand and profitability overlap, will become the new strategic focus of your business.

Now let’s talk about your results.

Stop Spinning Your Wheels

This simple exercise, getting focused by prioritizing the 3 key aspects of your existing practice and finding the focus for the future, can force a business owner to face reality and make needed changes.

By finding your sweet spot (your strategic focus), you can:

• Stop spinning your wheels or spending time in areas of your work that don’t yield profit, passion, or build your reputation
• Decide how and who and where to market for the most impact
• Know which aspect (service) of your practice you need to enhance, and which to leave alone

Focusing your practice is a process. Take the time you need.

But …if you are ready to do more marketing to grow your business, take this step first and get focused.

Private Practice Success Newsletter, March 2010

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If you read the news lately, you have probably read the term “leverage.” Many banks leveraged their debt using borrowed money, and this resulted in adding to the financial crisis. But there is a broader meaning of this business term that can help you right now.

Leverage at its purest sense means using something that multiples the outcome of your efforts – as though you were using a lever to lift a heavy rock. Archimedes said “Give me a lever long enough and a fulcrum on which to place it, and I shall move the world.” For those in a private practice, leverage implies that you are savvy enough to do a lot with a little.

Today, many of us need some leverage. Like Archimedes, we want to make life easier and better for ourselves and those around us.

I talk with many therapists, coaches, consultants and service professionals each month from across the US and beyond. The complaint I hear repeatedly from these business owners is how exhausted they are. Private practice can be hard, especially in a recession, and the burden of the practice falls squarely on the business owner’s shoulders.

In my coaching sessions with clients, we spend a lot of time looking at what the business needs, such as: clients, organization, cash flow, staffing. But when I ask these same clients to tell me what they personally need, their answers are always the same. They say:

• I need more energy
• I need more time

In this newsletter, we will explore how to leverage both of these needs, to help you have more with less effort. Then next month, in the April newsletter, I will show you how to leverage some of the essential needs of your business. First, let me show you how to use leverage to have more energy.

Build More Energy

Even if you have a healthy lifestyle, as a small business owner you can feel depleted. A private practice is like a demanding toddler – one who always wants you attention and efforts.

When you feel exhausted by the needs of your practice, writer Julie Plenty (www.selfgrowth.com) offers an important key for shifting exhaustion:  First, release resistance.

Resistance is the friction we feel when we fight ourselves, often fighting our inner judgments. You think: I should be able to finish the billing tonight, but I am too tired. As Plenty explains, resistance often feels as though we are going against ourselves in order to satisfy some internal authority or a myriad of “shoulds” “oughts” and “have tos”. It takes a lot of energy to stay resistant.

What do I suggest? Relax into the exhaustion. Feel it, understand it. Don’t resist. But then refocus. Ease out of the exhaustion by refocusing your thoughts and actions. What do I suggest you focus on? How about small steps of accomplishment? Focusing on any movement of your accomplishment can be an effective way to grow your energy.

Treasure any and all small steps – they eventually lead to big wins. Appreciating small steps boosts energy. This is why small steps count, each and every day.

Small steps might be thinking about inspiration: Who have you helped today? Or challenge? What did you do that was hard and even scary? When I ask my clients to tell me what they have accomplished between our sessions, I hear a long list of creative, effective small steps. The more I validate and celebrate these accomplishments, the more energized they feel, even in the moment. List your small steps, validate your accomplishment, and leverage your energy. Do this for yourself each day.

Have Enough Time

Time is my most valuable resource. I know I am not alone in feeling this.

One client agrees, saying, “I wish that there was more than 24 hours of a day. Between seeing clients, doing my administrative tasks, taking care of my family, and trying to have a personal life, I always run out of time. How can I do everything?”

I admire those very successful entrepreneurs who get a lot done, and have a good time doing it. They usually don’t talk about the lack of time; instead, they have strategies for leveraging time.

You need some strategies to do this too. Here is one that many of my clients say has helped them feel more abundant when it comes to time. Have enough time for everything you need to do.

One way is to rely on a calendar to devote concentrated blocks of time to each activity, instead of doing things piecemeal.

With so many demands on your time, you can’t be cavalier or casual about your scheduling and expect to feel in control.

My calendar is carefully scheduled with blocks of time each week that include seeing clients, writing, exercising, spending time with friends and family, and blocks of downtime for relaxation and reading.

A system taught to me years ago by coach and entrepreneur Jeff Raim, helped me think about time management in blocks. His calendar had three types of time blocked out each day: “work” “buffer,” and “spirit.”

• Work means activity that brings you both joy and money.
• Spirit means time that replenishes your soul and increases your energy.
• Buffer is a catch-all phrase meaning everything else.

When Jeff showed me this system, I blocked out my calendar and realized that my days were mostly work and buffer time, no spirit blocks showed up. This has changed and my time feels better managed and I am much more energized.

Finding the Time

Mary, a busy owner of a group practice, complained about having no time.  Her mother had recently become ill, and she said she was torn between the office and the hospital. I suggested that she look at her calendar in terms of work, spirit, and buffer time. Using these categories, she had nothing but buffer. Her work did not bring her joy, she said, so she counted the time spent at the office as buffer. This became part of our coaching goal, to help her find more satisfaction in her work.

But a larger problem as I saw it was that she had no activities scheduled on a regular basis that would fit the spirit definition. This was a formula for burnout, overwhelm; when so much buffer energy and effort goes out,  so little joy or nourishment comes back.

I gave Mary some tough love coaching. “Mary, you are the primary asset of your practice. So much rests on your shoulders. As much as you need to do to keep the practice running and take care of your mother, this can’t last. Your homework is to put an hour a day of spirit time into your calendar. It must be put in at the same time each day. It is sacrosanct and nothing can interfere.”

Mary hated this assignment. “Instead of having more time, your assignment means I have even less,” she argued.  But I was clear that without spirit time, she would not achieve any of her other coaching goals.

She finally found a way to carve out an hour a day – from 4:30 AM to 5:30 AM each morning! She got up and in the quiet of the morning, had a cup of tea, turned on soothing meditative music, and did some yoga poses.

This spirit time became her lifeline during the coming months as her mother got more ill and her practice took a dip from the economy.

“My spirit time is essential to my well-being,” she told me one day. “It’s mine. All the rest of my time is spent giving to others, my staff, my clients, my mother. But that hour in the morning, that is when I give to myself. I finally feel like I have the time I need in my day. Nothing changed except me and the way I handle time.”

Your Turn! Leverage Your Time

1. Schedule blocks of concentrated time in your calendar.
2. See if you can use the categories of work, buffer, or spirit.
3. If those are not right for you, create your own. Notice the degree of internal support you feel when you are taking care of yourself in this way.

Debbie Devine, LPC, Rockwall, Texas
www.devinerelaxation.com

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After reading an article by one of my favorite authors, Malcolm Gladwell, in last months New Yorker Magazine (1/18/10), I want to examine an important strategy to consider for these uncertain times.

Gladwell’s article is called “The Sure Thing: How Entrepreneurs Really Succeed” and using research and examples of famous entrepreneurs, such as  Ted Turner, he shows that contrary to myth, successful entrepreneurs are not always daring risk-takers.

The most successful business people are actually risk averse; they don’t put their personal or professional assets in harms way to make a profit.

In my new book, Crisis-Proof Your Practice, I wrote about how to evaluate risk in the chapter titled “Protecting Your Practice.”

After reading Gladwell’s article and with the recession still in process in the US and Europe, I want you to consider adopting an essential, risk averse position.  Here’s why:

Don’t Be One of the Practices That Will Fail This Year

Building a small business is hard and risky, even in the best of times.

Small business survival rates consistently suggest that even in a health or educational service business, 50-65% will fail during the first five years.

A large percentage of small businesses fail, and the creation of a business built on “intangibles” – services that are hard for the public to define, explain, or measure – adds to the difficulty.

When the market is tough, it’s essential that you evaluate your level of risk. By risk, I mean both what you do and what you don’t do that can threaten the survival of your private practice.

But risk is a two-edged sword.

You may think that curtailing all investment into your practice right now is the best way to avoid the risk of economic failure. But not investing in your private practice, not giving it enough time, money, energy, opportunities, or brainpower –is a way to threaten its survival.

The Top 6 Steps to Reduce Your Risk

Risk reduction is a term that means evaluating the dangers and then minimizing the severity of the loss or potential loss.

For example, one basic method of risk reduction in your home is smoke detectors that will warn you of a potential fire.

Risk reduction in your business includes these 6 steps:

1) A written business, marketing and financial plan that will help you evaluate and track the state of your practice at any given time.

2) A cash reserve to cushion the operating expenses of your practice. Each practice needs a minimum 6 months cash reserve to help you sail through especially tough months and still pay your basic operating expenses.

3)  Self care for the business owner so that you as the primary service delivery person don’t get sick, exhausted and unable to work, market and fulfill responsibilities to clients.

4)  Complete record keeping by the service professional and written treatment planning. Data counts. Know your limits and strengths with clients. Transfer those who are not a good fit for your strengths.

5) A plan for worst case scenarios. Try to average out losses over time (the bad winter month gets incorporated into the overall profit and loss statement for several months or a full year, to try and amortize the loss.

6) Maintain insurance including malpractice insurance, rental insurance, and life insurance on partners or associates if their income is critical to the operating income of a practice.

The Secrets of Successful Entrepreneurs

Gladwell says that successful entrepreneurs read the market, see the opportunities, take bold action, but don’t take unnecessary risks with their own capital or with their professional positions.

Instead, they pursue the “sure thing.” They look for ways the market is underserved and fill those needs. Writing a business plan is a must, and buying an existing practice may be less risky than starting up a new one.  They do their marketing consistently.  They compete on value, not just price. The list goes on.

The greatest risk, according to Gladwell, one that unsuccessful entrepreneurs forget, is to prepare adequately or think ahead.  Some risks are unavoidable but many can be anticipated and resolved.

{previously published in the Private Practice Success Newsletter, Dec 2009}

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Billy Joel wrote a song called “New York State of Mind,” an ode to returning to the East Coast after many years in LA.  Many of us in small business are in a “Referral State of Mind,” missing the frequency and reliability of referrals past.  Read on to see how you can increase referrals with grace, during this season of giving.

Who doesn’t love a referral? A client referral from a colleague or professional contact is always prized. Referrals infer trust and goodwill. With a referral, building the initial client connection is easier; the work of therapy, consulting, or coaching can begin right away.

But many of those in private practice have noticed a drop in referrals during the past year, as the recession takes its toll on our businesses. Even in a difficult economy, there is more that you can do to elicit referrals. Here is one strategy to incorporate into your practice-building efforts now that fits into the season of Thanksgiving.

Marketer Bill Cates says that building a business based on referrals is a mind-set. You must become an expert at not just getting referrals but also giving referrals.

Karmic Marketing

Karmic marketing means: What goes around, comes around. In my newest book I call this a “Give to Get” strategy of networking. When business is slow, think:  Who can I connect with and what do I have to give?

Over time, giving to others in your network leads to opportunities and referrals. At the very least you will generate good will, an important cornerstone of a viable business. Read on to see how this works.

My friend Cathy Lange, a leadership and executive coach, has developed the “Give to Get” strategy into a way of life. Cathy seeds many of her professional relationships with the idea of giving. “When I meet someone, I think about how I can be of help, long before I ask for anything,” she explains.

What does Cathy have to give? “Well, I love to take people out for lunch. I offer resources, referrals, open my rolodex. I can spend time, give free advice sometimes have some expertise that makes a difference. I might send an article, invite someone to a networking event, connect them to other resources, make introductions.”

The Give to Get strategy does not mean that you “give away the store.” But you can gift others with a “taste’ of your services as a way of reaching out.

During Thanksgiving week, one massage therapist I know gives free 15-minute massages to those in his business network. “Everyone is so stressed. I just want to help out those I can. I put out the welcome mat on the Friday after Thanksgiving. My colleagues can stop by, chat, and get a mini-back massage. Its fun for me and as they get to know and trust my services, they send me referrals. I don’t offer the mini-massage for that reason, but I welcome the result.”

Giving to Get

One veteran social worker gives back to her local community as a parent. Since she has children at home, she volunteers time at their schools and at the neighborhood soccer team. She gets known through these channels and develops relationships with other parents and teachers. These parents and teachers are her friends, not potential clients. But they need services and she finds herself making a dozen referrals each year to other therapists and health professionals.

Then those professionals reciprocate in kind, because she knows how to ask for referrals back, to keep her business network reciprocal and mutual.

Try this:

1) Create a diagram of concentric circles and place your practice at the center.

2) Name each circle to reflect the links to existing communities that surround your practice now. One may be your geographic community (neighborhood), another may be your professional community (clinical societies, business associations), others may be related to shared interests (sports, arts, volunteer, religious, social).

These do not need to be communities that you currently take part in, only communities that exist. Add as many circles as you need to represent the position of your practice.

3) Pick one circle. Think how to add value to that circle. Don’t contribute money–get personally involved and give something of yourself to this community for the purpose of improving your world. Feeding the circle will enrich your immediate environment, one form of reciprocation.

4) What gifts do you have to give? To get referrals, give referrals.

When referring to other professionals, make sure you establish a reciprocal relationship by explicitly asking that the favor be returned.

5) Other gifts to give? Time, energy, attention, a listening ear, asking good questions, a warm presence, business ideas, humor and lightness, and brainstorming.