Study Group Learning in Veterinary Services

– Spreading Best Business Practice

By Carson Taylor

Background – Economies of Scale

Economies of scale are a fundamental business concept that suggests that any business with fixed costs (costs that do not increase or decrease with revenue) should become more profitable as it grows revenue.

This industrial logic applies to groups of highly trained clinicians, whether they are human doctors, veterinarians, dentists, physical therapists, etc, because all of these businesses incur fixed costs. Rent is a prime example of a fixed cost in veterinary medicine.

Within veterinary medicine, many business functions – legal, accounting, finance, HR, etc. – are imminently scalable and tend to be inconsistently managed by DVM owners. The advantages gained by grouping clinicians or practices together to scale these functions so they can be provided at a higher quality and for less have been proven in the market by veterinary consolidators.

Scaling Best Practice

There is another strategic benefit of grouping together veterinary clinicians and veterinary practices. A group with many clinicians and practice managers may be able to make every clinician and manager better by disseminating clinical or business best practices from one clinic or doctor or technician to the next. Done well, this should allow the entire group to organically increase the average quality of every clinician and clinic. Whether the best practices apply to clinical elements or business elements, the basic premise is that clinicians or managers should be able to learn from each other under certain circumstances.

This is the holy grail of consolidation and the key to building a high-quality organization. It is not an easy feat to accomplish. It’s no surprise that I don’t see a lot of this happening in the veterinary market today, particularly among consolidators. It is much harder to create a company that is good at cross-pollinating best practices than it is to scale your accounting department.

Just owning a group of practices or introducing a group of individuals is not sufficient to spread best practices across the group of practice owners, DVMs, or other clinicians. The group members have to engage with each other and learn together. This is unlikely to happen without peer pressure, which creates accountability, a powerful motivator for anyone to stay engaged. The group members also need to trust each other. Members must trust that what they share will not be spread beyond those they share it with. This setting is unlikely to develop naturally but must be created by some structure into which everyone buys in.

How to Make Group Study Work

What do you need to form an effective study group that will deliver results for all its members? We’ve thought a lot about this as we’ve been building our technology, including the technology underpinning our Practice Management Groups (PMGs), a flagship offering with our Veterinary Practice Owner EcoSystem. Set and setting are critical.

The first condition is that you need to assemble the right group of peers. Each PMG is a small group (up to 20 members) of individual DVM practice owners committed to learning best business practices from each other. The resources each owner is willing to put into their group activities should be reasonably aligned. DVM-Owners with a lot of interest in improving their business practices will not make great peers for DVM-Owners with mild interest. Also, hospitals owned by the practice owners within a group must not compete with each other, a prerequisite for establishing trust and openness. There is no point in setting the stage to discuss business practices in detail if some participants are unwilling to share (for good reason). Finally, the practice owners within a group should face a similar set of business challenges. Practices with common business challenges may be in the same stage of ownership, focus on the same patient base, and / or have similar-sized businesses.

Setting a basis for comparison between group members establishes the mild peer pressure that can create accountability. Group members should track and report a standardized set of key performance indicators (KPIs). These KPIs create a standard set of facts. A standard set of facts allows owners to make comparisons and see the impact of their efforts clearly. Members who have not made a reasonable effort to improve will be revealed to the other group members and need to explain themselves, which most people would prefer to avoid.

The group must have ways to communicate and collaborate in a secure environment. Some of this collaboration can be virtual, and some should probably be in person. Synchronous communication (communication at the same time) such as zoom meetings should be used. But multiple channels for asynchronous communication, such as a chat-boards or messaging, within the same platform should also be available.

VMG built its Study Group programs using these key tenets. That program has been successful in helping practice owners learn best business practices from each other. I’ve heard from multiple contacts that Study Group members form lifelong relationships with their peers, who hold each other accountable for learning best practices together. Some of the best-run practices in the U.S. are study group members.

The issue with VMG is that while it has been around since 1984 it has just ~1500 members. There are 20K+ veterinary hospitals in the U.S., so as good as that Study Group solution may be, it is not nearly as accessible as it needs to be to help the practices that likely need the most help improving their businesses. VMG is also now owned by Covetrus, which bought the group for its buying group assets. Future investments to make the study group program more accessible are likely not in the roadmap at Covetrus.

How Our Technology Powers Study Group Learning

A few years ago, VetValue committed to building a group learning platform tailored to veterinarian practice owners. While we built the offering around the core tenets that make study groups successful, we thought we could also make group learning more accessible and more secure so that a wider variety of owners could participate with a greater amount of trust. We believe that what we have built is the only platform of its kind on the market.

Our Platform (VetValue’s Practice Management Groups) increases accessibility along multiple dimensions. We wanted any practice owner to be able to take something away from their participation. From solo practitioners just beginning the practice ownership journey to multi-practice owners nearing retirement, general practitioners in brick and mortar to mobile specialists, we believe all owners should be able to participate in a study group experience.

The cost of group study membership can be a barrier to accessibility. In our platform, joining and participating in group study costs very little and offers a very high return on investment, so any business owner can afford to try it without putting their business at risk. Higher-end services, such as data standardization, group KPI reporting, and valuation reports, can be purchased ala carte as desired/needed. While we believe these services help to make the group study experience more effective, they are strictly optional because budgets will vary.

The cost of collaboration can also be a barrier to accessibility. Attending an annual remote, in-person, multi-day event can be significantly effective but is not feasible for all practice owners. Our platform includes many integrated channels for owners to collaborate without needing to travel or mutually schedule. From virtual meetings, which can be hosted, recorded, and “snipped,” to private chat boards to group resource libraries, we have integrated every way we thought owners might seek to communicate and collaborate into our platform.

The cost of administration can create a barrier to accessibility. We built all the administrative tools we thought might be helpful to a group into our platform. Group members can propose and elect group committee members, schedule on a shared group calendar and apply as well as complete a group non-disclosure all within our platform. We still have human administrators to help groups succeed, but each can do more because we have built technology to empower administration.

Finally, we do not offer a one-size-fits-all approach in our PMG offering. Groups have significant flexibility in how they choose to conduct their activities. Some groups may choose to meet in-person every other year and virtually every quarter, others may choose a different cadence. Some groups may prefer a standard “curriculum”, others may prefer to create their own.

Individual members also have choices. We offer a chart of accounts that is based on the industry AAHA chart of accounts but can be easily applied with more or less detail depending on the resources a member chooses to devote to their bookkeeping. No member is required to adopt our chart of accounts, and we do not prescribe the purchase of any KPI reports or valuation reports, though we believe both make the group experience more productive.

All of these enhancements to the group experience and the technology that supports it recognize that individuals learn differently and bring different resources to the learning experience. We believe our focus on flexibility and accessibility, makes this offering value-add for any practice owner.

Giving Back and Independence

When building our technology, we wanted to facilitate giving back to the industry. In our minds, it is much better to give the industry what others might spend on a field sales force. To this end, we underpinned our ecosystem with an integrated system of referral credits that can be given to other members or donated to a veterinary industry charity. Members earn these credits through referrals. Our members choose the charities and peers that benefit. Some of these referral credits can be quite meaningful. Since inception, we’ve administered multiple five figure donations to animal health-focused charities. Every veterinary practice owner member can become a referral partner and begin to accrue credits, which our system administers. At the referral partner’s direction, VetValue makes the donations in the name of the referral partner (or anonymously).

Our ecosystem currently has no corporate sponsorship and is financed privately 100%. No corporates are allowed access, and we do not sell or otherwise share any data or insights we receive with any third parties. It is crucial, to us and to our mission, that we remain independent so we built a business model that does not require us to monetize our users’ data.

Create your vetvalue.pet ecosystem account to learn more. Use this link to earn a 40% discount on your first purchase in the system: https://app.vetvalue.pet/register?code=Xd91wE