Residual Based Theory Drill

The Masters of Marketing Administration is an educational advancement for training of business owners and their administrative and support staff on the Viva System—a system that puts in place the
ideal residual business model for consumer
acquisition, loyalty and retention.
Copyright © 2016 by Gregory Hughes, Viva Concepts, LLC. All rights reserved. This book or any portion thereof may not be reproduced or used in any manner whatsoever without the express written permission of the publisher except for the use of brief quotations in a book review. Printed in the United States of America. First Printing, 2016


Final Exam Learning Drill
Instructions for Administering the Learning Drill Exam
Read all the instructions below before administering the Learning Drill Exam. The procedure is precisely followed and brings the student to a high level of understanding of the subject studied.
What is a “Learning Drill?”
A Learning Drill is a set of questions to test the knowledge on the course taken by the student. The questions, and the correct answers, in the Learning Drill are always taken from the course manual.
The Way the Learning Drill works:
The student chooses a partner from the training room. The partner administers the Learning Drill to the student.
The Partner starts at the rst question and simply reads the question out loud. The student answers the question.
If the answer given is incorrect or incomplete in any manner, the person administering the Learning Drill Exam says, “That is incorrect,” and then reads the ANSWER out loud to the person taking the exam. This gives the student the correct answer every time he or she answers incorrectly.
If the answer given is correct, then the person administering the questions say, “That is correct,” and goes right on to the next question.
If an answer is INCORRECT, the procedure is to just continue through the learning drills, asking the next question, then the next until all questions are complete.
Learning Drill Procedure
The Learning Drill Administrator starts at the beginning of the questions and continues to go through each subsequent questions until the student gives a correct and accurate answer for every question. The Administrator always proceeds to ask every Learning Drill Exam question. Whether the student’s answer is incorrect or correct, the Administrator continues through all questions. This is done over and over, until the student gives the correct answer for each question. If the student misses one question, then all Learning Drill Questions are then asked again. If it requires going through the Learning Drill 5 times, 10 times or more, the drill is continued until the student gives a complete and correct answer for each question!


Rules to Follow When Administering the Learning Drills Exam
Each answer must be a complete and full answer to the question. The response from the administrator of the exam to any partial answer is always, “That is incorrect,” with no exceptions.
The student’s answer to each Learning Drill Question should match the answer in the learning drill. It does not have to be word for word, but the concept must be 100% correct and any answer to a question that contains a sequence, must always be answered in the correct sequence.


Learning Drills Questions & Answers Final Exam
The fundamental growth of any business is dependent upon application and use of the four business laws. Explain each of these 4 laws.
1) Consumer Acquisition: Every business will always have to acquire new consumers to continue to expand. Why? Because existing consumers are lost every month from the company’s database.
2) Consumer Sales: Once a business acquires a consumer the business must sell its service(s) or product(s).
3) Consumer Retention: Once the consumer has purchased something then that same consumer is entered the company’s database for future purchases. This law is at the core of every businesses growth potential.
4) Consumer Experience: A positive experience with the service or product generates reviews and referrals. This is far more powerful than it appears as referrals are the lower cost of consumer acquisition.
The most important aspect to improve case acceptance in any practice is through an understanding of the four business laws and how they interrelate. Explain why?
Specifically, when a patient enters a practice and receives his or her diagnosis, much of the diagnosed work is done at a future date due to patient limitation of fi Nance, ceilings on their insurance, fear of doing the procedure and so on.
What percent of treatment plans remains incomplete in dental o ces across the country?
The incomplete treatment in dental offices (sitting in the patient files) across the country averages 60-65%.


Growing the active database controls the growth of any business and its long-term increase in both the size of the business and the volume of its revenue. Draw the diagram that illustrates the 4 business laws and their relation to the growth of the database.
What are the two most workable methods for acquiring new patients?
1. Internal Referrals
2. External Marketing to accomplish neighborhood ownership
What is the national average for the cost of acquiring a new patient?
The national average cost of obtaining a new patient is $250.
What is the ONLY method to lower all marketing costs?
By obtaining referrals: The cost will of acquiring a patient is reduced by 1/2 by obtaining a referral.
If a 2nd generation referral is obtained then the cost of acquiring a patient drops to 1/3rd.


Why does the Vivapak put word of mouth on steroids to leverage your patients to refer friends and family?
The Vivapak, due to its uniqueness, remains in the home with a shelf- life month after month which creates the highest response to word of mouth referral.
Explain the de nition of a geo-fence
A geo-fence is a virtual perimeter for a real-world geographic area. A geo-fence could be dynamically generated—as in a radius around a store or point location, or a geo-fence can be a predefined set of boundaries, like school attendance zones or neighborhood boundaries.
Source: Wikipedia
What percent of the patient base is in the geo-fence of the o ce?
The geo-fence is where 90-95% of your consumers (or patients) are located.
What is the only type of external marketing to create neighborhood ownership?
The only method to rapidly identify your business by people in your local neighborhoods is through neighborhood mailers. Direct mail (neighborhood mailers) surpass every other type of marketing.


What does “Tail of the Kite” mean in relation to the marketing e orts of the o ce?
In using the “Tail of the Kite” you are capitalizing on the millions of advertising dollars to “identify” or “locate” your office in an instant!
Draw the “tail of the kite” to show your understanding of how this works.
Unquestionably the most workable method of obtaining neighborhood and community ownership and market share is through repetition
of direct mail. Direct mail however can be ine ective without an understanding of 4 KEY factors. What are the 4 key factors?
1. The offer
2. A high open rate (must be aesthetic)
3. Repetition of mailings: a minimum of 4 mailings a year to the same addresses
4. Call conversion
What are the two Guidelines for choosing an o er?
1. An offer should not be priced above the specials already being offered in the local area.
2. The Offer must address a broad public, not a niche. The services consumers are most aware of in the dental industry are cleanings, braces and teeth whitening. Offers on these services hit a broad and large public, versus an offer on an implant, dentures or root


canal. These last types of services hit a very small portion of the population causing a lower response rate and far higher marketing costs.
How often do you mail to the same mailing list in a neighborhood geofence?
Mail to it one or two times and you’ve “primed” your potential customers but will lose most your direct mail marketing dollars. Repeatedly mail the same direct mail piece to the same people. Mailings to the geofence addresses is a minimum of 3 to 4 times per year.
What is the most important aspect of acquiring new patients from ALL marketing e orts?
The cost of acquiring new patients is CONTROLLED by the ability of the receptionist to CONVERT new callers (enquirers) into scheduled appointments! The ONLY channel to new patient enquirers entering your practice is through a SINGLE CHANNEL. And that channel is the Receptionist!


What does the average new patient spend in a dental o ce in the rst year?
The nationwide average value of a dental patient in the first year is between $900 to $1200.
How much income is lost in the month of January if 25 new patients inquire for services and 15 are converted into scheduled appointments? This means 10 patients were not scheduled, so how much income was lost from the 10 patients that were not converted?
The average cost of acquiring a new patient is $250. The average revenue spent in the first year for any new patient averages $1,000. So, the lost revenue for each person not converted is $1,250.
If 10 patients are lost, then the lost revenue = 10 lost patients x $1,250 per patient = $12,500
What is the most valuable component of business?
The most valuable component of any business is its existing clientele (patients). The “business aspect” of this is called RETENTION & LOYALTY.
What is the de nition of Residual Income?
Residual Income: is income that continues to be generated after the initial eff ort has been expended. Also, called “recurring income” ... hygiene retention income.


What is the de nition of Linear Income?
Linear Income: is “one-shot” compensation or payment in the form of a fee, wage, or salary,” ... most practices in the U.S. operate off this type of income.
What are the bene ts or rewards obtained from Residual Income?
• Higher case acceptance due to patients coming back from hygiene visits
• Higher income security from hygiene revenue
• More free time and longer periods away from the office for family, vacations or hobbies
• Increased loyalty from patients
• Most importantly an increase in word-of-mouth referrals is generated due to the increase in people coming in and out of the office.


What is the single largest bene t of residual income?
The single largest benefit t of a residual income practice is removing the burden, stress and day to day “grind” of daily practice.
What is the ONE major component that builds residual income?
Years go by quickly and the most asset in creating residual income is TIME!
Linear income is itself part of the working model for dentistry... but as one works, and puts in the time over the years, build the residual income of the practice and invest in your database to raise the hygiene residual income center. The diagram below illustrates how linear income goes to zero when you stop working at any time. Residual in-come continues.
What is the national average loss in database patients each year?
American Dental Association surveys of dental practices across the U.S. show a minimum of 35% to 45% loss of patients every year.
What is the dental industry national average percent of incomplete treatment sitting in the patient charts?
The national average of incomplete treatment in dental offices across the country is 60% to 65%.


What is the gross income senior datum?
The size not the quality of an organization’s mailing list and the number of mailings and letters to it determines the gross income of an organization.
Revenue growth for any business is always proportional to________________ (state what this is?).
Answer: THE SIZE OF THE ACTIVE CONSUMER COUNT
What is the only method to increase the size of the active database?
The Active Database can ONLY be increased by:
a) Increasing the number of bodies (people) in the shop (office or business) and
b) The ONLY method to increase the number of bodies in the shop is by increasing the number of hygiene recall visits
To manage the hygiene revenue center is impossible without a knowledge of the metrics (metrics means a method of measuring something, or the results obtained from this). Give the correct numbers for each of the following questions.
What is the number of days the average hygienist works per week?
Answer: 4
What is the number of weeks worked per year for the average hygienist?
Answer: 50


What is the total number of working days per year for the average hygienist?
Answer: 200
What is the average number of patients seen per day by the dental hygienist?
Answer: 8
What is the average number of hygiene visits per year for a single hygienist?
Answer: 1,600
What is the average daily hygiene production per day for a dental hygienist?
Answer: $1,500
If the average daily production for a hygienist is $1,500 per day and he/ she works 200 days in a year (4 days a week of hygiene), then what is the annual expected revenue from a single hygienist?
Answer: At an average of $1,500 per day X 200 working days = $300,000 of annual hygiene revenue.
What is the single largest situation in dental o ces across the country?
The single largest loss of practitioner’s long term income in the dental industry is database leakage. The dental industry is unaware and uneducated about consumer retention. 90% of every patient is lost out the back door.


What is the de nition of the word dynamics?
The definition of the word dynamics means the forces or properties that stimulate growth, development, or change within a system or process.
Database dynamics show what is occurring with patients when they leave the o ce and go back home into the community. Explain the dynamic activity of what occurs when a patient leaves the o ce and goes back home,
The dynamic activity that occurs when a patient leaves the office is that the average home has 3 people who live there. Each of the 3 individuals has a minimum of 2 close friends. This results in a potential of 8 referrals from each household.
What is the most important aspect of knowing about database dynamics?
The most important dynamics of your database is leveraging your patients for word-of-mouth referrals.


What does the acronym SAFE, in the statement SAFE Strategy, stand for?
The acronym SAFE stands for the first letter of four statements that explain how to build a retention or residual based practice:
“S” stands for Statement of Purpose
“A” stands for Align all staff to 2 products “F” stands for Full responsibility assigned “E” stands for Execute database mailings
What is the most important factor in achieving a residual based practice?
The keynote, most important factor in achieving the strategy for a residual based practice is to drive home a continuous strong mission statement. Your mission statement is the focal point of all activities in the office...as this is the goal being achieved.
How is patient retention brought about?
Patient retention is brought about through an educational system put in place in the office.
The Mission Statement is an education step for every patient and is repeated many times. The Mission Statement is posted in reception, every operatory, the hygiene operatory, the hallway and even the bath- room. It is handed to each patient in printed form on stationery so every patient leaving the office knows the goal and can share it with family and friends.


What is the only factor that Changes Behavior to get patients to return for hygiene visits?
Education is the only factor that Changes Behavior of patients returning for hygiene visits.
With an established Mission Statement for the o ce it becomes extremely clear and focused—for all sta are now aligned to two speci c objectives in the o ce. In the SAFE strategy, the “A” in SAFE, stands for “Align all sta to TWO products.” What are the two products?
The two products that align all staff are 1) COMPLETIONS and 2) RETENTION (education to the level of never needing dentistry in the future).
Explain what Completions means?
Completions: This means completions of treatment after diagnosis by the doctor. Once a diagnosis has been performed, the objective for all staff, the office manager, finance coordinator, receptionist, the dental hygienist and the chair-side assistant do their part as a team to accomplish the goal of a completed treatment for every patient.
Explain what Retention means?
Retention: Retention is the primary focus of the entire office as a returning patient becomes a “Well Patient.” The retention program is a hygiene education center who establishes a bond and relationship with every patient with the goal of eliminating future dental care.... this is in fact a “Dental Wellness Program.”


What is the goal or result of a “Wellness Program” in the o ce?
The goal for every patient in a “Wellness Program” results in:
• Elimination of gum disease • No future implants
• No future extractions
• No root canals
Most importantly, the patient’s dental costs are dramatically reduced to almost zero.
The “F” in the SAFE strategy stands for “Full Responsibility Assigned.” What are the primary positions in a dental o ce that must be assigned full responsibility?
The primary positions that must be assigned full responsibility are:
• Office Manager
• Receptionist (a call conversion expert.... this is ONE person, not 2 or 3)
• Finance Coordinator
• Retention Coordinator (establishes hygiene retention wellness program) • Doctor & his assistants
What is the primary reason why patient retention is low in a practice (or stated another way, why is patient leakage out the back door so high)?
The primary reason there is no retention occurring in the dental profession is due to fact there is no one individual in the practice that is held fully responsible for the retention of the patients that enter the practice. The position is simply missing within the industry.


What is a Retention Coordinator?
A Retention Coordinator is an individual trained and assigned as the single person in the practice held fully responsible for the retention of all patients. The Retention Coordinator has the responsibility to become educated and skilled to put a retention system in place to increase the number of hygiene recall visits per quarter and annually.
The “E” in the SAFE strategy stands for “Execute Database Mailings.” What is the reason database mailings are so critical to the overall residual based strategy?
Execution of database mailings is a vital component of overall retention and the residual strategy. Loyalty is created based on a constant contact to your database on a routine basis. Viva developed the retention loyalty mailer to make it fully automated due to its critical component of keeping consumers loyal through a highly aesthetic and warm communication.
How does “Execution of Database Mailers” e ect the revenue or gross income of a business?
The “Execution of Database Mailers” is an application of the Gross Income Senior Datum, which is how any business determines its gross income.
Gross Income Senior Datum
“The size not the quality of an organization’s mailing list and the number of mailings and letters to it determines the gross income of an organization.”
What is the most important number (or statistic) for a business to monitor and keep track of?
The most important number to keep and monitor for any business is the ACTIVE CONSUMER COUNT (or ACTIVE PATIENT COUNT).
What is the correct de nition of Active Patient Count?
The number annual hygiene recall visits divided by 2.
This number is monitored monthly, quarterly and annually.


Why is the Active Patient Count monitored and why is it so important?
The reason why the Active Patient Count is monitored and so important is because:
a) It measures the Residual Income component of the practice
b) It is the only way to monitor the SAFE strategy to see if the goal of the practice is being achieved




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