DISCLAIMER: Today’s Advertiser helped make the production and delivery of this episode possible, for free, to you! But the themes expressed by the guests do not necessarily reflect the views of Inside Reproductive Health, nor of the Advertiser. The Advertiser does not have editorial control over the content of this episode, and the guest’s appearance is not an endorsement of the Advertiser.
This week, CARE CEO, David Burford, joins Griffin to discuss what goes into the operational and financial decision-making process behind CARE Fertility’s business model.
Listen to hear:
The tension between financial and operational divisions of a fertility center.
Examples that look good (or bad) in a financial model, but then have good (or bad) consequences in operations.
Certain elements of operations that served the clinic, but not the patient.
When staff needs are at odds with patient needs, and the trade-offs that need to be solved for.
CARE’s HR machine and the concept of necessary, if not immediately efficient, redundancy.
The mass retirement of physician CEOs, and what that means for the fertility field as they are replaced by business people without medical degrees
Care Fertility Group Limited: https://www.carefertility.com/
Transcript
David Burford 00:00
First and foremost, finance is very good on spreadsheets operations is very bad on PowerPoints and spreadsheets operations is about people. And it's about process and you only really can deal with one when you understand the other.
Sponsor 00:14
This episode was brought to you by Univfy. Download Univf;y’s free IVF conversion and revenue calculator at univfy.com/IVFpatientretention.
Today's advertiser helped make the production and delivery of this episode possible for free to you. But the themes expressed by the guests do not necessarily reflect the views of inside reproductive health, nor of the advertiser, the advertiser does not have editorial control over the content of this episode. And the guests' appearance is not an endorsement of the advertiser.
Griffin Jones 00:54
Redundancy, is it time to start laying off some of your fertility center staff or is it time to hire more because you need duplication in order to positively impact their performance management? This is just one of the topics that I cover with my guest Dave Burford today Dave Burford is the CEO of CARE Fertility. That might sound familiar to you because we recently had their chief scientific officer Allison Campbell on the show to talk about embryologists owning equity and fertility clinics taking equity in startups, you should listen to that episode if either of those two topics interest you. And you may have read an inside reproductive health article a couple of months ago about how care fertility recently made an acquisition in the United States in North Carolina because with their financing from Nordic capital, they're expanding beyond the UK and Ireland into Europe into the United States and possibly other parts of the world. Dave and I talked about the convergence and divergence of the financial and operations divisions of fertility center. I press him for examples of when something can look good or bad in a financial model, but then have good or bad consequences in operations. When Dave took over as CEO of care some years back, he said that there were examples of operations that serve the clinic but not the patients. And I asked him for specific examples in patient intake and in call center reception and scheduling. And then I pressed Dave a bit because there are examples where staff needs are at odds with patient needs. And the trade off has to be solved for I asked Dave to describe CARE Fertility’s Human Resources machine because with 1200 employees, I asked him to talk about the balance between efficiency and profitability and on the other side overlap and duplication so that you can support your team and support performance management support the advancement of employees, I asked because this is something I've really been working on as a business owner very deeply for the last six months. And it's funny to have someone from the United Kingdom on because layoffs in the UK are called redundancy, someone who is laid off is redundant. And I observe this tension where you might want to have efficiency and profitability and only have a certain staffing ratio. But if you lose someone that puts a tremendous stress on the staff, it makes it harder to hold people accountable because they end up having to do other people's work. So it's a lot harder to hold them accountable for their original outcomes, it's harder to advance them, it's easier to burn them out. It's harder to get rid of a cancer when a cancer comes into the organization. And worse the cancer has bone dry tinder to set ablaze because the rest of the workforce is burnt out and not supported and doesn't feel like they have the autonomy and doesn't feel like they're able to grow in their careers. So we spend some time on that topic. And then Dave gives examples where he has to pitch to the board or pitch to investors reasons for making certain investments that will be good in the mid and long term but don't necessarily look great. In the next quarter. I asked him what data he uses to make those arguments. I then asked him to talk about the balance of when you start something new and you test the concept versus how much needs to be invested in and built ahead of time so that the deliverable is positive. I asked Dave, now that we're starting to see the original CEOs of many fertility groups, who in many cases were physicians start to retire and they're being replaced by CEOs who were not the founders of those clinic companies and who very often are not physicians, they come with a business background, how temporary or not should these new CEOs be? Should they be around for a really long time? Should we expect to see a revolving door of them? Are they going to be a symptom of cutting fertility clinics to the bone and selling them at a higher profit and that churn just repeats? Finally, we part with Dave's thoughts on what he perceives to be the cons of a more process driven sale in the United States than in the UK in Europe. I asked him if he feels that it is more process driven in the UK and Europe. Why that is the case in his view, and if it is true, what makes it a bad thing? Please enjoy this episode with Dave Burford. Mr. Burford Dave, welcome Inside reproductive health. Oh, hi,
05:02
thanks for having me.
Griffin Jones 05:03
You're now the second leader of the care fertility leadership team that I've had on the show recently, your colleague, Dr. Campbell had joined me. And that was a very popular episode because we did a little more content for the lab folks than we usually do. And they were very interested in her talking about the career path for embryologist. There's a whole lot of places we could begin our conversation today with you being a CEO of such a large group, but one that I'm thinking of is probably germane to many people that are at a point where the founding physicians, the founding CEOs, or the earlier CEOs are starting to retire, and now CEOs from the next generation that are taking over. And that seems to have been your case, it seems that you worked for care at a higher level for many years, and then became the CEO in 2018. Is that right?
06:04
That's right. Prior to that, I was the CFO. And then I moved into the CEO role. For a short period of time, I did both the operations director role and the finance director role, and then moved into being the CEO in 2018. So I've had a kind of broad view of fertility and wearing a few different hats, but obviously a very different experience than somebody that has been a clinician or an embryologist.
Griffin Jones 06:30
Sure, that broad view I want to talk about if is how much of an advantage that is in taking over an organization at the top being able to see it from different vantage points. But to make sure that I've got my history that was Professor Fishel. That was he the the original CEO.
06:50
That's right. Yeah, he founded the business and was the CEO for all since 1996. right the way up to sort of 2015. And then there was a short period of another chap that was the CEO, and then me from 2018.
Griffin Jones 07:04
Okay, so you're the the third CEO total in the company's history. That's right. And so did you know that you are gone? Was this a track that you are interested in from the beginning looks like you started with the company in 2014. Was that in the finance role?
07:22
That's right. So prior to this role, I was at KPMG. So I'm an accountant by background and was looking to get a real job if you like outside of outside of accounting and moved into care, fertility not knowing a whole lot about IVF. But knowing that care was a respected good business in the Nottingham area, and it was a it was a job that I was very happy to get. And then really progressed through finance into operations, mirroring the challenges of the business, I think so the financial challenges of an IVF clinic, or a small group as it was then, uh, not that big. But the operational challenges were quite significant. And so my role morphed into operations, which then set me up quite nicely for being the CEO when, when that role became available.
Griffin Jones 08:13
Had you thought about that? It from the very beginning, did you know that you wanted to be on a track for CEO leadership, whether it be a carer or some other company?
08:25
I mean, that was ambitious insofar as I wanted to go as far as my career would take me, but I wouldn't say I set out to be the CEO, I set out to really understand business, my passion is really understanding what makes a business tick. How can you improve it? How can you take it forward, and that tends to be operational improvements. And so it became clear that my finance role would only take me so far. And if I really wanted to change the way that the business was performing, I needed to move more into operations. And that naturally led on to being CEO because you get a really good grounding, particularly if the businesses, private equity backed, you get a really good brand grounding in both the finances and in the operations. And really, that's the meeting there have a kind of corporate CEO if you like,
Griffin Jones 09:17
it sounds like it was a smooth transition from finance to operations. But in my view, it seems like more of a jump. So was it what kind of transition was it how did you go from a financial role to an operations role?
09:32
Where the it was really mirroring the challenges that the business was facing at the time we've we've always been a really successful so we've been going for 25 years and we've always been a very successful clinical business. So very strong success rates really good clinical innovation, as I'm sure you heard from Allison when she was with you, but the challenges of the business were that the founders were extremely good doctors and embryologist and good business people. But the challenges of running a multi site operation are, are different to that of running an individual clinic. And we had increased competition in the UK, and some of our operational processes needed improvement. And rather than just being a finance director that was happy to throw a few stone, shall I say, my, my director, colleagues saying, you know, why don't you do this? Why don't you do that I was very happy to roll my sleeves up and, and get involved. And I really enjoyed that side of the road, the ops director that we had at the time was looking to move on. And so it became a natural progression. And I did both roles for a short period of time, the CFO and the CFO role. And then that became unsustainable, and we recruited in replacements for me really to allow me to move on to the CEO role, but it was really reflecting the challenges of the business and my passions really for operational improvement.
Griffin Jones 10:57
Well, your passion maybe came from wanting to throw stones, but them saying back to Yeah, well, if you think it's so easy, buddy, why don't you come over here and try it? And he said, Okay, maybe I will
11:09
use funny you should say that, because we actually had a board meeting where the private equity investor at the time, was not very happy with some of the operational performance in London, and said exactly that way. You've just said to me, Well, if you can do better than Dave, why don't you do that? And so I said, Okay, I'll do a I'll do a month secondment to London to improve London's performance. And that really was the audition for being the ops director or the CIO, as it was at the time. So yeah, that was exactly what happened.
Griffin Jones 11:41
Well, there's a lot to dig into here. Because one of the biggest criticisms about so much external finance entering this field of medicine is that there is a financial pressure and sometimes an oversight on operational quality, there's operational improvements to be made. For days in this field, there's, there's no shortage of those. But there is also the reality that there is a way of looking at things where it can be just looked at from a spreadsheet without the consideration of actually making the operational improvements. And you had to at least experience some of the other side. So what were a few of the surprises that a way to do.
12:28
I think first and foremost, finance is very good on spreadsheets operations is very bad on PowerPoints and spreadsheets operations is about people. And it's about process, and you only really can deal with one when you understand the other. And so if I take this back to care's challenges, at the time, it was very much around a business that was geared up to serve the clinic rather than the patients. And that's okay, when you've got a lot of demand and not much supply. But when when that dynamic changes slightly, and you've got more competition in town, then you've got other people that are doing things in a more dynamic way. And actually, the challenge is bringing in supply or patients, then you've got to change your processes to adapt to that. And you've got to be more patient friendly. And you've got to be more adaptive and fluid in the way that you deal with things. And so the he only really do that by talking to the people on the ground, talking to the staff and understanding what their challenges are, and then adapting the processes to meet the demands of patients and the needs of staff. So it was for me, it was nice to get away from the laptop and then the PC, and to actually talk to people and understand what is it that is the challenge here. And that's best supported by a bit of data, if I'm honest as well, because sometimes anecdotal conversations only take you so far. And you need to have a bit of skepticism about what you hear. And then you need to look at the data and say, well, actually, look, we've got 1000 people call in is it that seven o'clock at night? You're telling me that patients don't have a demand for late night calls. But why have I got 1000? Why have we got 1000 people ringing me when when the lines are closed, and it's just tweaking that some of those operational processes to meet those needs? Generally not that challenging, but involved. You
Griffin Jones 14:25
mentioned that at the time, there were some things that were serving the clinic but not the patients. What were examples of that.
14:34
So you know, people set up processes often to meet the needs of either themselves or at the time the needs of patients or customers but things change and it takes sometimes longer for processes to change. So a good example of that where it's really important for doctors in this field to understand the medical history of patients so that they can give the patient the most informed consultation that they can give them so that the patient is getting best value for money. But there's a line there commercial or operational line, if you like that judgment between getting as much information as you can to make the consultation effective, but not putting patients off from coming to see you because you've made that process so difficult or more challenging. And so we really went through a process of thinking about where's the balance here? How do we get the information that we need to make sure that consultations and appointments are as effective as they should be, but not overwhelming the patient with requests for information that either put them off? Or made them think about going elsewhere? Because if you ring up two clinics, and one Clinic says, Yeah, you can come in tomorrow, don't worry about it, we'll see. And the other Clinic says, Well, can you fill in this 60 page questionnaire before you come in? There's a lot of people that will just choose to go to the clinic, with no information just simply because it's easier and quicker. And particularly when you put that in the context of most IVF patients between the ages of 25 and 45. And so that those people have grown up in a generation of technology and ease of access, not filling in lots of forms and ticking lots of boxes. So it's about mirroring that, that really and changing those in those demands. And that's a practical example of some of the things that we've done as an organization to make that access to patients, informative to our staff so that it's meaningful and productive, but slick and easy from a patient's perspective so that we can attract as many of them as possible.
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Griffin Jones 18:11
I want to talk about how those two things reconcile staff's needs and patients needs. You also mentioned that you were talking to staff and finding out what their challenges were, what did they tell you? Their challenges were?
18:25
Most of the time its challenges with the systems. And we've we've got our own in house system that we've spent 25 years developing, but in IVF, as I'm sure you know, there is lots and lots of different systems out there. But none of them are amazing,
Griffin Jones 18:39
referring to electronic medical records, correct?
18:43
Correct. Yeah. And so, you know, clinical staff want to do what they love doing, which is treating people clinically and talking to patients, and they don't want to spend hours in front of a computer and ticking boxes and moving pieces of paper around. And so it was really listening to them in terms of how can we make the system as slick and effective as possible, to make their lives easier. So that's how we fulfilled the needs of the staff. And there wasn't really much of a conflict between the needs of the staff and and the demands of the patient. The there was the only thing I would say where there's a small conflict is staff would typically want to have as much information as absolutely possible about the patient in advance. And we wanted, as I said, Put to put a bit of balance to that. But that's nothing more than you know, just communicating with staff, explaining to them the reasons for why we're making some of these changes, and then them seeing the benefits of those changes.
Griffin Jones 19:43
And so what about times where there are there is a bit of a conflict and I couldn't think of an example if the patients who want evening hours for reasons that you mentioned, they're in the demographic that they're in the demographics of their working prime and they would love to, in many cases to have a 7pm consultation. And then you have a call center team that says, yeah, right, Dave, I can barely get enough employees right now to staff, my current team. And they're telling me they want more time off. And they're already asking me for a raise. And I'm at risk of losing these other two. And we've had this opening for eight weeks. And so how do you reconcile those two?
20:25
I mean, one of the advantage of being a large group is that you can have more sophisticated processes in place. And I guess one of the things we're used to in the UK, and it will take us a little bit of time to establish this in the US is, we have centralized teams to do this and virtual teams, so they can work anywhere, and have calls with patients from anywhere. And so you then fishing in a much wider pool of employees to be able to satisfy that need. And actually, for some staff working, what were for some people we considered unsociable hours is perfectly fine. That's what they want to do. They want to work those hours. And so enable it, as long as you've got the right mix of people, you can do that. I mean, to be clear, out of ours, we tend to focus on just making sure that patients can contact us rather than having full blown clinical consultations, because that would be more challenging. But we we provide services to them out of ours, just in terms of contacting and talking to us, which often is enough.
Griffin Jones 21:27
So you need a well oiled Human Resources machine in order to be able to accomplish that though, don't you?
21:33
That's right. Yeah. If you ever
Griffin Jones 21:35
read the book, traction by Gino Wickman, or heard of the Entrepreneurial Operating System, you've probably seen some version of different accountability charts. But their version of the accountability chart is that you have the CEO on top and CEO is what they who they would typically refer to as visionary integrator, and then having three core functions of the business that they would call operations, which in our case, you might have lab operations, clinical operations, you have sales and marketing. And then you have finance. And they often lump legal in with Finance, any thing that has to do with compliance, they put with the finance side of the accountability chart, and they put human resources over there. And I'm not convinced that it goes over there. I don't know if it goes in operations, I don't know if it belongs is it's for thing and its operations, sales and marketing, finance, and then human resources. How do you think that it relates into an operational system,
22:34
specifically for human resources, I would argue that there's a sort of foundational layer that sits across those pieces, because you've you've got to get the culture of the business, right, you've got to get the, the quality of the staff in right in all of those three functional support layers. And so HR needs to sit across that I mean, from a technical reporting point of view, Human Resources report in to me directly. So I work with the group, human resources director to and literally tomorrow, I've got a three hour session with her around succession planning, and the quality of the senior management team making sure that we're developing the senior management team. So I think, you know, people like business such as healthcare, Human Resources can't be a module of finance, if you like, that's down there with reporting, that it needs to be high on the agenda, with, in my opinion, direct access to me as CEO, because we employ 1000 people. And we need and our business is very much around people interactions with patients, whether that be virtual or face to face, it's all about interactions with patients. And so the staff, the quality of our staff is critical. So I would see it as being a foundational layer really sitting across those those functions. I would also argue, by the way that in a business, such as as that sales and marketing, plays second fiddle to customer services, and you've really got to have a really high performing. We bucket that all together sales, marketing, consumer services, all as one big department because there's no good having a really hot marketing department and then having terrible customer service because a lot of our business comes from reputation, word of mouth, repeat business, and that is much more effective than spending millions of dollars on marketing Pay Per Click adverts. It's so having that one view of the consumer journey the consumer lifecycle is really important.
Griffin Jones 24:48
The customer service piece of sales and marketing is that which latches sales and marketing on to operations and makes it fluid and the sales and marketing Beyond that overlap piece should really be the activation of that piece. That is the activation of that experience that they're able to achieve. On the on the HR side, you have to have a system for advancement, you got to have a system for retention, you have to have a system for recruitment. Otherwise, things can buckle, and then you can start to have a lot of challenges delivering to the patients and then you can really start to have conflict between what the patient's seen what the the employees need. Did you find that balance harder? In late let's let's call it mid 2021 or early 2021? Perhaps to let's call it mid to late 2022, than any other time in your career? Or is that just me?
25:54
I think we've posed COVID, we've all had significant challenges, right. And I think we as a business have gone from predominantly work in the clinic, culture, head office function based in one city, everybody turning up to work to other than the clinical staff, obviously, having a lot of people working from home, a lot of people, and we're seeing now, some of that coming back, we literally had a conversation with a staff member this morning about feeling disconnected from the business, and feeling quite upset about that. So we have a big meeting on Monday with the senior team were one of the topic, one of the topics is how do we keep the efficiency of the working from home model because it's undoubtedly more efficient, but made sure we don't lose our identity and people's connection to care. Because we believe ourselves to be, you know, the care family. And it's really difficult to maintain that when people are working from home as much as they are. So I think we staff retention culture, it is more difficult now, undoubtedly, because of some of the dynamics that have been created in the post pandemic employment
Griffin Jones 27:06
market. So you might be the perfect person to ask having an operations background and a finance background. And being from the United Kingdom, where they use the word redundancy in the labor force. Because one thing that I had been considering a lot as, because I really struggled with meeting client needs without driving my team crazy in late 2021 and 2022, when it was so hard to recruit, and I've been completely, I've since completely revamped my human resources system and, and now really have a system and I tell people that I'm, I think that I'm a yellow belt at it right now. And then when I write a black belt, I will write a best when I when I am a black belt at it, I will write it in New York Times bestseller, you'll see it in the Heathrow Airport, you'll pick it up off the news rack and whatever the digital version of that in the meta verse is, and I really believe that I will be able to knock it out of the park. But right now I'm a yellow belt. And one of the the or two of the opposing forces that I'm really trying to master that with efficiency, and that with redundancy. And I'll lay the premise that I believe that recruitment is a retention strategy as well, for two reasons. The first is, it's really hard to hold people accountable to their seat, if you're asking them to do more and more things outside of their seat without that which they need in order to be able to accomplish it, you have to have more people coming in, or at least a replacement level to come in so that you can maintain that level of accountability. And second is that if you get people in that are not fit with the culture, or they are not able to achieve their outcomes, and you're not able to replace them that that can turn into a cancerous environment real fast, and they can barely and why not take a vote of no confidence? Because if the other if the great people are feeling stressed out and and not getting the resources they need, then they then see. Yeah, so that premise is that retention it recruitment is a necessary strategy for retention. And I see redundancy as being somewhat necessary in order to make sure that we constantly have people coming in so that that people can be accountable for their seats, they can be supported, and that we don't have the stress of it being several months of people having to bear a burden that they shouldn't have and then all of the cultural issues that come from that. And then I've been thinking about this also a lot because we say layoffs in the United States but when people are let go in the UK it's often let go to redundancy is that so? You coming from finance Were in a perfect world, we don't want any of that redundancy versus operations were having to you have to consider the needs. What's redundancies place? And all of that?
30:12
I'm picking that question, I would say there's two elements to it. One is performance management. And one is redundancy. And I think the lack of performance management is really corrosive in an organization. And, and, and that's holding people to account for their performance. And if you don't do that, and if you allow poor performance to prevail, then it's really corrosive to good performance. And it's really demotivating to those people that are doing a good job, when they see people doing a bad job, not being held to account. It really is a it's a very corrosive part of the business, and it can be very demotivating. And so I think performance management is critical in any business, and particularly in a in a people led business, such as ourselves and a decentralized business as well. So having having really good performance management systems and processes in place is critical when you're running multiple sites, because you can't manage that from the center, you have to delegate that down to the managers, and you have to provide them with good tools, good systems, and good training to be able to know how to do performance management. So we, we follow the kind of bell curve of performance management and that we would anticipate that in any given clinic, any given department, you should have some people that are poor performance, and people that are exceptional, and the majority of people in the middle, and really try and educate our staff on how to use those tools. So I would say performance management is is a main part of what you're discussing. I think redundancy comes in different layoffs come in different different packages. So we have very rarely resorted to redundancy. And even during COVID, we didn't really do much of it. But it is from time to time, unfortunately necessary. And I would say it's necessary, really in two main ways. One is the roles just change. So you know, the world moves on and you no longer need people in a certain role. And that role becomes redundant. And it needs to progress because you now need people that are doing chatbots, rather than answering phone calls, you know, that kind of evolution of the business. And if you don't evolve with that, then you might be doing somebody a favor in a very short term, but the business will suffer in that in the medium to long term. And so you've got to do what's right by the business, which ultimately is right by the staff, as well. And the only other period of redundancy that should be considered is in a downturn of trading. But you know, Touchwood, IVF is a pretty resilient sector to be in. And there's not that much need for redundancies as a result of downturns and trading, but never say never.
Griffin Jones 33:04
How about redundancy in the form of overlapping roles, or perhaps additional roles that you might not exactly need that person. But I've coming to see that as a necessity for performance management. So one of the ways that we have been onboarding our new folks, and even with the the team that's been here for a little bit, we've created an outcome hub so that each person has their own outcome hub. And so there's outcome hub for your seat. Okay, David, here's the three to seven main things that you're responsible for. And then we have rocks that which are like quarterly priorities or priorities that take several weeks to accomplish. And each of them are associated with one of those seat outcomes. And so when you start, we go over them in detail. I'm as explicit as I can be on what the outcomes are. And, and then I delineate what we have, and what we don't have for you to be able to achieve the outcomes. And we do that from the very beginning. And so it's okay, David, your your job is to grow the LinkedIn audience by 10%. By the end of second quarter. Here's what I have for you. We have these former campaigns, I have this designer on your team. Here's what I don't have for you, I don't have a, b and c. And then we agree. And so what I've found is that I need to have those things in place, which are very often people that can be moved from one scene to another if need be, or if one of those things, if we lose one of those people that we can replace them very quickly, so that I can hold my people accountable. And the further I get into this, the more I see the two as intertwined. So if redundancy is something that often means layoffs, what's the necessity of an overlay? app that might not make financial sense on the immediate line and in the spreadsheet. But that is absolutely necessary for keeping the operational machine going.
35:12
I think overlap in the way that you describe it comes into two ways. To me, I think you've got succession planning. And when you've got some really great people at one level, and you can see a role for them in a higher level, where they can add more impact into the organization, if you, you've got to go with that. And you can't be selfish insofar as or cautious insofar as well, they're doing a great job, let's leave them there and bring somebody in above because it demotivates them, and also the person you bring in above might not be as good as they would have been. And so there's a real need, when you get that situation, when you see these rising stars, when you see these amazed at this amazing talent, that you've really got to let them shine. And the only way you can really do that is to have a bit of overlap and bring in some resource at the lower level, to work alongside them to then enable them to elevate up into the, into the higher position. So I would say there's definitely a need for overlap is I see it in that situation. And, and the prize, then is that you've got talent from within growing up in the organization. And that's one of the things that we've very proud of. And we've done in many, many situations, our current director of integration was our previous IT manager who's been with us for 25 years, and we've moved him into a new role. But to enable that to happen, we we brought two people in to succeed him in his it role, we had a bit of overlap, they hit the bottom of the line for the p&l for a while. But we're now reaping the rewards because our integration director is got such a wide variety of experiences. That one, he helps us with integrations, he can help with all sorts of challenges. And he's a great guy as well. And we've invested in him. And he's he's moving on. So I think you in business generally. But specifically, in your point here, you've got to take a midterm view on these things. And the way to convince investors to take that view is to demonstrate to them that you're making the short term quick wins, you're taking them. And you allow them to use some of those short term quick wins to invest in the medium to long term growth plans, because they want them to but they'd soon lose interest if that's all you were talking to them about. And you'd be ignoring the current p&l, let's worry about tomorrow, they would not like that. But if you can demonstrate to them some good performance, some quick wins, you buy your freedom to invest in the medium to long term, and overlap, as you call it, or succession planning is critical part of that.
Griffin Jones 38:02
Well, that succession plan, as you described, it makes filling senior positions a lot easier for two reasons. One is that if you're continually bringing junior people in, if you're continually bring lower level positions in, some of them are going to grow to be great senior leaders. So you, you have that pool to begin with. But then secondly, if for those times, when you don't have a senior leader to take from that pool right away, you still have that team in place that is much more attractive to recruit a senior leader if you have those folks. So it's it's a lot easier to recruit that talent for two reasons. You talked about that it can hit the p&l for a little bit. And you need to make an argument to the investors that it's beneficial for the midterm. So what are a couple of examples where you've done that, and you'd say, Hey, I've sat on your seat on the finance side. And I know that it's going to be it's not going to look great on the p&l for the next four months. But in two years, it's going to be amazing. And what are a couple of examples of that and what data did you use to make your side of the argument?
39:23
That's good question. The The best example I've gotten to that is when we centralized call handling, and patient inpatient handling. So this is patients that are currently patients of ours, where they would previously ring or contact each individual clinic for updates on test results or whatever it might be that they were, they were ringing for. And we were providing an okay service, but we know it could have been it could be better. And the reason for that is is the clinics. It's the laws of small numbers, right? So each clinic I only have four or five people that are dealing with that kind of request. And small teams have vulnerabilities, vulnerabilities of succession, sickness, you name it poor performance, they are exposed to small fluctuations that lead to a big impact on on on their patient service. So we decided that look, it'd be a lot easier if we centralize this, because then one or two people being off sick, or it can be covered quite easily by a much bigger, broader central team. And we can share best practice better, etc, etc, etc. So we decided to make that change, excuse me, we decided to make that change. But the, the way to do it in the most impactful, least risky patient friendly way was to actually build 80% of that central team, before letting any if the local team go for moving them into position. And that obviously came with quite a significant cost, because you're building up a team before you've replaced the other team. And then you're running them in parallel, and then you make in the final changes. And that was really about articulating the benefits to the board and saying, look, the ultimate benefits here are this. And it's going to cost us this much. And these guys are very smart people. And if you treat it in the language that they understand, which is I need to invest this much. This is my investment. And this is my return, then they can visualize that. And they just want to know, when's it going to happen? How do we measure it? What are the milestones, and that's very, then that's a very easy business decision to make. And I would argue that it's all very patient friendly as well, because not only are you ensuring that the experience whilst you're building, the team is a good one. But ultimately, we did this not to cut not to save money, it was done, really to provide a better quality of service to the patient at the end of the day.
Griffin Jones 42:05
My second New York Times best seller is going to be about pre selling and, and to what scope pre selling should fit into what constraints pre selling should fit into for the reasons that you're talking about. My first business fertility Bridge is a client services firm and was very much we're selling, delivering, selling, delivering, it wasn't it's not like a crazy, huge business. So we're able to do it. But gosh, it you know, it's it's a lot to do to sell, then deliver. And now building inside reproductive health into a trade media company, I can take my time more. And I'm building out a lot more of the delivery capacity ahead of time in ways that I wouldn't have in years prior where I would have tried to had that immediately funded. And for a couple reasons established, I feel that the concept is proven and other ways have built up that cash reserve to do it. So I'm the board that you're talking to. I'm the investors that you're talking to, in this case, because it's self funded, but I am really seeing the value of it, you know, we'll just sell a couple advertisers at a time here, we'll continue to build this system. And it there's no rush to, I shouldn't say there's no rush, we're moving quickly. But it isn't like we're having to fulfill something and we're building really building a delivery capacity is much greater advance than we would have in the past. And that's what you're describing. But it's very antithetical to, if you remember, oh, gosh, what's the Eric Ries the author of The Lean Startup, and that whole school of thought of don't ever create anything until the concept is totally proven? And so do you? At what point do you feel it's sufficient to say, okay, the concept is proven, but I really need to build out the delivery capacity before I start selling it there before I start having paying customers go through it. I think it really depends
44:04
on what it is that we're talking about. In the case of what I'm describing. We were able to trial, the service in one clinic first for a six week period to really hone in on the way it was going to work, what the pain points were, what the SOP should be, and then launch it multiple, multiple clinics wide. So I think have it in having the concept is going to be a combination of data intuition and, and feedback. And then you did try then for me, you run a trial period of whatever that might be low touch trial period. It could be that if it's a clinical service, you've heard Allison talk about care maps AI when she was on. If it's a clinical service that you're launching, there may be you do it for free for the first month just to get feedback and you understand how it's working. And then when it's working And then you start charging for it. It might be in the case of my example, a patient services change, where you do it in a small way to start with just to get that, get that feedback, get the get the process perfected, and maybe also to prove some of the business case, because it might be that the business case says that we're expecting 50% of people to do this. And if it's only 20%, then maybe it doesn't work anymore. And so you get that feedback, you get your prove or disprove some of those myths. And as part of that, and then you go with a bigger rollout. So for me, it's all about limited, limited trial periods to really then perfect what you're doing. And that becomes even more important, the bigger you get. Because the bigger you get, what would be a challenging one clinic becomes critical in multi site operations. And if you if we were to roll out a new system or a new process across 20 clinics, without really understanding the impact of that, we could have a big problem,
Griffin Jones 46:02
I want to let you conclude with the thoughts you'd like to conclude on. But before I do that, I want to tie back into the theme that I opened with of a new generation of CEOs, in many cases taking over for the previous generation who had founded their groups. And it's happening everywhere as that's happening in the UK, it's in India, it's in the United States it probably in most of the countries of the world. And so I was thinking of Gilbert Godfrey, you remember the comedian Gilbert Godfrey with the funny voice from Saturday live, but he was on the second generation of Saturday Night Live. And he said they were the cast right after the original cast of Saturday Night Live and everyone hated them because they weren't used to Saturday Night Live cast changing at that point, it would be like if somebody just replaced the cast of your favorite TV show with a new one that people weren't used to it and, and so they they got fired within like a year or two. And they said nobody liked them. And, and the the, and then the next cast was able to really take off and become the classics of Eddie Murphy. And the that whole cast of the, the early 80s. That's probably more famous than the first one now. And so you're the third CEO. I, you, you the Eddie Murphy and what's what's it what's it like to be the Eddie Murphy after? What's it like to to try to resume a legacy, I guess in leadership?
47:28
Look, I always think of myself as the custodian of the care brand. And I'm temporarily carrying the brand to the next stage. And I'm always incredibly respectful and in awe, really, of the of the bravery and the foresight of, of my founders, you know, they did an amazing job. And I kind of carrying on that legacy. But I think the challenges are different than what there were for them when they founded the clinic. And certainly the challenges of running a private equity group, over three countries were tiny clinics, is very different to found in a one clinic, in a new city. And so I think it's different skills for different challenges, different areas and different periods. And, you know, there's some uncomfortable truths that are, you know, it's really difficult when you've got 1000 people to know everybody's name. When you're, when you're the founding doctor of one or two clinics, you will know everybody's name, you probably even know what their kids names are. And so the the environment is different, and there's no getting away from that. But then it's about changing some of the things for the better as well. So one of the things that we are very focused on you talked about it earlier, is HR and making sure that we share in some of these benefits of being a bigger organization with staff and then I think people do accept the cultural change that's, that's going on. They understand it. And then yeah, and it's about remaining visible, despite the fact that we're 20 clinics, 1000 employees, absolutely trying to remain visible so that you are accepted within the organization is not just somebody that's running the business that no one ever sees, but actually they know me as as Dave, and that's really important
Griffin Jones 49:25
to me. What level of temporary is appropriate, it's a temporary custodian and and someone that is brought on as an executive of whoever the CEO of Mattel is now wasn't the CEO 20 years ago and likely won't be the CEO 20 years from now and that's fine. Then there is a tenure that seems to be just too short to make any kind of meaningful difference. So you see, lots of CEOs I look on LinkedIn is like, Oh, they're the CEO there for 10 months. What are they like a Gen Z intern? How Probably the CEO for 10 months, and then the CEO for 11 months over there, or, you know, two years and, and one of the concerns that people have with private equity with publicly traded companies with venture capital in the field is that there's churn, and there's the stripping of assets and selling it at a higher price. And then and then being gone. And five years, you've been almost five years at care. And that's, that seems like a pretty good tenure, what level of, of temporary is appropriate,
50:29
five years and three private equity firms. So, you know, I've survived survive that long, I think, I think for me that, you know, in any job you go in, and I think most people would feel that within six months of starting a new job, you've got a good idea of where you can add value and what you can do and how you can and how you can do that. And, and I've kind of been through two phases that I would say, you know, I came in as finance director, I had some really good ideas about how I can improve things. And I did that within the first 18 months. And then as CEO, I've kind of been through that period as well, where it was like, right, these are the top five things that I want to achieve as part of being the CEO of for care. And then I'd say, I've been through that. And now my, my period I'm going through with care now is we've we've got a really, really good UK business, and how can I establish that on the international stage? And that is given me growth and drive and enthusiasm to see how can we take what is a one country really successful model, then see how that adapts into other countries and other successes, and then one of my other big passions is building the team around me? And to answer your question directly, I don't think there is a prescribed time. But I, myself would feel that when I've achieved that international growth, and I've really got a strong team around me, then it would be right and proper for somebody else to have a go really, because I think no matter how good you are, there is a period where you've done the things that you wanted to achieve, and you maybe get a bit stale. And and I think I don't know what that lead time is. I hope it's not six years, but three years
Griffin Jones 52:14
after that. And that's when you're gonna retire. We'll see. Dave, our audience is fertility practice owners, physicians and executives increasingly from around the world, how would you like to conclude on the topics that we discussed today?
52:32
Thanks for giving the opportunity and, and hopefully, people have listened this far. So thanks for listening. But the way I'd like to conclude is that the US is very exciting market. And that's why there's a lot of private equity interest in the US. I think there's some really good players out there and some really good firms. But they've all got their differences. And what I would say is, it's really, I've worked on nearly 10 acquisitions of clinics now talking to doctors, spending time at their houses, spending time getting to know them, and really understanding them, every single deal is different. And every needs, people are different. And so it does worry me occasionally in the US about how many sales are being really process driven sales because it for me, I would say that if you're a doctor, you should really think about what it is that you want, or unknown, or I should say, what it is that you want. And if that's the biggest check, that's fine. That's totally acceptable. But in my experience, that's not always the case,
Griffin Jones 53:37
process driven sales not happening to that degree in the UK, in Europe. In your view, though, what do you think are the main differences? The main,
53:47
it depends on the process, first and foremost, but generally, yeah, in a process, you don't get a very tailored deal. It's a very off the shelf deal. And in my experience, you you often have clinics with three or four owners, and each one of those owners might have different desires for the future. Some might want to retire straight away. Some might want to be with a business for 10 years, some people want to do research and development. Some people want to be just business people. And it's really difficult for a buyer to be able to present an offer in a structure that's really tailored to the those individual people's needs and desires when you're kind of held off, but a distance with an advisor in the middle, not necessarily with those same motivations. So it really it's horses for courses, as we would say, in the UK and it you've just got to think through what it is that you want from a sale and and we pride ourselves, really and I personally pride myself so I'm really trying to understand what it is that the sellers want, and then try and come up with a structure and a way of working that that satisfies those needs.
Griffin Jones 55:02
Why do you suspect that that type of process sale is more common in the US than it is in the UK, in Europe,
55:07
I think the pace of change in the US is faster. You know, we've been going through a consolidation process in the UK for over 10 years, I did my first acquisition in the UK back in when I joined 2014. And we're still doing them now. So it's been a much slower process in the UK, whereas the pace of change in the states seems to be a lot faster. And I think maybe clinics are getting not forced, but are feeling the pressure to settle and move on. And that maybe leads them to stay where they are going with these very fast six week advisor led processes, which, like I say, it's horses for courses that might suit some people, but this is advisor
Griffin Jones 55:53
being the person that represents the sell side. Yes. And so normally, that they the Steelmen argument for that would be you need somebody to advocate for you. And, and so what's the drawback? No, no, it's
56:09
not saying that you don't need sell side advice. It's, it's the type of sales. So sales side advice is critical. And these advisors do an amazing job. But it's when it's a very fast six week process and pious beard winds kind of thing might be perfect for some sellers. But in my experience, what you'll find is that there's sometimes a misalignment after the sale, because you didn't really get chance to talk about what it is that you want and what it is that they want. And how can you it was very quick. It was a very quick process. And so this is quite often somebody's Lifetime's work, right, they spent 20 years building this business, why not spend a little bit longer, just getting to know who it is that you're going to be partnering with after the after the deal would be my main advice, really, to people. And then, as I say, my passion and, and cares passion. And having done lots and lots of these acquisitions over the years is to really understand what it is that people want, and then to try and tailor that deal to suit them.
Griffin Jones 57:12
Dave river CEO of care fertility, thank you very much for coming on the inside reproductive health podcast.
Sponsor 57:18
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