How Dental Groups Can Centralise Finance, HR & Marketing in India

Welcome to the Going Global Business Podcast. Dive into the top business trends, ideas, and tips to help you go global with your business. Let's jump right in today with your host, Arun Mehra. Hi, everybody.

Here is part three of the GCC webinar series. I'm here with Arun Mehra and Deepak. How are you guys today? Great.

Good. I'm doing good. How are you doing? Yeah, not bad, not bad.

So remember the first two sessions we spoke about opening up a center in India and basically covering bas- the basics of what a GCC is. So today, I think we're gonna be focusing on, uh, something a bit more specific, which is dental groups. A lot of people would not actually think how can a dental group use this sort of a service, or how can somebody effect- who runs a dental practice effectively use this sort of a model? So could you guys explain exactly how a dental practice can go about this?

So I think, uh, a dental practice on its own is probably not the right way to look at it, Prajwal. It's more about, uh, an accumulation of dental practices, which is ultimately a group or a DSO, a dental service organization. And what we've seen over the last years is a lot of dental groups emerge or DSOs emerge, primarily through acquisition. They've been acquiring other dental practices, whether they're in the UK, the US, or different parts of the world, these groups have emerged.

But the big, the big problem that we see in so many practices, in so many groups rather, is that every practice they add does contribute to the EBITDA of the group. But every practice has a different way of doing things. Okay? So whilst the ideal situation is that every practice you're buying will have the same practice management system, the same financial system, the same way of how they record income, the same way they record costs, the same way they do everything, the reality is very, very different.

Okay? Each practice they buy has a different thing, different way of doing it. Okay? They use a different PMS, they use a different bookkeeping software.

They use different payroll systems. They pay on different base days of the month. It's just completely, completely different, and it's non-standardized. So the only way to really...

The, well, the, the, the, the key reason that you need to standardize firstly is firstly to, is to, is the DS- the reason the DSOs are emerging is because people or gr- or investors are buying these with a view to make further money down the line. And in order to make money down the, further down the line, you have to grow the EBITDA. And in order to grow the EBITDA, you need to standardize your processes and procedures. So that means in a clinical context, that's down to the clinicians, but when it comes to the business operations side of things, it means the, the finance and accounting department, the HR department, the compliance department, the marketing department, everything needs to be standardized.

Okay? Because if everyone's doing it differently, honestly, it's just a mishmash of lots and lots of dental practices, and there's no kind of, um, EBITDA creation or EBITDA growth possibility or minimizing EBITDA growth possibility. And any future investors who are gonna invest in it won't be particularly interested if it's just a mishmash. So this is the real reason why cons- uh, kind of a real standardized process needs to happen.

Sorry for a long answer. [laughs] No, that's cool. That's cool. Deepak?

Yeah, and I just add to this, uh, you know, when a patient walks into a, a practice or wherever for a, especially in a service, uh, oriented industry, you know, a service industry, experience matters a lot, right? Customer experience matters a lot. So if there's, as Arun said, right, if there's a standard process, a standard process how the, uh, you know, the appointments are scheduled, how calls are handled, how invoices are raised. If it's seemingly, we are not just creating a good dental practice, but we are then eventually creating a brand.

And for these dental groups, for the DSOs, creating the brand and that brand awareness is much more important. And if, if we are happy, if we have created that brand, if we have ach- tried, achieved that brand creation, of course, it will have greater returns. The ROI will be much, much greater than being a traditional, uh, the way if we, uh, you know, run a dental practice in a traditional way. So that standardizing the processes and, you know, the process, the client experience, if we focus on the client experience and the back end, the cl- the clinicians, the, uh, in-person, uh, staff can focus on the client experience, customer experience, and these, the retarded, the repeated process, if they can be offshored to a team which can handle them with quality, that of course increases your value that- Correct...

uh, helps you build that brand. So, correct. If I just add to that, what Deepak said is that w- we, we're not position- we're not clinicians, okay? This is not our remit.

The, but the clinical teams, the clinical leaders, the clinical directors will need to guide the group of practices to have a standardized clinical process. But where we do excel in and where we do have the knowledge is, is making sure that you've got the, um, standardized processes for the accounting and finance function, for the marketing, for the HR, for the compliance. It's all standardized. And therefore to, to, to, to kind of, kind of just look at where we are today in this economic climate, a lot of those processes can be standardized, but then they can also then be, um, operated globally.

They don't have to be done in a home country. They can be done in places like India where you have the accountants, you have the IT people, you have the marketing people to support this initiative. Um, and that's kind of where I see it going. Um, some groups are already starting to do this, um, but, and some people are just outsourcing it to third parties.

But where I see it really going excelling in the future is where groups actually set up their own entities in India as a subsidiary of their UK company, which ultimately is a GCC, and then they run and manage those teams, um, globally. Um, and so the finance function, the marketing function, the, um, HR function, a lot of those operational aspects can be actually run from, uh, a GCC or a global capability center. So just to be clear, it's basically the mishmash that dentists have to go about in terms of their non-clinical side, which is the finance and et cetera.

Yeah, I think that's the key thing is, is it's the admin side, it's the finance, the marketing. It's not the clinical side. It's w- we, we, the, the clinicians have to, have to make the call. They're doing the dentistry in their clinics, but it's the systems they're built on.

In order to deliver good quality care, you need to make sure you've got good financial and standardized finances. You need to make sure that the bills are being paid on time. You need to make sure that the, um, the p- payroll's being done properly. You need to make sure that the associates are being paid properly, all these things.

Okay? So they all have to be standardized, and whilst it can be done in country, um, the costs are rising, and the, the sensible approach is to standardize them and then ship them to, uh, another location such as India and set up your own GCC. That's when you get EBITDA expansion, and that's ultimately what investors are looking for. If the EBITDA is growing, um, and the, uh, the kind of leadership of the DSO are savvy enough to actually see and grow this that way, that's when, um, more interest becomes, become - you get, you get more interest in the group, and therefore there's demand to buy those such DSOs and groups.

So with that being said, in terms of centralizing all these functions in, let's say a respective country outside their, their home country, what are the real world cost savings that a dentist will go through in terms of like, you know, increasing the EBITDA and making it a more, you know, exemplary- Yeah, I, I, I wouldn't say a dentist. You need to get the terminology right here, Prajit. It's more about- DSO... the dental groups, the DSOs.

Exactly. Dental groups. So I, I think it could be well in excess of 50% of savings, okay, on those particular costs, maybe more, 60, 70%. It all depends on the roles and where and location and, and how they set it up.

But the costs, um, can be significant. Okay? Um, it may be 60, 70%, and it depends on what you do and how you do it. So you still might have in some key in-country people, but you have a much bigger team out there doing the bookkeeping, the payroll, ac- accounts payable, all of that stuff being done in India.

I just look at our own organization. That's what happens in our organization. In terms of the marketing side of things, for instance, marketing stuff is created in the UK, but then edited and reviewed and made and recreated in our team in India. Again, it's a saving, okay?

Um, and, um, therefore, we live in a global workforce, and as we saw in yesterday's budget, to be honest with you, okay, costs are rising in markets like the UK, greater taxes, um, greater national insurances, greater problems for s- small to medium, even large businesses. So you have to start st- thinking strategically, what am I gonna do? And therefore, um, one of the options is to start thinking, okay, I'm gonna move my admin side of things, a lot of the centralized costs to another jurisdi- jurisdiction, and then, um, uh, run the business that way.

Deepak? Yeah, I just add to this that any, any process or any role which does not need a pers- in a person, uh, you know, uh, uh, a fee to be in UK for that process or a job profile, I think that can easily be offshore to your, uh, GCC team in India. And as, as Arun rightly said, on the operation side of things, the operation cost can, uh, drastically be reduced by 50 to 60% cost saving. And, uh, you know, our, our, uh, dental DSO slide deck available on our website also illustrates this with an great example.

You have the cost comparisons there for a team of five to 10 people, you know, working in a dental practice. So if you, if you see the larger people, uh, larger picture and compare it to a group operating four, five, uh, dental practices, and if we compare the cost savings across the group, they are huge. They are seriously huge. And, uh, rightly said, increasing the EBITDA and the valuation.

Correct. Correct. So with this being said, which non-clinical function drains the most time for a DSO today? I'd say it's difficult to say which is the most, Prajit, but the ones that are significant, the finance function, okay, the finance and accounting function, because you've got to pay, pay the bills, do the bookkeeping, um, do the payroll, do the associate pay.

That's just, that takes hours of manpower. And if, and again, if it's not standardized, it can be a complete kind of mess. Then you've got, um, managing HR related things, um, marketing. So there's no one that's more than the other, I'd say.

Okay? Um, but what it also allows, if, if... O- one thing we haven't highlighted that I think is important to highlight is that if you've got an offshore opport- offshore team overseas, which the costs are lower, it also gives you the opportunity to add kind of, kind of an innovation element to the business as well. You could bring in data scientists, um, software developers to help you improve the workflows, help you look at your data that you've gotten all your data into, in your, in your clinics in a much, much more thorough and better way to analyze and say, "All right, what can we do with this data to improve performance, to grow EBITDA?"

So it's a re- it's a fundamental rejigging of how you structure your DSO, how you structure your organization. Okay? Um, there's pricing pressure in the West, uh, in, in, in terms of patients wanting to spend, and therefore, and then, and if costs are rising, okay, in the home market, you need to start thinking, "Well, I need to change my cost structure somehow." That means, okay, I've still got to play dentists and clinicians and nurses, staff over here in the UK or US, but then I have to eliminate, um, some other costs or reduce costs elsewhere, and that means it could be, as I'm saying, the centralized costs.

Then with that saving, you can then use, hire good data science people and AI people, software people to in, to bring into your team who can then ultimately, um, analyze and perhaps give you- Greater insights into the por- performance of the D- DSO to, for you to ultimately to make better decisions. Deepak, any thoughts? Yeah, I just add, uh, to just what Arun, uh, really said. We can't, uh, the West, the West and the practices in the US, UK have the pressure of reducing cost, right?

And you can't compromise with the clinical cost. You can't compromise with the cost of a dental. Because you have to give seamless experience to your patients, you have to take care. You, we are- Correct...

really in the healthcare industry. We can't compromise on that. But then the next factor is wherein we can utilize strategically leverage the cost-effective markets, if I say. That, that, that is, that is the main area.

You can't reduce the clinical cost, but then you have to find out a way wherein the admin cost, which are the central blocks for the, uh, dental groups, how we can leverage and take the leverage of the cost-effective markets without compromising the quality, without compromising our standards, but then to have leveraged cost, effective cost. And India is the destination, I'd say. You, you talk about the role, and it's available in India. Yeah.

India is leading in I agr- I agree. I think, uh, we may be biased, okay? People might argue, but at the same time, I, having seen and worked and dealing with the, the manpower availability in India, the India is definitely the market. You've got...

L- just look at the back office functions. I look at our own team, okay? Our own team's a great reflection of, of this. We have data scientists who we've hired are based in India.

We have a qualified accountants based in India. We have people such as video editors. We have social media people. We have accountants.

We have the whole spectrum of things. Now, do they have all the knowledge of the UK market? No, of course they don't, okay? Do they have all the i- understanding?

No, they don't, but that comes with training, that comes with development, um, and that comes with a good attitude. And, um, and, and, and in, and in In- if it's somewhere like India, it's, you, you, you, you, you gotta be sh- pretty shrewd, and you need to know where to look and who to hire and where to hire them from and look at the backgrounds of these individuals, okay? But with, if people come and work with us, we'll help them navigate and find the right talent because there is a huge talent pool out there.

It's just knowing where to look and how to find the right people for your organization, um, that will fit into your kind of culture. And so in terms of getting this leverage, and you said, like, it's very important for people to hire, for, for DSOs to hire, and I would say, like, when a DSO looks at this or looks at this model as such, they, they won't be really clear or they'll be a bit skeptical on how to do this. So what would be the steps for a DSO? Is it like any other business trying to do set up a GCC or is it gonna be a little bit more different?

Definitely, um, sim- there's some similarity, but there are also some differences, Praju. So I, I, if I had to kind of... The starting point is to do a feasibility study. Look at your existing business and look at what roles, as Deepak highlighted, could potentially be navigated to, to another team or another, another group of people sitting overseas.

Firstly, identify that and then work out with us, um, how feasible it is and what are the costs that are gonna come, are gonna be associated with it. Because sometimes initially if you've just have a few team members, it may not be cost-effective 'cause you've still gotta invest in office infrastructure, um, insurances, paid accountants, lawyers, all these types of things, okay? And it may not be. It's when you start scaling, and that's when the real opportunity comes.

By adding more manpower, that's when the real advantage comes. So I think, um, and then in addition, working with a team that understand this market, who understand the dental market, who understand the softwares, who understands the, the, the terminology, who understands what the pro- the pain points that DSOs have. Yeah. I think that's when, um- That's-...

the, the, the, the, the, where we come into our own, okay? I don't think anyone can really touch us on that. Um, we're not experts, say, in other sectors, but we, in this sector, God, we know it and we know it inside out. Deepak, any thoughts?

Yeah. And Praju, this is not a, uh, you know, setting up a, a GCC unit in India. It's not a short-term goal, right? You have to have really long-term vision.

You have to spend time. You have to make your training budgets. You have to train the team. You can't expect a person to be directly working as per the UK and all.

You have to have the, the Western leadership team has to collaborate with the Indian GCC members and make them an integral part of the organization. You have to spend time. You have to train them, you know? You have to sow the correct seeds to reap the benefits, so you have to really nourish them as an integral part of the organization.

Yeah, and what- And then, and then you get the fruits. Sorry, carry on. No. Yeah, I, I, I, I, I stress, I, I think I stressed that point that Deepak's highlighting.

It's not a matter of just hiring a few people overseas and letting them get on with it. No. That, that, that ain't gonna work. You, you will have the biggest disa- it'll be a big disaster for you, okay, if you do that.

It's about hiring a team, nurturing, as you said, nourish them, build them, develop them, build that trust. They bu- they'll build trust in you, you build trust in them. Um, and really kind of make them as part of your global team, okay? Not just some s- some people w- who work for your business sitting in India.

That ain't gonna work. That ain't gonna wash. The world is too small now, okay? And, um, the, the, the team members will get very disheartened.

Um, there'll be poor communication, and culturally it just won't work. So you really, really gotta focus on getting that culture, and you as a, if you're a DSO leader, it's all about that leadership and getting that culture right. So, I mean, going into that then, I have a question here which, like, just caught my eye. Why is practice level admin one of the biggest blockers to dental group growth?

And would practice managers really be, if they didn't focus on the admin work, then what would their roles be if a GCC was formed? So, okay, so kind of, uh, sit, is it, 'cause that's an interesting question. So if, if a lot of the ad- Administration roles as we're saying would move overseas. Okay?

Th- that then frees up manpower in the UK to focus on growth. Okay? That means focusing on, um, treatment coordina- coordination, focusing on, um, referrals between clinics, focusing on other things that can actually grow the growth, grow the business. Um, and that's what ultimately a, a good business cum practice manager should be doing.

But if they're bogged down by the day-to-day processes because they have to submit payroll data, or they have to submit time sheets or whatever it may be, and it's just not automated, there's no system in place. Honestly, it's just a - there's no scope to growth. And, uh, and, and really what you'll see is, and I, and I've seen this, I've seen so, so many DSOs emerge over the last few years, and people buying clinics, and they might have 15, 20 clinics, and it sounds fantastic, but they're - they've got no strategy to actually think about how can I, um, strategically bring everything s- standardized and reduce my costs, grow the EBITDA on a consistent basis going forward?

And that's when you've just ultimately got a mishmash of practices and no one, no other investor is really that interested in buying you. And, um, that time and time again has happened. And the, the only ones that will grow well, the one - are the smart ones who have actually understood these issues and looked at, okay, what am I gonna do? How am I gonna change things and make these strategic changes?

Uh, I'll add to this, Praveen, just, you know, I'll just give you an example. Like you walk into a dental practice and you see the receptionist being busy in calls, not paying attention to the patient who is there to get treated. And then there's a different scenario wherein you walk into a dental practice and the, you know, the receptionist is free. She's talking to the patient and he's waiting for his turn to come in for his appointment.

So this makes the difference. What we started as in customer experience, if the receptionist is free from the rescheduling the appointments, attending the calls, and someone, you know, a team mate in India, in your GCC team in India is handling and rescheduling those calls for the dental practice, the customer experience elevates, and this makes the difference. Absolutely. You know?

You, you get reference. Well, a great, a great example, Deepak, because you can then take away the m- emails or the WhatsApp messages or the scheduling calls, rescheduling calls or rescheduling appointments away by someone sitting at there. That person sitting in the clinic in the UK can be building the relationship with the patient, understanding their issues, and ultimately then selling other services to them as well. So spot on.

So the message is basically the people in the UK focus on the patient care and India will handle the rest, and we'll make sure that everything's centralized and this will be wonderful. It's not as easy as that. If, if, if, if only, if only it was that easy to say that. I think it's, sounds like it, you know?

Yeah, yeah. In, in, in, in theory, yes. Okay? Yeah.

Practical reality is never that easy. But in a nutshell, yes. Okay? But I think it ne- need - in this type of approach needs a visionary leader.

It needs people to actually, um, really see what the potential is for them also to st-stick out of their comfort zone. I appreciate going to set up an operation in India is not a small move, it's a massive move, okay? And it's a fundamental- Yeah... change in how you do things, okay?

But if you've got that willingness to change and see the benefits from it, then it's a solution that will compound and only make things better. Will it be easy initially? No, it won't be. I, I can guarantee it.

There will be struggles, there'll be challenges, there'll be problems, there'll be cultural issues, there'll be resistance from team members in the UK, US, wherever you're doing this from. 100, there will be resistance. I can tell you that now. Okay?

But if you're serious about growing your business, that will be the, um, kind of real opportunity for you. So in terms of, let's say, doing this, so what's stopping a DSO owner from taking this leap? Fear. [laughs] Maybe.

Not fear. I think it's the unknown. Okay? I think fear of, oh my God, it's overseas.

They have never been to India. They don't know what's possible out there. I get that. Okay?

But I hopefully we can bridge that gap by talking to people, uh, explaining the situation, helping them understand the, the good, the bad, and the ugly, because it won't always be smooth sailing, as I said earlier. Um, but if they've got an appetite to s- and they can see the potential long-term benefits to have a scalable team, and that's the key thing India really offers. It's a scalable team to help you grow further. 'Cause if you can start adding, if then you can start adding more practices in the, in, in your home market, 'cause you've got that scalable infrastructure to support that growth.

It's when you don't have that scalable team to support the growth, that's when it all starts kind of falling apart. Deepak, any thoughts in terms of what Uh, I-... practice? I would say also, also a myth that cheap is not good, right?

We, we, we see it as a, as a reduced, we always talk about the reduced cost. But I can guarantee that, uh, you know, uh, this myth the West has that cheap is not good. This is not necessarily correct. If, if the resources are properly trained, if the team is formed a part of the global team, as Arun said, and if they are, if, you know, uh, uh, there is proper investment in the resources, in the teams in India, then they give you great outcomes.

So of course, as Arun said, fear and myth mindset is the second one. And I, I, I'd add to that, Deepak. I think, um, by, by invest - it's about, it's about availability of smart manpower. That's the key thing.

India has definitely got more expensive over the last few years, no doubt about it, because of inflationary pressures, more demand for good people in India, et cetera, et cetera. But the reason you should go and do this is not because of being, it being cheap, okay? Definitely not, like in my mind. The reason to do this is because you're ultimately gonna get great talent, which will help you scale your business.

And if it's a saving financially, okay? Which it is usually, even better. Okay? If the, if costs aren't hugely saving or if the costs aren't hugely, um, uh, better Okay.

Could be, could question is it, is it worth doing? But in my mind, it still would worth - be worth doing, because you've got that trained team, and you can scale that team, and that team can grow as you grow your clinic, um, sizes or clinic group sizes, um, accordingly. So I mean, based on all your answers you've given, I would like to tell any DSO for any further information, just call us. But no, I mean, like, I'm pretty sure there'll be more to it.

But if you guys could just simplify, let's say, in like a step-by-step process in terms of, let's say, a DSO doing this, how would the steps look like? Um, Deepak, why don't you- You said, I mean, you said feasibility st- Yeah... I mean, you said, let's say we go through a feasibility study, right? And so then from the feasibility study, we look at which department exactly we feel should be outsourced to India or offshore to India, see what goes from there, and then what is the process for someone to do that?

Well, I guess it's, it's, it's - Sorry, you go, Deepak. You go on. You're the expert in this rather than me. No.

[laughs] So I'll just say, Raju, that, uh, you know, uh, the - our, our website, and in fact, the, we have discussed this in the, uh, last webinar also, that, uh, the approach we take is a ninety-day approach. As Arun said, the first step should be the feasibility study to understand the expectations, to expand the anticipated cost savings rate, expect the operations will be moving on, like whether it's feasible at this point of time for a TSA to move the operations to India or not.

Once we have done that, once we have done that, then we come to extensive discussions with the leadership team in the West and then prepare a blueprint, which, which takes around... We, we target it as phase one and which is for, you know, longs for s- uh, around initial thirty days of that. Once we have the blueprint, we have the hierarchy set, we have the processes in place, which processes have to be, uh, systematically moved to the offshore team in India. Then we come to give structure to the plan on papers.

We incorporate the entity. We hire the initial local directors in India. We hire the initial team in India. We take care of the infrastructure, the IT vendors, the equipment required, whether the team is to be working remotely or it needs to be settled in an office, which is the most, uh, s- uh, you know, ideal, uh, setup for the entity, for the DSO.

So this is, this is the second phase, which, by which we are at, uh, you know, day sixty-one. And from sixty-one to ninety days is the integral operations, where the operations go live. So for instance, we have started with the associate pay. We started with the, uh, bookkeeping, the accounts function.

We work parallelly with the team. So sixty to ninety days is the, uh, tenure wherein we work parallelly with your India team to streamline standard processes, establish processes to align the West and the India team to, uh, you know, have those, uh, training sessions, collaboration s- sessions wherein we can integrate both the teams, the H- headquarter as well as the India team. Of course, it sounds, it sounds very simple but realistic. It will have hurdles, as Arun rightly said earlier also.

It will have hurdles, but then I think the first, the, uh, foremost important step is the first step to move on. Correct. I think, I think- You just take that first step. I appreciate it's not easy.

Once you take that first step, then... But you need to be certain you wanna do it, and you gotta be ready for the, the, the, the, the, the, the, the, the, the kind of challenges that will come along, 'cause there will be some. I mean, in terms of like making it sound simple, I think you put it pretty clear to these guys in terms of like w- what is expected or w- how it's gonna be and giving out a ninety-day plan. So if there's any DSO that's looking to scale or looking to improve or looking to grow further in twenty twenty-six, well, we're right here.

And this is a service that's not just for cost saving. It's more about just helping your DSO group get to where it needs to be, not to where it is now. And so give us a call, and you have Arun right here. You have Deepak, our GCC expert.

So their Calendly links will be available in our website, samaraglobal.com. So give them a call, have an initial consultation, and we hope to speak to more of you guys. Thank you all.

Thank you. Thank you, Raju. Thank you. Bye-bye.

Thanks. Thanks. And that's a wrap for another episode of the Going Global Business Podcast. We hope you enjoyed it today, and please do share us on social media and make sure you do subscribe.

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