His case volume growing at the heady clip of 20% per annum, Chicago-based Steven H. Dayan, MD, FACS, enjoys one of the busiest aesthetic plastic surgery practices in the country. It’s one of the most financially robust as well, thanks to Dayan’s decision 4 years ago to organize the practice into six specialized divisions—at least three of which have since gone on to become profitable businesses in their own right.

A couple of these units can be considered conventional ancillaries to practice, but some of the remainder are not. Among those venturing outside the box is a Dayan-controlled marketing company that takes on as clients physicians who need help growing their practices, and medical-device companies looking to enter the market or increase their market share. Another is a research firm that conducts Phase III clinical trials at the behest of manufacturers seeking FDA clearance to sell their newest medical devices.

PRACTICE PROFILE

Name: Steven H. Dayan, MD, FACS

Location: Chicago

Specialty: Facial plastic surgery

Years in practice: 7

Number of patients per day: 30

Number of new patients per year: 1,200

Days worked per week: 5

Days surgery performed per week: 2.5

Number of employees in practice: 15

Office square footage: 4,000

“Each division has its own director who is incentivized with equity positions and performance bonuses to work hard at transforming that division into a successful, separately run corporation,” says Dayan, a solo practitioner whose flagship unit goes by the name SDMD.

Dayan contends that this practice model makes sense for anyone interested in growing beyond what a lone physician (or even a small group) can otherwise accomplish.

“In a traditional practice, you eventually reach a productivity ceiling,” he says. By that, he means there is an upper limit to the number of operations one can perform in the span of a day.

In contrast, there is no corresponding limit to the expenses a practice can incur. So if expenses can be counted on to increase after production output stops rising, eventually one’s practice will, in effect, begin to contract, according to Dayan.

Boosting efficiency and reducing overhead can help, but not forever, because there are limits to those actions as well. “In my opinion,” Dayan offers, “this makes for a horrible business model.”

The model he advocates thus does not seek to mine as much gold as possible from a single enterprise, but, rather, to spin off as many new ventures as practicable from the original and hire people to build each of those to the limit.

Go Where the Business Is

Dayan—a 1993 graduate of the University of Illinois School of Medicine—entered practice in 1999, following completion of an otolaryngology residency there and a fellowship in facial plastic surgery at Indiana University.

Patient coordinator Katie Ziemba (right) reviews postoperative care steps with a patient.

“My practice is limited to the face, so the majority of my surgical caseload is facelifts, blepharoplasties, and rhinoplasties,” he says, adding that he believes an in-the-process-of-establishing-itself, growth-minded practice should focus on services in greatest demand. That’s what Dayan himself did in the early days in his own office. “Until I was able to establish myself as an experienced facial plastic surgeon, I went to where the business was.”

For Dayan, where the business was and currently is turns out to be in the realm of minimally invasive services. “Minimally invasive office-based procedures are the fastest growing part of aesthetic medicine, growing at over four times the rate of surgical procedures,” he enthuses.

“That can be very advantageous for young plastic surgeons just starting out. They’ll find it much easier attracting a new patient for a Botox® injection than they will for a facelift. But that’s OK, because providing the Botox injection opens the door to developing a satisfied patient who can be converted into a surgical patient.”

Dayan and his students in his True University.

Analysis of Dayan’s practice patterns confirms that this was precisely the process that occurred under his roof in the early days of Dayan Facial Plastic Surgery. “Nearly half my aging-face surgical patients were also patients who had requested or were requesting Botox treatments,” he says. That insight led him to place strong emphasis on minimally invasive services of all types, but especially fillers and ablative and nonablative laser treatments.

Dayan’s complement of laser equipment includes technology possessed by few other plastic surgery practices in the United States. Credit for this belongs to his research subsidiary, formally named SDMD Research. “We do quite a bit of clinical research on lasers and other devices, so I have the privilege of being able to utilize many of the latest devices ahead of their introduction to the broader market,” he says.

SDMD Research typically has no fewer than 12 studies and three Phase III FDA clinical trials in progress at any one time. Among the key customers are foreign companies seeking help with the development of treatment protocols for products they hope to introduce domestically, Dayan reveals.

Receptionist Laura Garcia checks a patient out after a treatment.

A “Taught” Ship

SDMD Research is reported to be doing well. So is Dayan’s True University division, which he carved out from his skin care department as an enterprise devoted to offering postgraduate aesthetic training.

“True University is aimed at qualified aestheticians looking to get into the medical aesthetic environment,” he says. “Our hands-on training course attracts students from across the country. The unique thing about True University is that it isn’t sponsored, influenced, or biased by any outside company. It is wholly under the stewardship of a physician.”

Spurred by a love of teaching (as exemplified by his status as a clinical assistant professor at the University of Illinois), Dayan has partnered with academia to offer interns, residents, and fellows a plastic surgery rotation that takes place in his office. “In addition, we host paramedical professionals from physician-assistant programs and nurse-practitioner programs—we even have a program that offers high school students the opportunity to rotate through our office,” he says.

Assistant Leslie Manuilow photographs a patient prior to surgery.

“Once a month, we also conduct a formalized preceptorship program for physicians who want to learn more about aesthetic services and about the business of running an aesthetic practice—I’m very open and honest with the participants when it comes to business strategies and tactics, those that have worked for me and those that haven’t.”

Where Dayan’s practice is concerned, education is not confined to practitioners. It takes in patients as well.

“I want my patients well-educated in order that I can properly fulfill my role as their partner in their treatment decision-making process,” he says. “My patients know I’m passionate about teaching, and that helps them recognize me as a trusted authority and resource for their questions.”

To abet patient education, Dayan has designed his office as a knowledge foundry. “The ability to learn something new or find the answer to a question is everywhere you look here,” he says. “We make available a wealth of educational articles, DVDs, and brochures about aesthetic services.

Tracy Drumm, marketing director for If Marketing, and Dayan review a presentation for a client.

“Some of these are intended only to pique interest, but one thing they all have in common is they are produced internally. We don’t offer any materials that are flashy, gimmicky, or over-the-top promotional. My feeling is that sophisticated, intelligent patients are insulted by such materials.”

Anyone visiting Dayan’s office who plans to relax in the waiting room with the current issue of Cosmopolitan, Vogue, Mirabella, or something similar will be sorely disappointed. “I’ve taken the step of removing consumer magazines from the tables and stands, because those tend to distract from the educational experience we’re trying to provide,” he says.

Dayan tells of an experiment he conducted a few years back in which he placed on display in the waiting room a selection of educational materials and several fashion magazines, just to see what people would choose. Fashion magazines won hands down. That’s when Dayan realized medical literature could not compete head-to-head against glossy illustrated tales of sex, beauty, and celebrity crises. “So, out went the magazines,” he says.

However, fashion magazines have not completely vanished from Dayan’s office. “If a patient requests one, we will of course provide it,” he says, indicating those are normally now kept under the receptionist’s counter.

Star Power

The magazines—fashion or otherwise—that Dayan likes best for his existing and prospective patients to read are the ones in which he has been quoted. A favorite of the media, the articulate and informative Dayan turns up a lot in print (more so now that he has a consumer-oriented book on aesthetic procedures coming out later this year from Hatherleigh Publishers), but it really is on radio and television where he shines the most.

“I frequently appear on the local Fox News morning show—they have me on for a 3½-minute segment in which I introduce the latest advances in the aesthetic world,” says Dayan, who also has been a guest on programs aired over CNN, ABC, NBC, and local Chicago station WGN-TV.

Dayan appreciates being a media source. It is good for business, yes. But, equally important, it costs nothing, unlike display advertising. “I’m not fond of advertising in newspapers and magazines because that can be very expensive,” he says. “I do not believe the yet-to-be-established physician should put money into print advertising for building his or her brand.

“I believe in building your brand with free publicity. The time for paid advertising is after you’ve built the brand and then need to defend it, although print advertising would still be a low-priority investment even then.”

Publicity—PR, if you will—is therefore tremendously valuable for growing a fledgling practice. However, PR also is difficult to produce. “It takes a serious investment of time, effort, and creativity,” Dayan cautions.

“Early in my practice I wasn’t very busy, so I had a lot of time to sit around, think, and work on ways to get busy. PR was one of those ways I came up with. I had marketing consultants soliciting me all the time, but they wanted to charge fees I couldn’t possibly afford. I realized that the only way I was going to generate PR for my practice was if I did the work myself.”

Dayan became so good at creating buzz in the media that other physicians and local companies sought him for advice on getting their own businesses recognized. From this emerged If Marketing, Dayan’s in-house PR and marketing agency that also offers outside consulting and support. “We currently have a dozen clients and are in the process of expanding,” he says.

Speak to the Need

Physicians who try their own hand at marketing do not always succeed. Dayan suspects this is because they have no clear notion of what they want to achieve and, if they do, no solid plan for how they will go about it.

Enhancement Beyond Facial

One of the business divisions set up by Steven H. Dayan, MD, FACS, exists not to benefit his Chicago plastic surgery practice but to enhance public education. Accordingly, he named this unit Enhance Educational Foundation.

“Through Enhance, I have leveraged my influence in the aesthetic industry to stage an annual health, wellness, and beauty event that brings industry and consumers together in a highly sophisticated gala evening at the Ritz Carlton Hotel, with all proceeds going to benefit disadvantaged students,” Dayan says.

“For the women and men who attend, this is an opportunity to talk directly to physicians and over 40 distributors and manufacturers of products including injectables, fillers, breast implants, you name it. Many of the products displayed are new to the market, so there is considerable excitement associated with this widely publicized event.”

Last year’s gathering sold out—more than 650 people attended—and resulted in the Chicago school system receiving $35,000 in the form of scholarship money earmarked for a deserving inner-city high school senior with big dreams of continuing on to college.

This year, Dayan’s Enhance Educational Foundation has teamed up locally with a pair of name-brand cosponsors—Borders bookstores and Starbucks coffeehouses—to promote literacy in the inner city.

Dayan, a clinical assistant professor at the University of Illinois, is an ardent advocate of education for kids from hardscrabble neighborhoods—so much so that he himself teaches a lecture series at an inner-city high school. “These kids are really motivated to learn; they’re wonderful to work with,” Dayan says.

In addition to the health, wellness, and beauty event, Enhance Educational Foundation oversees book drives on behalf of the students and coordinates mentorship programs for them.

“Everyone always asks why I do this and, honestly, it’s because I love it,” Dayan explains. “You can’t devote this much time, energy, and resources to a charity if you don’t truly believe in it.”

—RS

“You have to start by knowing who your target market is and knowing what are the plastic surgery procedures they want most,” he says. “Then, you have to figure out the best way to communicate to those markets, using the most efficient means at your disposal.”

As to the message carried by such marketing communications, Dayan asserts it must contain elements designed to capture audience attention. These elements are best expressed by a pair of acronyms—WIIFM and TOIB.

“WIIFM stands for ‘what’s in it for me?’ ” he says. “This is what every person thinks when they look at your marketing materials. If what you’ve disseminated doesn’t immediately answer the question ‘what’s in it for me?’ then your materials are not likely to have any impact and will be wasted.

“Too often, we make the mistake of thinking about our new product or service or campaign from our own point of view,” he says. “You can’t do that. You must communicate from the perspective of your target audience’s interests.”

TOIB, on the other hand, stands for “teaser, offer, immediacy, brand.” This is the technique of ensnaring audience attention by right-off-the-bat making a strong appeal to their emotions or intellect, then following up with an invitation to utilize without delay the unique expertise, equipment, or product provided by the issuer of this marketing communication, Dayan elaborates.

Miles of Smiles

Born and raised just outside Chicago, Dayan is the son of a Moroccan immigrant and belongs to a huge extended family. His kinships have taught him invaluable lessons about the dynamics of relationships—specifically, what it takes to make many different personality types happy.

Indeed, woven throughout the very fabric of Dayan’s practice is the notion that making people happy is the answer to all questions and controversies. “Everyone in the office knows this,” he says. “Therefore, there is never much uncertainty on what to do in a difficult situation. It allows great freedom and empowerment to my staff.

“Instead of them asking me, ‘What should we do?’, they know the answer by always recognizing the core mission—make people happy. If they can make the person happy, then that’s what matters most. You make people happy by providing them a great experience. If you can do that, they will continue to come back and refer others.”

Ways in which Dayan and his staff attempt to delight patients include sometimes chauffeuring them home from the hospital after a procedure and, when possible, having skin care aestheticians provide complimentary facials, hand massage treatments, and waxings to patients queued an overly long time in the waiting room.

These and related customer-happiness functions fall under the category of concierge services. There is no separate division in Dayan’s practice set up for that, although the key ingredient to allow one to be established clearly exists—namely, good, conscientious employees.

See also “Rhinoplasty Minus the Knife” by Steven H. Dayan, MD, FACS, in the February 2007 issue of PSP.

“A great staff is invariably your most valuable business asset,” Dayan confirms. “However, without doubt, this is the hardest part to growing a practice. Even with my business model, success requires there be in place the right team. Unfortunately, putting together such a team is incredibly difficult and is something that can take years.”

That is really the only downside to Dayan’s divisional business model: dependency on personnel with the talent and the drive to take charge and make a go of these microventures.

“Still,” he assures, “if you can attract such employees, the results can be remarkable.”

Rich Smith is a contributing writer for  Plastic Surgery Products. For additional information, please contact [email protected]