Dr. Richard Workman, president, CEO, and founder of Heartland Dental Care, is seeking to revolutionize the dental industry. His burning passion: learning the newest advances in dentistry and clinical skills while staying on the cutting edge of business management.

In dental school, Workman and his peers were taught clinical skills—there was no focus on business skills. This has led to the common myth that dentists can’t simultaneously be successful businesspeople and dentists. But that’s not entirely true, according to Workman. “We don’t learn business in dental school,” he said, “but we can certainly commit the time and energy to focus on rudimentary business skills and incorporate them into our practice.”

Second time around
Heartland Dental Care is a collection of hometown dental practices in 12 states: Illinois, Indiana, Missouri, Florida, Iowa, Kentucky, Tennessee, Ohio, Michigan, Arizona, Texas, and Virginia. With roughly 1,750 employees in more than 175 offices, the organization’s revenue will exceed $180 million in 2006. It has no external equity investors.

An Illinois farm boy at heart, Workman went to dental school with the full support of his family. After graduating in 1980, he started a small practice near his family farm, in case he needed to work on the farm to supplement his income. Shortly after, he began to expand his dental practices, opening one a year. In 1991, with a total of 12 rural practices, Workman took on a partner. In 1997, with 21 offices, he sold the group to a publicly-traded entity for $15.8 million.

Immediately after selling the practices, Workman began to develop and grow dental practices again. By January 1, 1998, he had built another group of practices, bigger than the one he sold six months prior. Today, Heartland Dental is a $180 million dental group practice, a huge difference compared to the $10 million business it was in 1997. It continues to grow at approximately 25% to 30% per year, and Workman believes it has some of the best margins in the industry of larger group dental practices.

“When we sold to the publicly-traded company, they let us keep our entire management team,” Workman explained. “Our restrictive covenant was a few miles from each office. There were a few exclusions from the business, so we went about starting up our businesses from scratch. We redeployed most of all our cash right away, and today, we do more in a month than we did annually with the old group.”

Gift option
Workman said he’s still fascinated with understanding how to run a successful clinical dentist organization and providing patients the best options of care while fitting that hand-in-hand with a successful business model. “A lot of times, you hear dentists saying they may not be successful business wise because they focus most of their energy on being excellent clinical dentists. They may not understand how they can excel in both. Heartland helps dentists integrate good clinical protocols with new materials, products, and the latest technology along with sound business practices.”

Part of Workman’s passion is teaching young dentists how to run a business so they can at least avoid making poor business decisions. “The reality is they work in the business world, but dentists often keep using the same old patterns versus using new thinking that would be considered commonplace outside dentistry. I’m blessed to have grown up on a farm because I understand calculated risk and hard work. I also get to meet highly successful individuals outside dentistry to better help me learn ideas that aren’t readily available to the average dentist.”

In 2004, Heartland Dental Care was the first in its industry to offer an ESOP. Workman said he has learned that the more people he can get aligned toward the same goals, the easier it is to manage, and the better the basis for management.

In each of the first two years having the ESOP, Heartland’s employees received a little more than 30% of their wages. Heartland’s ESOP doesn’t take anything out of employees’ paychecks and employees don’t need to buy the stock—they just get a certain percentage of their salaries based on the company’s results. “This is one way I hope to help revolutionize the industry because today approximately 90% of dentists own their practices and do everything alone,” said Workman. An extraordinarily small percentage of dentists in the industry look to have more than one office—never mind about 200.

“I was fortunate I stumbled onto the idea of having an ESOP because, as a dentist, I wasn’t trained to think outside of the box. Innovative thinking isn’t always positively regarded in the dental industry.”

This includes collaborating with others and sharing ideas. “Working alone is seldom an efficient or effective way, and it doesn’t promote cross learning or collaboration. At Heartland, we’re making a difference in helping to change the entire industry from the way dental care is delivered to getting all professionals to collaborate together. This is my passion,” Workman concluded.