Scott Andersen is the co-owner along with his wife, Dr. Nicole Andersen of Artisan Dental, where he serves as the director of business development. In May of this year, Artisan Dental became Wisconsin’s 1st certified B corporation dental practice and the 2nd certified B corporation dental practice in the United States. Scott and his wife, Dr. Nicole Andersen have been incorporating the principles of Conscious Capitalism and certified B corporations since beginning their practice in Madison, Wisconsin nearly 4 years ago.
http://www.artisandentalmadison.com
VIDEO - DUwHF #946 - Scott Andersen
AUDIO - DUwHF #946 - Scott Andersen
Howard: It is just a huge honor for me today to be podcast interviewing Scott Andersen, who is the co-owner, along with his wife, Nicole Andersen, of Artisan Dental, where he serves as the Director of Business Development. In May of this year Artisan Dental became Wisconsin's first certified B Corporation’s dental practice and the second certified B Corporation dental practice in the United States.
Scott and his wife, Dr. Nicole Andersen, have been incorporating the principles of Conscious Capitalism and certified B Corporations since beginning their practice in Madison, Wisconsin, nearly four years ago. I asked you to be on the show, you didn't ask me, because I was very interested. When I first started learning about B Corporations, that has come into dentistry, Conscious Capitalism, and then I thought to myself, "Why do you even care since your quarterback is out?" I mean, I figured you're just up there dying of depression, up in Green Bay. Do you still even have a will to live?
Scott: We're hanging on by a thread. It's been a challenging a year, for sure.
Howard: So, what is Conscious Capitalism? I thought ... you remember when you and me were little, remember who was that movie where... 'Greed is Good'? Remember that movie, 'Greed is Good'?
Scott: Gordon Gekko?
Howard: Gordon Gekko.
Scott: Oh, yes.
Howard: So, and then when I was at MBA school, at ASU in 1998, I was even troubled then when they were saying, you know, the only thing that matters is the profitability and the return to shareholders. And I'd sit there thinking, "Okay, I get that if I was born a rich boy in Manhattan, but I came from nothing in Kansas and I can't buy into 'the only thing that matters is the return of profit to shareholders'." I thought that was a crock of sh*t. But have we gone from 'Greed is Good' and Gekko to Conscious Capitalism?
Scott: Well, it's interesting, because the history that you trace is something that I think Conscious Capitalism is responding to, and one of the main tenets of Conscious Capitalism is multi-stakeholder orientation, and the idea that a business has the opportunity to add value, certainly to its customers, or in dentistry its patients. And in addition, its team members, its suppliers and contractors, its community broadly defined, and then also the planet or the environment as a whole, and I think what's happening in our culture now there’s an evolution away from what you described in your early training as kind of shareholder primacy, or just maximizing profit, to a much wider view of the role of business in the world.
Howard: And, you know, America has got some roots in that up where you live. You're in Wisconsin. In Detroit, it was actually Henry Ford that started the $5 day. A lot of kids think it was the Unions or the government. No, it was actually one of our biggest capitalists ever that said, "These people need to be paid a working wage." And he also had some philosophical disputes. I mean, I know Henry Ford had a lot of flaws. I know he was racist and all that stuff, but he did say it didn't make sense that his employees couldn't afford to buy his own car. And he also, back then the most migrant workers - I'm 100 percent Irish - and they were Irish and what the Irish would do is they'd work for a month or two, make a bunch of money, then quit, go to bar and drink all their money for a week and they'd quit. And Henry said, "You know what? We start paying them $5 a day, they'll keep their job, we'll reduce employee turnover, and then our own employees can afford our own products." So, there's a lot of business sense in a lot of these things that my father would have thought you were being a hippie, you know, or, you know, some '70s radical movement in Berkeley. I mean, a lot of these principles make sense. But you keep talking about a certified B Corporation. What is a certified B Corporation?
Scott: That's a great question. So, a certified B Corporation is a designation that companies as a whole can earn, much like we know about certifications for appliances, for example, in terms of Energy Star, or in the food world, we have certifications for organic, or in the building industry, a LEED certification in terms of its greenness as a building. So, rather than it being product-specific, it's a certification for the organization as a whole and it looks comprehensively at how does an organization impact those stakeholders that we talked about before, and, you know, to your example, Henry Ford did see, from a larger kind of systems perspective, that if money is circulating within an economy, it's more likely that all boats will rise in that type of environment. So, it's this whole idea of recognizing all of the value that the stakeholders associated with your business create for the organization and then the sense of reciprocity in terms of thinking about how can the organization itself continue to foster a mutually beneficial relationship so that everyone wins.
Howard: And that's the biggest problem I have when people complain about how much goes to entitlements versus exports. Like when you buy a barrel of oil from Saudi Arabia, ninety-six cents of that Dollar will not be back to the United States in four years. They're buying German stuff, Japanese stuff, Chinese stuff. But when you give Grandma $1,000 for Social Security, she spends it all at the dentist and the IHOP that day. I mean, she doesn't have ... she never has a penny by the last five days of the month. And you can't compare entitlements to export for that very reason. What's the website to go to if you wanted to become certified B Corp?
Scott: You can go to bcorporation.net.
Howard: bcorporation.net. Tell us about that. What are my homies going to find on that website?
Scott: Yes, they'll find basically all the information that they'll need to learn more about becoming a certified B Corporation and this organization that certifies B Corporations is called B Lab. They're based in Pennsylvania, and they have a free impact assessment that organizations can take. And the impact assessment is one of the key ways that organizations can become certified. It essentially looks at five key components of your organization. It looks at your governance structures, it looks at how are you treating your customer, how are you treating your team members, what's your relationship with the rest of the community, and then the environment as a whole; and a company needs to score eighty out of two hundred points in this assessment to qualify as a B Corporation. And this is really, really important because it sets up a rigorous set of standards that companies have to meet, or at least aim for, to become certified and then it lets the consumer know, when a consumer sees on the back of a label or on a company's website that they are a certified B Corporation, that they can trust that this organization has in fact met this rigorous set of criteria, and it's not just ... oftentimes in the kind of social responsibility movement there's this idea of greenwashing, which is just kind of putting a nice face on some of your practices to make it look as if you're doing things that are beneficial for stakeholders. But this criteria that B Lab has created, I think really gives consumers confidence that companies are in fact following through on their intent.
Howard: You know, this seems like something that would come out of Berkeley, you know, after a Janis Joplin concert. You're up there in Wisconsin. I think of that as some of the most conservative parts of America. I mean, you're in Wisconsin, dude. How did you and Nicole get into this movement? I mean, how did you stumble into this?
Scott: Yes, we read a book by ...
Howard: Did you eat some bad cheese?
Scott: Inducing some hallucination. You know, we came across the book called 'Conscious Capitalism', that was written by John Mackey, who is the CEO of Whole Foods Market, and a gentleman named Raj Sisodia, who is a business professor, and they really articulate these ideas very, very well. And so, we began our practice using these principles of Conscious Capitalism and then when we came across the B Corporation certification, we saw it as an independent, third-party way of confirming that our practices were in fact in place and again, giving the consumer an easy way to identify we were in fact bringing our mission to life. So, there's many overlaps between the Conscious Capitalist movement and the B Corporation movement.
Howard: Okay, and what if my homies ... my homies listening to this are thinking - about a quarter of them are in dental school, the other three quarters are pretty much just out of dental school. I mean, in all honesty, I always tell my homies, "Email me - howard@dentaltown.com. Tell me who you are, how old you are, what country you're from", and 25 percent are in dental school, the rest are all under thirty and only like once a week does some guy say, "Dude, I'm as old as you. I'm a fifty-five-year old grandpa too." But, so, this little girl is driving to work right now, and she's working at Aspen Dental, Heartland, Pacific. She's twenty-five, she's got a quarter million Dollars in student loans. She's like, "Well, what does this have to do ... why should I get involved with this? What does this have to do with a thirty year old Millennial dentist?" You know, the twenty-five-year-olds have a quarter million Dollars in student loans and they're working at Aspen, Heartland, Pacific. The thirty year olds just bought their own dental office, and the average price of that is seven fifty, so that a quarter fifty in student loans. So, she's sitting there, thirty years old, saying, "Dude, I'm thirty. I'm a million in debt. What the hell does Conscious Capitalism have to do with this dental office I just bought in Salina, Kansas?"
Scott: Yeah. No, it's really an excellent question, and from a financial perspective, if we just go back and look at profitability, which is important for all organizations to be profitable so that they can be sustainable, the information out there regarding the effectiveness of Conscious Capitalist-oriented organizations is very, very strong, and so, a few examples in the literature are, if you look at the organizations that have earned Fortune magazine's best places to work honor, in a study that was done looking at those organizations, they have outperformed the S&P 500. So, it will be one data point. Another data point would be, there's a non-profit out there called Ethisphere, and what they do is they create annually a list of the most ethical companies in the world, and in a study looking at those companies versus the S&P 500, they out-performed financially; and then Raj Sisodia, the co-author of 'Conscious Capitalism', also wrote a book called 'Firms of Endearment'.
Howard: Nice.
Scott: And this is about ... which is a nice spin on the old movie, 'Terms of Endearment', for those older listeners. In this book, he looked at companies, large companies, that had very strong cultures and they had an multi-stakeholder orientation, and they far outperformed the S&P 500, and he even showed that they out-performed the so-called 'Good to Great' companies, which are those companies that were outlined by Jim Collins in his well-known book; and then there is another group of researchers out of Harvard that has showed that, in a group of large U.S. companies, those companies that again have a strong culture and they think more holistically about their stakeholders, they too outperform market averages. So, from a financial perspective, it makes sense, and, in terms of how could that be, one of the focuses of a Conscious company is really satisfying and delighting your customers at a very, very high level, and because all stakeholders are working together to serve, hopefully, a higher purpose, the likelihood that sales are going to increase because you have such great customer experiences, is very, very high. It's also another great way to attract the best talent, because increasingly studies are showing that team members are looking for more than just financial compensation and fringe benefits. They're actually looking to work with an organization that has shared values and it has a higher sense of purpose and, in terms of your example case, there is research out there showing that Millennials are a demographic that values more highly organizations that have some type of purpose, that certainly supports the product or service that they offer, but it's a big differentiation point for the Millennial generation in terms of how they select products and services and companies that they want to support over time. And when we looked at this question of what supports loyalty to an organization over time, one of the most important factors is this shared sense of values, and it only accounted for 60 percent of loyalty towards a company, but it was the largest single factor in consumers' decision-making process. So, those are just a couple of examples, and we can we can talk about others, but those are a couple.
Howard: Well, you know, I still think ... obviously dentistry is still a cottage industry. By definition, a cottage industry is where no single participant has more than 1 percent of the market, whereas mature industries, like take aviation, you know, four companies have 80 percent of the U.S. Market. You take automobile industries, I mean, twelve companies have the whole global market. When you walk into Walmart or Kroger, 80 percent of the items come from nine companies. But in dentistry, even the biggest beasts on the planet, Heartland Dental, Rick Workman out of Effingham, he only has eight hundred offices out of a hundred twenty-five thousand. He doesn't even have a percent. And when I look at dentistry, they're still into always wanting to spend money on advertising to get a new patient, whereas the mature industries want a repeat patient. I mean, nobody at Southwest Airlines wants a new customer. I mean, who the hell hasn't flown Southwest? They want to find out how loyalty. Same thing with staff. One of the things that I can't stand about accounting is that, you know, if I go and value two dental offices, you know, the bean counters, the nutheads, are going to count up the number of chairs and the charts and everything's analytical. Well, hell, what if one office, the average employee's been there two years and the other office the average employee's been there twelve years? And all that human relationship, it doesn't even make the scale. I mean, they don't even measure that stuff. Like when I'm looking at airline stocks and I want to diversify, and I want to get like the number one person in all eight, twelve major sectors of the economy, I just want to see employee turnover. I mean, if I was looking at four airlines, if Southwest, who has the longest employee staying, versus American, which can't keep an employee, that predicts wealth. Look at the FAANMG. The biggest stocks now, I mean, the last run '93 to 2000, March 2009, it was basically just Dell and Cisco and Intel and Microsoft, and now we're in a new one and it's called the FAANMG and it's cool that Microsoft is in this new bubble too. But FAANMG is Facebook, Amazon, Apple, Netflix, Microsoft, Google. And Facebook, in my opinion, is winning because their average employee only stays with them two years, and Apple's the bottom because their average employee only stays with them a year. And I'm sitting there thinking, "How do you even run a company where everybody's in there twelve months and gone?" And if these young kids that just came out of dental kindergarten can adopt some of these concepts that you're talking about, so say, "Hey, we're not going to focus on just accumulating new patients." I mean, look at that. You went back, and you went back into practice with your dad in a town of five thousand, and your dad, from twenty-five to sixty-five, he's been looking for new patients. I mean, come on, you're in a town of five thousand. Your dad's pissed off everyone in the county three times. Let's focus on the new patient experience and customers for life. And it's not a fun customer to come into the dental office say, "Oh, I can't wait till Shirley cleans my teeth." "Oh, Shirley quit. Dad was in one of his moods and fired her." And now you've got some new girl, Jolene. And it's like, people want ... you should look at customers for life, employees for life, and these things that you're talking about, Conscious Capitalism, I guarantee you - I know my homies - 50 percent of the dentists out there are hardcore conservative and they're saying, "Oh, this guy, he's some pot smoker from Berkeley. Greed is good. Gordon Gekko is my god!" But I think this, what you're talking about, creates more wealth.
Scott: Well, you're to be acknowledged, and the examples you gave, Howard, are also the examples that John Mackey talks about in his book. So, he talks about the fact that where this extra profitability comes that eclipses the S&P 500, it comes from exactly what you're saying. When you have patient loyalty, your marketing costs can drop to almost zero. And this has been the case in our organization. We discontinued all active marketing more than a year ago and have been growing patients at a hundred to a hundred and twenty-five new patients without proactive, external marketing. You also talked about team member retention. This is another advantage Mackey talks about, that so much time and energy and money can be invested in training new team members that, if people stay, can be retained and that can fall to the bottom line in terms of profit. And your other example Southwest Airlines is very apt, because Southwest Airlines is considered a Conscious Capitalist organization and they're are also featured in the book, 'Firms of Endearment'. So, these are all great examples across the board. And we can talk about other things, for example, if there's good relationships with, let's say, your suppliers and contractors and, of course, with your patients, there's much less of a likelihood that there's going to be litigation, that there's going to be a negative patient review that's published that can kind of tarnish your brand. So, I would say the big piece here that this orientation offers, is it offers the ability to harness the attendant synergies that are present when you have all of the stakeholders pulling in one direction to accomplish a common goal. And many of those things, to your example, are very, very intangible, but they show up in terms of a patient review that says, "I genuinely sensed that your staff was happy. I genuinely sensed that they enjoyed being there", and all of that, I think, is about creating just more happiness in the culture, a greater sense of meaning for the team, a greater sense of pride and quality work done.
Howard: You know, employee turnover. I mean, you just nailed it. I mean, right now all over the news media, some poor dentist, an associate dentist quit, reported to the government and all the media outlets, that he did not sterilize his handpieces in between patients. He's old school and just wiped them all down. Oh, my g*d, she basically destroyed this guy. And then there's a thread on Dentaltown saying, "Well, how many of you actually sterilize every handpiece between deals?" and it was shocking how many dentists say, "No, we just CaviCide. We wipe them down because it just tears up these engines." So many of dentists, when they get thrown under a bus, it's from an old employee. These views. I mean that's amazing. You know, when ... they keep talking about this new marketing thing called - what do they call it? Cause marketing, where people say, "Well, I'm going to go to you because your company is all in pink ribbons and supports breast cancer." And the craziest one I saw is this fracking company in North Dakota, and they painted all their frack heads pink, and I'm like, I just don't associate fracking with, you know breast cancer, but obviously it was cause to him. But I have seen, in the field, I mean, I'm out there, I lecture pretty much every week, this weekend I lecture in two cities, and I'm meeting dentists in places like California, where they'll call their local utility and the local utility will say, "Well, for a little higher price, all your electricity can come from solar." So, then you can say, my entire business, my entire dental office is off the grid. No fuels, none of that stuff like that, and they have hippies driving forty-five minutes away, and they sit there and they say, "You know, I just thought a dentist like that, that would care about the environment and go off the grid, and runs his whole dental office with no fossil fuels, that's just the type of guy I would like and I would trust", and it's just like, so, I mean, I'm looking into that right now in Phoenix, because I called SRP - which is a nuclear power plant - and they have tons of solar fields out there and they go, "Absolutely, for a slightly higher price we can give you only electricity from solar and you can stay off your grid." I tried to go solar myself and I've been having a solar consultant, because I'm in Phoenix, but what he says is that I didn't do one thing smart under the roof. He says, like when you walk out of the bathroom, the lights should automatically go off; when you walk in, it should go on you. He says two-thirds of your electricity needs could be diminished if you just did smart stuff underneath the roof. So, he's telling our team every Dollar you spend, let's first go underneath the roof and then, when we need to go to the roof, we won't need two-thirds as many panels. But do you believe in cause marketing? Do you think it's out there? Do you think it's effective?
Scott: I think a yes to both of your questions, and I think that it's something that organizations can use. And I would say, at kind of another level, one of the benefits of using renewable energy is this, I think, genuine recognition that the planet is providing us all resources that are sustaining us, and this vision that one might have that it seems like that, as a culture, we're going to move to renewable energy. So, I think there also can be an internal sense of satisfaction that you're part of a forward-looking group of people that's embracing the future, kind of seeing around the corner, and so, there will be affiliation to your example with those patients that are willing to drive longer, and there's also the potential that your staff might really appreciate that, because they might have a shared value with that. And then you also, I think, have the potential to serve as a model to other dental practices in your community. Your suppliers that come into your organization note that this change has occurred, it might spur them to think about their choices even in their home, even within their business. So, it's, to me, another form of leadership, as well. And in our particular practice, we did make the choice to go to renewable energy, to your example, with a little bit of additional cost, but we think it makes sense on multiple levels. And then the other piece I would say regarding your examples, in your own case, about the opportunity to make changes under the roof, this is a great kind of microcosmic example of systems-based thinking. You're thinking about both inside your organization's walls and outside in the inter-relationship, and, to your point, we can save a lot of energy just by having motion-detecting sensors on our lights. So, a lot of that heavy lifting can come with relatively small cost.
Howard: And, you know, my book, 'People, Time and Money'. I mean, my dental office is thirty years old. Thirty years ago, I got paid $1,000 from Delta Dental for a crown and $1,000 for a root canal. Thirty years later I get paid $600. That's 40 percent less. And to me, dentists find that insulting, but I'm like, well, that's reality. I mean, look at the cost of a DVD player. They were eight hundred bucks when they came out. Within five years they were a hundred bucks. Now they're thirty bucks and they're better. So, you have to lower costs. Everything goes faster, easier, higher quality, lower costs, more miniature. So, getting smart underneath the roof, I mean, one way ... I mean, if they're paying you 40 percent less for a crown, you shouldn't be burning 40 percent more coal to run your deal. You've got to get smart. And back to your point on people. I always thought it was very weird how, like when you go to bonuses, a bonus system, well, people who make money at the $10 to $15 an hour, they were never motivated by money. If they were motivated by money, they wouldn't be making $10 to $15 an hour. Bonuses were directly linear to how much money you make. A person on Wall Street making $10 million a year would be more motivated by a bonus than anyone in America making $10 an hour. And I always thought it was amazing that my team, like when we got out of school, when I opened up thirty years ago, our first mission was: it doesn't make sense to sit here and drill, fill and bill when we don't even have fluoride in the water. And I was calling the Centers for Disease Control and I was calling the Arizona Department of Health and Human Services and the Arizona Dental Association, and we were amassing all the evidence of what would have happened to the diseased, missing and filled teeth in Phoenix, Arizona, if it got into water fluoridation. So, I closed down Fridays and I told my team, "We are not going to drill, fill and bill Fridays. We're not going to sit on the assembly line for eternity and all day Friday, me and my two dental assistants and my two hygienists and my two receptionists, we were going to call City Council. We were going to work that campaign. And I was so young and dumb at twenty-four, I thought this would take like ... it's a no-brainer decision. So, what could this take, like a month, two months, three months max? Yeah, it took two years.
Scott: Wow.
Howard: But it gave them so much purpose, so much passion, when the City Council of Phoenix voted it in eight to one, we all cried.
Scott: Yes. You really should be acknowledged, Howard. That's a fantastic story.
Howard: And that's why that assistant stayed with me for thirty years, that's why I've got so many people that are with me twenty years. It's about purpose and passion. I mean, who cares how much money you make, because when you die, we're all going in the same size coffin. I mean, no-one gets the high-rise, you know.
Scott: That's right. I really feel the same way, and I think what you're pointing to, Howard, is how do we redefine, as a culture, what is success? And I think success can include many things beyond profit maximization. Profit maximization can be part of it, but it can go beyond that. And your example is a great one of that, where you're thinking on a much more macro-scale, how can I promote the oral health of the whole Phoenix area through this high leverage activity called fluoridating the water and, moreover, being persistent even when the timeline got protracted. And it's people like you that actually evolve the systems in our culture so that the quality of life of everyone increases. And it sounds like, as I listen you talk about your whole business philosophy, from early on in your life, you've been a long time Conscious Capitalist, and you probably have the infrastructure in place to become a certified B Corporation now. So, I would encourage you to consider it, just walking through the assessment process, you may score high enough as you are today. Maybe with ...
Howard: Well, do you have numbers on this? I mean, how many dentists are there and how many have got the certification? Do you have any numbers on this?
Scott: Yes, currently in the United States, there are two practices: Permanente Dental is one group up in the West, and Artisan Dental is the second. There is a group in the country of Chile that is certified. There's another dental practice in Italy that's certified. And then there's some smaller kind of industry-supporting organizations that are certified. There is a group called Direct Dental Administrators that are helping companies basically self-insure, create their own dental self-insurance. Preserve is a company that produces toothbrushes that are made out of recycled materials.
Howard: Preserve makes toothbrushes?
Scott: They're made out of recycled material. They make a, you know, extensive line of recycled products from picnic products to [00:29:53] [sounds like: cutlery]. [0.0]
Howard: I'm Googling that right now. Preserve toothbrushes.
Scott: Preserve toothbrushes. And there's a smaller company ...
Howard: Are they out of the U.K.?
Scott: Preserve. I think they might be in the South East, but I'm not exactly sure where they're headquartered.
Howard: Hah, Preserve products. Toothbrushes. Now, I've heard of the bamboo toothbrush, and now there's a toothbrush by Preserve toothbrushes. That is a new one for me. You stumped me. That's why I love this show. I'm the only one who has listened to all my own shows and I only one that's learned anything from all my shows. That is amazing. Preserve, yeah. Well, you know, recycling, you know what really threw me for a loop on that is, again, you know, I was born in Kansas, 1962, so, of course, I was white, Republican, Catholic, conservative. I mean, that's just, you know, the purple stuff you're fed at birth, and I walked away from so much of that. And what made me walk away from them all these anti views on recycling and the environment and all that, was a dentist heard me say in some of my lectures - his name was Jason Luchtefeld - and he said, "Okay, dude, you're totally wrong, but you're smart." I mean, if you get As in calculus and physics and geometry, I mean, dentists - that's why I love my homies - I mean, dentists are smart. You're never going to find someone that gets an A in algebra, chemistry, biology and physics and knows that 23 ATP comes out of a Krebs cycle, but, you know. But, like, my mom spent the night with me last night. She's eighty years old. She only lives with for the Catholic Church. You couldn't change her mind with a crowbar, okay, regarding the Catholic Church. I mean, she still thinks they went south when they switched the masses from Latin to English, you know. I mean, you can't. But, anyway, but this book, it was called, 'Cradle to Grave', and it was made of recycled plastic, and it was saying, "Look, dude, go to Europe, go around the world. If you see any structure that made it five hundred to a thousand years, was it made out of plywood and Styrofoam and carpet? No, it was all stone and tile. So, you build your house out of stone with tile floors. Do it one time, it'll be there in a thousand years. But if you put paneling and carpeting and all that, every five or ten years you're throwing all this crap in landfills and then you're putting in new stuff that's leaching formaldehydes and toxins and all that stuff. And I read through this whole book and I thought, damn, it's actually better business to be an environmentalist, and start looking at ... we were talking about it earlier, about keeping customers for life, keeping staff for life. It's nice to keep facilities for life. And it's really changed because when I was little, you walked into all those fast food restaurants and it was all disposable crap. You walk into a Chick-fil-A, it looks like a neutron bomb could go off and nothing would be disturbed. I mean, everything's rock, cement, even the light bulbs are just like a bulb hanging from a wire. I mean, I don't know how you could do property damage in a Chick-fil-A. I mean, what would you have to have? If you walked in there with an AK47 and shot the place up, nothing would happen. You know, I mean, it's just ... and that's cheaper. They don't have to throw everything away every seven years. That Chick-fil-A will look fine in half a century.
Scott: That's right. And you're pointing to, you know, what are the maintenance costs for Chick-fil-A? They're probably very, very low as well. So, again, these are great examples of systems-based thinking, and how can we think over longer tracks of time, and, you know, cathedrals, to your example, are great examples. I mean, those are structures that are now still around for, you know, half of a millennia. So, sustainability, in many ways, is an idea that we know [00:33:39] [INDISTINCT] [0.3] civilization. We know about sustainability and, your example of Henry Ford, we know about systems thinking, we know about circulating money through an economy. I think that sometimes we just need to kind of remind ourselves of that.
Howard: You know who is the biggest knockoff in dentistry of Henry Ford?
Scott: Who?
Howard: The Number One dental company that just idolizes Henry Ford? It was actually Ken Austin of A-DEC Dental Chairs out there in Oregon and, basically, he was an engineer, and what he loved the most about Henry Ford is that his first car was $668, but ten years later and ten million later, they were $228. And what Ken Austin liked about it is, every year didn't have a new design. So, in an A-DEC chair and a Henry Ford Model T, all the way the Model A, if your daddy had a 1920 Model T in the creek, that was all rusted away, and here you’re his grandson, forty years later and you needed a part, you could go take it out of that 1920 car and it would perfectly fit in the 1950 car. And he loved that, no changes, everything's for function. You know, the only change that he had to make which would be equivalent between like the Model T and the Model A. You know what it was for A-DEC Chairs?
Scott: No.
Howard: As Americans got so big, fat and obese like me, you'd lean them back and the chair would start to fall over, so halfway through his company he had to make the baseplate bigger, fatter and heavier.
Scott: Yeah.
Howard: But other than that baseplate from the first dental chair he made, from the one he made yesterday, all interchangeable parts, and he was telling me - I went up there with my four boys - and he was telling me that, not only is that smart for the customer, but it's smart for faster, easier, higher quality, lower cost, and that he wins as a company, his employees win, the dentists win, everybody wins across the deal, and that good business people do everything win, win, win.
Scott: Yes.
Howard: Yeah, not I'm going to take the money and run.
Scott: Yes, and I would say, if you were to summarize the description of the certified B Corp movement or the Conscious Capitalist movement, it would be what you just said. Win, win, win. And this has recently been kind of modernized by saying, how can we redefine success using, for example, the three Ps, or the triple bottom line of profit, people and the planet. And, to your point, I think we are bright enough as a species, I think we have enough creativity and we have enough design acumen - ‘coz you're also kind of speaking to design acumen, in terms of A-DEC or Henry Ford - we have enough design acumen in terms of how we create our organizations and how we deliver products and services, to create these multiple wins or to create more beneficial bottom lines for everyone in the system that we live.
Howard: So, most people refer to what you're doing as ... is B Corporation or The B Corporation?
Scott: They have a designation called 'Becoming a Certified B Corporation', and this is a certification conferred by the non-profit, B Labs. I think it may be also helpful to mention to your listeners that, now in thirty-four different States around the United States, there is a way that you can organize your company called a Benefit Corporation. So, this is a distinct designation from the certified B Corporation. It's something that States confer, and you organize, much like you organize as a C Corp or an S Corp or an LLC, and the main difference as a Benefit Corporation is it provides the leadership team and the board of directors, the ability to consider these multiple stakeholders when they're making decisions and not be tied to just maximizing shareholder profit. And this is really important. You know, we saw this in the case of Ben & Jerry's Ice Cream, which is a certified B Corporation. You know, originally Ben and Jerry, they felt like because they were organized as a traditional corporation, they had to sell to the highest bidder to maximize shareholder return, and fortunately, the company that bought them, they're still allowing them to operate as a B Corporation. But we even saw recently when Whole Foods had a series of activist investors that wanted them to maximize shareholder return by selling to the highest bidder, and Whole Foods ultimately evolved to find Amazon, who ultimately purchased them, but, you know, in a recent interview John Mackey even talked about the fact that, had Whole Foods been organized differently in terms of its legal structure, he could have pointed to, you know, we've spent decades building this whole supply chain of sustainable agriculture. There is some value there that we want to try to preserve. We don't want to just destroy all the livelihoods of all those farmers that we've helped kind of to build their businesses. So, that's just a little bit more about the difference between Benefit Corporations and certified B Corporations.
Howard: And I want to speak out to my homies, because if anybody knows how a conservative redneck thinks, there ain't any better than me. I mean, I was born in the sh*t in Kansas. I mean, I know. I mean, all my relatives, I mean, all my grandparents went to the grave knowing that the Apollo was filmed in Hollywood as a propaganda thing to, you know, scare the Russkies. I know how these people think. But when you really get literate and you read a lot of history, I mean, like those railroad barons. I mean, when they finished the railroad, they left tens of thousands of Chinese workers out in the middle of nowhere. They didn't even know where they were. So, when you really believe that greed is good, and capitalism is the sacred cow and all this stuff, you're really out of your mind. There's a lot of participants. Like you said, there's the customers - you want them to stay with you. There's your workers - you want them to stay with you. Yourself - you want to have pride and purpose and value, because if you're just sitting on a treadmill, doing it to make money, you'll be going to the bar after work and you'll be a drunk alcoholic in no time at all. I mean, everybody has got to be sustainable, everybody's got to be in this: the community, you know, the doctors. It's the same thing ... I see it in ... you either think in hope, growth and abundance and sustainability and we can all win; or you think in fear and scarcity. And I've been a dentist in my Ahwatukee city for thirty years, and the ones that thought in fear and scarcity, like "Oh, you're my competitor. I don't want to know you and, you know, you're the enemy." They had miserable lives, but the ones that stood there and said, "Oh, come to my house. Have a beer. I'll make you dinner", because we realized that we were competing against Disneyland and iPhones and buying Mountain Dew and all that, and we never ever once saw each other as a competitor, and, hell, I'd go on vacation and I'd give dentists across the street from me my emergencies, because I'm thinking, well, hell, if I was my patient, I don't want to drive five miles, why would I want to drive five miles, if this guy could go across the street with one of Howard's classmates. I mean, how cool is that?
Scott: That's right.
Howard: And the more you think in fear and failing, the economics results are horrible, and you personally fall apart, and the more you think in hope, growth, abundance, we're all on this, you know, rock together, great things happen. So, let's switch from dental offices to dental manufacturers. Like, you know, the big, you know, 3M, Patterson, Schein, Benco; are any of these gone this way? Have you talked to any? Are any of those people looking at this?
Scott: You know, it's really a great question, Howard. I actually spoke with our Benco representative and she shared with me that they've actually developed, internally, their own criteria for evaluating more sustainably-oriented or 'green' products, and that's actually part of their online purchasing system. They have a way that designates products as more 'green'. And we've also talked with our representatives at Patterson around how could we develop - and maybe this is something that you could help with, Howard, and your colleagues - how can we develop an industry-wide rating system for products in the dental industry that's universally agreed to, that all manufacturers can use, and another variation on this idea is, maybe there's a way that we can create a system, maybe the B Corp system is one of those that we can actually evaluate companies in the dental industry in terms of those that are maybe more sustainably-oriented or maybe have practices that are more conscious in a way, and I think what this does is it then allows organizations to then choose to allocate resources towards those companies that are more progressive in their thinking, that are more holistic in their thinking.
Howard: Well, I mean, I would be so excited about that. I dedicate an issue each year of Dentaltown magazine, which is mailed to a hundred and twenty-five thousand general dentists, and ten thousand orthodontists an Orthotown magazine, if every year we had an issue and it was devoted to sustainable dental products. I mean, and dentists are in on this. I mean, when ... I mean, one of the biggest schisms in dentistry that no-one will ever talk about because it's kind of like, you know, when you're ... you know, the four things my momma told me never talk about is religion, sex, politics, violence. You're not going to make friends and influence people talking about those four things. But like in dentistry, probably the big four hundred thousand pound gorilla that causes war is amalgam versus composite. I mean, amalgam, they last thirty-eight years; composites last six years. I mean, look at amalgam, it's half Mercury - you'll never find Mercury in a multivitamin - the other half is silver, zinc, copper and tin. I mean, the thing is massively antibacterial, but a lot of dentists think, well, it's not only antibacterial but it's toxic to the person it's antibacterial in. Then there's the other person who says, "Oh, well, this is no heavy metals, it's not toxic and all that." Well, yeah, because of that Streptococcus mutans eat it like hot butter and knife, and they just pour gravy on it. And when I take out a thirty-eight-year-old amalgam, there's like a little black scuzzy decay. When I take out a six and a half-year-old composite, it's just like mush. I mean, you can blow the decay out of there. So, what is right? Well, there's, you know, an engineer doesn't believe in right or wrong; an engineer believes there's a tradeoff. Everything has a tradeoff. And so, an amalgam, it's not tooth-colored, it may be toxic to the host, but it definitely retards decay. Composites may look pretty. You know, they're light and fluffy, but they don't really have a defense against, you know, a bunch of, you know, fungus and bacteria and all that stuff in the mouth. And I think, you know, to start this debate of, you know, Conscious Capitalism, like what products do last longer? I mean, I don't want to be ... like, I was very for that dentists have mercury scavengers on their dental offices, because as a capitalist and a libertarian, I mean, if I'm the one drilling out mercury, I should be the one scavenging it. You shouldn't have to throw that in the pipe and then someone down in the city has to get rid of my waste. If I'm causing the waste, I should clean it up. And all the stuff that we're pouring down the drain, the cleansers, you know, I always worry about that. I mean, I don't ... like, I quit using bleach years ago just because I read so much stuff that what bleach does to the rivers and I'm like, man, I'm in the desert of Arizona, these rivers are fragile enough without me pouring a gallon of Clorox down them once a week.
Scott: Yep.
Howard: And so, I think a lot of dentists probably agree that we probably don't know all the answers, but it's good to start the conversation of like maybe there's a fluoride rinse that works and it's better to spit down the drain than another fluoride rinse, you know. Maybe, you know, just ... we need to start the conversation, and I'm sure a thousand years from now, you and me will both look like Fred and Barney Flintstone. I mean, I'm sure we don't even know what dark matter is. We don't even know what dark energy is that's making the universe fly apart faster than light. I mean, dark energy is expanding the universe so fast that these galaxies, where their light can only come at us one hundred and eighty-six thousand miles a second, is being thrown away from us faster than that. So, every generation going forward, they'll actually see less galaxies. And so, if you don't even know that, I'm sure we don't know everything. But I would love to get the companies involved and the dentists involved.
Scott: Yes.
Howard: We could do something like the Townie Choice Award, where we just ask them ... I mean, we got a quarter of a million dentists on Dentaltown, we just put up an easy, no-brainer deal: vote what is your favorite Conscious Capitalism - would you call it 'biodegradable'? What other buzzwords go with Conscious Capitalism?
Scott: In terms of products?
Howard: Yeah.
Scott: In terms of products, I think, you know, buzzwords would be those that are less toxic, those that are more biodegradable, those that have less packaging, that have less toxins involved in producing them, and then also, better health for the people at those companies making those products to make, that they don't have any kind of side effects for the people producing the product. But I really like the way you're framing the discussion, Howard, because now it's really then a design challenge. It's really about creativity and engineering. How can we invent better material? How can we design around this problem? And I think we as humans have that potential.
Howard: Yeah, and you know, I've podcasted the CEOs of the biggest companies in dentistry, I mean, you know, Ivoclar, Schein, and all that, and Bob Ganley of Ivoclar, he says, "Trust me," he says, "at Ivoclar, we definitely know that these cosmetic fillings are inert and we are looking at thirty thousand different chemicals saying, what can ... I mean, there obviously, someday, we'll be able to put something in it, so when the Streptococcus mutans starts eating the filling, it will say, I don't like that, I'm going to go eat something else, you know, or just die." I mean, I have the Terminix man come to my house every month, but I don't know how good the Terminix is for [00:48:41] my [UNCLEAR]. [0.2] In fact, you know what my neighbor told me just yesterday? My neighbor had artificial grass, but ten years ago when they put down the artificial grass, they said, "Well, we're going to spray your dirt so you won't have weeds." So, now they took out the artificial grass because they wanted to go back to natural grass. Nothing has been able to grow there for like three years. So, it's like, "I don't know what the hell they sprayed on my soil." But he says, "I'll buy big plants from Home Depot, plant them in the soil, thirty days they're all dead." He said, "I don't know what the hell they did." But, you know, again it's that tradeoff. So, you want to spray a chemical so that you don't have weeds growing underneath your fake grass, but now you decide to go to fake grass, now you're probably living in an environmental toxic zone. But I like these conversations and, like I say, when I was little, any form of conversation like this when I was ten and under, it was some dope-smoking hippie from Berkeley, probably just left a Jimmy ... Janis Joplin concert. They were probably on drugs, you know, and the guy who's saying it's, you know, doing a shot of Jim Beam with a beer. And so, I really like how this is evolving. So, my homies, will they learn anything going from your website, artisandentalmadison, or is that just your dental office, or will they learn anything about B Corporations and everything we're talking about?
Scott: They can certainly go to our website and they can look at some of the background that we have on B Corporations, and they can also look at some of the programs that helped us earn certification. For example, we have an oral products recycling program and we were the first in our metropolitan area to create it and we partnered with the City of Madison to promote it, where basically people can bring in toothbrushes, toothpaste tubes, floss containers, and then we recycle them through our partnership with TerraCycle. They basically take in that product, pelletize it and make new products with it. And then, interestingly, they give us a two cent credit that we then, in turn, donate back to local nonprofits. So, here's another example, kind of like your fluoride example earlier, where if we kind of step back and think about how can we create partnerships with key stakeholders in the community to now just start to recycle oral care products that were formerly not recyclable, I think we can all move the ball forward.
Howard: Now, your wife's born and raised in Iowa. Where were you born and raised?
Scott: Yeah, I was born and raised in Iowa as well.
Howard: Okay, well, let me give you an example. I'll give you the grossest example of the benefits of recycling that will make you skip lunch today. So, when you go back to New York City in like the 1800s, you know what New York City's Number One transportation problem was?
Scott: No.
Howard: They had too much horse manure in all the streets, and it would be six or eight feet against the wall, like a snowplow, and they could not get the horse manure out of there, and then the mayor thought that Number One problem to New York City's growth was that they couldn't find enough horses. So, they always had a horse shortage, but the horses couldn't get around because of the manure. Well, in Kansas and Iowa, a long time ago, they had a poop problem in the stalls. You know, when they fatten up the last couple of weeks of this cow, they're going to take them off from getting grass-fed and they're going to put them in pens and feed them corn. The problem was all this manure. Well, what did they find out? They found out that all animals only utilize about 20 percent of the benefits of any food through the digestive system from the in mouth to the out back, and so they started collecting all this poop, putting it in dehydrators, turning it into pellets, and re-feeding it to the cows five times. So, they got rid of their poop. They lowered their corn costs 80 percent, and the cows got all bigger and fatter and made more meat for a profit. And that is just a crude rude example. And who's the smartest animal and why did the Christians and the Jews, way back in the day, say you couldn't eat pork? Because they thought the pig was a disgusting animal, because every time it had a bowel movement, the first thing it did was turn around and eat it. And, see, the pig was the smart one, he knew that 80 percent of that poop is still food. And then the other animals are like, "Oh, well, now I've got to go kill another bird or catch another frog or another animal." So, the pig, being so disgusting, recycling his own poop, is why the Torah said you can't eat the pig, you know. And then it was later on overturned in Christianity that you can actually eat the pig, and now we're all fat on bacon. But the bottom line is, there's big money in recycling. It's usually anything that's sustainable is better, smarter, more profitable, gives your staff more purpose, gives you more purpose, gives your customers something to believe in you, because if your wife, Nicole Andersen, owned an automotive shop and my engine light went on - the American people call the engine light, the idiot light, because I don't know what it is - so, I go into your auto garage and Nicole Andersen, head, you know, engine-in-chief says, "Well, dude, you need a whole new transmission." Well, hell, I don't know. What am I supposed to do? I grew up with five sisters and played Barbie dolls until I was twelve. It's the idiot light. I'm in pure faith, and then she comes to me and I say, "Nicole, you've got five cavities." So, she's looking at me like, I have to trust you, and you have to trust me. And these little things around you, like long-term staff, high morale staff, other missions and purpose, community involvement, oh, he's in the city council, or he's in the city chamber, or he's in the Boy Scouts, or he sponsors the local Little League club. These are all clues to say, I know it's scary to have to trust someone with your transmission or your teeth, but that's the way it rolls.
Scott: Yeah.
Howard: And I think this should be ... to get a credit in something like this is an amazing thing to help me make you trust me.
Scott: That's right. And I think that's very well said, Howard, and I think that's a great example, that the customer is looking for all of those signals from the organization to say, “What are your values? What are your ethics? What's your larger intent?” So, I think that's a great example. And it's hitting on these intangibles that are hard to quantify, but once they're in place, they result in the types of things we talked about earlier: lower marketing costs, greater staff retention, greater treatment acceptance. All of those things that enable you to both be profitable and be able to create value for those other stakeholders that, as we talked about at the beginning, they're helping you create value. Patterson and Benco and the electric company, they're all helping us deliver a product or service to the marketplace.
Howard: So, what's the next move for you? How are we going to spread this movement? What's next?
Scott: Yeah, that's a great question. So, there are many small chapters forming all around the country called B Local chapters. So, these are organizations ... these are volunteer organizations coming together to create community around those certified B Corporations in those respective Metro areas. For example, in Portland, Oregon, I think there's something like twenty B Corps in Portland. In western Michigan, just across the pond from us, there's a group of thirteen B Corps, and they're everybody from those people who are making energy bars to those people who are making other manufactured goods, and I think, you know, again, to [00:56:30] [INDISTINCT] [0.2] lead, Howard, if we think over long tracts of time, two hundred and fifty, five hundred years from now, I suspect that most businesses will be operating like this, and maybe the certification process has fallen away and it's just the norm, because it makes business sense.
Howard: Well, you should start to thread on this on Dentaltown.
Scott: That sounds great. I'd be happy to.
Howard: I mean, you've got a quarter of a million dentists on the website and sixty thousand downloaded the app. That tells you how old dentists are, because, you know, when you look at like Snapchat, Instagram, all that, they've got all these kids in high school. Well, my customer base, dentists, they don't even graduate until they're twenty-five, and they practice until they're sixty-five. So, like, I'm fifty-five, that fifty to fifty-five, I'm actually right in the middle. So, we're one of those old, old people companies, so, we still have more people on the desktop than the smartphone. We've got sixty thousand on the app, a quarter of a million on the website, you should go start a thread on this. And then I'm howard@dentaltown, but the editor is tom@dentaltown, the editor of the magazine, and you should write him an article for the magazine. And then, I'm out there lecturing every week, and it's funny because when come up and say, "Oh, I love Dentaltown", I say, "What do you love about it?" and I realize every week, four out of five are still talking about the magazine, because they're that damn old. And the only people, when they say Dentaltown, does that mean the app and the website and all things digital, they're always under thirty, but there ain't no fifty-five, sixty, sixty-five-year-old dentists on the Internet. And one of the reasons the dentists are still not digitally involved is because the greatest job destroyer of all time in America was the answering machine, because it turned out there were about three million women, that their only job was to take a call and write down a number because her male boss is on the phone. So, the answering machine. The second biggest one was the ATM machine, which got rid of about thirty thousand bank tellers a year for a decade. But these dentists, it's only dentists, physicians and lawyers that all still have a secretary. So, when you meet forty, fifty, sixty, seventy year old dentists, you say, "Well, how are you going to get this book that you were talking about, that 'Firms of Endearment', or the one that John Mackey, CEO of Whole Foods, wrote, 'Conscious Capitalism'. Dude, how are you going to get that book by John Mackey, 'Conscious Capitalism'?" They say, "Well, I'll just tell Emma. Whenever I want a book, I just go tell Emma." And I'll say, "Well, you're going to the Townie meeting in April, how do you get the plane tickets?" "I just tell Emma, and then she puts it all together in an envelope and she hands it to me and says, 'Here's your book and your boarding pass and your reservation'." So, since they're enabled ... I'm telling you all this because you should definitely get on the digital, the Dentaltown website, the app, and start a thread on this.
Scott: That sounds great.
Howard: And you should probably also contact Tom Jacoby, because Dentaltown actually influences ... I would say ... this is what I'll say, 80% of Dentaltown's influence is still the magazine going to a hundred and twenty-five thousand dentists every month and the Orthotown magazine going to ten thousand, and only a quarter of them homies are sitting there reading it on their iPhone or their Kindle or on Dentaltown or Orthotown or Hygienetown. So, I would contact Tom, write an article, and I would get on Dentaltown and start a thread on this. And thanks for all that you're doing for dentistry. Love your karma, love everything about you.
Scott: Well, thank you very much for the offer to reach out to Tom and to start a thread. I like taking that comprehensive approach and I really appreciate the opportunity to be on, but I want to acknowledge you for really being a Conscious Capitalist. And really it sounds like an organization that's ready to become certified as a B Corp. So, I would encourage you to consider it. It sounds like you're probably already there.
Howard: Well, we already got certified as a sociopath corp, so, now that should just be an upgrade to go to Con... And I also want to tell you something, if I'm thinking this, some other old dude is thinking about it. One of the most confusing things about having Scott S. Andersen on your show is you're thinking, "Is this Scott P. Andersen, the ex-CEO of Patterson", and I swear to g*d, I know both of you. I know both of you, you look like brothers. I mean, you’re both are named Scott Andersen. The only thing different is a middle initial. When I look at his face, I look at your face. I'm sitting here thinking ... so, my last question, were you adopted? Was he adopted? Am I possibly reuniting a family today on my podcast, of two adopted brothers who don't know they had another brother?
Scott: It might be the case, or I may just have another alias out there.
Howard: My gosh, that is amazing. Yeah, Scott, the other Andersen, was from Effingham where Heartland Dental is, and he started Eaglesoft and then Eaglesoft got bought by Patterson.
Scott: Okay.
Howard: And when they bought Patterson, they said, "You're so sharp, you should be the CEO." And that is Scott P. Andersen, and you're Scott S. Andersen, and, I swear to g*d, you look like twins. But anyway, but I love both of you guys out there. But anyway, thank you so much today for coming on the show and spending an hour with my homies. I really appreciate it. And tell your wife I said hello and thank you so much.
Scott: You're welcome and thank you very much for having us. It was a pleasure and it was really enjoyable.
Howard: All right, well, you have a rockin' hot day.
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