IN MARCH, Neil Rodaway, along with two other directors of Vision Group, bought $1.3 million worth of shares in the company.

They paid $2.10 a share. The shares are now fetching $1.68 — not much above the lowest price since the ophthalmology company listed in late 2004.

Ask Rodaway, 44, who took over as chief executive last October, after a long career with Mayne, and he looks perplexed.

"I've got no idea," he says. "You tell me why we're so undervalued. I think all of our metrics are heading in the right direction, except the share price."

He notes that during the period when the share price dropped from $3 to under $2, the company made no announcements that were responsible for the decline.

"Nothing changed," he says. "We outperformed all the analysts' expectations, but the price went from $3 to $2. We said nothing. Our numbers did nothing but beat expectations, but the share price went down."

He is aware that the small-company sector is just about friendless now and that some fund managers have had money pulled out from under them, but nevertheless it is still frustrating.

"If the whole market was running ahead and we weren't moving, I'd be really worried," he says. "But if you look at us from a fundamentals perspective, you'd probably say it's great value, but there are just no buyers in the sector."

When Vision Group went public, it raised money at $2.30 a share. The idea was to buy up and consolidate ophthalmology practices. The investment community liked the story and the shares hit $5 within a year.

Such investors as Fidelity, AMP, Perpetual, Hyperion, Fisher Funds and Challenger are, or were, big shareholders.

But now the stock is right out of favour.

Six years ago, the group was booking $33 million sales a year; in the latest June year it reported $111 million sales from a string of eye-care clinics from Townsville to Melbourne. It is the country's biggest private provider of eye-care services.

Profit over that period has increased threefold and profit over the past three years has improved by about 19% a year.

Rodaway joined Vision Group in February last year as chief operating officer, taking over as chief executive from Vision founder Harry Unger in October.

Rodaway trained as a chartered accountant in England and when he moved to Australia he worked as an auditor with KPMG. Mayne's health-care division was a client.

He joined Mayne and moved through several positions; including being the numbers man for the logistics division, running the pathology, radiology and medical centres for a couple of years, as well as buying and selling a large number of assets along the away.

Moving to a relatively small company such as Vision Group was a big change, but it was in an area he knew well — health care.

"I had a chance to have a look at Vision and it had a chance to have a look at me, and then Dr Unger decided that he thought I was the right person to take over," he says.

Vision is one of those businesses where a group of specialist professionals has been brought together under the roof of a listed company. The challenge is to keep them all happy.

There have been several attempts to go public with groups of accountants, medicos such as radiologists and ophthalmologists, and other specialist professionals. Some have worked well, others have been dismal failures.

Vision Group has 45 doctor partners who are all ophthalmologists and who own about one-third of the shares. Another 10 associates work in Vision's practices and use its operating theatres for such things as cataract surgery or laser surgery.

The trick is to get them all working together for their own benefit and for the benefit of outside shareholders.

The doctors are on contracts and one thing that might be concerning the sharemarket is how the contracts will be renegotiated when they come up for renewal soon.

So has the model of buying eye-care practices, and their doctors, worked? "Well, I think that Vision has proven so far that it does work," Rodaway says.

"I think we're facing a crucial point in time. We've got the first major batch of contract rollovers and some people have raised concern about that. I think all of our doctors are happy working within Vision. They like how it works, they like the medical sovereignty, they like the fact that they run their practices how they want to. The question is, though, do they want more money?"

The contract talks will be crucial to how investors see Vision and its share price. If the doctors are paid a lot more than they are now and sales remain the same, that will cut into profits and the share price will probably fall.

The skill is to get a balance between the two, remembering that the doctors are big shareholders in Vision, alongside outside shareholders.

"To me it's about whether they take the foot off the pedal or whether they press harder on the pedal," says Rodaway.

"If they don't get enough money and they're still dissatisfied, they'll still re-sign because it's the best place to work, but they won't be happy and maybe they won't work as hard. Whereas if they're happy and the remuneration model gives them incentive, then they'll press a bit harder on the pedal.

"That's what we're looking at. It is not so much a new model, it is tweaking the existing one to see if we can provide for greater incentive for doctors who want to push a bit harder. Human nature says that 'if I'm generating more, then I'd like a piece of that pie as well, please'."

Vision head office, which has about 15 employees, has to keep the doctors happy.

"My job is to look after all shareholders but, without doubt, the doctors are the most important part of the business and I've got to balance up — through the board — what is going to provide the greatest incentive to the doctors to continue to grow the business," Rodaway says.

There are two "doctor" directors on Vision's board and there are two alternate directors who are also doctors.

"They're there to bounce ideas off and following every board meeting there is a telephone conference with what we call the partners' advisory group, which consists of about a dozen doctors who represent a cross-section of all doctors.

"We talk to them about what we've discussed at the board meeting, things such as doctor contracts and 'are we heading in the right direction, are we pushing the right buttons?' "

The doctors are critical to Vision's success and Rodaway says it is not easy to balance the interests of every person.

"We have some fights and spats along the way like anybody," he says. "There's nothing wrong with people having different opinions, as long as we deal with them."

Rodaway is looking at plastic surgery as a possible growth area.

"We still want to acquire and grow through acquisition in ophthalmology, so don't get me wrong, we're still looking at that, we just don't see quantum growth in Australia," he says. "So to get quantum growth, you've got to look at something else."

Meanwhile, he's trying not to take too much notice of the share price.

"We've just got to hold our nerve and keep going until market conditions change," he says.