Would you rather have one marshmallow now, or two tomorrow?
In the late 1960s and early 70s, Walter Mischel, a Stanford psychologist, and his colleagues conducted a series of studies on delayed gratification.
Would a child choose one treat, for example, a marshmallow, which was placed in front of him, now, or would he wait 25 minutes or so for the researcher to return, at which time he would receive two treats?
Only about a third of the children could hold off long enough to “win” the additional reward. And, in follow up studies of the same children many years later, those that were able to hold off for the second treat tended to have better life outcomes.
How does your medical group do in terms of waiting for marshmallows, figurative ones, of course?
Most medical groups have compensation plans that focus on immediate gratification, on zeroing out at the end of each year.
Sure, your accountant tells you that you are reducing your group’s tax liability or that you’re distributing the cash to your partners to match the income that will be allocated to them on their K-1s.
But you’re also destroying your ability to aggregate capital for your group’s future, whether that’s for expansion or simply for a rainy day.
And, speaking of gratification, because the loss of a dollar causes more psychological pain than does the gain of a dollar, try making a call for capital contributions from your fellow shareholders or partners — see how happy they’ll be to capitalize the group in that manner.
Is it time to tune up your compensation plan?