Nearly all business decisions involve elements of both risk and uncertainty. This is just the nature of predicting the future course of events. They are not the same thing, but how do you identify which is which and how do you move forward, knowing that there is an element of both present? The basic distinction between these two features is this: in predicting the outcome of a decision, how much information can be known beforehand, and how much of that information do you know? If you know most of the data points, then you are dealing primarily with risk. If you do not know most of the data … [Read more...] about Risk and Uncertainty
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Opportunity Cost
Operating a private practice, or any private business, means that you as the owner are frequently faced with choices about how best to spend your resources, money and time. Most of the time, you will not have a complete set of information about how to best decide. Analyzing the opportunity costs of any decision will help you prioritize and make a wise decision more likely. What is opportunity cost? This concept is rooted in the self-evident and simple idea that you are operating with finite resources. This may be time, money, access to capital, people, etc. But, none of … [Read more...] about Opportunity Cost
Facts and Interpretations
Confusing Facts and Interpretations is a common and time-honored way of acting in a way that will later be thought of as a judgment error. Sometimes it’s not so easy to tell these things apart and sometimes it’s not so easy to defer action until you are sure your interpretation is right. Developing these two skills is an important part of being a business owner and/or manager, so let’s look at a few features. Fact v. Interpretation A fact is something that has been shown by proof or repeated observation to be true and is not dependent on the context or the messenger. It’s … [Read more...] about Facts and Interpretations
Hierarchies
In traditional organizations, hierarchies are the normal state of affairs. While this may chafe those at a lower level of the chart, there is usually no thought to getting rid of a hierarchy, it’s more about finding ways to get on the top of the pile. However, in more progressive organizations and societies, hierarchical structures are much flatter, looser or may not exist at all. In many ways, medicine in all forms has some aspects of both types of systems, which can plant the provider squarely in that uncomfortable transition zone. Hierarchies are very much the norm in many … [Read more...] about Hierarchies