What exactly is the law of diminished returns and why is it so important for you to understand it?
I'll tell you....
The economic Law of Diminished Returns was originally coined by David Ricardo and expressed a relationship between input and output, stating that dding units of any one input (labor, capital etc) to fixed amounts of the others will yield successively smaller increments of out put...
A more common way of expressing it is..
That at some point any additional effort or investment in a given endeavor will not yield correspondingly increasing results...
So what does that mean for you...
1. That there are a maximum number of hours per week you can effectively deliver your service
2. That there is a maximum number of patients you can "effectively" see a week.
3. There are only so many weeks a year you can work.
But what do most practioners do in order to increase their income?
Work more hours
See more patients
Work during their free time
And don't take enough vacation time
Which actually hastens the law to take effect, caps your income and drains your resources.
If you really want to make more money in less time then take the following actions
1. Plan your year ahead 6 months before the year ends. In other words, this august, plan out 2007.
2. Work IN your practice no more than 24-27 hours per week.
3. take one full day off per week to work ON your practice
4. Automate and systematize as much as you can in your work and in your practice
5. Hire an assistant!(and don't say you can't afford it. The reality is, you can't afford not to!
By taking these 5 steps you will increase your efficiency and maximize your impact and profits.
I practice in a very small space so I have not hired an assistant because the extra body seems intrusive. Any recommendations?
Posted by: Raleigh | July 07, 2006 at 05:50 PM
Good points, but last I heard it was the Law of DiminishING Returns-- which changes the meaning a bit.
Posted by: Elene Gusch, DOM | July 08, 2006 at 12:16 AM
Glad you like the points!
Please feel free to shed some light on how the distinction you made will impact what you will do this year to impact your practice.
Posted by: Eric G. Schneider, D. Min. | July 08, 2006 at 09:35 AM
Very small space?
No room for assistance...then go virtual!
A virtual assistant and even a virtual concierge service can help you have a context to delegate all of those tasks that steal time away from you doing what you are genius at!
Posted by: Eric G. Schneider, D. Min. | July 08, 2006 at 09:36 AM
very interesting, but I don't agree with you
Idetrorce
Posted by: Idetrorce | December 15, 2007 at 06:01 AM