How good of a driver are you? Better than average? Excellent?
Of course you are.
I know what you said because most Americans rate themselves as ‘excellent’ or ‘very good’ drivers.
We’re good at driving; math…not so much. Like Lake Wobegon, 90% of the children are above average.
Psychologists could cite us many examples of our overconfidence, but the driver rating serves the purpose here because it is so universal. Even though we admit to driving too fast, driving while tired or even intoxicated, and occasionally texting behind the wheel, most of us still think we’re excellent, especially if we are husbands.
And the accident…never our fault.
I bring this up to continue this line of thinking about our thinking when it comes to navigating our businesses through the restart. Not only are we stumbling blindly down the hill with incomplete data and no friggin’ idea what the fall will bring, much less the next five years, but our thinking is as flawed as our information.
We have cognitive biases all over the place that screw up our thinking, but Daniel Kahneman, the best-selling author who introduced these ideas to the world at large, called overconfidence ‘the mother of all biases.’
We are infected and wearing a mask won’t help.
A recent McKinsey & Company survey found that most physicians believe that a year from now volume will be back to, if not slightly higher than, pre-COVID levels.
As someone whose business depends on the patient volume of our clients, that is awesome news. As someone genetically predisposed to optimism, I’m ready to sign up for the scenario that says, ‘Hey, this is healthcare…we are doctors…this is life and health we are talking about…we’re special…we’ll bounce back first.’
For affirmation, another recent report by the very same smart folks at McKinsey agrees, showing ‘Healthcare and Social Assistance’ as the segment of small businesses that will return to pre-COVID levels the fastest.
But what if we are being a tad optimistic? What if there is just enough fear, just enough friction, just enough governmental brake-tapping to drop things permanently to 90% of past levels? How about 80%?
Not to be rude, but if large numbers of people having a heart attack during quarantine decided not to go to the ER, what makes us think there will be no long-term change in patient behavior? Some stuff can wait, for some stuff just rub some dirt on it, some can be managed through that free telemedicine visit offered by my health plan.
There is one other interesting finding from the physician survey. Pre-COVID about half of the practices had a month or more of cash on hand. The other half either had less (23%) or had no idea how much they had (26%). Now, only 30% have more than a month’s worth (probably inflated by PPP money) on hand.
So, we are very positive in our outlook even though our indicators are flashing a lot of risk.
Yes, we still have car crashes.