Should You Take the Money? The True Cost of a Signing Bonus

Posted by Bill Robinson, ADAPT President & CEO on 1/20/20 9:27 AM
Bill Robinson, ADAPT President & CEO

Blog_Images_695x320_female_dollarIf you ask a dentist about “corporate dentistry,” you may get a strong reaction. Opinions range from “corporate dentistry is destroying the profession” to “corporate dentistry is ideal – it allows a dentist to focus on dentistry rather than running a business,” with many flavors in between.

In particular, I have heard a number of established dentists lament how many new graduates choose the corporate dentistry route for their first job. Whenever I encounter someone who is disappointed with a new graduate’s choice outside of independent dentistry, I often have the following conversation:

“Have you ever hired an associate?"

“Of course I have.”

“Did you hire a new grad?”

“Oh, I would never hire a new grad. Someone has to have two to five years’ experience before I would consider them.”

Read that over a couple more times if you missed the irony.

Don’t get me wrong. There are certainly dentists who are willing to hire and train new graduates, then mentor and nurture them as they gain speed and proficiency. But it is alarming to me how often I run into dentists who want an associate with significant experience but just can’t understand why new grads often choose corporate dentistry.

What does that signing bonus mean?

Some corporate entities pay dentists signing bonuses if they agree to stay for a certain number of years.

This is “real money” and can be a significant help to dentists graduating with hundreds of thousands of dollars of debt.

I got my MBA from Kellogg in the mid-90s. This was at the tail end of a time when consulting firms would often pay large bonuses to newly minted MBAs from top schools. In a competitive talent market, this was seen as a good way to lure top employees. When I looked into those opportunities, I concluded the bonuses were necessary because the jobs were not particularly attractive. Not that the work was too hard, but that the job entailed some unpleasant tradeoffs. The positions required constant travel and long hours with little autonomy regarding what you did and how you did it. Some business school friends who took those jobs (and the bonuses) mostly regretted their choices. I took a job that paid less but where I had a real sense about my ability to contribute to the company and control my own destiny.

The signing bonus money can be helpful in the short term, but it may not help you achieve your long-term goals.

For recent graduates, my advice is to understand all the tradeoffs that come with any job. Some people find the corporate dentistry practice model and money to be exactly the right solution for their needs. But for others, especially those who want to eventually buy a practice, it might be worth a pause. While the signing bonus money can be helpful in the short term, it may not help you achieve your long-term goals.

Take a good look at how much control you desire and choose a situation that allows that level of autonomy.

Paving a path to ownership

Our ADA Practice Transitions research tells us that over 60% of dentists would like to own and manage their own independent practice but are often uncertain of how to make that happen.

Owner dentists tell us overwhelmingly that their ideal situation is to sell their independent practice to another dentist who shares their philosophy of care so that their patients and staff experience continuity.

One of the best ways to make that happen is to train and mentor an associate over time. That lets owners hand their legacy to a willing colleague who has become the perfect person to buy the practice. The best way to do this is to hire a new graduate who shares a similar philosophy, then train them in the ways of the practice. It may require a bit more work in those first couple of years than hiring someone “with experience” – but it often provides a ready buyer when it’s time to sell.

Independent practice and the future of dentistry

I don’t want to get too grandiose here, but your decision – and I’m talking to all dentists – will have an impact on the future of the profession. There are certainly economic benefits that come from standardization; McDonald’s has perfected that model for over 60 years. But the pendulum is swinging back the other way. People are drawn to more unique experiences and McDonald’s is suffering as a result. Patients like to feel like they have found a unique dentist – someone who cares about them as a person. Sometimes it is easier to make that happen in an independent practice. Usually that is more gratifying to the dentist, as well.

No matter which phase of your career you’re in, go into the situation with your eyes open. Consider not just what’s best for your short term – whether it’s a signing bonus or hiring an “experienced” dentist – but what might be right for the long run.

What are your thoughts? Join the conversation by commenting below.

Topics: looking for a job


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