To get your New Year started right, I’d like to share with you what I’ve been taught by homemade bread, lawn mowers, and cheap customers. They’ve all taught me my time is valuable and I have to protect it.
In this economy, money saving tips and articles are hot. You can read such advice all over the web. I recently read one of the dumbest articles I’ve ever seen on this exact topic. The basic premise was you can save a lot of money by doing things yourself. The example they used was one of making homemade bread.
The basic math they used was you buy 4 loaves of bread per month at $2 which comes to about $100/year. Their brilliant idea was buy a bread machine for $60 and ingredients for about $10-15 a year and you’d be saving bread in no time (pun intended).
Hey morons… how about the cost of the gas to go to the store? But that’s not the fatal flaw in this article. What they really forgot to factor in is the cost of your TIME. If you’re making $80,000 per year, your time is worth $40/hour. Suddenly that bread got extremely expensive.
This is only one case of stupidity. Of course I can’t help myself and I have to offer more…
I hate mowing the lawn. I just do. But again, many people argue you should do it yourself and save the money of paying someone else to do it.
WRONG. It takes me about 90 minutes to mow, bag, and clean up afterward. My choices are I can do it myself or pay someone $28 to do it. Using our basic math above, the choice is very clear – pay to have it done. He does a better job of it than I do and it actually costs me less to outsource it than doing it myself.
We’ve all experienced that customer. You know the one – he calls constantly and complains incessantly. He sucks up hours of your time and drains the life from you. He’s also the cheapest person you’ve ever met.
I spent some time with colleagues recently and they were complaining about one such customer. This particular customer paid them about $175/year to be a member of their organization. If you run the above math again, if they’re on the phone with the guy for more than about 12 seconds, they’re losing money.
Hopefully by now you’ve realized the core message of this post is your time is worth money. If you don’t keep this in mind, you might make some economically unwise decisions about how you spend your time. Sure, if you enjoy making bread or mowing the lawn, you’re deriving value from those activities so this mindset doesn’t necessarily apply. But if you’re not in it for the sheer joy of it, you need to be judicious with the time you spend on anything.
Let’s relate this to your business. Take a hard look at where you spend your time. Many of your activities might fall into the above value destroying categories. I encourage you to prune those activities and instead focus that time either on growing and building your business with more valuable activities or you can reinvest that time into having a more balanced life.
I’m sure one or two of you right now are asking “So Mike, you spend your time writing your blog and that doesn’t seem to jive with your advice.” Not true. I’ve actually had sales opportunities arise exactly BECAUSE of this blog. So the 20-30 minutes a week I spend writing have the potential to drive very large engagements for my firm. The time spent here is well worth it for me (plus, I love you folks – you’re awesome readers!).
So make a New Year’s resolution to be more explicit about the tradeoff you’re making when you spend time on something. Perhaps you’ll say no to less valuable work and either grow your business or reclaim a little sanity.
Happy New Year everyone!