You are now entering one of the most exciting and challenging times in your life. One of the first lessons that I offer to any new entrepreneur is learning the tradeoff between time and money. Now more than ever you will need to learn the importance of how to spend your valuable time. As an entrepreneur, time is money.
To illustrate the importance of time to the entrepreneur consider the following comparison between the time of a salaried, professional person versus an entrepreneur when accomplishing a simple non-business task.
From the perspective of the average salaried person, time spent on household tasks such as mowing their lawn is saving them money. They are performing the task themselves and can retain the money they would have spent on hiring a landscaper. This assumes that the salaried person does not spend their non-working hours in an income generating activity. The salaried person works a set schedule and in general, focuses their attention on limiting the outflow of their salary to others and desires to conserve as much of their salary as possible within a savings account or other savings mechanism in the hopes of retirement. The salaried individual focuses on saving as opposed to generating revenue.
The entrepreneur has a very different situation. An entrepreneur is not compensated with a set salary or hourly wage. The entrepreneur is only compensated for the value by which they bring to any given customer. If the entrepreneur does not offer value, the entrepreneur will not receive compensation. On the other hand, if the entrepreneur offers a high level of value to a customer, their compensation will reflect the value offered. The entrepreneur focuses on maximizing income, or revenue as opposed to saving money.
To the entrepreneur, moving the lawn is a distraction and potential non-value added activity. It is true that the entrepreneur may save money by moving their own lawn, but they are taking time and energy away from potential income generating activities. To the entrepreneur, any time away from the business is a distraction from value creation. While the entrepreneur may save a few dollars by performing the task themselves, they are potentially losing much more money in terms of opportunity cost.
When considering this example with the entrepreneur there are a couple of caveats. First, this example assumes that the entrepreneur is not in the business of mowing lawns, in which case mowing their own lawn may be a value-added activity as it may increase his proficiency. Secondly, I am strictly comparing revenue generating and non-revenue generating activities. If the entrepreneur uses yard work as a means of momentarily stepping away from a challenge to gain perspective, then mowing the lawn could be valuable for distancing themselves from the present challenge and offering a fresh perspective when they return to the original challenge.
The old adage of “you need to spend money to make money” is very true to the entrepreneur. If spent wisely, the time of an entrepreneur is much more valuable when compared to the cost of outsourcing lower order, repetitive tasks that may distract you from your passion.
Similarly, a business coach can help you save both time and money. By offering a fresh perspective, years of experience, and knowledge across many fields and markets, a business coach can save you the time (and therefore money) that you may have spent on your own seeking a solution through trial and error.
To learn how to implement the concepts presented within this article schedule an Initial Consultation with me at Brilliant Basis.
Through individual coaching sessions I will:
- Help you achieve profitability faster
- Assist you with overcoming specific challenges
- Help you grow your business
Purchase an Initial Consultation here.