We’ve all heard the phrase “time is money.” Usually, it comes out of the mouth of an employer and it goes something like, “Get to work, time is money and we can’t afford to waste either.” Indeed, most of us have been guilty of uttering colloquialisms to that effect on occasion. But while there is a strong relationship between the two, when you get right down to it, the two are not equal at all. In reality, time is infinitely more valuable than money. After all, you can always get more money, but you can never get more time. You’ve only got so much time allotted to you, and that’s it. Once you spend it you can’t get it back, so how and why you spend it becomes extremely important. It’s ironic how much more thought people give to how they spend their money, than to how they spend their time.
Time Management is the key to accomplishing any objective. It puts you in the drivers seat, giving you control over your life. People sometimes react negatively to the notion of time management, arguing that it is impossible or even wasteful to try to organize their time. They are wrong. Time Management is the foundation of self-mastery. It allows you to live your life “on purpose” by giving you control over your destiny like nothing else.
If time is money, it's better to invest it than to spend it
Think of a scale. On one side are the hours you “Spend” running your business and on the other side are the hours you “Invest” improving your business. If you are like most business owners, the scale now is probably tipped in favor of your “Spent” time. Your day probably consists of making sales calls, answering customer complaints and helping employees with their immediate problems. Our goal is to steadily tip the scale in favour of your “Invested” time, freeing you to do more valuable work.
“Spent” time represents anything that can be done by someone else assuming you had, and could afford, that person. These activities typically add short-term value to your business. Some examples may include answering sales calls, completing payroll or even washing windows.
“Invested” time represents your “business development” activities, the things you do that add long-term value to your business. Some examples might include writing position outlines, developing new product ideas, updating your organizational structure or fine tuning your marketing strategy.
“Imagine there is a bank that credits your account each morning for $86,400. It carries over no balance from day to day. At the end of each day, it deletes whatever is left of the balance you did not use that day. What would you do? Draw ALL OF IT out of course! Each of us has such a bank, its name is TIME. Every morning, it credits you with 86,400 seconds. Every night it writes off, as lost, whatever of this you have failed to invest to good purpose. It carries over no balance, it allows no overdraft. Each day it opens a new account for you. Each night it burns the remains of the day. If you fail to use the day’s deposits, the loss is yours.“
When you spend your money, you exchange it for a product or service. If you exchange it for something of similar or greater value then you’ve received your money’s worth. When you spend your time you also exchange it for something of value, but do you always get your “time’s worth?” Are the results of your efforts worth the true value of your time?
What is your time worth? $50 per hour? $100 per hour? $500 per hour? More? If you own a manufacturing company and you spend five hours every week in production, are you exchanging your time for something of equal or greater value? How about when you go out on an installation? Are you earning your value then? You’re bringing in dollars, but are you bringing in enough dollars to properly compensate you for all of the time and energy you put into your business? How much are your products worth? If you gain some intrinsic value from the activity of assembly or installation, or if you learn something from the experience, then by all means, do it. But if you do it simply to save a few dollars or because you want it done right and your employees never seem to do an adequate job, then you may need to reexamine your approach. Things need to get done right. That’s how you stay in business. But if the whole system relies on your own ability to get things done, then you’re building in limitations.
If your business has the potential to give you a personal annual income of $500,000, then your time is worth about $250 per hour, based on a full-time salary. If you would eventually like to work part time or to retire with a similar income, then it’s worth considerably more. If you spend the majority of your time doing work that’s worth $20 per hour, how are you ever going to reach your potential? You won’t! You wouldn’t hire a lawyer to sweep your floor or assemble your products, so why do you do it? Are you worth that much less than your lawyer? These things all need to get done, no question about it, but do they all need to get done by you?
For now, the answer might be yes. If your business is young and growing then you may need to spend your time on this type of work in order to preserve cash flow. If your business is fully dependent on you, then if you suddenly stop taking care of the details, it may collapse. In the long run however, “spending time” on work of minimal value will cost you more than it will save you. Not just financially, but physically, mentally and emotionally as well. It takes a lot of time and energy to earn $500,000 at a rate of $20 per hour. Even if you worked 24 hours a day, seven days a week, it would still take you nearly three years.
Of course your time is really worth much more than any hourly wage you could pay to replace yourself, so the question becomes, what kind of work will pay you what you're really worth? The key to increasing the value of your time is investment.
When you invest your money, you expect it to return a profit to you over time. If you invest $500,000, you expect to eventually get back more than you invested. Your time works the same way.
When you invest, rather than spend your time, its value increases dramatically. Henry Ford became successful because he “invested” his time developing an assembly line system to build automobiles. He would not have had the same success had he “spent” all of his time building cars. Just imagine Henry Ford trying to keep up with his orders by building one car at a time, all by himself. Clearly, his business would not have become the success it is today. Building cars is “spending time,” developing a better, faster way to build cars is “investing time.”
All business owners do this to some extent. When you hire employees to do work that generates a profit for your company, you are investing time. When you outsource work, you are investing your time. When you mark up a product for sale, you are investing time. The problem is, business owners usually “spend” far too much of their time and “invest” far too little of it. The key to financial success in business is to tip the scales in your favour. To increase your invested time and to decrease your spent time, when-ever possible.
The rewards from invested time take longer to manifest themselves than do the rewards from spent time, but they are always much more substantial. By investing more of your time now, you can free up more of your time for your future. More time for your family, more time for yourself, or even more time for your business. This small, yet significant shift in your thinking will allow you to achieve more, with less effort, and in less time. Guaranteed.
Before you can improve your time management, you first need to find out exactly what it is you do with your time right now. No doubt you are busy, but what exactly are you busy doing and when are you busy doing it?
To get a clear understanding of what you do with your time, you need to spend the next two weeks tracking your time. It may take a little work, but what you will learn will be more than worth the effort. This will give you an idea of how much time you “Invest,” “Spend” or use up for non-business related activities but are still crucial, included under “Other”.
Once you know what it is you are currently doing with your time, your first priority will be to delegate or outsource as many of the non-invested activities as possible. You have a lot of important work ahead of you and you’ll need all of the time you can get. If you would like to delegate certain activities but can’t just yet, keep those activities in mind as ones you will pass on the moment you can afford to do so.
For most business owners, this is one of the hardest things to do. Loosening the reigns makes them terribly nervous that something will go wrong. In reality, however, a business owner who refuses to let go of the reigns becomes the single greatest limiting factor to the growth of his business. You may not yet be ready to pass on certain responsibilities, but if you want your business to grow, eventually you’ll need to. The process of delegation will be addressed in detail later in the program, in the next section of Management. Fortunately, the changes you make to your business through this program will eventually allow you to delegate with confidence.
To make the scale tip to your favour, you first need to master your daily schedule. The backbone of Time Management is scheduling. Operating on a schedule allows you to make time for the things you know are important, but have trouble getting around to.
If your daily routine varies, depending on whatever seems most important at any given time, then setting aside time to invest in your business will remain a low priority for you. Something will always take precedence. A customer will need to be called back, your employees will need your help and so on.
This does not mean you can never break your schedule. You are in charge, not the schedule. If something new takes priority then by all means, make an adjustment. Just don’t make it a habit. When you adjust your schedule, you are making a proactive decision. This is still a form of management and is completely different from operating without a schedule. When you deal with things as they come you are reacting to, and consequently being controlled by, your environment.