In the early stages of business, when we’re trying desperately to get things off the ground, it’s important to keep as much cash as possible in the business to help keep it going. So the entrepreneur will do everything themselves, no matter how menial, in a bid to save money.
The problem is, as the business grows, it can be difficult to move out of this “DIY” mindset, relinquish control and transition into a delegation mindset. In order to do this, we need to start thinking differently about how we use our time.
You probably invested some money to start your business, right? Well, in the same way that the business needed capital to get started, and requires cash to feed it on a day to day basis, it also requires an ongoing investment of your time.
When we talk about financial investment, we can calculate the return as follows:
ROI = (Gains – Cost)/Cost
But what’s the return on your time investment? Assigning a value to your time and thinking of it in financial terms is a big step towards achieving the delegation mindset. You begin to value yourself as the CEO of a growing business, and realise that it doesn’t make financial sense for the CEO to be doing the admin.
If you’re struggling to move away from the DIY mindset, don’t worry, you’re not alone. But take some time today to work out your ROTI (return on time investment) on just one of the tasks on your to-do list.
Here are some of the factors to consider:
What’s the value of my time?
If you offer a service on an hourly or day rate then this is easy to work out. You should price every hour in your day at the same rate as your charge your clients.
If you pay yourself a fixed salary, then divide it by the number of working days in the month, and then by the average number of hours in your working day to give yourself an hourly rate.
If you’re not at the stage of paying yourself a full salary yet, then consider your “job title” and what the equivalent role in an established organisation would command. This is how you should start to value your time.
Would I pay someone my hourly rate to do this task?
Now that you know the value of your time, reflect on the tasks you perform throughout the day and ask yourself “would I pay someone my hourly rate to do this task?”.
If not, then you shouldn’t be doing it! You might feel that you’re saving money by doing things yourself, but when you consider the value of your time, you’re actually making a loss by spending it on menial tasks.
If it’s not something that you could delegate right away, then think about the steps you take to complete the task, write them down and start to build a procedure that could be handed over to someone else.
What else could I be doing if I wasn’t working on this task?
The other question to ask yourself is what else could I be doing to drive my business forward, if I wasn’t doing this task?
All too often, business owners become “busy fools”, distracting themselves with the day to day admin in procrastination of strategic, creative or growth-generating activities. Why? Because it’s easier, less scary or less overwhelming.
So when you find yourself defaulting to a menial task, consider what you might be putting off, and what you are losing out on (e.g. new clients, growth, profit…) by avoiding doing it.
Asking yourself these questions will allow you to start calculating your return on time investment, and transitioning into a delegation mindset that will facilitate the ultimate growth and success of your business.
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