Do you ever wonder how you will have time enough to get everything done, much less get ahead of the game? Surely everyone has heard of Tim Ferriss telling us that we can “join the new rich” while working 4 hours per week and also that Robert Kiyosaki’s Rich Dad makes more and more even while working less and less, but how do can you get everything done working 60 hours a week, much less 4? Whether an entrepreneur builds a business and a lifestyle that lasts depends more on how you spend your time than how much time you spend. Therefore, segregating your time into three essential activities and giving each its proper emphasis is key to becoming a successful entrepreneur.
As a busy, gets things done type of person you can divide your economically productive time into three major categories: Activity One, time spent on tasks that bring in the money now, Activity Two, time spent on building assets that you hope will bring in money in the future, and Activity Three, other tasks such as networking, administration, and educating yourself by reading this blog. Note that the order is not a valuation, all three are vital to developing yourself as a businessperson.
Activity One, right here right now
The immediate term is usually where the priority is placed, and rightly so for most of us. There are deadlines to be kept, clients to be satisfied, and bills to be paid. Last weekend I read Michael Gerber’s E-Myth Revisited and I couldn’t put it down; this is essential reading for anyone working as or with entrepreneurs and I immediately recognized that about 80% of my clients fit the E-Myth description. They are smart people who were great technicians in their fields who thought “I could do a better job on my own.” So they hang their own shingle or open their own shop and work killing hours getting everything done, usually by themselves or with a few subordinate level employees, constantly fixated on Activity One, the here and now. The problem is, while they do great work, they feel too busy and too overwhelmed to devote time to the other two essential activities.
Activity Two, building for the future
This is time that is spent building assets with the expectation of an indefinite future gain; and when I say “assets” here please don’t confuse that to mean something that you can drop on your foot but rather any activity that is intended to bring future benefits. I’m not getting any revenue by writing this article, but I expect that it will educate more potential clients about my business and bring more readers to my blog and so I consider this part of Activity Two. Working on restructuring your business’s processes to make them more efficient is another example. The trick here is usually finding the time to get to Activity Two projects. While absolutely essential in the long-term, they’re not timely, and often get put off until “later.”
Activity Three, management, networking, and education
Paying your vendors, attending trade conferences, hiring employees, the list is endless. These are the activities that need the most planning because, if you’re not careful, they could become incredible time sucks. On the other hand, if you get it right, this could become the most valuable time you spend as a business owner; as you’ll see next.
The activity life cycle of the entrepreneur
If all the activities are essential, how do you know what to spend your time on now? You need to budget time for all three activities but the ratio of time spent on each will change as you grow as an entrepreneur; the more advanced you become the more you will dedicate time to Activity Two and Activity Three projects. Once your business is started, Activity One projects take priority because most of us are deathly afraid of not bringing in enough money. If we’re not careful, this can become all-consuming to the detriment of Activity Two and Three. Try spending 80% of your work time on Level One, and 10% each on levels two and three. This is true even if you are an artist or artisan marketing your own product and you don’t really plan on scaling up to become and entrepreneur. Think Scrooge McDuck and “work smarter, not harder.”
Next try slowly increasing your Activity Two time at the expense of your Level One by building more for the future. Use this time to explore new products or markets, experiment with the administration and automate processes. Finally, as you have success in your business Activity Three projects will naturally demand more and more of your time. Indeed, if your business becomes successful enough that you can hire others you may find Activity Three projects become as pressing as Activity One projects originally were and you will have to carefully budget your time to allow for activities One and Two.
As the WebCPA and the author of WebBizFinance.com, my job is to help you have more time and make more money!