I spoke to a friend who is starting his own company. His first order of business was to do a month or two of clerical work to build an email list. The work is tedious and boring, but he doesn’t want to hire someone to do it. He is saving his money,
One of the basic principles of business leadership and growth is to continually hive off low value work from high to lower cost assets to improve the efficiency of the company. It goes something like this: If you have someone in your company that is worth $80,000 per year in salary and part of their responsibility is work that could be done by someone earning $40,000, you need to find a way to move that $40,000 per year work to a $40,000 person as quickly as possible.
We had a conversation with a client recently regarding his designers. He has six. They did a variety of things as part of their job description, most of which was designing, but some of which could have been done by a purchasing agent or estimator earning much less. We recommended he survey his designers for the number of hours they spent on the low value work and, if the total across the group added up to 40 hours a week, it was time to hire someone at a lower cost to do the work and let his designers do what they do best, design.
It’s pretty simple math, but it is surprising how few business owners act on it. Why? Because there is a leap of faith involved whenever you hire another person. You are taking on another responsibility. You are deciding that growth is possible and will occur. You put pressure on yourself to sell more — to be better. To commit to success. Not comfortable.
Back to my company-launching friend. A $15 per hour clerical worker could take over the task of email collection with the consequence of leaving his much-more-valuable time open for the work that is not only high-value, but that only he as the business owner could do: plan his product offerings, lay out and implement his marketing strategy, workshop his ideas, seek strategic partners.
But no, he was going to mine the internet for email addresses himself. Why? Because the decision to hire someone to do the work for him was a declaration that he was serious about going in to business. Because he would have to commit his own money to his ideas and he wasn’t ready.
Imagine, now, asking your customers, your bank, your business partners and potential investors to invest in a company you are not willing to invest in yourself. You want to use their money to run a business that you are not committed to, have no confidence will succeed and with inefficiencies already built in to the mindset of the owner!! They would be foolish to do so and the company is already doomed to fail.
My advice to him was to imagine pulling $30,000 from his investments, putting it in his business account and hiring someone to collect those emails. How did that feel? Did his business idea seem like a sure thing still? Did betting $30,000 on himself look smart? If not, he needed to rethink his business until he believed in it.
If you can’t bet on yourself, there is no point starting in business and there is no sane person that will bet on you either. You need to lay down the bet.