As a business owner, do you still have a hard time letting go of all the clutter (low-value, low-priority tasks) that surrounds your work day? A hard time letting go of the “trivial many” tasks? Are you still trying to be competent at every role and task in the company? Still wearing too many hats and juggling too many balls? Well, here is a simple Growth Coach exercise that will help you learn to let go of the many technical and administrative tasks you should NOT be touching on a daily basis. What is your time worth per hour? That’s right. Picture a specific number in your head. What is it?
Did you think $35 per hour? $50? $100? $150? $250? $500 per hour? What did you honestly think your time was worth per hour?
Whatever number popped in your head is quite revealing about you, your role, your work, and your self worth. The dollar-per-hour figure also reflects on if you are working “on” your business or “in” your business. Whether you are working on strategic matters or tactical matters. Whether you are prone to tackle low-value, low-priority tasks or not.
Whether or not you had a pre-existing number in your head is also revealing. Most owners never assign an hourly rate to their time. As a consequence, they don’t value, respect or protect their own time … they spend it foolishly. While they work hard, they typically do the wrong type of work. They seldom differentiate between the real value of daily tasks and end up costing the company money … and themselves some sanity.
It’s also revealing during our business coaching sessions to understand an owner’s thought process to determine that number. Was it logical or emotional? Off the gut or well thought out? Honest or fabricated? Did they base it on what they charge customers or clients per hour? Or was it simply a number in their head, even if from years ago? Or, did they take their salary (usually below market rates) and simply divide by 2,000 hours. That last approach just tells you what you are paid per hour, not what you are truly worth per hour.
No matter what number you came up with or the process you used, odds are that your number was too low. Since The Growth Coach serves thousands of clients each and every year, we know that most owners write down a number that is too low when they begin our business coaching process. However, through our on-going coaching and accountability process and over time, that hourly rate soars and the client learns to discriminate between high-value and low-value tasks. As they focus more time and energy on leadership and strategic business-development matters, their profits soar as well. By doing the right type of work, they learn to work smarter, not harder.
As a business coach, I have concluded that most business owners, doing this exercise for the first time, could safely double whatever number they wrote down and that would be closer to a true worth per hour number. Because most owners are handling so many menial tasks on a daily basis, they undervalue themselves. So if you thought your time was worth $100 per hour, in reality, it’s probably closer to $200 per hour. The worth of an effective owner to the success of a business is nearly priceless. If an owner is working “on” the business and “on” strategic matters, that number should be well over $250 per hour.
No matter what number you came up with, examine it thoroughly. Challenge it. Revise it if necessary. Now I want you to pledge, whatever the number, that you will not touch tasks unworthy of this rate. That you will delegate, outsource or eliminate tasks not worthy of your hourly rate. Did I hear you say a loud “YES”?
For example, let’s say you still do the bookkeeping and payroll for your company and that your hourly rate from above is $100 per hour. Let’s say you can hire or outsource bookkeeping and payroll at $20 per hour. Therefore, you are stealing $80 per hour ($100-$20) from your company every time you spend an hour doing bookkeeping and payroll. As a strategic business owner, that task is not worthy of your time and odds are, others can do it better and quicker than you can. The same goes when you do IT, paperwork, collections, administration, shipping, customer service, surfing the web, answering the phones, accounting, basic marketing and selling, scheduling, training, handling most fire drills, etc.
Whatever your hourly rate, start holding that number up to the value of the tasks you are doing on a daily basis and ask if that task you are about to start is truly worth your time. If not, delegate, outsource or eliminate that task. Learn to value, respect and guard your time.