I posted earlier that Friday would become more free form and less directly connected with anecdotes about my work history. Today, I want to talk about managing limited resources. This is an issue in business and in your personal life.
If I loop back to my time at AFC, we were always faced with companies wanting us to buy them after the Telecom Bubble popped. I used to call my car (a 97 Mitsubishi Galant) the "M&A Limo". I would get a visit from a banker or a call from a firm and would then do a site visit. We did not pull the trigger on a lot of things that were available. One of the primary reasons was limited resoures. Money was not the resource in question, but time was. If we did one of these random acquisitions, we would have had less energy to do something on our strategic path. But for me to spend a day on a visit to get an idea if there was "anything there" was a good use of time. I always learned something.
I always ask clients "Who is your ideal client or prospect?" Again, this is a limited resource issue. It is not that I wouldn't do business with anyone else. It is that where do I spend the bulk of my time and money. I have gotten lots of Val-Pak ads in my mailbox for products and services I can not use. That money is wasted, even if it is small. If you visit someone who can not use your product or services, what did you accomplish. On top of that the opportunity cost of spending time and money in a bad way is huge.
The same goes true in your personal life. Working is a means to some other end. Almost everyone gets money in order to do something with it. I see people using consumer credit and not realizing the long term cost of that money. It is not always bad to do so. If you spend your money on paying off your credit cards, then you are not buying something else you want or need. Interest rates in consumer credit are huge 15% - 30% or occasionally more. If you really need something, you are better off borrowing against a 401k so that you have a lower interest rate and end up paying the interest to yourself.
Think of it this way. Take the price of the item and add in the interest rate you are going to pay on it. If the interest rate is 30% then raise the price 30%. Is the item worth it to you now? The reality is that a 30% interest rate is going to cost you a lot more than 30% but that is an easy way to start.
If I return to coaching, time is a big issue with many clients. They want their business to earn them the same or more money for less time spent on work. And it is possible, you just have to rethink what you do and how you do it. Time with your family is a precious commodity. More can not be created unless you create it. Some business owners are working over the holidays but their employees have taken the time off. If that is you, let's chat.
Monday I return to the story of what is now the Tellabs Access Business Unit.
FocalPoint Business Coaching
We Focus On Your Business - Time, Team, Money, Exit
Business Coaching, Sales Training, Web Marketing, Behavioral Assessments, Financial Analysis