When we think about currencies and resources, the factor of renewability plays an important role. Entrepreneurs frequently consider their assets and current economic position. What does the cash flow look like for the next quarter? How about manpower, or "human capital"? Is a new technology purchase in order? Does money need to be spent in order to make more of it? The majority of an entrepreneur's assets can be renewed or replaced: the company can expand its personnel, computers can be replaced, subscription services can be renewed, and money can certainly be recuperated. But time, as an asset, concept, and facet of life, is often scarce and always finite.
The other day, I spoke to a somewhat risk-averse entrepreneur who found himself making the bulk of his risky decisions very begrudgingly. When it came to leaving opportunities behind, acquiring entities, or sorting out his action items, he took massive leaps over daunting obstacles to overcome difficulties and keep his business and life afloat. He noted several times that, while others may have made these riskier maneuvers to shoot for a thriving business, he was in a position of survival. The uncomfortable discrepancy between want and need.
Interestingly, the one area where he was willing to take significant risks and almost always chose to do so was when he considered opportunity cost. Despite working within an industry that is mostly structured on a success-based contingency fee, he chose to work off a consulting business model with billable hours. Why is this? Because he's not afraid to price his time according to its true value or to recognize that it is fleeting. Although this may dissuade potential clients from using his service, it allows him to focus on a network of accounts that appreciate and trust his expertise. And so far, it's worked well.
We've considered the risk and opportunity cost of not being in control, and now we evaluate the risk of time squandered. What we do with our day is important because the ways that we spend our hours contribute to how we have lived our lives. If that sounds too obvious, I urge you to reread it. There's nothing more precious than time, and there's no time like the present.
We'll be taking a mini break from blogging on July 4th and 5th to celebrate and recharge. We'll be back in action on Monday, July 8th with more exciting content! Stay tuned and enjoy your holiday!
Comments