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Is the Way You’re Spending Your Time Costing You Money?

moneyGeoffrey Moore, in his book Living on the Fault Line, discussed the “Core versus Context Model” for businesses. Core activities are things which set you apart from your competition and context is everything else. For many businesses, this may include administrative activities, marketing activities, and the like.

As we discussed his model, we realized that this works in our personal lives as well. You want to do more of the things you’re really good at and less of everything else. Usually, we really like to do what we’re good at so by focusing on just those tasks, we can advance in our careers.

Like for us, our strength is working on content for Bigg Success. At least we’d like to think so … or more importantly, we hope you think so!

For us, the contextual activities would be everything else. So for a couple of examples, we outsource our house cleaning and the yard work. Instead of spending time on these things, we can work on our business.

You’re getting a glimpse into how integrated our personal and professional lives are. Since we often work from home, all of these decisions are floating around together. We don’t think we’re alone on this – a lot of people are finding it pays to integrate their work life and their professional life.

By outsourcing your contextual activities, you save time and you open up the opportunity to make more money. It comes back to the time vs. money conundrum …

If you don’t have money, you have to invest more time.

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georgeFor example, if you start a business that is well-capitalized, you will be able to spend your time differently than if you start on a shoestring. With limited capital, you may have to take care of the janitorial work – a lot of business owners have done that. I’ve done that!

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At first, you may have to do it yourself because there’s no money. But you want to contract it out as soon as you can because it’s definitely a contextual activity, unless you happen to be the owner of a janitorial service.

Thinking about core vs. context helps you focus on where you want to spend your time and where you want to spend your money. You think twice about spending money because there’s something else that will let you spend more time on your core.

You may find that you spend your money on things that save you time, rather than cost you time.
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marylynnI want a bigg screen TV, but we would rather spend that money on a web person. Right now, I handle our web site. So when there are changes that need to be made, I get to work. But there are better uses of my time.

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Because we know that’s not in our core. Bigg Success is still in its early stages, so as soon as we can we’ll outsource this activity. Another example is publicity – right now, we do it ourselves. We want to contract with someone who is better at it than we are and can accomplish more than we can on our own.

So although we don’t have HDTV, we do have goals for that money!

It boils down to thinking about how much your time is worth. You may find that by contracting out certain activities, it costs you less than what you can make by spending your time working in your core.

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Related posts

Your Personal SWOT Analysis (Part I)

Your Personal SWOT Analysis (Part II)

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BIGG Success Logo boxed

Is the Way You're Spending Your Time Costing You Money?

moneyGeoffrey Moore, in his book Living on the Fault Line, discussed the “Core versus Context Model” for businesses. Core activities are things which set you apart from your competition and context is everything else. For many businesses, this may include administrative activities, marketing activities, and the like.

As we discussed his model, we realized that this works in our personal lives as well. You want to do more of the things you’re really good at and less of everything else. Usually, we really like to do what we’re good at so by focusing on just those tasks, we can advance in our careers.

Like for us, our strength is working on content for Bigg Success. At least we’d like to think so … or more importantly, we hope you think so!

For us, the contextual activities would be everything else. So for a couple of examples, we outsource our house cleaning and the yard work. Instead of spending time on these things, we can work on our business.

You’re getting a glimpse into how integrated our personal and professional lives are. Since we often work from home, all of these decisions are floating around together. We don’t think we’re alone on this – a lot of people are finding it pays to integrate their work life and their professional life.

By outsourcing your contextual activities, you save time and you open up the opportunity to make more money. It comes back to the time vs. money conundrum …

If you don’t have money, you have to invest more time.

.
georgeFor example, if you start a business that is well-capitalized, you will be able to spend your time differently than if you start on a shoestring. With limited capital, you may have to take care of the janitorial work – a lot of business owners have done that. I’ve done that!

.
At first, you may have to do it yourself because there’s no money. But you want to contract it out as soon as you can because it’s definitely a contextual activity, unless you happen to be the owner of a janitorial service.

Thinking about core vs. context helps you focus on where you want to spend your time and where you want to spend your money. You think twice about spending money because there’s something else that will let you spend more time on your core.

You may find that you spend your money on things that save you time, rather than cost you time.
.

marylynnI want a bigg screen TV, but we would rather spend that money on a web person. Right now, I handle our web site. So when there are changes that need to be made, I get to work. But there are better uses of my time.

.
Because we know that’s not in our core. Bigg Success is still in its early stages, so as soon as we can we’ll outsource this activity. Another example is publicity – right now, we do it ourselves. We want to contract with someone who is better at it than we are and can accomplish more than we can on our own.

So although we don’t have HDTV, we do have goals for that money!

It boils down to thinking about how much your time is worth. You may find that by contracting out certain activities, it costs you less than what you can make by spending your time working in your core.

Subscribe to the Bigg Success

Related posts

Your Personal SWOT Analysis (Part I)

Your Personal SWOT Analysis (Part II)

(Image by penywise)

BIGG Success Logo boxed

Why Your Brain May Not Be the Best Money Manager

Morningstar, one of the most respected names in financial information, recently held their annual investment conference.

There was a great deal of discussion about the volatility of the market and how jittery it’s making many investors. Jittery investors like to do something, but the problem is they don’t make the best decisions in troubling times.

 

We have met the enemy!

One of the speakers was Jason Zweig, who is also the author of Your Money and Your Brain. Our brains can be our own worst enemies when it comes to investing. He said there are two parts of our brain – the reflexive (emotional) part and the reflective (logical) part. The emotional side is ever-present; we have to consciously call upon the logical part.

Obviously, we want to buy low and sell high. The problem is, with the emotional part of our brains running rampant, we may tend to buy high and sell low!

So don’t get in a hurry to sell in times like these. Stay the course if your investment horizon is five or more years, because research shows that a broad portfolio of stocks tends to go up as long as you hold them for five years or more. If you need the money (e.g. you plan to retire or send a kid to college) within the next few years, talk to your investment advisor to determine your best move.

You can make money with a stock that goes nowhere!

Let’s say that you have $100 to invest each month. You decide to invest it in a broad index fund (e.g. the S&P 500).

NOW: Assume that shares of that fund are selling for $20 right now. So you buy 5 shares.

Month 1: Assume the price falls 50% to $10 per share. But you keep investing. You buy 10 more shares with your $100 monthly contribution. So you’ve invested $200 total and your 15 shares are worth $150. You’re in the red. But you don’t care – you’re in it for the long-term!

Month 2:
Assume shares of this fund are now selling for $20 again. With your $100 monthly investment, you buy 5 more shares bringing your total to 20 shares, worth $400. But you’ve only invested $300. You’re $100 ahead, even though the share price is the same as it was when you started!

Reacting logically may mean not reacting at all!

It’s very difficult (if not impossible) to predict what the stock market will do. However, research has shown time and again that staying the course is usually the most profitable path for most people.

It’s understandable that you might be worried right now with the market being so turbulent. But don’t panic – react logically … which may mean not reacting at all!

 

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Before Going into Business with Friends, Consider These 8 Scenerios

One thing people often don't think about when going into business with a friend is the relationship itself. You’re going into business as friends. You want to remain friends.

Business is full of surprises. Discuss the possible surprises upfront, before you mix friendship and business, so you can keep your relationship strong while you’re in business.

You may think your friendship is really strong … and you’re probably right. But when you go into business together, your friendship will be tested more than it ever has been before. It’s wise to prepare for it beforehand, so you already have a lot of the answers when you’re in the middle of a tough situation.

Look at it this way – a business partnership is like a marriage. You need a pre-nuptial agreement! So find a good attorney to draw up an agreement for you.

8 “What if …” scenarios to discuss with your attorney

#1 – What if the business fails?
According to statistics, if the business fails, it’s most likely that no one will be owed any money. But what if that’s not the case – what if the business does owe money? How will you resolve that?

#2 – What if it succeeds wildly?
That may not sound like a problem, but you’d be surprised. Sometimes when a business succeeds at this level, greed enters in. Then comes the power struggles. Discuss the dream scenario upfront to avoid a nightmare.

#3 – What if one of you is incapacitated?
What if one partner is no longer able to do his or her part? How will the others handle this? Will this person get bought out? Is there formula for the price? There’s a lot to think about if this unfortunate situation happens.

#4 – What if one of you dies?
Obviously this is even more extreme than the last scenario. There’s the human side – your friend has passed and you’re grieving. But you also have business to attend to; work still needs to get done.

Many of the same questions from Scenario #3 apply here. But there’s more. For example, does the deceased partner’s family now have an ownership stake? Or do you buy them out?

#5 – What happens when one of you gets married?
Or you may already be married. What say does the spouse have in the business? Can the partner’s interest be jointly owned with a spouse or do you want to restrict ownership to your original group?

#6 – What if one of you gets divorced?
The business interest may be a significant asset. You probably don’t want a former spouse having a say in your business – even as a minority stakeholder. It can really muddy the waters, as the saying goes. What restrictions will you place on ownership?

#7 – What if one of you wants out?
How will you determine a price? What kind of notice will you require? What is the process?

#8 – What if one of isn’t pulling his or her weight?
How will you determine that this is case? What can, and will, you do about it?

These aren’t pleasant things to think about, let alone talk about. However, you’re more likely to find good solutions now when you’re thinking logically than to try to work them out in the heat of the moment.

We can’t stress this enough – get a good business attorney.
Then sit down with your partners and your attorney and work through these issues. Your attorney will probably have even more situations to discuss. Work through these issues before you start – for the sake of your friendship … and your business.

 

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I Want to Start a Home-Based Business. How Do I Make Sure It’s Legitimate?

With tough times, people are looking for ways to either save a little or make a little more money. We’ve been getting more questions about part-time and/or home-based business opportunities. Specifically, we’re being asked how to tell if they’re legitimate.

One of the first things to look at is what they’re promising you. Specifically …

Do they make earnings claims?

george "Many offers will tout how much you can make. Legitimate operators will do one of two things: they won’t make any claim at all, or … they will tell you both the number and percentage of people who actually earn what they’re claiming. In my experience, they’re more likely to not make any claim at all."

Some real world examples

marylynn "I did a search for “home based business opportunities.” I saw six on my screen without scrolling down. Of those six, five made an earnings claim. I saw claims like “$250 thousand or more at home”, “$500 to $8,000 per month”, and $30 to $150 thousand in 12 months”. Then I looked at the most regulated business opportunities – franchises. I typed in “franchise opportunities”. One out of the four franchise opportunities made an earnings claim and it was also one of the home-based business opportunities!"

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We’re not saying that being a franchise automatically makes it a legitimate opportunity. Nor are we saying that just because it’s not a franchise means it’s a scam. But from these examples, you do see differences in behaviors of companies that are more regulated and those that are not.

Do they stand behind their own claims?

marylynn "I went to the site of one of the home-based business opportunities. This was the one that claimed you could make $250 thousand. I scrolled way, way, down to the bottom of the page and clicked on the tiny, little link that said 'Earnings Disclaimer'."

george "Mary-Lynn printed it out. It was in ALL CAPS. Unlike the small font used for the Earnings Disclaimer, this was in 13.5 point type. They’re covering their you-know-what."

Here are some highlights …

“ANY EARNINGS OR INCOME STATEMENTS,  OR EARNINGS OR INCOME EXAMPLES, ARE ONLY ESTIMATES OF WHAT WE THINK YOU COULD EARN.”

“ANY AND ALL CLAIMS OR REPRESENTATIONS, AS TO INCOME EARNINGS … ARE NOT TO BE CONSIDERED AS AVERAGE EARNINGS. TESTIMONIALS ARE NOT REPRESENTATIVE.”

And our favorite part …

“WE DO NOT GUARANTEE OR IMPLY THAT YOU WILL … GET RICH, THAT YOU WILL DO AS WELL, OR MAKE ANY MONEY AT ALL. THERE IS NO ASSURANCE YOU'LL DO AS WELL.  IF YOU RELY UPON OUR FIGURES; YOU MUST ACCEPT THE RISK OF NOT DOING AS WELL.”

So they make a claim and then they disclaim their claim!
When you see this, exclaim your skepticism!

We’re NOT (sorry, we got used to seeing ALL CAPS) saying this particular example is a scam, but you would definitely want more information before proceeding.

The thing about earnings claims, at least here in the U.S., is they are required by law to disclose both the number of people and the percentage of people who are earning any amount they quote you.

So don’t be afraid to ask for documented proof of any claim. Then check out our article that describes your next steps are when investigating a business opportunity.

 

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