When entrepreneurs, leaders, or investors consider the merits of a new opportunity or project, there's one factor they tend to take into account above all others: what's the potential Return on Investment (ROI)?
While that's certainly a good question, it might not be the most important one you can ask--especially if you're trying to build a business. Rather than asking "is this worth my money?" A better question to ask might be, "is this worth my time?"
Here are a few reasons to start focusing on ROTI (Return on Time Invested), rather than just ROI alone.
Not all 'capital gains' are financial.
Beyond a good income, what do you want to achieve from your career? Professional accolades? Awards? The knowledge you've made a difference? All are valuable. All require time. None can be purchased with cash. On a recent episode of the "Follow My Lead Podcast," Logan Stout, CEO of IDLife explained it this way:
"What powers people through adversity is the thought of the value they're receiving in exchange for the time they're putting in--and I don't just mean money," said Stout. "The best feeling is when you look at your work and see that you're not just playing the game--you're changing the game in your industry."
Optimize your efforts to maximize those extra-financial rewards that ultimately mean so much.
In business, time is money.
This is obviously true for employees who get paid by the hour, but it's even more important for entrepreneurs. At any given moment of the day, there are ten or twenty different things you could be doing.
The question becomes, what's the most efficient way to use your time? Choose wisely. Consistently making poor time choices can change the course of your whole career for the worse.
Jeff Bullas, the copywriter and content marketing expert, once told me that his career changed when he stopped mowing his own lawn. An hour of his professional time was worth more than $100, but for many years he'd been cutting his own grass to save the $25 it would cost to have a service do it for him.
Finally, it dawned on Jeff that every hour he spent in the yard was actually costing him $75 in lost work hours. The opportunity cost far outweighed what he was saving by doing the menial chore himself. His decision to focus his time on high-yield activities changed his life.
Ensure you are spending your time on the activities that produce the best financial return.
Your clients are already focused on value-for-time.
You want to offer outstanding value for your clients, right? Then it's important to start thinking like they do. Great leaders care deeply about ensuring the value they bring their clients is maximized both internally and externally.
"No matter what products or services a company offers to its clients, the importance of optimizing your workflow for maximum value is hard to overstate," says Itai Sadan, co-founder and CEO of Duda, a web design technology business.
He continues, "This is especially true for companies like digital agencies that keep their businesses afloat through ongoing, high-contact relationships with clients. Every time our team is preparing to build a new product for agencies to work with, we ask ourselves, 'How will this feature help our customer build websites more quickly?'"
There are many processes and procedures in your business where you could streamline the activities that would have great value to your employees and your clients. The key is to evaluate which ones could be streamlined and which one would have the best return on time.
You can always get more money.
At the risk of sounding philosophical, the only resource you have that you can never earn back is time. In terms of supply and demand, time is incredibly valuable. It's very limited, everybody wants more of it, and yet it can't be manufactured, bought or sold. It's truly the only thing we can't get back and we don't know when it will run out.
Just think about all of the stories you have read or heard where people have come back from bankruptcy to be a multimillionaire. There is almost no financial setback that you can't recover from. However, if you squander your time on inefficient projects or businesses, you might neglect things like your family, your health and your character. Once those things are gone, they don't usually come back.
Unlike money, time is absolutely finite--don't waste it!
Any time I evaluate a new opportunity, I always consider whether it will be a good use of my time before I get into crunching numbers and potential ROI. If you're looking to be more efficient and successful, while ultimately enjoying a more fulfilling career, I invite you to do the same!