“Time is money” sums up the concept of opportunity cost – because time is money. It means time is a valuable resource (because our time in this world is finite), therefore it’s better to do things efficiently. Alternatively, spend time and effort on things that get the results you are looking for.
Starboard TCN recently moved offices across the street from the building we worked in for over 12 years. The buildings are very similar, yet still different in key ways. In the new building, I no longer need to cross the busy traffic on Market Street. Instead, I can walk from the underground exit to the building entrance. In our old office, I would typically stop to talk to the building security guard for and discuss the latest sports news. Now, I just enter my building and take a sharp left straight to the elevator.
My old elevator stopped virtually on every floor before I made it to my office on the fourteenth floor. My new elevator now has “express control” so I rarely share the elevator and I zip straight up to the sixteenth floor, without any stops. When I leave the building, instead of going around the block to enter the underground train station, I now have a direct path from the new building to the entrance. As a commercial real estate broker, I typically use the underground at least four times a day, so this new location is very convenient.
If you add up all the time I’m now saving just by moving to a new office location, it’s about an hour a day. That’s five hours a week, 20 hours a month, and over 260 hours in one year.
As a salesperson, particularly if you work on commission, it’s crucial to figure out how much money you will need to make in an hour in order to hit your financial annual goal. Assuming you want to make $200,000 and you work 40 hours a week, you would have to earn $96.00 an hour in order to achieve that goal.
Before the office move, I was losing five hours a week, which means at the time I was really only working 35 hours a week. Using the same $200,000 annual goal, instead of needing to earn $96.00, I now need to earn $109.00 an hour to achieve my goal. However, if you continue to work towards $96.00 an hour, you would earn $175,000 instead of $200,000 – a loss of $25,000 in annual income.
What’s really interesting to me is that it was not my intent to move our office in order to save time. But what if I studied the effect of time savings or loss of time to determine our move? As one person saving that amount of time in a firm of 20, what is the potential gain for the company if each of our agents were expected to make $200,000 annually and they each saved five hours a week?
If you study your daily routine, like my daily chat with the security guard, making personal calls, or checking social media during the day, you will likely find the precious time needed that could be added back in your work day, increasing efficiency and overall productivity. All of us, whether we are successful or not, should take note that one of the easiest ways to improve your production is to study your daily habits.
Write down all of the activities and note an average time for each. Then study these numbers and see what you can eliminate or change to become more efficient. You might just find a spare $25,000 at the end of the year.