When you hear someone say they need to be more productive, what comes to mind? Maybe they need better time management skills? If it's a personal finance issue maybe they need a little more discipline? Do you ever think of productivity as a function of inputs though? While I love the romanticism of productivity being a state of mind, it really is the summation of a few variables that come together to help you produce at a certain level of out put (or lack of production). Today I want to break out those underlying principles and maybe offer a little insight to you to help you make your endeavors that much more productive. This even counts for money!! Don't think that because you "feel" like your doing "ok" that there's not always room for improvement. I would hate to get all: Suze-Orman-taking-phone-calls-and-cutting-people-down-when-they-ask-for-permission-to-buy-stupid-stuff on you!
Capital Stock (and Technology-it's a two for one here) - Not in the conventional "stocks and bonds" kind of stock but in the equipment and tools you use to get through your to-do list. What tools are you using to keep you productive it could me the PC or Mac you type on to get content to your website, to the car you drive to get your errands done. We all use physical capital the question and take away here is: would an additional investment in your capital stock make you more productive. If your a web-preneur than your computer is a very important tool - so the cost of a needed upgrade would be helpful in increasing your output. But if your just looking for that next tech toy and claim it will make you more productive when all you really want to do is play...maybe not a great investment. As the technology gets better investments in that technology that will increase output and productivity should definitely be considered.
Human Capital - This is one of my favorites. While who you know is pretty important in getting things done I'm a firm believer in what you know always edging it out - regardless that people are telling me the opposite quite often. Your knowledge and skills are what give you the power to navigate those social, business, personal, and political situations to get what you need done. So when it comes to productivity it makes sense that with any given task the greater level of competency you command the more efficient you can be. Have you ever heard a business or financial coach - not unlike myself - tell you that you need to be a student of your business. The rationale there is that the more you study and improve the skills you need to do your job the better you'll get at it and the farther you will potentially progress. Instead of wasting time "winging-it" take a few extra moments to prepare and the yield for it will most certainly out way the cost of the time it took to prepare - beating out good ol'opportunity cost. Isn't learning fun!
Now we have blended Technology and Knowledge between Human Capital and Capital Stock. Which really leaves only one final component to try to apply to the individual and the small business - that's Natural Resources. For all the lumberjacks and miners out there reading this, it's probably a no brainer that tree's and minerals are disappearing faster than they are either replanted or discovered. You guys are living this part of the productivity cycle. For everyone else applying the allocation of scarce resources concept we have to get a little more abstract. Money. Money for almost everyone is an ever scarce resource - and to aspiring young businesses it's almost like trying to fill a cup with water that has a whole in the bottom of it. How we allocate our budgets has a direct impact on our productivity. In financial planning it's pretty easy to see that if every weekend you are going out and spending through the parts of you paycheck not allocated to rent and all the other amenities you get a bill for than odds are you probably aren't saving as efficiently as you should be. Getting a job done has a similar story in that businesses have to manage their budgets to buy the appropriate tools to get through their objectives. With businesses you are measuring return on that investment (your spending) along the way because even the money spent can be sometimes grouped in your capital stock.
This week I had the opportunity of listening to a panel of amazing entrepreneurs speak at Bay Path College at their eighth annual Innovative Thinking & Entrepreneurship Lecture, titled “Secrets of Successful Businesses.”. It was amazing to hear about the successes they found, their impact on and inspiration from the community and what they do to stay productive. The two PhD's on the panel along with a third being an MBA all echoed each other in the importance of educating yourself in a way that makes you as efficient as possible in carrying out your mission. Notice how they didn't refer to what they learned in their graduate schools. There are many forms and specializations of business education, some of which are profiled on MBA Online and Bloomberg's business schools page, but none of these will truly prepare you for the challenges of real world business. It isn't up to the professor to shape you into a productive individual, this has to be learned yourself and its not always easy they may not have used those words but coming out of the research lab and into essentially sales meetings with venture capital firms means you might have had to do a little extra studying. All those hours and all that effort to bring to light their passions - all because they are taking and allocating their scarce resources (time and money) to bring their dreams to market as fast as possible (efficiency).
So the next time you feel like you need to be more productive take a look around you. You might be able to give yourself a boost just in changing your environment a little bit or even a little extra investment in yourself. If your motivations are personal finance in nature look at your behavior patterns - where are you allocating your biggest scarce resource. You can make lists and listen to motivational speakers all day every day but if you don't give yourself the tools or opportunity to succeed then you'll always be chasing productivity...and that's not very productive now is it.
Wednesday, November 10, 2010 at 1:34PM