The most crucial identity shift for business entrepreneurs, those seeking freedom of their work is their ability to live inside of a results economy —instead of a time and effort one.
Let me explain:
Most of us are conditioned to live in a time and effort economy:
We trade our resources —time and effort —for a paycheck.
In a time and effort economy:
- We get paid based on our time and effort.
- We are guaranteed income regardless of result.
- If we want more money, we increase the inputs.
However, there is a Milky Way Galaxy sized issue inside of a time and effort economy, as you may have guessed:
Your time and effort are finite resources —and you only have so much to give.
So, what’s a better way?
Enter the results economy where you’re compensated not for your time and effort —but your ability to create a result.
Let me explain this in a simple way.
The Average American worker is productive 2.1 hours out of an 8 hour work day.
(I know, I’m always shocked by that number too.)
Let’s call the total deliverables and “output” of this day the result.
If we were living in a results economy, we should be able to march into our bosses office and tell them we’re going to work from 9 AM to 12 PM —and call it a day after the result.
And they’d tell us to screw off —because they’re operating out of the old model.
Instead, in the result economy —there’s only one thing that matters —as you may have guessed: the result.
So if you run your own business as an entrepreneur or freelancer:
You must ensure you operate in a results economy —and then your responsibility is to streamline work to create exponential results.
So, how do you live in a results economy?
1. Get hyper clear on the result you’re providing.
If you’re selling web design —what is the result you’re providing?
Sure, there’s the deliverable of the website, but go deeper: the result could be confidence in the marketplace and the emotional freedom that comes with having a killer site.
2. Never sell your time hourly —sell it on value.
The time and effort economy loves hourly rates, but the result economy sells on value.
Value leads to exponential growth and profits for you, while charging a premium leads to higher-quality clients with less friction.
3. Improve your skill and focus to reduce time and effort.
Your ability to streamline workflow and deliver on the result is based o your skill.
Which means you could reduce time and effort by 50% if by being more effective at fulfillment or delegating to others.
4. Become a master at finding those who want the result.
Our ability to find the people who really need the result we’re providing and who are willing to pay a premium for that result will determine our success.
5. Turn one-time revenue into recurring-style subscriptions or retainers.
Time and effort means always grinding for more income or new clients.
Instead, turn one-offs into recurring, predictable revenue streams by selling those who already trust you on an ongoing or similar service.
Ultimately, let’s say you write copy for brands.
Inside of a time and effort economy —you may charge $150 per hour to write a sales page.
Let’s say it takes you ten hours —you’d make $1,500.
Inside of a result economy —you understand that if you craft a converting sales letter —a brand can use it for years of profit and growth.
Instead of charging by the hour —you charge based on value, which you deem $5,500.
And because you’ve mastered the skill of focused, disciplined output —it takes you three hours.
So, let me ask you:
Is it better to make $5,500 in three hours —or $1,500 in ten?
Now, let be clear here:
There are downsides to a results economy —because if you cannot deliver or it takes you forty hours to make that sales page —then you’re on the wrong side of the equation.
I know this concept takes a bit to digest, but this is by far the number one issue with people who transition from a full-time gig to their own work.
They live inside the employee model of time and effort —instead of the result-based economy of entrepreneurship.
(By the way, this is a valuable mindset shift even if you work for someone else.)
Last —this original concept was learned from Strategic Coach, Dan Sullivan —whose work has influenced me greatly.
I simply chose to expand on it and share how I process it inside of my own life and business.
So, let me ask you:
Are you living in a time and effort —or the result economy?