Increasing Your Value

We are living in an economic age for which most people are largely unprepared. Massive shifts in economic activities and incredible dislocations of businesses and industries are taking place all over the country. Being either an employer or an employee today is like being a long-tailed cat in a roomful of rocking chairs.

Your goal is to organize your life in such a way that you enjoy a good income, a high standard of living, and that you are the master of your economic destiny rather than a victim of changing economic times.

In 1945, at the end of World War II, America and Americans entered into a golden age that had never existed before and will never exist again. Those of us who grew up during this golden age developed a particular way of looking at the world that was greatly influenced by what was going on in America at the time. We developed certain assumptions about our lives and about business in general, and we have a hard time giving them up. But give them up we must if we are going to survive in the economy of the future.

At the end of World War II, America and American industry dominated the world. We had not only abundant natural resources but also advanced technology, an intact industrial base, most of the money in the world, an advanced educational system, millions of competent workers, and a fully integrated system of roads, schools, hospitals, cities, and farms. It was said that America got rich by coming late into two world wars, and it was certainly true in the late ‘40s and ‘50s.

Meanwhile, the rest of the industrialized world, in both Europe and the Far East, was bombed to rubble. Our industrial and economic competitors had been ravaged by war. For this reason, anything that American factories produced found a ready market, both nationally and internationally. The economy took off. There was good-paying work for everyone. The ‘50s became an age of expanding prosperity, tremendous job security, and opportunities for all.

In this economic environment, anyone could get a job. Not only that, but there were plenty of low-skill jobs that paid high salaries and benefits for average work. A working person in America could have a nice house, a car⎯maybe two cars⎯and eventually a motor home, a boat, and all the other trappings of the good life.

After a few years of this robust, expanding economy with opportunities and jobs for all, Americans began to accept the good life as their birthright. People began to feel that because they were born in America, they were entitled to the good life, whether or not they worked hard. The Unions took full advantage of this mind-set and negotiated ever higher wages and benefits from American manufacturers. The increased costs of the products and services were simply passed on to the customers. Since the rest of the industrial world was still rebuilding, the only products to buy were American products. And since American consumers were also workers who were making good wages, as prices went up, sales also went up.

But by the '60s, the world was already changing. Our industrial competitors, especially Germany and Japan, had begun to rebuild and to manufacture and export products. Competition for the good life began to emerge all over the world. The pace began to pick up, slowly. The average American wasn’t aware of it, but the golden age was coming to an end.

In the '70s, America began to be flooded with high-quality products from all over the world. American companies and American working people had become complacent with their captive markets and had let their quality deteriorate. Low-price, high-quality products coming in from Japan, Germany and other countries began to take sizable chunks of the market. The affected industries cried out to government for protection, which was just another way of selling higher-priced goods to captive customers. And it didn’t work.

By the '80's, we were in a real race. Everyone in the world wanted to enjoy the same living standards Americans had. And people were willing to work long hours and produce high-quality goods and services in order to achieve those living standards.

We lost our advantage in natural resources. We lost our edge in technology. And we lost our edge in capital. Today, any change in economic policy anywhere, in any country, instantly causes capital to flow in or out of the affected areas. Countries can not even control the value of their currencies.

The one edge that America maintained is that we have the most productive workforce in the world. America and Americans produce more goods and services per capita than any other country. But there is a race on, and we are in it, and if you want to be employed in a good job for the indefinite future, you must get in and start competing as you have never done before.
Your job is an opportunity to contribute a value to your company in excess of your cost. In its simplest terms, your job is as secure as your ability to render value in excess of what it costs to keep you on the payroll.

If you want to earn more money at your current job, you have to increase your value, your contribution to the enterprise. If you want to get a new job, you have to find a way to contribute value to that enterprise. If you want any kind of job security, you must continually work at maintaining and increasing your value in the competitive marketplace.

And here's a key point. Your education, knowledge, skills and experience all are investments in your ability to contribute a value for which you can be paid. But they are like any other investments. They are highly speculative.

Once you have learned a subject or developed a skill, it is a sunk cost. It is time and money spent that you cannot get back. No employer in the marketplace has any obligation to pay you for it, unless he can use your skill to produce a product or service that people are ready to buy, today.

Whatever job you are doing, you should be preparing for your next job. And the key question is always: Where are the customers? Which businesses and industries are growing in this economy, and which ones are declining?
I continually meet people who ask me how they can increase their income when their entire industry is shrinking. I tell them that there are jobs with futures and there are jobs without futures, and they need to get into a field that is expanding, not contracting.

There are three forms of unemployment in America: voluntary, non-voluntary, and frictional. Voluntary employment exists when a person decides not to work for a certain period of time, or not to accept a particular type of job, hoping that something better will come along. Non-voluntary unemployment exists when a person is willing and able to work but cannot find a job anywhere. Frictional unemployment is the natural level; this includes the approximately 4 or 5 percent of the working population who are between jobs at any given time.

However, there are always jobs for the creative minority. You never have to be unemployed if you will do one of three things: change the work that you are offering to do, change the place where you are offering to work, or change the amount that you are asking for your services.

If there is no demand for your particular skills and experience, you will have to learn to do something else and provide skills that are in demand at the time. Employers don't care about your past. They care only about your future and your ability to contribute value to their customers.

You can change your location. Sometimes you will have to move from one part of the country to another, from where there are few jobs to where there are more jobs. Many people transform their entire lives by moving from an area of high unemployment to an area of low unemployment.

The third thing you can do to get back into the work force is to lower your demands. Remember, because your labor is a commodity, it is subject to the laws of supply and demand. If you ask too much, people will not hire you, because customers will not pay your demands in the price of the product or service that your organization produces. It is not the employer who is forcing this downward revision in wage requirements; it is the customer, through his or her buying behavior.

There is a small, creative minority in America who are never unemployed. No matter what happens, they always have a job⎯sometimes two jobs. If they lose a particular position in one place, they find another position doing the same thing, or something else, somewhere else. They are fast on their feet. They move quickly and they don't accept unemployment as an option. And they always have jobs.

There are always jobs to be done. Even in the worst economy, there are always problems to be solved and consumer needs to be met. For this reason, all long-term unemployment is ultimately voluntary.

There are more opportunities for you to fulfill your dreams and aspirations in the American economy than have ever before existed, or than exist anywhere else in the world. You can be, have, or do anything that you can dream of by preparing yourself for better and better jobs. It is never crowded at the top. There are no traffic jams on the extra mile. Your job is to get good, get better, and then make yourself indispensable.


By: Brian Tracy

www.focalpointcoaching.com

Increasing Your Earning Potential

Throughout most of human history, we have been accustomed to evolution, or the gradual changing and progressing of events in a straight line. Sometimes the process of change was faster and sometimes it was slower, but it almost always seemed to be progressive, from one step to the other, allowing you some opportunities for planning, predicting and changing.

Today, however, the rate of change is not only faster than ever before, but it is discontinuous. It is taking place in a variety of unconnected areas and affecting each of us in a variety of unexpected ways. Changes in information processing technologies are happening separately from changes in medicine, changes in transportation, changes in education, changes in politics and changes in global competition. Changes in family formation and relationships are happening separately from the rise and fall of new businesses and industries in different parts of the country. And if anything, this rate of accelerated, discontinuous change is increasing. As a result, most of us are already suffering from what Alvin Toffler once called, “future shock.”

You can’t do very much about the enormity of these changes, but the one thing that you can do is to think seriously about yourself and your basic need for security and stability. In no area is this more important than in the areas of job security and financial security. You must give special attention to your ability to make a good living and provide for yourself in the months and years ahead.

Above all, to position yourself for tomorrow, you must think continuously and seriously about your work today, your earning ability , and the work that you will be doing one, three, and five years from today. You must plan to achieve your own financial security, no matter what happens.

Charles Kettering said that you should give a lot of thought to the future because that is where you are going to spend the rest of your life. One of the greatest mistakes that people can make, and the one with the worst long-term consequences, is to think only about the present and give very little thought to what might happen in the months and years ahead.

When our grandfathers started work, it was quite common for them to get a basic education and then go to work for a company and stay with that same company for the rest of their working lives. When our parents went to work, it was more common for them to change jobs three or four times during their lifetime, although it was difficult and disruptive.

Today, with increased turbulence and change in the national and global economy, a person starting work can expect to have five full-time careers between the ages of 21 and 65, and 14 full-time jobs lasting two years or more. According to Fortune Magazine, fully 40 percent of American employees in the 21st Century will be “contingency” workers. This means that they will never work permanently for another company. They will continue to move as needed, from company to company, from job to job, earning less money than full-time employees and accruing very few, if any, benefits in terms of health care and pension plans.

Imagine what your job will look like five years from today. Since knowledge in your field is probably doubling every five years, this means that fully twenty percent of your knowledge and your ability in your field is becoming obsolete each year. In five years, you will be doing a brand new job with brand new skills and abilities. Ask yourself, “What parts of my knowledge, skills and work are becoming obsolete? What am I doing today that is different than what I was doing one year ago and two years ago?” What are you likely to be doing one year, two years, three years, four years and five years from today? What knowledge and skills will you need and how will you acquire them? What is your plan for your economic and financial future?

We are now in the knowledge age. Today, the chief factors of production are knowledge and the ability to apply that knowledge to achieving results for other people. Your earning ability today is largely dependent upon your knowledge, skill and your ability to combine that knowledge and skill in such a way that you contribute value for which customers are going to pay.

The Law of Three says that you must contribute three dollars of profit for every dollar that you wish to earn in salary. It costs a company approximately double your salary to employ you in terms of space, benefits, supervision, and investment in furniture, fixtures, and other resources. For a company to hire you, they have to make a profit on what they pay you. Therefore, you must contribute value greatly in excess of the amount you earn in order to stay employed. To put it another way, your earning ability must be considerably greater than the amount you are receiving, or you will find yourself looking for another job.

To position yourself for tomorrow, here is one of the most important rules you will ever learn: “The future belongs to the competent.” The future belongs to those men and women who are very good at what they do. Pat Riley, in his book The Winner Within, wrote that, “If you are not committed to getting better at what you are doing, you are bound to get worse.” To phrase it another way, anything less than a commitment to excellent performance on your part is an unconscious acceptance of mediocrity. It used to be that you needed to be excellent to rise above the competition in your industry. Today, you must be excellent even to keep your job in your industry.

The marketplace is a stern task master. Today, excellence, quality, and value are absolutely essential elements of any product or service, and of the work of any person. Your earning ability is largely determined by the perception of excellence, quality, and value that others have of you and what you do. The market only pays excellent rewards for excellent performance. It pays average rewards for average performance, and it pays below average rewards or unemployment for below average performance. Customers today want the very most and the very best for the very least amount of money, and on the best terms. Only the individuals and companies that provide absolutely excellent products and services at absolutely excellent prices will survive. It’s not personal. It’s just the way our economy works.

To earn more, you must learn more. You are maxed out today at your current level of knowledge and skill. However much you are earning at this moment is the maximum you can earn without learning and practicing something new and different.
And here’s the rub. Your accumulated knowledge and experience is becoming obsolete bit by bit, day by day. The knowledge in your field is doubling every three to five years. That means that your knowledge must double every three to five years just for you to stay even.

The solution to the dilemma of unavoidable change and restructuring is continuous self-development. Your personal knowledge and your ability to apply that knowledge are your most valuable assets. To stay on top of your world, you must continually add to your knowledge and your ability. You must continually build up your mental assets if you want to enjoy a continuous return on your investment. And only by building on your current assets do you stop them from deteriorating.
By engaging in continuous self-improvement, you can put yourself behind the wheel of your own life. By dedicating yourself to enhancing your earning ability, you will automatically be engaging in the continuous process of personal development. By learning more, you prepare yourself to earn more. You position yourself for tomorrow by developing the knowledge and skills that you need to be a valuable and productive part of our economy, no matter which direction it goes.


By: Brian Tracy

Hello Mr. President!

While speaking at a seminar the other day, I asked the audience, “How many people here are self-employed.” Of the 3,000 people who had come for motivation and inspiration, only about 300 raised their hands.
That’s the usual number. About 10 percent. I know because I ask audiences that question all the time when I’m trying to make a key point.

I then tell them, “The biggest mistake you can ever make is to think that you work for anyone else but yourself. You’re all self-employed. From the time you take your first job to the day you retire, you’re working for yourself.” And this goes for you as well.

You are the president of your own personal services corporation. You are the Chief Executive Officer, the Chairman of the Board. Legally, you can form your own sole proprietorship, and using your own name (William Smith and Associates, Susan Jones and Associates) just by deciding to do so. You can print business cards today with your name and the word “President” under it.

You don’t need permission from anyone. You don’t need to register anywhere. You can be the president of your own legal corporation from this moment forth.

You are the president of your own career. You are the boss of your own life. Your current employer is merely your “best client.” If another client offers you a better deal, you can take your personal services and sell them elsewhere.
How, some things in life are optional and some things are mandatory. Going to Fiji for your vacation is optional. Being president of your own life is mandatory. The only question is whether you accept it or not.

The very act of defining yourself as self-employed, no matter who signs your paycheck, moves you into the top three percent of Americans. These are the people who “act like they own the place.” This elite is distinguished from others by their attitude toward themselves and their lives. They are proactive rather than reactive. They take charge of their work situations rather than accepting them passively.

You choose your own job. You set the terms of your employment. You decide your own pay. If you want a raise, look in the mirror and negotiate with your boss. You’re in charge. How, what are you going to do about it?

By: Brian Tracy