Jeff Walker in his book Launch said that in a workshop that he was hosting, an attendee came up and asked him what was the one thing that made all the difference to him and his business success. The thing this man should be focusing on as his business grew. Jeff ‘s answer was this – Opportunity Cost.
Opportunity cost is a theory in Micro-economics.
www.netmba.com defines it this way – The value of the next best choice, that must be given up when making a decision.
www.wikipedia.com defines it this way – The value of the best alternative foregone, where a choice needs to be made between several mutually exclusive alternatives given limited resources.
When I was a teenager, I started learning to play guitar. I used to lay in bed imagining myself playing my favorite songs in front of large audiences. I’m sure I’m not the only one who’s ever had rock-star dreams. The thing is, I also liked hanging out with friends and I was getting interested in girls. While I did learn quite a bit about playing guitar, I knew several guys in my school who could play far better than I could. Why? Because they didn’t spend the majority of their time hanging out with their friends. When they had spare time, they were sitting on the edge of their bed practicing scales. Here is where we find the Opportunity Cost. There has to be a trade off.
We all have the same amount of time every week. We all get 168 hours to work with. While we would like to be awesome at everything we pursue, we simply can’t. We humans develop excellence through study & practice, so we can’t realistically expect to be stellar in every area of our lives. We need to make choices as to what we are going to give our time to because for everything we say yes to, we have to say no to something else. You will be saying no to opportunities in order to say yes to (hopefully) better opportunities.
“The chief cause of failure & unhappiness is trading what you want most for what you want right now.” -Zig Ziglar
One of my favorite Zig Ziglar quotes is: “The chief cause of failure & unhappiness is trading what you want most for what you want right now”. Isn’t that sad? We sometimes short circuit our own long-term success because we run off after vain, short-term satisfaction.
Another favorite Zig Ziglar quote is “Success occurs when opportunity meets preparation.” Let’s take that to heart and take the time as we enter the new year to build a plan. Set a goal to make the life we dream of, a reality. As we make our plans, here are some things to consider:
- Look through the corners; Another thing I learned from Jeff Walker. If you only focus on what’s immediately in front of you, things will “suddenly” pop up in your field of vision and you will not be able to react in time. Make it a practice to look around the turns & see what’s coming before it gets here. Also, consider how your actions will affect your future. Wisdom sees down the road.
- The value of a good reputation is immeasurable. Therefore, sacrificing a good reputation is not acceptable. When considering Opportunity cost, saying no to a solid, honorable reputation in order to achieve short-term gain is not worth the trade-off. Above money or power, your reputation will work for you, or against you. Protect it constantly.
- Money should be a byproduct of making the world a better place. When we focus on enriching the lives of those around us, we stand a better chance of finding happiness and fulfillment in our own lives. There’s a book by Marsha Sinetar called Do what you love and the money will follow. I believe this to be true unless your love is sleep. I haven’t seen anyone making a long term living at that one yet. I will say this though. There are now people making a living playing video games on youtube. No joke. The bottom line is that when money is at the top of the priority list, things are on shaky ground.
“Success occurs when opportunity meets preparation.” – Zig Ziglar
As we stand here staring square in the face of 2016, let’s examine not only our goals for the coming year and beyond, but also the opportunity cost to make them happen. If we carefully choose only the few truly important things we want this coming year, we can use these to guide our decisions about all the other things. The things that while eating up all of our time, don’t really get us where we want to be. Let’s get where we want to be in 2016! Let’s be strategic with our “Yes & No”. Say NO to good opportunities so you can say YES to great ones!
Happy New Year!
