what is value?

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Client Service Associate = $68,000 / 2000 hrs = $34/hr

Operations Manager = $120,000 / 2000 hrs = $60/hr

Chief Operating Officer = $200,000 / 2000 hrs = $100/hr

Price is what you pay, value is what you get. ~Warren Buffett

Try not to become a person of success, but rather try to become a person of value. ~Albert Einstein

Value is what you're exchanging with your employer for a salary.

So what actually makes one person's time worth 2-3x more than another's? I'm going to shoot from the hip for a little while and then dig deeper into what value is.

At the basic level, the "more valuable" person has more skills, knowledge, experience, gray hairs. They're better at solving difficult problems, reversing entropy. They've been through more ups and downs, seen first-hand what works and what doesn't.

So how does one shortcut this? You can't speed up time, but you can learn skills. You can study other people's stories, learn from their wins and losses. You CAN seek knowledge more than other people seek knowledge. The most important thing you can do to become more valuable is to learn principles & frameworks (I'll revisit this for sure) - and smart, successful people love sharing how they did it - in books, videos, podcasts... now I'm back at Curiosity again.

People who are seeking to learn come across a lot more knowledge than people that are not. So if you want to 2-3x your income, become a seeker.

One person I came across in my own seeking is Alex Hormozi . He's a master at principles & frameworks. Here's his definition of value:

Ok, I'm going to explain the above framework with a very common example. A CSA is tasked with helping an advisor prep for a client review meeting. This particular advisor is the one paying the CSA's salary, so we're talking about the value the CSA is providing to the advisor in the specific situation of helping the advisor prepare for a meeting. How do we calculate the value of this CSA?

• Dream outcome: the advisor shows up to the review meeting and absolutely everything is ready - the conference room is prepped, the investment reports are pulled up on the computer, the client has their favorite drink, and any paperwork required for this meeting is pre-filled and sticky-noted for signatures on the table. Even better, if there are two possible outcomes to the meeting, both sets of paperwork are ready depending on what the client decides.
• Perceived likelihood of achievement: based on previous experience with this CSA, the likelihood of achievement is very high. They've done exactly this for 30 previous client meetings, and furthermore they're proactive and hardworking and the advisor is very confident that any issues that may come up will be quickly and excellently addressed.

Ok, so these two are the numerator of this value equation: Dream outcome multiplied by perceived likelihood, and they are divided by:

• Time Delay: Almost none, everything is ready to go for the meeting. Alternatively, let's say the paperwork isn't prepared and the CSA rushes off to prepare mid-meeting. Worse yet, the paperwork isn't sent to the client for 2 weeks afterward. How long does the advisor have to wait for the expected outcome to be ready?
• Effort & Sacrifice: In the above good example, there is very little effort & sacrifice on the part of the advisor. This is a top-notch CSA and very valuable to the advisor. But what if the CSA doesn't know how to prepare the paperwork, hasn't run investment reports, or hasn't noted the client's favorite drink in the CRM? The advisor had to spend several hours preparing for this meeting.

This is value. A pro-active, knowledgeable, efficient CSA provides more value than a reactive, lacking in knowledge and skills, inexperienced CSA.

If a CSA is pro-active, knowledgeable, and efficient, its highly likely the advisor will give them more responsibility by delegating higher level tasks. If those are done to the same standard, even more will be delegated - possibly start managing, a promotion, greater opportunities.

And the CSA's hourly rate will increase.

I'd like to close this week's newsletter with the five laws of stratospheric success from The Go-Giver by Bob Burg and John David Mann .

1. The Law of Value - Your true worth is determined by how much more you give in value than you take in payment.
2. The Law of Compensation - Your income is determined by how many people you serve and how well you serve them.
3. The Law of Influence - Your influence is determined by how abundantly you place other people's interests first.
4. The Law of Authenticity - The most valuable gift you have to offer is yourself.
5. The Law of Receptivity - The key to effective giving is to stay open to receiving.

If you happen to be open to receiving, we're giving away 10 books on April 1st to the top 10 contributors in our RIA Operator's community - The Go-Giver is one of the options to pick from. See you there!