What are the first three words that come to mind when I say the word money?
Well, it opens up a lot of things, doesn’t it? I often hear is things like cash, income & capital. Others say strapped, broke & debt. Some say bills, payments & wages. The reason I ask that question is to offer the thought, that money is an abstract concept backed by confidence. What that really means is money isn’t anything except what we believe to be true about it. Yet all of us have a relationship with money and it governs how we behave.
An example of that, I’m sure everyone’s heard the story of the guy who won the lottery and five years later he was broke. And the reason that happens is that the money mindset of the average middle-class person is to spend or to pay bills. So, when that person is given a lot of money, their behaviour then becomes about spending lots. Car, boats, holidays, clothes, parties…
The person with the “money is for spending” mindset thinks, well, I now have a lot of money, I’m going to spend lots.
If Richard Branson or Warren Buffet were to win the lottery, how do you think they would behave? They would likely think about how do I employ this money? How do I get some leverage from this money?
Let me describe for you this money mindset and the entrepreneurial ladder.
So, an employee thinks about earning a salary. Their money mindset is earning a salary in exchange for their time.
A self-employed person on the other hand makes money. They earn their living from an independent pursuit of economic activity.
At the next rung on the ladder, an owner receives profit. So, at this stage, an owner has an arms-length, third party entity (the business) from which they receive profit. And their level of engagement in that business depends on where they are on the entrepreneurial ladder.
At the next level up, an investor has an entirely different mindset about money because they are seeking a return on their investment.
And at the entrepreneur level, say Richard Branson or Warren Buffet, don’t work for money. Money works for them. And so, you can see that’s an entirely different thought.
None of us can operate at the level above our current money mindset.
What that means, certainly in my experience working with my business owner clients, many of them operate at the money mindset of being self-employed in a business that has their name on it, or at least the brand they own.
And so, they operate at the level of a technician. They operate at the level of, I have a J.O.B (just over broke), being the technician in my business, whether that’s you’re an accountant, an electrician, or own a factory.
What I see very often is that the business owner effectively operates as a hub and spoke manager. Where nothing happens in your business or your team unless somebody consults with you and every time, they have a problem or need to make a decision, you are being consulted.
And it just feels like you’re being pecked all the time, or never able to get anyone to make decisions and it’s kind of that way because you’ve trained them to think that way. That anytime they have a question or anytime they feel like they need a decision, they’re not going to take the responsibility for it because you’ve always done it in the past, in fact, you prefer it that way. Yet it has this negative outcome for you because if you’re not around the business or department is never going to work.
So ultimately the big question for you right now is do you have a job, or do you have a business?
If you’re a business owner and you have a team and you still feel like you’re the hub and spoke boss, then you have a job, not a business.