23 June 2011

The most damaging phrase in the language is:  “It’s always been done that way.”

Grace Hopper

 

I speak with people all the time who tell me that they could never be an entrepreneur. “It’s too risky” they say. They think I’m crazy.

I think they’re crazy as well. Not for enjoying working at a corporation, but because they’re already entrepreneurs, it’s just nobody told them.

Once upon a time there existed a fantasy world that we like to call the 1950’s. In this fantasy world it was possible to be an employee of a company that cared about you, gave you a steady job, and guaranteed your comfortable retirement after only 20 – 30 years of service.  The sad part is that people have continued to live as if that fantasy world still exists. It doesn’t, and it won’t ever again.

It’s no longer possible to be a 1950’s employee of a corporation. Nowadays, the minute it makes financial sense to fire you or replace you with a worker overseas at 30% of your salary, you’re gone. People no longer get pensions, and they’re lucky if they can get a decent match on their 401K. Researchers think that people will have over seven different jobs over the course of their career. No matter how much you love your job, if you don’t own the company, you’re just a temporary worker.

As a temporary worker, there is very little difference between you and an entrepreneur. You are your own service business selling one product; your time. You can get into big trouble by acting like your temporary worker business relationship is actually a 1950’s employee employer relationship.

In a 1950’s employee employer relationship, if the company wanted you to do a job that wouldn’t increase your overall skills and wouldn’t make you more valuable to other companies, who cares? You’re planning on being at that company forever anyways, and they are taking care of you for the rest of your life. In the current temporary worker relationship, you would be crazy to accept any position that wouldn’t boost your overall skills and make you more attractive to other companies. This is because, as an entrepreneur with only one product (your time) it would mean suicide for your business to let your one and only product become outdated and not valuable. If you insist on being an entrepreneur with only one client and one product, you also need to be responsible for continually increasing the value of that product.

The other big risk to your business is that you lose your one and only client. Back in the 1950’s this would never happen unless you did a terrible job, but now you can be fired, laid off, or outsourced without warning, and your performance can have very little to do with it. As the CEO of your own personal service business, it is your job to plan for this scenario, since there is a high chance it will happen to your company at least once. It is your job as the CEO to have a list of other clients who know all about your company’s services, and would be ecstatic to hire you as soon as they get a chance.

Another reason that you need a long list of other potential clients who know about you and want to hire you, is because there is a high chance that there will become a mismatch between the rate you should be charging for your time and the amount your current client will be willing to pay. Many companies have set amounts they are able to offer you as a raise. Even if over the last 3 years the market rate for your skills has gone up 50%, you might only be able to get a 15% salary increase. The only way for you to get paid the amount you should be paid is to go work for another company. As long as you have a large list of others who want to hire you, this won’t be a problem.

So, how can you get a long list of other potential clients for your time? Every business is different, and you will have to answer that for yourself. It might be a blog you start about the industry, it might be going to conferences and networking like crazy, or it might be joining an industry association. However you do it; it is an important and generally ignored responsibility of your position as CEO of your own company.

Looking at your business from the eyes of an entrepreneur can give you a whole new perspective on life and your career. Want to take a 3 month vacation? No problem, since you’re the CEO of your own company, you get to make decisions for yourself. As long as you have been continually increasing your skills and have a list of other potential clients who would be happy to hire you, it’s not a problem. Your current company will probably keep you because finding and training a great employee is very difficult, and if they don’t, you can go work for one of the many other firms that want to hire you. The benefit of owning your own business and not being an indentured employee is that you get to make the rules.

In summary, even if you work for a big firm, you are still the CEO of your own company. Your two biggest responsibilities as CEO are to continually increase your skills, and have a large list of potential people who are waiting in line to hire you. Being a successful CEO will result in a happier career and life. Ignoring your responsibilities as CEO can be disastrous.