In the part IV of the Career Lover series, we’ve addressed the Practicality issue of pursuing your passion by talking about 3 strategies to convert your passion into a money-making venture . No matter which strategy you choose, your level of success as a Career Lover will depend on the amount of value that you create; This is the main focus of Part V of the Career Lover Series.

Value creation is often an abstract and difficult concept to understand, simply because the definition of value varies from people to people - what is valuable to me may be worthless to you. As such, trying to create value is like trying to hit a moving target; there’s nothing definite to work on.

This is where I believe the following definition of value will help: value is anything that someone is willing to pay money for.

Although this definition doesn’t remove the subjectivity, it gives us the guiding principle - to create value, you must serve someone else’s needs or wants. Identify the product/services that you provide and find people who need it. As such, they are more likely to pay for it. These people are your target audience, your potential clients.

Who Are Your Clients?

This brings us to the next point: who are your clients?

It is a very important question for you to bear in mind. Your clients are the people you serve as part of your work. Likewise, your level of success will greatly depend on how well you serve and fulfill their needs with your work.

• If you are self-employed or in sales, the answer to this question is straightforward. Your clients are people who need or want your products and services, and are willing to pay for it. The better your product and services matches their needs, the better your chances of making more sales.
• If you are an employee, the answer is a little less direct, but the principle of serving others’ needs remains. In this case, your clients are people who benefit directly or indirectly from the work that you do. Your boss and immediate team members are people who benefit from your work. For anyone who has ever manage subordinates/employees before, you will understand what I’m talking about. If you have a strong team member working for you, it makes your own job much easier - that is value too.

  Although your boss and team members don’t pay you for your work (at least not out of their own pockets), they have a strong influence on the amount of income that you get. This comes in terms of promotion prospects. When you serve a large group of people and they come to depend on you for your expertise, your circle of influence expands and your responsibility will increase over time. When that happens, promotions usually follow after some time.

As such, identifying your clients and understanding their needs is key to value creation .

Focus On Increasing Your Hourly Rate

Having said that, does the principle of serving means that you should start making coffee for your boss, or to shine the boots of your clients?

Well, definitely no. You see, not all needs are the same. To be successful, you need to be smart about serving needs that will bring you the greatest returns on investment. In this case, your investment is your time and energy to get the work done. And your returns will depend on where you commit these time and energy to.

I encourage you to understand your current hourly rate, and focus on delivering value greater than that. To derive your hourly rate, simply use the formula below:

Hourly Rate = Monthly Salary divided by Total No. Of Work Hours In A Month

Assuming your hourly rate is $30/hour:

• If you are self-employed, you need to ask yourself if someone is willing to pay you $30 to just make coffee or shine boots.
• If you are an employee, then you need to ask if your boss is wiling to overpay you, just to make coffee or shine boots.

Clearly, in both cases, the answer is a resounding ‘no’.

There’s only some much time and energy that we can commit to work. To be effective, we need to be smart and focus on serving needs that will increase your hourly rate. When you deliver value that exceeds your current hourly rate, you will find that your hourly rate will increase over time, catching up with the amount of value you create.

Improve The Top and Bottomline

Perhaps the next question begging for answer is: what are the areas that have the greatest value potential? From my experience, the work that yields the greatest return on investments are those that improves the top and bottomline of the business. You need to focus on activities that allows you to:

• Increase sales of the company OR
• Improve cost of operations.

Either of these measures result is higher profits. As such, work related to these 2 areas has the highest visibility in terms of value created. As much as possible, try to do work that can contribute in these areas - it will greatly increase your chances of recognition and success.

It can be a challenge to translate our work into something that relates to increasing sales or maximizing costs. To do so, you need to understand the work that you do and the deliverables expected of you. Ask yourself how these deliverables contribute to the business in terms of increasing revenue or maximizing cost. Below are 2 strategies that I’d learned which can start you off:

Strategy #1 - How To Increase Revenue

The following formula shows the components that you can focus on to increase your company’s revenue. By increasing each component below, you can improve sales, and also value.

Revenue = No. of Items Purchased x Value of Items Purchased x Purchase Frequency

• No. of Items Purchased - Marketers call this cross-selling: introducing additional products to your clients which complements the primary products. McDonald does this very well; whenever I’m buy a Big Mac, the counter staff is trained to ask “would you like some fries to go with that, sir?” That’s one example of cross-selling.

  For whatever products and services that you are selling today, be creative and think of related items that your target customers will also be interested in. For example, many publishers and bloggers also publish audio books/podcasts based on previously written materials. It’s the same materials and with a little rework, you have opened up additional revenue opportunities.

• Value of Items Purchased - Marketers call this up-selling: the basic aim is to introduce and sell a product of higher quality (and value) than what the customer originally intended. It is not a trick to swindle more money out of your customers’ pockets. The aim here is to provide matching product/service that will better meet their needs. This includes continuously producing new improved version of products to meet your customers’ needs.

  For example, look at Apple iPod, we had the 10GB version; now we have the new iPod Classic at 160GB. And some customers are happy to buy the new version because it means they can store more videos and MP3s on the better, improved version.

• Purchase Frequency - The 3rd way to increase your sales is to serve your customer so well, that they will think of you the next time they want to buy the same product/services. This is about customer loyalty - repeated sales definitely means more revenue. A related idea is word-of-mouth marketing: this means that customers refer your products/services to their friends because they were pleased or impressed with what they got from you. Essentially, you want the customers feel that they are getting a good deal so that they will come back or recommend you to someone else.

  This means a few things for you:

  • deliver as promised - if your product/service lives up to your sales pitch, you will have better chance of repeated sales. So you must be mindful of your quality of work. Slipshod quality does not get repeated sales.
  • provide a pleasant sales experience - the way you treat your customers during the sales process is important. If they feel that you’ve treated them well - made recommendations and gave advice based on their best interest, you’ll leave a better impression.

Depending on your job role, you may not be able to influence all 3 variables above; you don’t have to work on all 3 at once. Start off with one within your job role, and begin to increase your influence from there. As you begin to produce results, your influence will increase, thereby allowing you to influence more areas of work.

If you are in sales & marketing or a client-facing position, it is easy to apply these to your work. Even if you are in customer service, operations or product development, you can also improve these factors by coming up with new product/services to meet market demands, and improve customer satisfaction - thereby increasing revenue indirectly.

Strategy #2 - How To Maximize Productivity

The other way to increase value creation is to work on improving cost. I’m not talking about laying off people; it’s about maximizing cost by improving productivity so that more output can be created with the same amount of time and effort. When you improve productivity, you will maximize cost by ensuring that more value is created with the same unit of time and effort.

The following are some points you can work on to increase productivity of your company:

• Knowledge - If you are skilled or knowledgeable in your product/services, you will produce more than someone who isn’t as skilled. This implies the importance of continuous training and life-long learning. This is especially true in the information age, where a lot of products and services are actually based on information. The more you know, they better you can advise and direct others to improve their work - the more valuable you become.

  You don’t always need to have this knowledge yourself. Work with people who are experts of their field and get them to help you. When you are able to influence a group of good people to help you, you also create more value.

• Plan To Do It Once - Sometimes we waste time redoing things because it was done wrongly the first time round. The best productivity is achieved when you get the desired results the first time you do it. The best way to achieve this is to spend some time upfront to plan and think. What are the desired results? How are you going to do it? By thinking and planning ahead, you avoid wasting precious time and resources, only to discover that you have started onto a wrong path halfway down the road.

  Project managers are highly paid because they are trained to think and plan ahead. They understand what is required to accomplish the project objectives. They lay out the tasks, sequence them and assign them to team members who will execute them; all in a coordinated fashion. Projects without good project management often overruns in time and budget, causing damages and more money in the longer run because of rework. This is an example of value in maximizing productivity.

• Establish A Process - One good way to get it right the first round is to have a process. Once you manage to get it right one time, take note of the steps you took and repeat those same steps so that you will get it right again the next time round.

  Top operational managers are people who understands this point. They learn to establish processes so that others who are less skilled, can repeat the same process and be as successful. In doing this, they create a whole lot of value to their companies. And of course, such managers are paid a lot more than those workers who simply follow the steps in the process.

• Leverage On Past Work - Another way of ‘do it once’ is to do something that can be repeatedly used again and again. When you do this, the value of that work is magnified by the number of times that others can enjoy the benefits of this same work. For example, my articles usually take me hours to write. However, each published article is permanently searchable on the Internet and reachable by a global audience, even after years I have written them. This really maximizes the value of the few hours I have put in.

  Not all work are the same. If you have to reinvent the wheel each time you are given a new assignment, then you are not maximizing your time. After a couple of executions, look for commonalities or patterns across them and do up a template for those common parts. In doing so, you avoid reinventing the wheel and can reuse them the next time round.

I hope you get the idea - create more value by consciously thinking about the way you currently work. How can you save time? how can you remove unnecessary steps to make things happen more effectively? Are you simply following instructions without understanding what you are doing? By working smarter, you make yourself a valuable worker.

Closing Remarks

It is possible for you to love your career and not enjoy great success because you have not learned to work smart. Directing your passion for your work into value creation will help you to enjoy the successes that a Career Lover should. I see it as a virtuous cycle - love your work -> create value -> enjoy success -> love your work even more…. Nothing can be better than achieving this. Life, even though challenging, will be meaningful and fruitful; and I wish for this for all my readers.

With this, I conclude the 5-parts Career Lover Series. I hope the series has given you some food for thoughts about your work. And I hope that it’ll prompt you to ask yourself some important questions about your work and your life.

If you feel like you’re stuck in a rut today, I hope this series helps you to reexamine your situation in a more directed and positive perspective.

Do you have any questions or thoughts to share about being a Career Lover and creating value? Please feel free to share in the comments section.

(Photo by 油姬)

Links To The Series

• Part I - Is Your Ladder Of Success Leaning Against The Right Wall?
• Part II - Why It’s Dangerous Not To Do What You Love
• Part III - Discover Your Passion - Life Is Too Short For The Wrong Job
• Part IV - 3 Strategies To Monetize Your Passion
• Part V - How To Massively Increase Your Value

This blog is about leading a balanced life focusing on career, relationships and money. You can read more about balancing your life here. These articles are written for you. If you find them useful, feel free to subscribe for regular updates as new articles are posted. It's FREE. :)