Yesterday, we looked at how Oprah Winfrey, Warren Buffett, Tom Clancy, and Andy Warhol spent their time.
How can we apply the lessons from this diverse group of incredibly successful people? Dan Martell asks in his book Buy Back Your Time.
We begin by creating a 2×2 matrix where we analyze how valuable each task we are doing in terms of (1) money and (2) energy.
This creates four quadrants: Delegation (low money and low energy), Replacement (high money, low energy), Investment (low money, high energy), and Production (high energy, high money).
“If we’re spending all our time in the bottom left, the Delegation Quadrant, we’re doing tasks that should be removed from our plate as soon as possible,” he writes.
“Contrast that with the opposite corner, the Production Quadrant,” he observes. “Here, we’re spending our time on what matters most, which is what brings us insane energy, lots of money, and drives our business forward.”
Let’s do a deep dive into each quadrant.
I. Delegation Quadrant: Makes us little money and drains our energy
“Tasks in the Delegation Quadrant are menial tasks that are sucking our energy,” Dan writes. “Think about administrative work, billing, invoicing, setting up travel arrangements, responding to emails, et cetera.
“I know millionaires who are still performing many of these tasks,” he notes, “because they just haven’t figured out how to get rid of them. They have beliefs around them that keep them a prisoner of that work. . . They’re bogged down by the weight of it all.”
Imagine hiring a marketing genius for $100,000 a year. Would we want them spending six hours a day washing the windows?
Our goal here is simple, Dan writes: “If we’re doing tasks that bring in very little money and they’re draining us, transfer them as quickly as possible.”
Exhibit one: He shares a story about his team members who needed to transfer a large amount of data from one system to another. It would take dozens of hours and cost hundreds of thousands of dollars.
“I quickly looked online and found someone else who was an expert at this exact sort of data migration who was happy to take the work for less than $1,000,” he recalls. “Likely because they were an expert at it, it would probably take them half the time it was going to take anyone on my team, and they’d do it twice as thoroughly, as it’s all they do day in and day out.”
II. Replacement Quadrant: Makes us money but drains our energy
Here, we’ll “find highly important tasks like onboarding, selling, marketing, and managing our team,” Dan notes. “These tasks are high value, but they may not light us up the way they once did, so it’s less obvious what we do with these tasks.”
Our job here is more complex than the Delegation Quadrant, where we just need to move these tasks off our plates ASAP.
Dan labels the Replacement Quadrant as “the pitfall quadrant” because “we can get stuck in here, working on sales or marketing or delivery or managing big teams, because these tasks do make us money, but they don’t light us up.”
Some entrepreneurs “have a mound of tasks that cost substantial money to outsource, and they aren’t sure where to start,” he writes.
What often gets in our way? We are convinced no one can do it as well as we can. “Founders often think that they must do everything,” Dan observes, “it’s the ‘right way’ to run a business,” we believe.
One example: Dan’s colleague Larry. He “owned a healthy grocery store—you know, like Sprouts or Whole Foods, just a little smaller, he was great at what he did, so his business grew. Eventually, he owned two stores. He was still rocking and rolling. Later, he expanded into his third location. It sounded like he was killing it, but that’s actually when all his trouble started.”
Larry started dreading coming to work. “Dan, all I do is hire, fire, and order,” he said. “I’m working like crazy, and it’s miserable.”
Dan asked: “Do you have an assistant, a store manager, or any sort of general ‘number two’ to help you out?”
“No,” Larry replied. “If I don’t do it myself, it won’t get done right.”
Dan paused and said, “Larry, name a brand in your industry you really respect.”
“Whole Foods.”
“Larry, do you think the CEO had any help getting to their current size, or did they do everything themselves?”
Larry got it. “He was starting to see that things being done right is critical, yes,” Dan notes. “Those special little touches are often the secret sauce of our entire business, but they can be taught.”
In subsequent posts, we will explore how to move tasks out of the Replacement Quadrant.
III. Investment Quadrant: Makes us little money but lights us up.
“The Investment Quadrant contains those tasks that light us up but don’t make us much money, at least not today,” Dan explains.
“Every task here is an investment—in ourselves, in relationships, or in our businesses,” he notes. “For entrepreneurs, these activities are often highly collaborative and thought-provoking—depending on our personality, this could include things like writing a book, speaking at conferences, being interviewed on a podcast, or going to lunch with peers in our industry.
“This quadrant also includes hobbies and health,” he explains, “such as wakeboarding, skiing, yoga, or playing chess. Any time we spend with our family, friends, or faith organizations would also go into this quadrant.”
Dan organizes these Investment Quadrant activities into five categories:
A: Physical activities: Walking, running, working out, sports, and exercise. Dan points out that we can connect with others during our workouts. “When coaching clients, potential partners, or even just friends who happen to be in town, one of my favorite things to do is invite them on hikes, a bike ride, out wake surfing, or for a run,” he explains. “This allows me to do a workout (investment in self), pour into other people’s lives (investment in others), and oftentimes I’m spending time with potential coaching clients (investment in my business).
B: Time with others: Time spent with family, friends, and our community is often the zest of life. He writes: “There’s no sense in getting through all of life and finding out one day that we missed the most important parts.”
C: Hobbies: This category includes everything from biking to yoga to building model airplanes to painting. “Hobbies are vital,” Dan believes. “While no one may be paying us as we build a model airplane, we’re exercising and building our creativity—a key ingredient in business. Think about how much happier we feel when we’re pursuing our hobbies. Trust me—those around us can feel that.”
D: Industry collaborations: This grouping includes activities like podcast interviews, coauthoring a book, giving a TED Talk, etc. “Unless we’re being paid for the content creation itself, most of these activities don’t make a lot of money today. However, most of them are investments in the future of our businesses. When we do a podcast interview, we’re creating marketing material for our brand while also building potential client and partner relationships. When we coauthor a book, we’re driving future clients to our company. Giving a TED Talk uplifts our entire brand.”
E: Personal and professional development: We sharpen our skills and our mindset by taking professional certification programs, studying, reading books, or going back to school. We can also get a coach, attend conferences, or attend personal development workshops. “All of these are investments in ourselves that will eventually pay dividends,” Dan writes.
IV. Production Quadrant: Makes us lots of money and lights us up!
This quadrant is where we want to maximize our time.
“When most of our tasks are in the upper-right-hand corner,” Dan writes, “where we’re making lots of money, and our energy is flowing, we’re living in true freedom.
“Here, we’re highly energized, and the market responds by bringing us more money. As the market pays us and our companies more, we have more money to buy back more of our time and energy, giving us more room to invest into what lights us up and makes us money, which makes us more money, creating the Buyback Loop.”
Dan shares the story of his friend Chris, a fitness guru. “He started out as a personal trainer working at a physical location. He used social media to gain more customers.
“Eventually, he was spending two days a week on social media, drumming up business, when what he wanted to do was help clients get healthy.
“So he had a choice to make: hire someone to help, or stall out. . . Chris wisely wanted to deposit his time into the area that made him the most money and brought him the most energy, which for him was working with real people, helping them get fit and healthy.
“So he hired someone part-time to handle all the social media. Then Chris spent two more days with his customers. As a result of his social media efforts and his world-class training, word got out, and Chris’s business grew.
“He tried to keep up with demand by raising his rates, but eventually, it wasn’t enough—his calendar was tapped out, and he’d raised in-person rates as high as he could.
“That’s when Chris went online with his training: he moved out of his physical location, and now he builds workout programs online, still working with customers on their fitness and health.
“In only five years, Chris went from having a few clients in the gym to making $1.5 million in annual revenue. He did it by continually redepositing his time into his Production Quadrant.”
Our goal? “To spend the majority of our time in the Production Quadrant, with some deposits into the Investment Quadrant,” Dan writes.
One secret we learn: When we learn to hire right, we’ll hire people to take responsibility for “tasks that live inside their Production Quadrants,” Dan notes, “meaning everyone is executing on tasks that they enjoy performing and make them money.”
That’s truly next-level success!
So, what gets in our way? “I can’t afford it,” we tell ourselves. Yes, we can, Dan argues. And that’s what we’ll cover in our next post.
More tomorrow!
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Reflection: Which quadrant am I spending most of my time in, and what’s one task I can delegate or shift so I can invest more energy in work that excites me and drives results?
Action: Map my weekly activities into the Delegation, Replacement, Investment, and Production quadrants, then choose one Delegation or Replacement task to transfer off my plate this week.
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