How much time do you waste writing documents that are only used once? Wouldn’t it be great to be able to do work that can be used again, and again, and again – possibly infinite times?
Getting more with less – that’s what we call, leverage. Prefer to read rather than watch and listen? No problem – here’s everything I said in the video as text: Hi, this is Shweta from London Coaching Group. What I want to discuss today is the most important concept around business and wealth creation. And that concept is leverage. What I’ve seen working with quite a few of business owners is that not very many are highly leveraged. The leverage that they have is mostly financial leverage because of the borrowing that they have from banks and other sources.
Now to understand this process we will take multiple angles. The first type that I want you to take is a mathematical angle. Now leverage in very simple terms is divide to multiply. So, for example, Henry Ford – when he approached his production line, he approached the concept of leverage. He divided the tasks on his production line to actually multiply the output. Ray Kroc, founder of McDonalds? He actually took that really good concept in actually dividing it into multiply locations through a franchise model to multiply the value of the overall business. Even as human beings we grow through the division of the cells into 2, 4, 8, 16. So that’s the concept of leverage – divide to multiply.
But the challenge is, when I discuss this concept with business owners, they get it, but they don’t know how to implement it. They understand the fact that we need to approach business with the lens of how do we get more with less, which is leverage. But then how do you practically implement it in your business? We will look at it from the different definition. The definition I want you to remember, and we will take a mental note or a proper note here, is that you do the job once and you get paid forever. If not paid forever maybe get paid long term. If you keep this principal at the back of your mind when you walk into your business every morning, trust me it will pay you an amazing amount.
Now let’s take a few examples. What I’m doing today – I’m just recording this video, right? So you’re listening to this video, thousands of other people are listening to this video. This video is going to stay forever: this is leverage. Writing a book and getting royalty forever, not just from one person but also generations of readers is another concept of leverage. So the question you need to ask yourself is – Am I really doing the job once and getting paid forever? Or is that you’re walking into your business and there is always the fire fight happening or there are mistakes happening of the same nature again and again, so you actually have to closely supervise your team members. If that’s happening, you’re not actually getting leveraged.
So as a business owner, what are the best ways to get leveraged? Let’s have a look at a few examples: Getting the right team members on board is a big way of getting leveraged and when you have a recruitment system and you have an induction system for your new team members – think about it, how many times will you be using that recruiting system to get the right superstars on board and actually inducting them in the right way? Forever, while you are still in business you’ll be using it on and on and on. The second example is – I’ve seen so many business owners approaching their marketing with a kind of blindfold. “Let’s try lots of things and hopefully something will work.”
But actually if you approach marketing campaigns in a systematic way and figure out the campaigns that actually work for the business – for how long do you think you’ll be leveraging such campaigns? Forever. You do the job once but you’ll get returns for long term. Forever. Literally, that’s the concept. You could also write a system module for your operations or for your production line depending on what business you’re in. Writing a system manual is a big way to get leveraged. What I’ve seen is that lots of business owners have stuff in their head. It’s just there and they go back to their business every time and they end up doing the same stuff again and again because it’s all sitting up here in their head. Can we actually manage that knowledge, can we actually make a manual out of it, the video out of it, so that we can leverage that.
So there are various ways that you can approach this concept. Not just at a concept level but actually at a practical level. So the question that you need to ask yourself, looking at what’s happening in your business on a day-to-day basis is: Am I properly leveraged in my business? Where can I get better leverage? Start asking these questions, start asking how you can get more with less, how can you get more returns, more sales, more profits with lesser efforts, lesser time, lesser money and trust me – you will get different answers.
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