What value have you brought to the table lately?

Disclaimer: This may come off as a rant, and if it does, it might well be. It stems from frustration and after thinking about it, I feel okay with it coming off that way because it might just change someone’s thinking that needed it. Also, things only change after people get fed up with the way things are and say or do something about it. I hope that this piece has that effect. Read on to see my theory about employee-employer value exchange and how this is important whether you are an employee or want to run your own business.

Since I was a kid I was clear in my head that I wanted to work in corporate. What was not always so clear to me was whether I wanted to lead/manage or work for someone else. I have done both and learned a lot along the way. I haven’t been in the workplace too long, about 10 years or so. A lot of the people around me have been working as long as I have been alive, or more. And in my experience, if you want to learn, there are two ways to do this:

  1. Time – Nothing can beat time for teaching you (if you are willing to learn along the way).
  2. Observing and absorbing – watch those more experienced players and learn what you can from them.

As I said, I have been working for about 10 years or so and with a clear vision of where I want to end up one day, I have been obsessed with fast-tracking it. I couldn’t go with option 1, it would take too long to learn purely by my own experience over time. So, I went with option 2, observe and absorb while time teaches me the rest. Obsessively observe and absorb. I would look around me at work and wherever else the opportunity presented itself, to learn what made the people around me great or average.

I learned that there are those that are great entrepreneurs and leaders. Then there are great employees to those great leaders and companies. They don’t want to be the boss, they aren’t interested in the admin that comes with it and enjoy showing off their skills as a team player. And when you have that kind of combination – the great leader with the great employee – it sets things on fire! It’s awesome. Everyone wins. Then you get others that are happy to just fit in, do what is required. Their quality of work is good, and they might have interests outside of work that they look forward to. So work is just a part of their day and they do good jobs, keep the machine running and they get along with most people around them. They are happy and don’t complain much; great people to have around the workplace.

Then you get the ‘others’. If you are one of these people, you may want to listen up.

Money does not precede value and it never will. Ever. I worked for a company and had a team member that was more experienced than I was. She constantly spoke of how she should be earning more, how she didn’t get paid enough and how the company we worked for was screwing her over. I was quick to make sure she didn’t influence me negatively. I never said it to her, because she was senior to me, but always wondered how much value she delivered (gave the company) before she decided she deserved more money. It fascinated me how she felt so entitled to just want more all the time, but I couldn’t see what she gave in return. A junior joined our team and I saw them become friends quickly. The junior (who is not so junior anymore), still speaks about the same things she ‘taught’ him years ago. The conversations still revolve around money. Very seldomly around solutions and value.

Are you this person? Do you believe you are entitled to your salary just because you pitched up at work? Do you believe when the company does well you deserve an increase purely because you are there? Do you get irritated when you see the owner/directors making good profit? Do you feel you are irreplaceable, entitled? Do you sit calculating how much you think you deserve when you find out how much the client paid for the project? One or two of these questions crosses our mind at some point, it’s natural as you grow and try to figure out what you are worth in the market. But, if these questions start controlling how you experience your career, then you are that person. It needs to be fixed.

For people that think this way, their understanding needs to be turned on its head. You first bring value, then you get compensated. No employer pays their employee then expects work to be done. You get paid for work already done (value added). The next time you get your pay cheque, I want you to think about the work you did for it – would you pay someone else out of your own pocket to have

  • done that job,
  • the way you did,
  • for that amount of money?

Let’s put it this way:

  1. If it was your business, how much would you think is fair to pay the employee that is doing your current job and
  2. What would you (fairly) charge the customer for that piece of work?

Now it starts making sense.

I had a theory in my head when I was still an employee about this exchange of value between myself and my employer. Years later and with my own businesses, I still use this model and still believe it holds true. Here it is –

If I do work that is worth $100 and my employer sells that piece of work to her customer for $150, then she makes $50 profit. This gross profit still needs to pay a portion of the rent, other expenses and it leaves her with (maybe) $20 to take home for herself as a reward for finding the customer or the work, winning the project, giving me a job, running the company, dealing with me and all the other nonsense that comes with a business. It is fair. This is how I visually depict it:

Power and Profit

Part A is the employee’s (hard) work and effort = salary

Part B is the portion that contributes to overheads, gives the owner of the business their reward and makes it worth their while to have a business and deal with everything they do as a business owner.

Part B also does another very important thing – it gives the employee power in the relationship. We encourage our employees to work with us to maximise Part B so that we get higher profits and they gain more power. What is this power? It is the power they have when it comes to contract extensions and salary negotiations. The more profit I make off an employee, the more reliable they are, the better their quality of work, the less likely I am to let them go at the end of a contract, the less likely I am to say no when they ask for an increase.

Would you walk into a shop and say, “Here’s a hundred bucks, give me whatever you think I should have”? No? Then don’t expect your employer to first offer you money then have you decide what you will give them in return. You give value first then the value is paid for (in the shop analogy, you would pick an item off a shelf that you considered fair for its price, then you would pay for it at the check out counter).

In conclusion, I have realised that I love being in corporate, I do want to lead, and I have realised that there are times when I need to follow. This will change as my career evolves. But one thing I am clear on is that I need to deliver value first, before I expect (more) remuneration. When I am the employee, I will deliver value before I receive compensation. When I am the boss, our customer will receive their value (and more) before we expect their money. If you do not understand this as an employee now, it is likely you will not understand this as a business owner someday. And even if you have no plan to start your own business, you still need to understand this concept as a basic principle of exchange in life. You do not take first, you first give and let the value justify the remuneration, whatever it may be.

PS… If you are thinking about starting a business, or have one and want to challenge what you think you know about it, then my book might be of interest to you – here is the link and it costs less than a t-shirt to invest in yourself by purchasing the digital copy:

Digital Copy of “Listen Here!”

 

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