Common Misconception: Time and Value

There’s a common, almost instinctive, misconception that time and value are directly related i.e. the greater the amount of time expended, the greater the value. The reality is that time and value are inversely related. We’re going to explore both this misconception and what it has to do with confidence.

Misconception

Evidence of our belief in a direct correlation between time and value is most readily available in business. It’s the reason why service providers bill for time expended. Similarly, buyers often compare the price they’re being asked to pay with the amount of time that it takes the provider to produce the product or service they desire.

To illustrate the fallacy of this perception, we’ll use the following examples.

Examples

You’re looking for temporary help for your business. The staffing company has two people that fit the bill. One person will cost you $60/hour, the other $30/hour. Our natural inclination is to choose the lower-priced option…until the staffing company tells you that the $60/hour person accomplishes tasks in a third of the time it takes the $30/hour person to complete the task.

You do the math and realize that for every hour the $60/hour person spends, you’d spend $90 for the $30/hour person. The difference in value between the two alternatives is the fact that the first option can accomplish the task in less time. Indeed, there’s a case to be made that the the $60/hour person is worth more than they’re being paid.

A more humorous example is a story I heard about a dentist. He’d just extracted a tooth for a patient. He handed the patient a bill for $140. The patient railed saying “It only took you 10 minutes to extract my tooth, how can you charge $140 for that?” The dentist responded “Well we can make ti take longer, but most patients prefer that we not.”

Another way to look at it is that the more quickly someone can help you get the result you desire, the earlier you get to enjoy the result. That’s where the true value lies…in getting what you desire sooner rather than later.

So what does this have to do with confidence?

Confidence

My experience has been that confident people aren’t threatened by challenges to the value they provide…whether that’s in a job interview or as a seller of goods and services. Confident people understand that there’s a common misconception about the relationship between time and value. They accept the fact that, in many cases, they’re going to have to demonstrate the fallacy of that misconception in a way that isn’t condescending or denigrating. And they have confidence in their ability to do so.

Less confident people feel threatened by challenges to their value. They become defensive and try to quantify their value. Unfortunately, the more aggressively they defend their value, the less others are to believe them.

Conversely, confident people use examples like those presented above to illustrate that there is an inverse relationship between time and value. These illustrations are not defensive, they offer an alternative perspective on time and value.

What does this mean for you?

For you

The next time your value is questioned because what you’re offering doesn’t take you much time, do NOT become defensive. Instead use the examples above to demonstrate the real relationship between time and value.

For our kids

As you teach your kids to handle money, teach them about the inverse relationship between time and value. As they become consumers of products and services, they’ll make better buying decisions. As they become potential employees, they’ll position themselves to get higher salaries. If they decide to become a business owner, they’ll enjoy greater success because they understand the value they’re providing and are able to hold firm on their pricing.

Regardless of what role they choose in life, they’ll be better equipped to enjoy success.

I love hearing your thoughts and experiences, please share your thoughts below.

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