What is leverage in business?

by | Mar 28, 2020 | Insight, Musings | 0 comments

I talk about being a leverage mentor, and I get a lot of questions: Ahhh, so what are you talking about? What is leverage?

With all the craziness going on in the world right now, and challenges around continuing face-to-face delivery, now is the perfect time for businesses to get this whole leverage thing sorted!

What is leverage?

Leverage is when you exert a little effort and get back far greater returns.

It comes from the concept in physics of a lever.

Archimedes said “give me a lever long enough and place for me to place it, and I will move the world”.

He wasn’t being metaphorical. He actually meant: give me a long strong beam, and a point of leverage to anchor it, and he will literally with his own two hands and body weight alone, shift the entire earth out of its orbit.

The concept of the lever works even better in business.

In business we can:

  • A) Grind (keep doing all the boring, repetitive things the hard way over and over)
    Or
  • B) We can use leverage our time, talent, technology, team or even our business itself to get our time back. Make our lives easier. Less boring. Make more money and have more fun. And then use that extra time and less effort to make a bigger impact or enjoy a lifestyle business that’s we always wanted but didn’t dare dream was possible.

So how do we leverage?

It’s all about time, talent, tech and team. And then we can get meta and leverage the business and assets we’ve built. But we’ll come back to that later.

Time

Do you spend time jumping between tasks, responding to emails and messages all day? There are simple hacks and habits you can use to to be efficient and get time back in your calendar every day, I guarantee. For most people it’s not difficult to regain 1-3 hours back EVERY DAY. I mean DAMN!!

Talent

Your experience and expertise is unique. You’re a master of your craft and the way you do what you do is nothing short of genius! What if you could bottle that genius and sell it to others? What if there were clones of you in your business who can do what you do, or at least some of it? Many will think “what I do can’t be taught”. Well maybe. But I’d argue that large parts of it could be taught. And sold. Build the training and put it online or teach people in groups. This is a way you can make a bigger impact with less of your own time and effort.

Technology

Tap into what 2020 has to offer! Technology can help us streamline and automate the most important and yet repetitive parts of our business.
If you have to do the same thing or something similar more than 3 times, streamline it, automate it, or at least document and delegate it if you can. If you find yourself saying the same thing over and over, turn it into a video that you can send to clients so you don’t have to say it every time.

Team

Outsource what you can, what you’re not good at, what you don’t love to do. What you find frustrating or boring. This is work better suited to others. Allow your time to be focussed on your highest value activities. These are the ones that make the most impact to business that only you can truly do. And it’s critical you do them. These are also usually the most fun.

What are the benefits?

Help you get time back

Would you rather being doing the boring and repetitive parts of your business or living your life? Every practitioner should be practising what they preach. Balance, happiness, fulfilment, empowerment and what’s more balanced and empowers than having time back in your calendar every day. Time for self care or for the kids and family. Or more time to serve more people and to work on taking your business to the next level. Time is our more precious commodity. Leverage is how you get time back!

More profit

With more capacity you can choose to go after and take on more clients. Also, with greater efficiency comes less expenses to deliver your business wimhich increases your profit margin. So it’s a double win for profit!

Scale up

When you are the business it a very hard to scale up. Without a cloning machine. But when processes are out of your head and down as assets and they’re streamlined, automated, and delegated, then you are ready for more. Time to scale up!!

De-risk the business

Great for peace of mind, sleeping through the night, or if you want to sell and make a bunch of money.
The less you are the primary asset and the more of the assets that you build within the business the more robust the business is and therefore the less risk. This drives up the value of the business and makes it much easier to sell and you’ll get more money for it.

How do you know if you need leverage?

  • You have more clients than you can just about handle, you are getting overwhelmed keeping up with delivery, or bored with repetitive stuff.
  • You could use more clients and money, but you know you couldn’t handle it, you’re struggling to keep up now.
  • You’ve worked hard to build a client base, but now you’re ready to get serious about business, streamline things so the business works smoothly and you can scale up.
  • You love what you do, and do amazing work, but it takes way too much effort, and admin, and you know there must be an easier way.

How do we do it?

Practitioners’ entrepreneurial journey

  1. I am the business
  2. Streamlined practitioner
  3. Powerful business owner
  4. Impactful influencer

To level up each time you need to do 2 things:

  • Make more capacity for clients
  • Fill that capacity with more clients

To make more capacity you have to either scale up, with more staff. Or gain more efficiency so more can be achieved in the same amount of time. This is achieved through leverage. Then use that capacity to seek out and take on more clients.

At each level the challenges are a bit different.

1—“I am the business”

Starts with survival. Just doing whatever you can to learn and hone your craft while learning about business experimenting with lots of ways to get clients and deliver and just trying to prove the model and that you can be a success.

2—“Streamlined practitioner”

Then practitioners typically realise they don’t have time to take on more clients. And they’re wasting too much time doing boring, repetitive stuff. They feel disorganised. And they hate these parts of their job. This is where they streamline all important processes, automate what they can, and delegate what they can. Then they go out and take on more clients with the extra capacity they’ve freed up.

3—“Powerful business owner”

At the next stage the practitioner reloaded there’s only so much more than can do. There’s only one of them and no matter how efficient their processes there are limits to how many clients they can handle at once. Unless… they shift to delivering group sessions and online learning. And there are many practitioners who now swear by the powerful of the group environment and online learning to go deeper and provide peer-to-peer touchpoints and support that just can’t be achieved through the one-on-one approach.

4—“Impactful influencer”

Eventually practitioners have their business running smoothly at scale. But they want to sell the business or transition to focusing on advocacy and strategic relationship building, speaking and influencing. This is where they get serious about building key assets and practices that can help them run the business with far less of their input. There are also opportunities at this level to extract even more value out of your business by leveraging the existing assets within in new ways you hadn’t thought of before. Like partnerships that tap into your customer base, network or community.

Wherever you’re at on your journey, you can level up by leveraging your time, talent, tech and team.

Which I love talking about and helping conscious business leaders make a reality in their business. So they can make a greater positive impact. Because this is how we heal and transform the world together.

Common examples of leverage for practitioners

  • Marketing Automation—Email sequences and social media. Free gift for signups (self assessment, ebook, app)
  • Sales and pre-sales—Streamlined and automated. Scripts, forms and bookings, email sequences
  • Client-onboarding—Welcome. Initial assessment. Agreements. Signatures. Payment
  • Client management and delivery—Invoicing. Payments. Client bookings. Tracking notes, actions, files etc. A library of key branded assets to call upon.
  • Online memberships, delivery and training platforms—Ability to deliver sessions online and guide people through packages of content and learning online.

Where are you at on your leverage journey?

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