How to earn more money

Leo Messi

Why do some employees earn massively more money than others?  Does Leo Messi or Christiano Ronaldo work harder than Bob Smith or John Doe?  More hours?  Better formatted CV?

In this post I do a quick thought experiment - using a tool from MBA Business Strategy 101 to look at personal life strategy.

In Business strategy, Michael Porter's Five forces model of competition allows companies to understand why certain industries consistently earn more, how they maintain margins of 60% whilst others are destined to margins of 2-3%.

There are some simple insights in applying Porter's five forces model to any given employee.

1. Threat of new entrants - how easy is it for somebody to learn to do your job as well as you do?
2. Intensity of competitive rivalry - is there solidarity and a code of honour between employees, or will other employees be willing to do your job for less money?
3. Threat of substitute products or services - Can the work you do be outsourced?
4. Bargaining power of customers - If you do your job as you're told, then you're easy to replace. "Nobody Cares How Hard You Worked. It's not an effort contest, it's an art contest. As customers, we care about ourselves, about how we feel, about whether a product or service or play or interaction changed us for the better." Seth Godin, The Linchpin.
5. Bargaining power of suppliers - If all of your monthly income goes out in mortgage payments, tax, car payments, food and none go to savings - you have no cushion, no safety net - you are a slave to your monthly wage.  If you have savings, other income streams, outside interests, hobbies, a network of friends who love you for who you are not what you do or the position you hold then you are not such a slave to the job.

If the threat of new entrants is high, competitive rivalry is high, substitutes are available, the company has many similar employees to choose from... then you will be earning minimum wage - either now, or soon.

What can you do to earn more money?

Linchpins

1. Reduce threat of new entrants - Continually develop your skills, build your network of colleagues and seek harder jobs where it is hard for a new employee to do the same work to the same quality.  Is what you can do valuable and scarce?  Are you increasing this value and scarcity every day?
2. Reduce competitive rivalry - Foster a profession-type attitude for your type of work - are there recognised accreditations and systems to manage reputution within your type of job?  You want a clear way to distinguish quality workers from cheaper less professional work (for example look how lawyers, doctors, dentists do it with accreditations, certificates, formal recognition).
3. Reduce "substitute-ability" - If your job could be described in a manual then you can be outsourced.  If there is decision making, if there is variety... then your job is less easy to outsource. "There are no wonderful jobs left where somebody else tells you exactly what to do" Seth Godin.
4. Reduce bargaining power of employer - build your own personal brand.  Be known for you.  Start a blog, start a movement, speak at conferences...  begin to be known in your own right.  
5. Reduce bargaining power of suppliers - Have a cushion of savings.  Don't acquire too many things with monthly payments (house, car, boats, telephones, satellite TV, book club subscription, credit card payments etc).  Have the flexibility to change jobs, to be able to survive a time with lower income.

In the words of Seth Godin "Be a Linchpin".  There are Meetups around the world on 14th June for anyone who has read one of Seth's books, follow his blog or generally like the ideas that he espouses of personal responsibility, intelligent marketing and taking control of your own life.  I plan to be at the Barcelona Linchpin meetup.

Need some encouragement? Victor Frankl and "Man's Search for Meaning"

There is a Buddhist tenet that suffering is the universal human condition.

Victor Frankl wrote a powerful book "Man's search for meaning." (full text at google books)  It is half autobiography and half textbook on human psychology.  Frankl survived three years in the Nazi concentration camps, passing 6 months in Auschwitz.  Only 1 in 30 of those that entered the camps survived.  Frankl noted that it was not random.  Those that survived had something that those who did not survive did not.

"We who lived in concentration camps can remember the men who walked through the huts comforting others, giving away their last piece of bread. They may have been few in number, but they offer sufficient proof that everything can be taken from a man but one thing: the last of the human freedoms—to choose one's attitude in any given set of circumstances, to choose one's own way." Victor Frankl

Frankl said that those that survived the horror, disease, starvation and mistreatment of the concentration camps had a purpose to their life - and believed that there was something worth surviving for - a loved one that they will see again, a new theory that the world needs to hear, a project still to complete.  A concentration camp is an extreme form of suffering, but all life includes a little bit of difficulty, challenge, stuff you wish wasn't so, stuff you wish you had.

A good friend once told me "God would never give you an obstacle that he didn't know that you could overcome".  Nick Vujicic has overcome an obstacle that is bigger than anything that I have ever had to face.  (video here).




Nick Vujicic has an incredible attitude.  He has a really good reason to be allowed to feel sorry for himself, but he chooses not to.  It was clearly not an easy journey, but it began with belief that there was purpose to his life and the challenges he needed to overcome.

There is a powerful video of Victor Frankl speaking over at TED.com.

How to tell great stories

Ira Glass, presenter of This American Life, tells us that there are three basic building blocks of the story - the anecdote, "bait" and moments of reflection (video here).  We improve a story by building up the central conflict, ensuring that the listeners can relate to one of the central characters and by adding surprise.

Here goes my 5 step process for telling good stories (I have been practicing it with my 3 year old daughter for her bedtime stories... and getting to the point that she wants one of my stories instead of one from the book).

1. Begin stating the moment in time:  
1. "A week ago" or
2. "Twenty years ago today", or 
3. "Once upon a time".
2. Introduce the situation and key characters: 
1. "I was sitting with my grandfather. My grandfather was a tall man, always impeccably dressed in a suit. He had been a country bank manager all of his working life. I was 13 years old.  As we did every Sunday, we were sat watching the horse racing on television on Sunday afternoon." or 
2. "A girl lived in a small cabin by the lake. She lived with two friends - her dog Ruff and her horse See-Saw. Each morning she set off around the lake to collect mushrooms for food and wood for a fire.  Each day she would set off on the walk with Ruff leading ahead and See-Saw walking behind. Some days it rained, some days it was warm and sunny."
3. Something out of the ordinary occurs
1. "but on this particular Sunday he turned to me and said 'would you like to see something?'. Before waiting for an answer he got up from his chair and left the room"
2. "Now on this particular day, the girl began her walk... but Ruff stopped in his tracks and would not move.  There was a noise in the forest and a cold wind blew across the surface of the lake"
4. Allow the tension to build - pause, add detail to the complication
1. "I sat there for a moment not knowing whether to follow him or to stay where I was.  I was surprised and I wondered what it was that my grandfather was going to show me."
2. "The girl asked herself 'what can it be? what might be making that noise?'  A few moments later she heard the sound clearly again.  There was something in the forest".
5. Resolve the complication
1. "It was ten minutes before he returned to the room.  He came in with a large bundle under his arms.  I could see colours, fabrics...  clothes or robes of some sort.  He carefully laid the bundle down and started to separate the pieces.  'These are my freemason robes.  I have been a free mason for 50 years.  I am the head of the Leinster region.  These robes mean a lot to me.  These badges mean a lot to me.'"
2. ...at this point my daughter demands that the noise be a fairy or Barbie or a Princess or a flying horse called Dina...  and takes control of the story.

Here is an example from Japanese folklore of a fable that shows the story steps put together into a longer flow:

The Stonecutter

Many years ago, a poor stonecutter spent day after day in the quarry. He chipped away at the rockface with his simple tools.  Hour after hour, day after day, the clink, clank noise of his chisel and hammer rang through the quarry.  One day the man shouted out loud his frustration "why can I not be powerful like the rich man?"  A fairy heard his wish and appeared at his side and said "I will grant your wish."

As a rich man, the stonecutter felt powerful.  He gave his servants orders.  One day the rich man was outside and the sun shone hotly upon him.  He said "The sun is more powerful than I.  I wish I were the sun".  The fairy granted his wish.

Now he was the sun.  He shone down powerfully upon the earth.  One day a cloud passed in front of him.  "That cloud is more powerful than I.  I wish I were that cloud".  The fairy granted his wish.

As the cloud he blocked the sun day after day, causing darkness and cold.  But one day a wind blew up and pushed away the cloud.  "I wish I were the wind".  The fairy granted his wish.

As the wind he blew dust storms and hurricanes.  Nothing could stand in his way.  One day he came to the mountain and couldn't move it.  "The mountain resists me.  I wish I were the mountain".  The fairy granted his wish.

As the mountain he was immovable.  Nothing could budge him.  But one day he felt something chipping away at him.  It was a poor stonecutter.  "The stonecutter is mightiest of all.  I wish I was the stonecutter".  One last time, the fairy granted his wish.

What is the meaning of this story?  What does it represent?  What does it make you think about?

Why the Rhetorical Journey?

A friend of mine, Roger, asked me "why do you call the blog The Rhetorical Journey?".

Ireland's biggest export, U2

I am a fan of U2.  I have been since I was 10 years old. On the album "Rattle and Hum" there is a recording of an interview between a journalist and Bono and The Edge of U2.  The journalist asks them "what are you doing?" and The Edge replies, with laughter, "We are on a Rhetorical Journey".

I didn't know what Rhetorical meant, but it sounded like a cool thing.  To me a Rhetorical Journey is a journey searching for meaning and purpose; a desire to travel, to experience to see and feel and experience all that life has to offer.  I have always thought that U2 is one of the few musical groups who completely reinvent themselves every 5-6 years.  They travel, they seek new inspiration, they seek new answers.  No album is ever a simple repeat of what worked in the previous album.

The Album Cover

I was in hospital the last two days for an operation.  I don't like needles.  I spent the time waiting for the operation working to keep my brain full of other thoughts and not allow room for thoughts about needles, knives or operations to enter my head.  I spent about 40 minutes in a clean ward with 6 others getting wired up before we were wheeled off to our respective operating rooms.  At a certain moment I looked up at the ceiling and thought "hospital ceilings are horrible. Green paint and florescent lights. How many people have this as their last view of life."

This blog is a journey away from anonymity for me.  These are ideas that I think about and have often written about in my own private notebooks.  It is sometimes painful to press "publish" and put my half-formed ideas out for all the world to see and comment on.  I am generally surprised by the positive feedback that I receive and has been a big motivator to keep the habit of blogging (It might be a bit sad, but I do pay attention to which posts get comments, RTs on Twitter, Shares on facebook...).

I had felt for a long time that I had no base to talk about life - I can't point to massive success or some other external "validator" that my ideas might be useful.  I was greatly helped by an insight from a friend, Tony Anagor, who has decided to take a step back from his successful business and build a role as a "life coach" (check out his website Keep The Bounce) - helping others understand and take steps to achieve their dreams (in work, family, personal lives).

Anthony Robbins

Tony told me that he had gone to one of the first Anthony Robbins conferences in Europe.  This was about 18 years ago in London.  Anthony Robbins was only at the beginning of his journey towards the famous motivational guru that he has become today.  Tony went to another Anthony Robbins conference a couple of years ago where Anthony was now successful, confidante to Presidents, a millionaire author with his own resort in Fiji (here is his TED talk).

My friend told me that the first conference was the most powerful of the two.  Robbins was on his own journey of discovery and the conference was about Robbins sharing his pains, fears, steps of his personal journey.  The second conference was powerful, but less authentic for being so professional.  Robbins had lost any of his own doubts about his own path and is clear on his purpose today.  It was harder to connect to the guru Robbins than to the "on a journey" Robbins.

I saw then that I do not need to point to my successes (few), but only remain humble (I fail often), open to ideas, stories, people and provide my mundane, simple commentary on these experiences that appear in my life.

This then is my Rhetorical Journey.

5 Techniques to Win Over the Masses

A short note inspired by a post from Verne Harnish of Gazelles.  He wrote about a keynote speech by Dr. William Horton, author of Mind Control. After showing various debate clips featuring Presidents Reagan, Bush, Clinton, and Obama, Horton outlined five techniques for winning over (manipulating) the masses:

1. Encourage their dreams
2. Justify their failures
3. Allay their fears
4. Confirm their suspicions
5. Create a common enemy

So this is how it's done -- cold and calculating.

Entrepreneur? Business manager? Verne Harnish will be running his European Growth Summit on 15th June in Barcelona - a powerful event for anyone growing a business - two themes this year - Going Global, Getting Lean.  He has two free downloads on the site that are worth a read whether you can attend or not.

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