Friday, 16 November 2012

The Time/Skill/Money Pie

Once in a while, you get handed a tool that sticks with you and becomes a part of your life from that moment on. For me, the Time/Skill/Money Pie is one of them. It is something I use personally and I also pass on to clients to help with their decision making processes.

The concept of the Time/Skill/Money Pie was something I was taught years ago by a preacher who was once an insurance salesman. (He had a very unique skill set.) Basically, the idea was that no matter the task at hand, you will have to determine the amount of time, skill and money you will use to complete it. If you have lots of one, you may not need as much of the other two. If you are lacking in one, you will have to make up for it in the other two.

The pie looks like this ...

To show how it works, lets take the example of fixing your toilet. Here are three most basic possible pies.

The simplest way to get it fixed is to pay a plumber to come and fix it. (Figure 1) If you have the money to pay the plumber, you don't need much time and you don't need any skill, just enough common sense to let the plumber do his job.

If you already have the skill to fix the toilet (figure 2) then you don't need to hire the plumber. That means you don't need much money (maybe just to buy some parts) but you will have to use some of your time to do the job. 

The third scenario here is not having any skill and not wanting to pay a plumber (figure 3). That means you had better free up some time. You are going to need to learn about how to fix the toilet and then do it yourself, making a couple mistakes along the way but eventually getting it done right. (The silver lining in this is that you develop a new skill through investing that time. The next time your toilet breaks, you will have the skill to fix it! Your pie will look different again won't it? More like figure 2.)

Once you get used to using it, you will find that pies from different decisions overlap. For example. I can use either time or money to fix my toilet as I don't have any plumbing skills. I also want to go watch my kids in their soccer games. Solution? Use money to pay a plumber (pie 1, where money displaces time) so I can free up time to watch my kids game (pie 3, where time is plentiful). 

The great thing about this is that it can simplify many decisions. From family life to your business and everything in between. Look at the task at hand. Decide which of the 3 sections you have available, decide which you want to use and which you want to preserve and then move forward.

Let them eat pie.

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