What is the Actualized Return of Your Creative Output?
What is the Actualized Return of Your Creative Output?
Are you paid from knowledge work or leveraged work?
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You might have heard the term “actual return” when it comes to business performance, stock markets, investing, etc., but have you ever thought of the “actual return” when it comes to your creativity?
Let me explain…
An actual return refers to the actual gain or loss an investor experiences on an investment or in a portfolio. It is also referred to as the internal rate of return (IRR). It can greatly affect net worth. (Investopedia)
I started thinking about what is the actual return from our creative output… that is, what is our gain… or loss… from how we bring forth our value to this world.
Now, do I believe it’s ever really a “loss” when we bring value to this world?
Absolutely not!
Do I think we sometimes give it away to the point of exhaustion and depletion, which in turn can create resistance, a halt in productivity and in some cases, burnout.
100%!
When I think of creativity and the return on creativity, I like to think through the following variables…
TIME
It’s a depleting asset that goes down in time but up in value. We can never get more of it and we are required to use it more wisely the further along we go.
And if we use it the same year after year, we may never fully materialize all the other blessings life has to offer.
KNOWLEDGE & EXPERIENCE
These are appreciating assets that go up in time and up in value.
The more we learn within our craft, industry (or set of industries) or from life in general, the greater the output we are able to deliver in less time, with more skill and more detail.
Knowledge and experience are priceless.
LEVERAGE
This asset is where the “actual” returns come from.
It may be “passive” based (that is, it’s always bringing you returns)…
or it may be “distribution” based (that is, you have curated a vast enough network and community to serve at scale)…
or it may be “product” based (that is, refining how you deliver your creativity and value without ever hindering your time).
All 3 (passive, distribution and product) do something very significant within the “Return on Creativity” formula for me… they buy back time, serve more people, preserve more energy… and most importantly, increase your overall health.
KNOWLEDGE WORK VS. LEVERAGED WORK
So, why should you be thinking about these variables?
Because today we have tools that allow us rethink our work…
Today we have tools that allow us deliver knowledge at scale while decreasing the amount of time it takes to deliver it.
Now, before I go on, I’m not saying that you should immediately forgo traditional work that gets you the knowledge and experience to begin with.
What am I saying is that I want you to rethink your approach to your work and your knowledge delivery mechanisms.
Knowledge work is simply trading your time for the output of your expertise and know how in exchange for earning a set amount of money ranging from beginner to far advanced.
Leveraged work is the ability to have mechanisms in place that allow you to deliver more of your expertise and know how in less time, at scale and available whether you are or not, all while delivering immense output and value.
Here are a couple of great graphics to depict what I’m saying.
*Graphic provided by Visualize Value
Jack Butcher (Founder of Visualize Value) is a multidisciplinary entrepreneur who worked as a designer for an agency for many years. He then created his own agency, which ultimately led to him productizing his knowledge and expertise more.
There’s two really great points I’d like to make here.
By all accounts, Jack was one of the best in his field so in order to work with him, you’d have to pay a fortune. Instead, getting tools and knowledge from him so you can deploy them yourself became a much more viable option and it allowed him to help thousands of people.
As you can see, no matter how good you are or how much you charge, you can still end up exchanging your time for money.
Here’s a similar concept produced by Janis Ozolins.
The above graphic represents two concepts of time.
The left column depicts using our knowledge in a unique, custom way for every task of the day.
The right column depicts productizing our knowledge to deliver repeatable results.
By the way, I’m not solely advocating for only productizing your knowledge.
Leverage comes in many forms.
As an agency owner, systems are our primary focus. We’ve actually built out so many systems, that we now can solely plug and play brands into them because we know they work well.
We’re not exerting any extra effort, and in fact, we’ve reduced the time it takes to deliver… pending clients participation of course. lol
Another great example… you may be a beginner (a novice or apprentice) documenting your journey as you gain experience.
You could just as easily be willing to learn on the fly, “build in public” (a term used to knowledge share your process in real time) and create community around your work in exchange for a small monthly fee that supports your efforts in delivering the public value (passive). This is one of the many ideologies of the creator economy.
Side note - No matter what stage you’re in… beginner or advanced, this is always a good idea to have, given that superior knowledge can be obtained for a fraction of the price instead of a fancy school education. We can learn more from the doers than from those who built via “title-ism” or “credentialism”.
Even yet another example… maybe you’re a gifted consultant with a vast network (distribution) and are able to be a part of someone else’s business earning monthly returns (passive) from the knowledge you bring to their table.
ALL OF THIS IS LEVERAGE!
In short, you simply need to think about the delivery mechanisms that support your time and energy, which will ultimately increase your leverage.
Read this week’s Simplify, Multiply, Diversify below…👇🏼
SIMPLIFY…
The goal… find ways you can repeat your efforts without repeating your efforts.
Ask yourself the following question for anything you do or create… how can I do this with more ease and how can I simplify scaling my output in the process?
MULTIPLY…
Always be solving for time, energy and money.
Translation:
In every situation of life, always be solving for maximizing your time and increasing your energy… and prioritizing these two will solve for your money needs.
DIVERSIFY…
Leverage provides options to be in multiple places at one time without exerting more energy. Seek where you can find leverage either through passive means, distribution means or product means.
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