{"id":748,"date":"2008-06-02T10:00:31","date_gmt":"2008-06-02T17:00:31","guid":{"rendered":"https:\/\/www.scotthyoung.com\/blog\/2008\/06\/02\/dont-pay-yourself-by-the-hour\/"},"modified":"2018-04-03T08:27:02","modified_gmt":"2018-04-03T15:27:02","slug":"dont-pay-yourself-by-the-hour","status":"publish","type":"post","link":"https:\/\/www.scotthyoung.com\/blog\/2008\/06\/02\/dont-pay-yourself-by-the-hour\/","title":{"rendered":"Don’t Pay Yourself By the Hour"},"content":{"rendered":"

\"Clock.png\"<\/a><\/p>\n

One of the worst things you can do is paying yourself by the hour. Hourly wages make the accounting easier for a payroll department. But that doesn\u2019t mean it\u2019s a good strategy when you\u2019re working on your own time. Unfortunately, I frequently see students, entrepreneurs and self-employed people counting hours worked instead of work accomplished.<\/p>\n

I once knew a software developer who was working on his first product. He was a bit stressed because he was working 12 hour days. Or at least, he claimed to be working 12 hour days. Despite this workaholic attitude, I noticed he was frequently making long forum posts and responded to emails almost immediately after they were sent.<\/p>\n

My question is this: if he was working 12 hour days, how did he have time to make forum posts and answer emails so quickly?<\/p>\n

Pay Yourself for Results, Not Hours<\/h2>\n

My friend was caught in the trap of counting hours worked, not results accomplished. He was working 12 hour days, but how much of that was useful work? As a software developer, getting his first product to market should have been priority #1. Not forum postings and emails.<\/p>\n

If this guy worked in an office, they would probably give him a raise. He\u2019s a go-getter, working 12 hour days while his \u201clazy\u201d coworkers only come in from 9-5. If he was paid by the hour, he would be earning more than the person who only works eight hours each day.<\/p>\n

But as an entrepreneur, he wasn\u2019t being paid for work. He wasn\u2019t being paid at all. He only earned an income if people eventually bought his product. Which meant that the hourly wage mentality was having him work twice as much with no visible results.<\/p>\n

I\u2019m being a bit hard on this friend, but only to use his comment as an example. He was talented, smart and driven. But by falling into the wrong mindset, he was working a lot of hours without doing a lot of work.<\/p>\n

Students Who \u201cStudy\u201d<\/h2>\n

Internet entrepreneurs aren\u2019t the only people that fall into the trap of paying themselves by the hour. Students often make the same mistake.<\/p>\n

I\u2019ve frequently heard horror stories from friends who complain about the hours spent studying for a big exam. However, many of these people are studying with the television in the background, friends sitting around them or instant messaging applications running. How can you consider that<\/em> studying?<\/p>\n

Even if some people get rid of the distractions, there isn\u2019t a studying plan. They simply read and re-read their textbook and notes. No brainstorming for ways to lock in the information instead of just pounding it into their skull. They are too busy \u201cstudying\u201d to stop and ask themselves if there is a better way to remember the information sitting in front of them.<\/p>\n

Studying is hard to measure. It\u2019s an open loop and it isn\u2019t easy to know when you\u2019re finished. Because of this ambiguity, many students slide into the habit of counting hours. Instead of counting hours, I suggest forming a list of tasks that will help you learn the information. Reward yourself for finishing tasks on that list, not for spending another hour locked in your room.<\/p>\n

Switching to a Results Mindset<\/h2>\n

I believe there are two keys to breaking out of the hourly wage mindset:<\/p>\n

    \n
  1. Realize that more time spent working is stupid, not virtuous.<\/li>\n
  2. Measure work as projects and tasks, not time.<\/li>\n<\/ol>\n

    Paying by the hour is so prolific, that unless you follow those two ideas, you\u2019re probably infected.<\/p>\n

    Working More is Stupid<\/h2>\n

    More work is not a good thing. Productivity is the art of eliminating work while having the same amount accomplished. All else being equal, a 3-hour workday is better than working 8 hours. The 3-hour workday yields an extra five hours of free time.<\/p>\n

    You can boost your productivity by assigning set working hours. Not hours to work, but hours you can\u2019t<\/em> work. Set up your workday from 9-4 with the principle that you aren\u2019t allowed to work before or after those times. If you finish early, you can leave early. But you can never stay late.<\/p>\n

    Setting up a constricted schedule flips the attitude. Instead of seeing more work as being more valuable, it\u2019s seen as a higher cost. Every extra hour worked is another hour gone from your day. Forcing all the meaningful activity into a smaller slot keeps you focused on actually working.<\/p>\n

    Measure Projects and Tasks, Not Time<\/h2>\n

    Most jobs emphasize time over tasks. They expect you to show up to work from 9-5. Only once you\u2019ve fulfilled that requirement do they ask you to finish a certain to-do list. If your to-do list goes unfinished, that\u2019s disappointing, but understandable. But leaving an hour early or showing up late are reasons to be fired for.<\/p>\n

    If you\u2019re paying yourself, you need to switch the emphasis. Tasks should come before time worked. In fact, if you\u2019re tasks are being accomplished, time worked shouldn\u2019t even matter.<\/p>\n

    Keep a daily list of tasks instead of an endless to-do list. Daily to-do\u2019s force you to put tasks first. When your to-do list is endless, it doesn\u2019t matter what is accomplished today and what is put off for tomorrow. When your tasks are linked to today, there is pressure to complete them now.<\/p>\n

    Don\u2019t just measure tasks (which can be a trap in itself<\/a>), measure projects. Look at the progress every day is making towards projects and use that as a guide for deciding when to stop for the day. Paying yourself by the hour inevitably means you get paid a lot less than you\u2019re worth.<\/p>\n","protected":false},"excerpt":{"rendered":"

    One of the worst things you can do is paying yourself by the hour. Hourly wages make the accounting easier for a payroll department. But that doesn\u2019t mean it\u2019s a good strategy when you\u2019re working on your own time. Unfortunately, I frequently see students, entrepreneurs and self-employed people counting hours worked instead of work accomplished. […]<\/p>\n","protected":false},"author":7,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":"","_links_to":"","_links_to_target":""},"categories":[680],"tags":[51,52,38,45,30],"class_list":{"0":"post-748","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-nc-productivity","7":"tag-effectiveness","8":"tag-efficiency","9":"tag-productivity","10":"tag-studying","11":"tag-time","12":"entry"},"acf":[],"yoast_head":"\nDon't Pay Yourself By the Hour - Scott H Young<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.scotthyoung.com\/blog\/2008\/06\/02\/dont-pay-yourself-by-the-hour\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Don't Pay Yourself By the Hour - Scott H Young\" \/>\n<meta property=\"og:description\" content=\"One of the worst things you can do is paying yourself by the hour. 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