Don’t have enough time? For many entrepreneurs, their time is a key constraint when growing their businesses. To help entrepreneurs relieve their time bottleneck, Assistant Professor Onesun Steve Yoo from UCL School of Management scientifically revisits the popular mantra of “invest time now to save time later”.
Entrepreneurs spend (sometime unknowingly) significant amount of time attending to firefighting activities that could have been avoided. Investing time to reduce the frequency of such time wasted in the future (i.e. improve process) has the effect of increasing the supply of future available time.
Unlike investment of money which brings in money, people do not see tangible benefits from investing time. As such, when busy, investing time to save time often feels like a waste, but those are precisely the activities that entrepreneurs should prioritize on.
To conceptually quantify how much time is created by investing time, Dr Yoo introduces a novel notion of “return on time invested” utilizing the net present value analysis method commonly used in the financial valuation of “return on investment”. It can be used as a basis for simple but effective time allocation strategy.
“Opportunity to create time is everywhere, and is also true in everyday life. For example, beginning a new exercise routine when you are busy may appear to be poor investment of your time. However, if you account for the reduction of number of sick (or less productive) days in the future, the return on time investment can be significantly positive, i.e. you have created time,” says Dr Yoo.
An additional benefit of creating more time is that you can use it to make your time more valuable by growing faster or to create even more time. When accounting for this multiplier effect, analysis shows that entrepreneurs should invest time in process improvement even when it leads to a net loss in time.
These findings come from an article that was recently published in the journal Manufacturing & Service Operations Management.