Some people assume that simply having a job will bring them the feeling of financial security. But in fact, the only thing that will bring them a sense of security is for them to be truly productive at their work. That is: to continuously produce more than they cost.
Many people feel childishly entitled without actually understanding what entitlement really means. So in the context of your work, it’s important to understand what it costs the company to have you work. You have to produce more than what it costs the company than to have some form of security.
It’s important to itemize every large or small cost you cause for your company. Most employees assume that their only cost to their company is their salary, and nothing more.
What are the actual total costs of being employed?
You need to take at least the following into account:
- Annual and monthly salary or hourly wage costs.
- Annual and monthly or annual bonus costs.
- Annual holiday and sick day costs.
- Annual holiday party costs.
- Annual parking costs.
- Annual insurance (liability, health, disability, injury) costs.
- Annual percentage of office space and maintenance costs.
- Annual equipment and furniture depreciation or rental costs.
- Annual supply costs.
- Annual telephone and technology costs.
- Annual training (transportation, hotel, food manuals…) costs.
- Annual error or irritated customer costs.
- Annual unproductive time costs.
- Annual average expected profits.
Once you ascertained your portion of your company’s total operating costs, you will more likely be productive. This in turn will help you to be more aware of what the company requires to employ you.
It will also provide you with a true reflection of your job and financial security. As long as you produce more than your total costs and add sufficient profits to your company, you will have a higher job security. Only then you can determine what you are truly entitled to financially.
General profit margin of company plus your total costs
Once you know what your true costs are as an employee, it’s next wise to find out what the general profit margin of the company is in order to add that percentage on top of your true total costs.
For example, let’s say that for every million rand your company produces, the net profit is 300,000, which is a 30% profit margin.
What does the average employee produce?
To know what the average employee produces for the company, add another 30% on top of whatever their costs are. When you know all the costs, you will get grounded in reality about what you have to produce to make sure you have job security.
As long as you produce more than you cost, and add additional average profits on top, you will have some degree of security. You’re only entitled to your actual portion of productivity and contribution.
If you exaggerate that amount, and that entitlement, you will set yourself up for unrealistic expectations.
“If you want job and financial security, produce way more than you cost.”
No manager of a company is likely to get rid of you if you do this, unless of course there are other social or personal reasons or issues.
So don’t go for entitlement, go for empowerment!
Educate yourself on your true cost, and you will contribute more to the company and to your own life!
Start each week with a boost of inspiration from Dr John Demartini. To receive your Monday inspired quote click HERE.