Have you just bought a job?

How do you assess what you earn as a business owner?

Is it the salary you pay yourself? Or is it the cash drawings you make? Or is it business profit?

What should you base it on and how should you assess it?

Understanding how to analyze your business earnings is really important. If you don’t assess this properly, how can you accurately determine if you are running a successful business?

Market Salary

Regardless of what type of business entity structure your accountant put you into, you need to compare ‘apples and apples’.

Most owners work operationally full-time in their business. So let’s assume that most of you are working in a senior management role.

Regardless of how you take out money from the business for tax purposes, the first step is to look at recognizing a market salary for your operational role. 

Your market salary is the salary that you would pay to an arms-length person to fulfill your operational role. For example, if you are General Manager and the market salary you would pay someone else to fulfill that role is $200,000, then that is how it should be assessed.

It doesn’t mean you have to pay yourself the $200,000.

It just means that you should deduct ‘on paper’ a market salary for yourself of $200,000 as an expense to assess your business profitability ‘after your market salary’.

If you have other family members that work operationally in the business; you should analyze profit after deducting notional market salaries for them on the same basis.

Business Profit

So now you’ve assessed your business profit after deducting a market salary for you and other family members working operationally in the business.

Now I want you to look at the remaining business profit as a percentage of total revenue.

Let’s assume that many businesses have annual sales revenue of between $1M and $10M.

For businesses with annual sales revenue between $3M and $5M I like these businesses to earn a business profit of between $300,000 and $500,000. 

For businesses with annual sales revenue between $5M and $10M I like these businesses to earn a business profit of between $500,000 and $1,000,000. 

These are of course just guides and vary based on size, industry, and margins experienced by your business. 

This is, of course, AFTER you have deducted a market salary.

Market salary is what you should be paid for your operational role. This has NOTHING to do with owning a business.

Business profit is the commercial return on the business. This has EVERYTHING to do with owning a business.

I’ve met business owners (husband & wife) that don’t pay themselves a salary tell me that their business makes a profit of $240,000. Upon analysis of their roles, it becomes apparent that their market salaries for key management roles are $120,000 each. When we deduct these two market salaries from the $240,000 they discover that they are actually not making any profit from the business.

They have just bought a job!

Alternately, many of my clients like to draw a market salary and use this for living expenses. They then withdraw business profits periodically for investment purposes. This methodology quarantines money into two categories. One for living and one for investment. This is a Fourth Moon discipline that leverages their success.

Make sure that you are receiving both a market salary for your operational role AND a commercial return for your investment, risk, and skill for owning the business.

And make sure that you haven’t just bought a job.

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I really want you to start creating sustainable success in your business and life. Simply check out my FAQs videos HERE on what business owners most commonly ask about sustainable business success. If they help you, simply sign up and get the other 20x videos free.

Claim your Giveaways now, find out what the Fourth Moon is and reach your goals sooner!

Cheers, Darren K Bourke

Three Ninja Tactics to leverage your Big Ideas

How often do you find yourself daydreaming and a Big Idea pops into your head? Or you might wake up at 3am with your mind racing thinking about a business opportunity.

What do you do when this happens?

More importantly, what do you do to make your Big Ideas come to life?

Project Board

Whether a melody to the next big hit, the plot to a blockbuster movie or a tweak to your business model. Big ideas must be captured.

Or they just float away. Never to return.

Whatever you do, just write it down. I have notepads in my car, office and satchel. Just make sure you WRITE IT DOWN BEFORE it goes. These ideas tend to disappear faster than last week’s pay. They simply float in and float out of your mind.

That’s where you must establish a Project Board.

A Project Board is simply a list of your Big Ideas. Your potential projects. 

I don’t care whether you capture these Big Ideas in the notes function of your phone, on an app, saved in a Word doc or spreadsheet, scrawled in a notepad or written in red lipstick on your bathroom mirror. Please just write them down in one place.

I have a Project Board in my office. I find it helpful to reflect on it and muse on what I might tackle next.

Clusters

‘Clusters’ are the different revenue streams that I hope to generate from my Big Ideas. They can be new products or services you’d like to offer. They might be a start up business. You might want to buy a business. They can be a creative project. 

I treat a Cluster as a Big Idea that might generate six figures of revenue or more per annum. That is, $100,000 or more each year.

Of course, whether these Big Ideas will or won’t generate any revenue is academic at this point in time.

90 Day Action Plans

So now I’ve captured my Big Ideas on my Project Board.

I’ve thought about my Big Ideas in terms of Clusters of annual revenue.

Next I decide what Big Idea I want to work on to create a potential Cluster over the next 90 Days.

Once I choose the Big Idea to try and make into a Cluster, I create a 90 Day Action Plan. This 90 Day Action Plan lists all the activities and actions I will attend to over the next quarter in relation to one specific Big Idea. I create a spreadsheet with descriptions, comments outlining actions and deadlines.

Of course, some Big Ideas can’t be completed in just 90 days. However, by putting a short-term timeframe around your activity you force yourself to push through the ‘heart’ of the work to see if the idea has merit. 

At the end of the 90 Days, you may have finished the project and can implement it into your business life and attempt to create a new Cluster of revenue. Alternatively, you may not have been able to complete the project and decide to push on based on the encouraging progress made in your 90 Day Action Plan. Or sometimes, you discover that the Big Idea doesn’t have merit and is unlikely to create a Cluster so you drop it.

Start leveraging your Big Ideas

The power of these ninja tactics is that you work on four Big Ideas each year in addition to your existing business. Ideas that don’t fly are dropped.

But what if just one of these Big Ideas is born and creates a six-figure Cluster?

And next year you get to start working on four new Big Ideas.

So start bringing your Big Ideas to life. Introduce additional revenue streams to your business model and diversify risk. 

Just don’t leave your big Ideas in bed. Or left on the side of the highway while daydreaming. Or on the train. 

But I can assure you of one thing.

Something will happen. And it could be big!

Let me know what’s on your Project Board and what Big Idea you want to tackle in the next 90 days?

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I really want you to start creating sustainable success in your business and life. Simply check out my FAQs videos HERE on what business owners most commonly ask about sustainable business success. If they help you, simply sign up and get the other 20x videos free.

Claim your Giveaways now, find out what the Fourth Moon is and reach your goals sooner!

Cheers, Darren K Bourke

The Busy Fool

Readers of The Fourth Moon may recall the parable of The Busy Fool.

A number of people have mentioned to me that they have recognized attributes of The Busy Fool in themselves. I always reassure them that, if we are being completely honest with ourselves, that we have all been The Busy Fool at different stages of our careers.

The trick is to identify the archetype when we see it appear and banish it. Better still, ask others to call out The Busy Fool when they see it in us.

An extract from The Fourth Moon below reminds us of parable of The Busy Fool.

"The Busy Fool keeps himself constantly busy so he never has to see who he really is. The Busy Fool spends years toiling away. He doesn't have to think, plan or develop a strategy. He just does. He doesn't truly help others, foster relationships or invest in other people. He is an island. An island that never stops working. He can't be queried, challenged or attacked for his autocratic style, grumpy demeanor and emotionless state. It would be like attacking Mother Teresa. How can you attack someone that works so hard and so selflessly? What a man."

"But one day The Busy Fool loses his business, gets sick or has to retire. The Busy Fool returns home to his empty house. His second wife left him. His kids know him only as a stranger. He doesn't have any real friends because he was always working. Worse still, he doesn't have any hobbies and interests as these were never developed over 40 years of work. But hang on says The Busy Fool, I have an amount of money that you couldn’t climb over in a lifetime. Unfortunately, The Busy Fool has no family to share it with, friends to spend it with nor hobbies and interests to spend it on. So sad. Just 18 months after stopping work, The Busy Fool dies as an unhealthy lonely man. At his funeral, attended largely by business acquaintances, the priest delivers the eulogy with no family or close friend to deliver it. The priest says he worked hard and was wealthy. No one cries. The coffin leaves. The end."

The principle of the parable.

Don’t be The Busy Fool.

It may seem counterintuitive but don’t create a level of busyness that blocks out opportunity. I see executives that can’t have a meeting for six weeks. Business owners that can never find time for professional or personal development. Entrepreneurs who constantly work sixty plus hours per week can create a vacuum where nothing, or no one, can get in.

Busyness is a form of laziness. 

Being constantly busy allows you to never have to truly face your pressing headaches. Think about that. You can’t meet with your challenging customer because your schedule is full. Can’t see the lawyer to tackle those issues around your terms. Unable to see one of your key team members to discuss their frustrations. 

Being constantly busy also blocks you from seizing opportunities. Can’t hire that new talent because you haven’t got time to interview. Unfortunately can’t meet your key supplier to hear about an emerging supply chain opportunity. No time for that gun website developer either unfortunately. 

You just can’t meet that person because you’re just too…err…busy.

Right?

This is limiting and self-destructive behavior that simply won’t allow you to reach your potential. 

Remember also that The Busy Fool might not be you. It could be a business partner or key team member. Once identified, you must discuss this with The Busy Fool sensitively and soon. If you don’t, you all lose.

A smart business owner once told me to keep 10-20% (Say 4-8 hours of your working week) of your capacity free on a rolling basis as a minimum. This available capacity allows spontaneous allocation of your time to dealing with both pressing headaches and emerging opportunities.

Do you currently have four to eight hours of capacity as a minimum free each week? 

And what were the most recent headaches spontaneously dealt with or new opportunities scheduled to be explored?

To understand the 28 steps to sustainable success through my digital training program Fourth Moon Mastery, click here

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I really want you to start creating sustainable success in your business and life. Simply check out my FAQs videos HERE on what business owners most commonly ask about sustainable business success. If they help you, simply sign up and get the other 20x videos free.

Claim your Giveaways now, find out what the Fourth Moon is and reach your goals sooner!

Cheers, Darren K Bourke

Flossing & Success Habits

I want to let you in on a secret. I find it really hard to floss. I have an aversion to it. My gums bleed, it hurts and it feels altogether weird. 

In short, I hate it. Some people hate flying, hospitals and clowns. I dislike flossing.

Or at least I did back then.

In the past, I had to endure being reminded by my dentist each visit how important it is and all the really good reasons why I should do it. 

And up until recently, I ignored it. 

Frustrated by my inability to overcome my aversion to flossing, I decided to book an appointment with a dental hygienist.

At my initial visit with the dental hygienist, I recall it being very uncomfortable, painful, invasive and took a long time. The dental hygienist was very patient and politely suggested I make a habit of flossing.

She even gave me some floss to take home.

Determined to break this aversion to flossing, I booked in to see her again in six months as I was walking out of her clinic.

My goal was simply to floss more often. To start.

But how?

The tactic I adopted was to put the floss in my bathroom cabinet in front of my contact lens case. Each night, I would then have to reach past the floss to pick up my contact lens case and place my contact lenses in before going to bed.

This I thought would act as a daily trigger to prompt me to think about flossing and hopefully execute.

So what happened next?

At first nothing. The tactic failed miserably. The awkward thought of flossing was still greater than the desire to adopt the new habit.

But the daily trigger of reaching past the floss to pick up my contact lens case continued.

And then one day I picked up the floss and flossed. Two days later I flossed again.

I’d broken the deadlock.

Of course I’d be tired and miss nights. And like any new habit I’d fall back. But the positioning tactic reminded me each day by bringing the habit back to the forefront of my mind.

Slowly but surely I would floss. Several nights each week.

And what’s happened since?

I went back for my six-monthly visit to see the dental hygienist and was surprised at how easy, painless and quick my next visit was. She was very complimentary on the state of my teeth and gums. The Dentist also came in for a quick check of my teeth, smiled and gave me the all clear. 

This of course validated my adoption of the habit of flossing.

So what can we learn about success habits from flossing?

Quite a lot I think.

I had a deep-seated aversion to flossing so I introduced a strategy around how I would adopt it. I changed things up by booking an appointment with the dental hygienist. I accepted the floss that she gave me with a promise to her that I would try and floss more often. 

I adopted a key tactic that would act as a trigger each day by positioning the floss in the bathroom cabinet. A daily physical reminder to floss. 

I was open to adopting a new habit and forgave myself when I failed knowing that I would be brought back by the trigger on a daily basis. 

The other key tactic used was to book my next visit with the dental hygienist literally upon walking out of my appointment. I didn’t leave the re-scheduling of the next appointment to chance. This placed an onus on me that I would be going back and there would be inbuilt accountability when she checked on my progress. 

Combining the micro strategy of introducing a sequence of small incremental changes on a daily basis with the macro six-monthly strategy of the dental hygienist visit was critical.

And while I don’t floss 365 days a year, I floss more days than I miss. 

I still aim to make this a daily habit and I am optimistic in achieving this goal. I have a strategy and I have implemented it. 

I’d love to hear what challenge you’ve had in adopting a new success habit on my blog or on social media. 

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I really want you to start creating sustainable success in your business and life. Simply check out my FAQs videos HERE on what business owners most commonly ask about sustainable business success. If they help you, simply sign up and get the other 20x videos free.

Claim your Giveaways now, find out what the Fourth Moon is and reach your goals sooner!

Cheers, Darren K Bourke

Thirteen Traits of the world's best creators

I must admit to being fascinated by the traits and rituals of the world’s best creators. To be the best in the world, you have to be different.

I study these daily traits and rituals. Many provide insight to genius. Others are completely useless, indulgent and can be discarded.

But to do great things creatively takes talent, flair and often a ‘devil may care’ attitude.

I’ll leave you to make your own choices of which of these daily traits and rituals exhibited by the world’s best creators are useful to you.

        1.    Knowledge of one’s biorhythms

Know when your body and mind works best. Are you a night or day person? Or both. Do your most important work when you are at your best throughout the day. Jackson Pollock liked drinking so he rose at 1pm for breakfast before commencing his painting in the afternoon.

        2.    Meditation

One of the big discoveries is that so many highly successful people meditate. There has to be something in this. David Lynch has done transcendental meditation daily for 33 years.

        3.    Sleep
The vast majority use daytime naps as a powerful tool to sharpen creativity. 

        4.    Walking

Going for walks to aid the creative process is a well-known ritual. Steve Jobs was known for holding ‘walking meetings’ with key people. Charles Dickens went for three-hour walks while crafting plot and character.

         5.    Indulgence of eccentricities

Confident creatives indulge their eccentricities. Truman Capote only wrote in bed. Steve Jobs had a helper hide a cheeseburger in a tree outside at 3pm each day regardless of whether he was there.  Freud had his beard trimmed every morning at his home by a barber.

        6.    Daily Goal

Many successful creatives have a daily goal that they set and drive themselves to meet daily. Steven King writes at least 2,000 words every day including holidays and his birthday.

        7.    Social Interaction

Social interaction is key to daily rituals in many cases. Andy Warhol famously spoke to his longtime friend and writing collaborator for one to two hours every day. He would painstakingly outline the prior 24 hours of his life and share gossip and pop culture. The friend would take notes and return it typed up to Andy as a diary journal.

        8.    Strict Routine

A strict routine is common but appears a particularly strong trait of composers. Strauss, Gershwin and Schubert all worked grueling schedules. Life was shorter then, and with so much to do, creating great work required a strict routine. 

        9.    Completion

Completion is the final step in a creative work. This is key. Charles Dickens was known to have a business-like regularity to his creative process.

        10.    Changing Themes throughout day

It is a common thread that many of the most successful creators adopted a routine of ‘changing themes throughout the day’. Without the convention of a 9-5 imposed world, they were free to run their own schedule. I am amazed at how these daily schedules packed in so much work, but still included a wide variety of other activities. Charles Darwin’s typical day included research, writing, walking, napping, reading, letter-writing and backgammon consistently for forty years with few exceptions.

        11.    Planned Distractions

Aware of the challenges surrounding the creative process, great creators scheduled what I’d describe as ‘planned distractions’. These planned distractions would be visits to the village, social interaction, walks, appointments and personal affairs scheduled to break up the rigor of the work. Woody Allen scheduled extra showers throughout his days while writing to assist with the creative process.

        12.    Vices

And oh do creative people have vices. Alcohol, cigars, drugs and sex are spread liberally through their memoirs. Do vices help or hinder?

        13.    Selfishness

To be truly great as a creator requires selfishness and indulgence. Producing great work requires disciplines beyond the normal man or woman. The time and commitment required to be great involves sacrifice. Many of the great creators had long suffering family and friends who had to tolerate their eccentric personalities, selfishness and indulgences.  

If you are interested in learning more about the habits of not only creatives, but a wider range of successful people, I recommend Tim Ferriss’ Podcast The Tim Ferriss Show and the book Daily Rituals – How Artists Work by Mason Currey.

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I really want you to start creating sustainable success in your business and life. Simply check out my FAQs videos HERE on what business owners most commonly ask about sustainable business success. If they help you, simply sign up and get the other 20x videos free.

Claim your Giveaways now, find out what the Fourth Moon is and reach your goals sooner!

Cheers, Darren K Bourke

How does the world see you

Back in my days as a young professional one of the firm’s partners caught me off guard when he gave me some advice.

I remember him saying this to me.

 “Don’t tell HR this. But the conventional wisdom about focusing on your weaknesses is BS. By now, your weaknesses are never going to be your strengths. My advice to you is to direct almost all your energy towards your strengths. Because it is your strengths that people are going to pay you for and your weaknesses, even with improvement, will never be better than others that possess those same weaknesses as strengths.”

I was 27 and little did I know I’d be in business myself in just a few short years.

This advice was counterintuitive at first. All my professional life up until then I had bought into the mindset of improving on my weaknesses. This is noble, and to a certain age, the right approach. However, probably in your mid to late twenties and after, it’s time to take on board this sage advice passed on to me.

I’ve recently read Sally Hogshead’s best-seller How the world sees you – Discover your highest value through the science of fascination. It has a compelling message and I urge you to read it. 

Here is an intro.

How is your personality most likely to impress and influence the person sitting on the other side of the table? Once you know what makes you valuable to others, you’re more authentic and confident, and more likely to make a brilliant impression. 

You’ll be able to confidently and authentically communicate, based on your natural personality advantages. To become more successful, you don’t have to change who you are. You have to become more of who you are. HOW THE WORLD SEES YOU reveals who you are at your best, so you can create better relationships, grow your business, and become intensely valuable to those who matter most.

The book is based on research conducted by Kelton Research on Fortune 100 Companies. The research focused on over 1,000 Americans based on understanding the relationship between fascination and decision making regarding brand choice, careers, relationships and personal branding. 

The book identifies 7 advantages of fascination:

•    Innovation
•    Passion
•    Power
•    Prestige
•    Trust
•    Mystique
•    Alert

While all of us have elements of each of these seven primary archetypes, we have a dominant archetype. We also have a secondary archetype within the seven advantages. The combination of our primary and secondary archetypes determines one of 49 personality archetypes (7 primary advantages x 7 secondary advantages).

Knowing your personality archetype helps you to focus on what makes you most fascinating to the world. This helps you to spend time on your advantages. Knowing this advantage provides an edge and can make you more successful.

There is a Fascination Advantage Assessment for free included with the book (you can purchase online but it costs more than the book) which provides an assessment of your personality archetype.

I took the test…… Spoiler alert!

My primary advantage is INNOVATION and my secondary advantage is PRESTIGE.
INNOVATION + PRESTIGE = THE TRENDSETTER 

Here’s what the book says about The Trendsetter as a personality archetype:

Trendsetters prefer breakthrough to incremental innovation. Their ability to reformulate products, processes and business models is a distinct advantage. They impress with their intellect and inventiveness.

You’ll like to turn to Trendsetters in uncertain times. They are able to see opportunities where others see only threats. They’re able to turn a company’s weakness into a strength by adapting your product offering to changing conditions.

Trendsetters’ implement change with determination. They have an ability to see things in a different light. They change your perception of what business you’re in.

Understanding your personality archetype is powerful as you begin to strategize ways of utilizing your fascination advantage. The book also explains how to work with other personality archetypes. 

And finally I discovered who my kryptonite archetype is – MYSTIQUE – the personality archetype that I find most challenging to deal with.

This stuff is great to know. 

So I recommend you buy the book How the world sees you by Sally Hogshead. The book includes a free personality profile. You can learn more at www.howtofascinate.com 

I’d love to hear your personality archetype so please post it on my blog or social media.

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I really want you to start creating sustainable success in your business and life. Simply check out my FAQs videos HERE on what business owners most commonly ask about sustainable business success. If they help you, simply sign up and get the other 20x videos free.

Claim your Giveaways now, find out what the Fourth Moon is and reach your goals sooner!

Cheers, Darren K Bourke