Featuring time value of money and money value of time
Part 1
Author: Sarjo Bayang
Enterprise Architect Project Management Consulting, UK
A perspective based on the author’ professional service delivery as enterprise architect and project management consulting work for small, medium and large scale organisations over many years.
Scope of studies these findings rely on result induced tasks delivered with tangible evidence of impact. Further studies through career building courses covering cross continental divide helped consolidating the gains of practical experience in sharpened contrast.
This stimulating research interest stems from curious observation through needs assessment for enhancing entrepreneurship. The focus is productive resourceful capacity of finance, material and human capital needed to develop an enterprising population in promoting enterprise culture
Context
Converting opportunities to real time valuables is an aspect of entrepreneurial character and resourceful capability; though not all enterprising persons are rich in material and money count. Similarly, not all rich people are readily enterprising. What then is an enterprise and who is enterprising or not?
Mobilisation and employment of resources for purpose of creating value added gainful output is what it takes to be in enterprise undertaking. An entity that comes into operation when resources are employed for the stated purpose is called enterprise. Operator of the enterprise becomes entrepreneur. What it takes to start and run an enterprise is not occasioned by chance.
To venture into enterprise entails risk bearing. Such risk is conceived and ventured by calculated endeavour. Merely plunging into open chances is considered blind risk taking. By kind twist of chances, even blind risk takers end up with highly paying results. Winning a lottery is one such blind risk venture.
Far from blind risk bearing, genuine entrepreneurs work out and utilise opportunities. Such opportunities may not be openly seen by all others in the wider society.
Only by applying particular mind set associated with calculated risk and high achievement motivation that latent opportunities are identified and converted into gainful enterprise.
Thus truly enterprising society or person is seen as one with ability to identify latent opportunities and mobilises resources for their optimal gainful exploitation. There is vast responsibility involved in establishing before operating an enterprise.
Just because enterprise venturing is associated with wealth creation does not mean that a person has to be enterprising to get rich. In contrast too, being rich does not always result from business venture or enterprising disposition.
Invariably there are good numbers of very rich persons who are least enterprising. In another head counting, society is peopled by extremely capable and genuinely enterprising persons all around the world with little or no command over resources in business outfit.
What you are about to read relates to elements of enterprise in the perspective of their resourceful instrumental value. The individual who ventures to combine these elements for creating a value added commercial entity is no lesser input of the enterprise.
Entrepreneur as human capital input of the enterprise
To appreciate and accept being part of resources that make up the enterprise mix is tricky deal not everyone takes kindly. It is more challenging where the proprietor happens to be sole provider of seed capital cultivated in starting business.
Enterprise culture prohibits arbitrary use of business resources even if that was your own investment. Social perspectives differ in that friends and family extend their relations by assuming what belongs to one belongs to all.
Strictly binding, the entrepreneur is a separate entity from the enterprise. Business and personal expenses are meant to be separated. Money in business is reserved purely for meeting requirements of the venture and not to satisfy proprietor’s personal demands.
Ability to recognise instrumental use value for anything is good starting point. Competent managers differ with any others in their capability by effective allocation of resources for optimal value added returns.
Right decision making does not come by easy passage of chance. Before allocating or employment of resources critical assessment of variables is the most prudent in prioritizing line of action. Each input of enterprise commands particular resourceful value in varying use and readily employable for result induced output. The proprietor or entrepreneur is just another input in the enterprise mix.
Money value of time and time value of money in brief
Same amount of money does not always fetch equal volume of goods and services over a lapse of time. The exchange value of money drops from time to time. Thus time value of money is something recognised by financial operatives with specific accounting terms to measure this.
People who train at same institutions and gained same grades do not always enjoy equal package of remuneration. Exactly what your pay offer says is the money value of your time. That to some extent is also the going rate for the net worth of your resourceful market value over time period.
To increase your earning potential requires doing something different from others. Doing same thing as anyone else will only earn you what everyone gets. Your ability to deliver a difference leads to inching you ahead of the rest.
Resourcefulness as instrument of enterprise
People capable of recognizing the instrumental value for anything within their reach and transforming life around by combination of resources are known to be most genuinely enterprising. What that means simply is that everyone and everything around us has some instrumental resource value.
It takes only limited people in society to identify the gainfully instrumental value of anything and making it into something someone is willing to pay for. Payment is not always done by money. Popular TV shows consume vast amount of valuable social time. Time cost is something commanding value. Social media hooks up more people in recent times than few years ago. Again, social time is consumed in larger chunks. All these are aspects of buying into someone’s enterprise.
Fact of the matter at hand is that if you do not produce anything as your enterprise then be ready to feed the gainful enterprise of others from far and near.
Global dimension of enterprise
The universe is now one big platform where various types of enterprise compete for material, money, time, and good life. You are one of those feeding those enterprise formations.
You begin to rethink about your own instrumental orientation and enterprising drive. You wonder how much of resources within your remote or immediate reach you try transforming into something with value added attributes so that anyone is willing to pay for possession and use of it.
Extent of your personal resourcefulness is measured according how much you are capable of converting resources for enhanced use value. Those who are capable of just that are the ones leading in the arena of truly enterprising pursuits of life globally.
Science, technology, engineering, design, arts, advance digitals, you name could not have been much readily useful to vast numbers of consumers without the thrifty hands of enterprising genius.
Truly striving entrepreneurs have expanded the horizon and their territory of influence in almost all spheres of life. Thanks to enterprising genius you are able to read this line generated by another computer so many thousand miles away. The technology at play is certainly someone’s engineering talent. Engaging technology driven instruments to generate extensive variety of value added goods and services is by the giant foot print among people of enterprising genius.
There is hardly any sphere of life that is not invaded and under command of some enterprising creation.
Poverty, wealth, sickness, peace, politics, war, legal service, lifestyle, food industry, technology, society, entertainment, media, security, commerce and trade are all part of some enterprise schemes.
Consider amount of money the junk food industry contributes to research on food related sickness. That goes to explain how some people are busy feeding society with sickness induced edibles while others trade on sickness as an industry to build up profits. If that is not enterprise what else is then?
Abundance of unaccounted resource input
Name anything or anybody on this planet you are referring to a unit of value by infinite variety of resourceful measurement. You as a person too are by extension of that count in useful value terms one item of resource most frequently left out by none other your very self.
Subject to critical assessment, this split of seconds, minutes, and hours also belong to the mass of resources that the counter skips by default.
Many will never bother to include tiny elements of resourcefulness beginning with awareness of one’s immediate environment. Awareness is an aspect of resourceful attributes that may still lay dormant in many people like that sleeping giant never awaking.
Failure on part of society’s compact majority not taking proper account of their immediate possessions stems from least attention to detail. In better words, much is taken for granted.
On TV the other day, a young man of tender teens was ready to blow the roof with anger against his single parent mother. He claimed lack of support.
Quizzed by the presenter where he lived all the years since. With his mother of course, he said. That was when the presenter challenged him to say if living under someone’s roof with full access to all resources including water and food was not enough support. It was the beginning of resource awareness by this very energetic but highly deluded person blaming everyone else for his own failure.
Taking this as teaser all of us are challenged to assess, identify, and gainfully utilise elements of resourceful value affecting life around us by extensive variety. Basic elements of life such as waking from sleep, moving your eyes, then your whole body to reach out are done by impulse. Without critical attention to detail, abundant resources are discounted with no use value tapped from.
The truth of matters is that every passing moment holds vast elements of untapped resource with potential to add value next return of time in motion. Not doing anything while time fleets also has its rewards. Doing nothing this minute means expect nothing in return next spin round. Point to take home is that like atoms, each person, group, team, organisation and any entity for that matter is surrounded by vast element of resources mostly idle and untapped.
Everything begins by curious awareness of one’s environment in relation to resources. Anything resourceful is anything with value. Transforming any type of possession to gain added value is where enterprise resourcefulness begins. It is still not enough to bank on a resource as output of enterprise unless it is of use value, controlled, and in demand by those willing to pay money in exchange for it.
Take the example of air. To inflate a tyre air is put under control and priced for particular amount in exchange. You still prefer to call it service but the real product of enterprise is air we all have equal share of and walk through it without paying. Those who track air and transform it into a saleable commodity then demand price for it. That becomes their business for a living. When you travel by air, it is not the comfort of that plane being f paid for although it appeals so. You are being lifted from one location to another within shorter span of time. The product of enterprise there is TIME. Then you arrive and fine yourself doing nothing with that bundle of time sold at prohibitive price. There are other attributes of the flight packaged for money value in exchange. We are still looking at enterprise value of resources.
In narrowing our search for resourceful elements, the very breath of air is of more resource value than lavishing it on gossips, trivialities, and whole lot of time consuming engagements with no returns or very little at all.
Experience in everyday life reveals that compact majority of people overlook the resourceful value element of life around them. Bearing that in mind, this perspective of resourceful value orientation is conceived with a view to stimulate robust rethinking about things most of us take for granted.
By identifying and gainfully employing vast untapped resources at minimal cost what that generates will keep society banking on excess output. One big reason why the world is left to endure deeply biting pain of need is because there are more consumer spending hands and fewer creatively producer hands.
What the few produce if the majority wants to enjoy, the price for them not being part of value generating process comes dare enough. With all the advancement modern world boasts about, it is still in the hands of fewer people that the whole circulation of resource values revolves around. Barriers to entry as suggested by some experts cannot be enough excuse to have majority of people least enterprisingly engaged.
Infinite variety of enterprise entities
Curiously looking at matters close enough it comes out very clear that almost every unit of existence represents an enterprise entity. In that count of things, you are a unit of enterprise by fact of your being here on this planet. How you end up utilising all that opens to your gainful use and transforming ordinary things into extraordinary good for something value is your choice to make.
Everyone has abundant responsibility for everything around you. The clock ticks on for everyone. Yet only those who engage the passage of time in motion gain upper hand at the receiving end by value terms. Along the long road to vast destinations over course of a life time, opportunity strikes at every turn of the superhighway.
Truly enterprising persons are known for their ability to identify latent opportunities and seize the moments in value added gains around the clock.
Not only commercial business venture belong to the enterprise universe. In reality every personal sphere of life is an aspect of enterprise by infinite variety of value concerns. Everywhere you go in this wider universe, writings on the wall read “mind your business.” That may sound like someone else warning you not to meddle in their affairs. On broader perspective, it is to alert you that life is just another business to manage. Thus the establishment of an entity you take wholesome responsibility to manage. You decide venturing into a commercial trade and call it business. Yet, even in the absence of buying and selling, life is still a business to mind. Your very existence up to this minute is another embodiment of enterprise reality needing to mind about and getting to manage most resourcefully rewarding. End of part 1
Any reaction can reach the author through email: [email protected]