It’s easy to live life on auto-pilot, going with the flow with a “whatever happens, happens” approach. But it’s possible to take control and live a life you love by running your life like a business.
We live in a world that is becoming increasingly controlled by massive corporations. This consolidation of power over everyday life is both inevitable and intentional. Corporations operate with ruthless efficiency, increasing profits and building their reputations to overtake their competition.
If we learn what businesses do to increase their influence, we can use those same tactics to improve our lives. The end result is a more efficient, impactful, and intentional life.
Welcome to the third article in the Saving Series. In this series, I share my thoughts on why consuming less and building independence allows us to create efficiencies that will serve us for the rest of our lives.
Running your life like a business can give you the skills and acumen to make sound decisions and improve your circumstances. This allows you to optimise how you manage your time and your money. This, in turn, unlocks the ability to choose work you love.
What Does a Business Do?
When running our lives like a business, we need to understand how businesses succeed. There are a number of traits that successful companies have in common.
Understand The Mission
Businesses and the leaders understand the importance of a mission. Just about every company has a mission statement – a sentence or paragraph that explains what they do and what their goals are.
Businesses with well-defined mission statements are often very successful. Tim Cook, Apple’s CEO, defined Apple’s mission statement as “bringing the best user experience to its customers through its innovative hardware, software, and services“1. Apple’s focus of creating the best devices and user experiences has made them an extremely successful company, with Apple becoming a global leader in mobile devices.
If you understand why you are doing what you doing, you can ensure you remain focused on your goals. You also understand how those goals influence your mission, and how individual tasks allow you to achieve your goals.
Protect & Diversify Income Streams
Businesses often have multiple streams of income – even if it doesn’t seem this way. Some businesses operate within multiple industries, while others may use investments as alternative sources of income.
Creating additional streams of income allows businesses to weather downturns in the market. This diversification reduces risk, and allows them to survive another day.
If they survive, they can make a profit in the future – whatever that looks like.
Do what you can to create as many income sources as possible. When one fails, you can rely on another. Nurture and protect those income streams so that you can continue to rely on them in the future.
And remember – for many of us, paid employment is often our most lucrative source of income.
Manage Departments Effectively
Businesses rely on many highly skilled disciplines in order to function effectively: executives, HR, marketing, research, finance, and operations, to name a few.
Putting high-calibre people in charge of each of these disciplines is therefore essential to operate a business effectively.
So how do we do this in our own lives?
We have to learn those skills ourselves.
Lead yourself by making high-quality decisions. Ensure your relationships with others are positive.
Engage with others and share your experience and values.
Continuously learn about how you can improve yourself or your work.
Manage your money wisely.
Navigate the world effectively, every day.
Break down your life into smaller chunks based on categories like a business, and slot tasks into each of them.
Understand which tasks work towards the goals of one or many areas of your life.
In doing so, you learn to develop self-reliance, improving your ability to take on challenges that oppose you in the future.
Eliminate Unnecessary Costs
Finance is a massive portion of business.
At their core, businesses are vehicles for taking inputs of time, money, and resources, refining and transforming those resources, and creating outputs. Those outputs are ideally sold for a profit.
A business exists simply to execute this mission at scale.
Money, and by extensions operating costs, therefore play a large role in determining profitability.
If your business is spending more than it makes, it is unprofitable and will eventually fail. The higher the expenses, the greater the velocity towards failure.
It is imperative that from this standpoint, unnecessary costs are removed.
Successful businesses are vigilant about eliminating unnecessary expenses. We must be as vigilant about unnecessary expenses in our own lives, and do what we can to eliminate them.
Achieve Profit (Not Just in Money)
By eliminating expenses, we build efficiency into the business. This efficiency rewards either the business or its shareholders with profit.
Profit can be used in three main ways. It can be reinvested into the business to generate higher returns in future, or it can be paid out as a cash dividend to shareholders. Alternatively, it can simply be held by the business to protect against loss of profit in future.
But how does this work in our own lives?
Say we receive an unexpected bonus from work. Our three options would look like this:
- Spend the bonus money on things that make us happy, such as a new device or a holiday.
- Invest the money into generating future profit, such as an investment or purchasing a course.
- Keep the money in the bank, and protect against job loss/ illness/ emergencies.
The three things above are part of the balancing act of life.
We need to earn enough to cover our operating expenses. But we also need enough left over to reward ourselves, protect ourselves, and invest.
The profit must be achieved in order to invest, grow your skill set, and protect your future earning potential.
Improving how you do certain tasks can result in time savings. Apply these to your life in a similar manner.
Maximise Shareholder Returns
If you were a business, you would be your primary shareholder.
The actions you take to improve your health, wealth, and relationships correlate to how successful you are as a business. As a human.
Yes, there are some things that are outside of our control. Bad luck and poor circumstances can happen to anyone.
But the existence of bad luck does not stop the march of time. The negative forces of entropy will gradually eat away at your profits if you do not seek continuous improvement.
We have to keep moving forward if we want to succeed.
Why Businesses Fail
Businesses fail all the time. And there are many reasons for it, too.
Unfortunately, if we are a business, our failure represents a worst case scenario that must be avoided.
Being aware of how we can fail allows us to create plans to avoid them in our own lives.
Lack of Funds
Without water, the ground dries up. Without sunlight, plants wither and die.
We fail in a similar way without a steady supply of income.
We usually need an income to pay for shelter, clothing, and food. Without this, we lose the ability to survive.
Protecting our income therefore becomes paramount.
Diversify your income streams via side hustles or investing. Or circumvent the problem entirely by building a portfolio that pays the dividends you need to survive.
Mismanagement
Not every business decision is a good one. In fact, some decisions can lead a business to a catastrophic end.
It’s important to understand what bad decisions you can make, as well as how to avoid them.
Avoid things that aren’t “worth it” to you; expensive things are fine if they are valuable. Avoid people, experiences, or substances that leave lasting negative effects on your body or mind.
Think through your actions carefully to avoid making decisions that can ruin your life.
Infiltration
Businesses can become victims of predatory tactics used by other businesses. There’s a legion of businesses using other businesses to make money: private equity firms.
In early 2024, US restaurant chain Red Lobster declared bankruptcy and closed its roughly 600 locations for good. The reason?
This isn’t to say that all private equity funds are bad, or that every private equity sale results in financial ruin.
But if someone wants to buy your business, it’s either because it or its assets are undervalued, or its future returns are too valuable to pass up on. And it’s uncommon for those interests to align with yours.
Be wary of external influences on your life, that seek to pull you in certain directions or offer rewards that are too good to be true.
It’s possible they may be attempting to literally sell the land out from under you.
Why Should I Run My Life Like a Business?
The simplest reason for running your life like a business is as follows:
If you do not run your life like a business, then someone else, running their life like a business, will be sure to use you to work towards their dream.
This mindset allows you to be serious and intentional about how you approach your everyday life and future opportunities.
Ground Zero
Running your life like a business gives you the skills necessary to thrive in the modern age. From managing your money to growing your network and income streams, it is essential to start building these skills as early as possible.
Everything you can do to succeed stems from developing skills that will serve you will in a business capacity.
Control
The intentionality of structuring your life like a business gives you greater control over various aspects of your life.
Control only comes after understanding. If you can understand your life, income and expenses, you can attempt to control them. With control comes the ability to alter and improve these aspects of your life to further improve your situation.
You cannot attain this without control, which comes from deep understanding.
Do What Matters To You
By understanding how each task you complete contributes to your personal business, you can focus on what truly matters.
There are some tasks that must be completed. But a business-minded approach allows you to understand each task and build efficiencies into your life that allow you to do what you want.
Fun is Part of the Plan
It’s important to call out having fun. Fun should form part of your business goals.
There’s no point optimising every aspect of your life for maximum efficiency, and stripping away everything that makes you happy.
Build time into your life to focus on doing the things you love.
Avoid Surprises
Running your life like a business gives you knowledge of every operation in your life.
This gives you the knowledge to work through each operation in turn.
This approach allows you to always see what’s coming, and have the means to deal with curveballs as they arise.
Avoid living a life where you can be caught off-guard and put into a disadvantageous position.
Become Your Highest Self
Your reward for running your life like a business are control, clarity and efficiency.
These traits allow you to unlock the most powerful version of yourself.
Your continuous effort in managing and optimising every aspect of your life will serve you greatly. As your skills and responsibilities increase, so too does your potential, allowing you to unlock higher incomes and new opportunities.
The pursuit of your highest self is a lifelong journey – regardless of whether you run your life like a business or not.
Closing
Running your life like a business is an intentional choice, but one that I believe pays dividends in the long term.
In addition to giving you greater clarity, it rewards you by increasing your efficiency and self-reliance.
This opens the door to becoming your highest self, giving you opportunities to earn more, save more, invest more, and eventually, choose work you love.
This approach to life will position you towards your North Star – whatever that may be.
And I hope that it serves that purpose for you.
Thank you for reading.
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