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Top 10 Distinctions Between Building a Business and Creating Your Own Job
Many professionals and Small
Office/Home Office owners don’t understand the distinction between building a
business verses creating a job for themselves. While either route can be
satisfying and fulfilling, it is important to choose the path you prefer. The
"rules" and priorities are very different for each, as are the long-term results
down the road. Many professionals believe they are creating one type of
enterprise, but are actually creating the other. This can result in frustration
and unexpected (and unpleasant) surprises when planning for retirement or other
significant events.
While the following distinctions are only tendencies and most business people
use a mix of all these traits, this list may help:
1. A business can be sold; your job ends when you retire. In creating a business
you are creating an enterprise that has assets and a "life" of it’s own. Other
people can buy it, run it, build it up or merge it into their own enterprise.
When you create a job for yourself, the enterprise is largely dependent on your
being there ever day. You are the primary asset, and when you leave, the
business has little inherent value.
2. A Business markets its inventory; a Job markets your skills. A business has
an inventory of something…books, tapes, a staff of consultants, something that
can be counted and managed. A job markets your skills and your personality. You
are the primary inventory or product that is sold.
3. A Business has a relationship with it’s banker; a Job has a relationship with
it’s clients. In building a business, you will typically need a line of credit,
a merchant credit card account and other services from your bank. You’ll get to
know you business banker on a first name basis. Creating a Job requires superb
personal relationships with individual customers and clients. You probably know
your clients better than your banker.
4. Businesses develop formal accounting standards; Jobs are run out of a
checkbook. In developing a business, other people (your banker?) will want to
see accounting records and expect them to use standard accounting principles. In
building a job, you want your paperwork to be minimal, simple, and invisible so
it never interferes with your ability to serve your clients.
5. Businesses develop policies and procedures; Jobs have standards and
boundaries. As a business evolves it becomes more complex, requiring policies
about personnel, vacations, retirement plans and so forth. A Job is largely
about YOU. You have personal standards and boundaries that help you run your
life, and your work is a reflection of that.
6. A Business is likely to have a 5 year Plan; A job is more likely to have
Goals. A Business Plan is likely to include a formal market analysis,
demographics, product develop statements and marketing programs. A Job is more
likely to have a goal of increasing income, a full practice, or writing a book
in the coming year.
7. A Business is more likely to be incorporated; a Job is more likely to be sole
proprietorship. As a legal entity, a business is likely to have filed legal
papers, set up a legal headquarters, and have a Board of Directors. Jobs are
much more likely to be owned and operated by a single individual or a couple of
partners, sometimes very informally.
8. A Business is more likely about strategy; a Job is more likely about passion.
People who enjoy creating a business tend to be analytical, calculating and
precise in their decision process. People who prefer creating their own job tend
to enjoy the freedom, the individuality, and have a love or vision about the
work they can do as an individual. The different approaches are often obvious
after even a brief conversation with the
owners.
9. A Business tends to require more financial investment; A Job may require
little cash, but may require that you invest your whole heart. Creating an
enterprise that will continue as a profitable business typically requires some
initial cash investment. Creating a job may only require a phone number, a
checking account and perhaps a fax machine.
10. Businesses have vacation pay, Jobs don’t. This is the "acid test" in many
cases. Businesses establish policies and have financial reserves for health
insurance, vacations and retirement. Most small business operations that are
actually more like Jobs have no formal provision for these things. If the owner
goes on vacation, the income stops. Health insurance and retirement are the
personal responsibility of the
owner/operator.
Knowing where you come out on these distinctions, and where you would like to
be, can clarify many other business decisions. Do you want to hire employees?
Should you incorporate? Can the business legally buy your car for you? These
decisions can often be made more easily once you understand the distinctions
between building a business verse creating a job you love.
"Written by Dr
Philip E. Humbert, writer, speaker and success coach. Dr.
Humbert has over 300 free articles, tools and
resources for your success, including a great newsletter.
It's all on his website at: http://www.philiphumbert.com"
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