People often talk about time and money in the same breath, as though they were one and the same, interchangeable or at least equivalent. Certainly there are some strong correlations between the two but there are also some fundamental differences. Time and money however are both important resources in any business; we never have enough of either; and each needs to be carefully managed.
Problems with Time and Money
Many of the problems faced by small businesses arise because neither time nor money are properly planned or managed. These problems become increasingly serious as a business grows and it takes increasingly more money and more time to run. The owner finds there are so many demands on their time during the day that they have to spend their evenings doing their bookkeeping and budgeting; when they are tired and having trouble concentrating, and just want to get home to their family or their bed. Often they do just the bare minimum necessary to get through the next day and postpone the rest, sometimes indefinitely. At the same time the cash is running out faster than it is coming in.
If steps aren’t taken at this time to improve small business cash flow, they are likely to run into serious financial difficulties despite the fact that the business appears to be flourishing. They need to prepare proper cash flow budgets, manage invoices, negotiate payment terms with suppliers and arrange lines of credit to cover shortfalls. And it all takes time that they don’t have. Or do they?
Finding the Time
Time is very subjective, it passes more quickly when we are having fun and seems to drag when we are not. Although most people go into business hoping and indeed expecting to make money, their focus is usually on the work the business was set up to do, selling to customers, providing a service; and that is the part they enjoy. The underlying administrative and financial aspects are generally far less appealing, and therefore given a much lower priority; but still seem to take an excessive amount of time. Proper time planning helps identify areas where time could be saved, enough so at least most of the work doesn’t have to be done at night.
It requires a certain degree of optimism to build a business, and confidence. These are the driving forces and are crucial to success. So there is a natural tendency to ignore or downplay anything that might put a dint in them. Even when the owner is aware there are problems, they may still be reluctant to face up to the reality. And the worse the problems become the more difficult it becomes to tackle them. Some people resolve this just by giving themselves a good metaphorical kick; for others it’s time to get help. This usually means having an accountant, finance or a business manager come in and sort out the mess, set up proper systems and recommend appropriate actions.
One of these actions might well be engaging a business manager or bookkeeper to come on a regular part time basis. We can spend our time or we can spend our money. But how do we decide? Which do we have more of, time or money? The last question can’t be answered because we can’t compare the two. Despite all the apparent similarities they are very different concepts.
Time and Money are Not the Same
Money has been with us since the dawn of civilisation nearly 10,000 years ago; it made civilisation possible, and it is certainly an integral part of our lives. But it is still just an abstract concept; a symbol developed to facilitate trade, and now reduced to a digital representation of an abstract symbol. Whereas time, our awareness of time passing, is part of our genetic makeup. It can be classified as one of our senses, along with sight, hearing, smell, etc. To compare time with money is like comparing our sense of sight with the written word ‘sight’ on a page.
So while it may be useful sometimes to talk about time and money as though they the same, it can be very misleading. When we spend money, we can get that money back another way; but when we spend time, we never get it back. How we spend our time means far more to us than how we spend our money.