When I picked up this book, I was very skeptical about the content. I’ve always had the mindset that I might not be the best at something or the smartest by far, but I always promised that they would never let me work. Well, reading this book puts everything in perspective about the concept of Work. This is the quintessential book on smart and effective work. I thought that I did not want to take a book that taught laziness. This book does not do that. In fact, it teaches you to use your brain and stop sleepwalking through life. If you want a fundamental paradigm shift in your life, then you need to read this book.
Why is this important to me?
This is important because life can slip away and the concept of working and driving hard for 40 years and then stopping is unrealistic. People have fantasies about retirement and how cool it would be to quote “to be free.” Reality sets in and people either wilt from lack of motivation or celebrate too much and worry about running out of money. Both scenarios are bad and there needs to be a new paradigm. Tim talks about that paradigm in this book. Two central concepts that are the framework of this book are:
1.80/20 Rule – Most of you don’t know me, but I’m a numbers geek. Pareto was an Italian mathematician and this is his rule. It basically translates to 80 percent of the results coming from 20 percent of the work. If you combine being efficient and effective, the 80/20 rule has compounding effects. The only weakness here is that you can become very efficient at ineffective work, so you need to assess what is ineffective and stop doing it. There is no one better than Tim Ferriss.
2. Parkinson’s Law – This is great because I hadn’t heard of it before reading Tim’s books. It basically says that a task will increase in “Perceived” difficulty as the allotted time lengthens. Simply put, you can finish a term paper in one night or the entire term. The difficulty of the project only seems more difficult because of its name, that is, Term Paper. To use this law effectively, you need to focus on the good and NOT the perfect. So you can get 95% effective in, say, 1 month, instead of 100% effective in 5 years. This is where this law has real value.
This book is packed with relevant material on how to become part of the “new rich”. The acronym for the process is DEAL. is the next:
1. D for Definition – Who are the Newly Rich (NR) and how do they operate? A comparison of the Deferred (D) with the New Rich covers: D: They work for themselves while the NR make others work for you. D: To work when you want NR: To avoid work for the sake of work and do the minimum necessary to achieve maximum effect (minimum effective load). D: Take early retirement NR: Mini-retire now and don’t make inactivity a goal. D: To buy all the things you want to have. NR: TO DO THE THINGS YOU WANT TO DO. D: Being the boss or being in charge NR: Being the owner and training others to manage it. D: Make a ton of money NR: Make a ton of money with specific defined reasons and dreams to achieve. You can see that the definition is important because it is a paradigm shift in thought and action.
2. E for Elimination – Let’s face it, the most common saying among working Americans is, “I’m too busy.” Deletion forces you to ask, “Busy doing what?” If you ask this question and use Pareto’s 80/20 rule and Parkinson’s Law, you will free up more than 80% of your time. You need to measure what matters and eliminate what doesn’t. Two basic concepts need to be drilled into your head:
1. Doing something unimportant well does not make it important.
2. Taking a lot of time does not make a task important.
A great quote to burn into your brain is: “Being busy is a form of laziness.” This quote has real power when you think about it. Most people find meaningless tasks to avoid what really needs to be done. This takes root and people end up sleeping walking through life. Elimination forces you to evaluate things. Side note: anyone who knows how to tell understands that I am a weather person. The men in my family are short-lived, so I’m possessed of not wasting time on small things. Remember “Tomorrow promises to meet one.”
3. A for Automation: Tim is a big fan of outsourcing. He promotes the maximization of his money with the following maxim: “Earn dollars, live on pesos and compensate in rupees.” This is very deep. Personally, I want to create jobs here in the US, but the fundamental concept of automation works regardless of whether you’re outsourcing things “onshore” or “offshore.” Initially, it may be cheaper abroad, but the quality at home must be considered. The real “beep” of the mind here that you will need to overcome for this to work is CONTROL. Automation requires diligence on your part. One way to get your head around this is to figure out your hourly value now or your target and then automate or delegate things that are less. Example: If you make $300 an hour, then you shouldn’t be spending time on any tasks that can be done for a lesser hourly rate. This is true in all businesses. Would you have a top notch programmer working on your cool new product fixing a user’s computer? NO WAY!!!!!
Example: Tim talks about what a waste of time email is. Most entrepreneurs live in their inbox, which wastes a lot of their time. Tim outsources email to him and ONLY responds to those that conform to the 80/20 rule and Parkinson’s Law. Most people, myself included, can’t imagine doing this, but if you don’t, you could spend hours and hundreds of hours per month buried in emails as your business grows. One great technique in the book is to set up an autoresponder and let people know that you only read email twice a day. This is very effective and allows you more time to work on what matters.
4. L for Release – This comes down to the release of time. This is much more difficult if you’re a 9-5 employee, but doable if you commit to a productive schedule. I can tell you from a business owner perspective that owners care about customers, stakeholders, and profit. I know profit sounds difficult, but without it there is nothing else in business. Therefore, if the employees can generate profit through effective work, you will get the freedom of Liberation with work at home. This is necessary for the 4 hour work week lifestyle. The easiest example is seen in the seller. Business owners don’t care if they reach their quote in 2 hours per week or 80 hours. As long as they hit him is all that matters.
Remember: “You will never see a U-Haul following a hearse.” You can’t take it with you when you’re underground.
I realize this summary doesn’t scratch the surface of how good this book is, but for the sake of time, I need to keep it short.
Another excellent part of the book is covered by Automation. Tim talks about revenue automation. This is great because any financial guru will tell you that CASHFLOW is king. If he can set up automated cash flow streams, he can easily dictate his freedom. Set out that your money works harder than you and you will have all the free time in the world.
I hope you found this short summary video helpful. The key to any new idea is to work it into your daily routine until it becomes a habit. Habits are formed in as little as 21 days.
One thing you can take away from this book is to respect your time. Time is the only good that IS NOT REPLACEABLE. Instill this in your mind and live by it and you will flourish.