Opportunity Cost & How It Applies to Information

Opportunity cost is a concept you must know how to effectively apply to survive and thrive in the 21st century.

My definition of opportunity cost is this: The value of what you could be doing whenever you are doing something else.

For instance, writing this blog post in this moment carries an opportunity cost. Because I could be doing any number of other things: writing sales copy, marketing my business, spending time with my kids, etc.

One thing I continue to struggle with is the volume of information I receive, whether digital or in print.

At James Brausch's suggestion (see his "Life Management 101" CD), I canceled my newspaper and six magazine subscriptions, including a subscription to Fast Company that was paid up until 2011.

Why?

Because every moment spent reading a magazine carries a high opportunity cost. During that time, I could be reading something more valuable. For instance, a book or newsletter. Or I could be applying concepts, strategies, and techniques I've already learned.

Now I'm examining additional subscriptions with a more critical eye. Am I reading them? Am I actually applying what I learn? If not, why am I still paying to receive the information?

You see, at some point, reading (and the consumption of yet more information) is simply a way to avoid taking action. It becomes an escape behavior.

This is why it's so important to choose carefully who you listen to... whose suggestions you believe are worthwhile... who is actually adding value to your life. Select a few premium sources and cut off the rest.

Otherwise, you may find yourself drowning in information, yet still thirsty for progress.

Think about the concept of opportunity cost. What are you doing right now? What is it costing you? What could you be doing instead that would add more value to your life?

Comments

[Mike Munro]

I think that we should also look at this from the other perspective though. Using a monetary analogy, everything that has a cost also has some sort of value. And rather than always focusing on cost, sometimes it may be more important to appreciate the value that an activity offers instead. For example: In the context of life in general, I'm sure it's hard to think of any kind of cost (which seems negative) associated with spending time with your kids.

I realize that here, the idea of opportunity cost is offered more in the context of professional productivity. But I just worry that we'll forget the importance of down-time if we start to meticulously quantify the cost of all of our daily activities.

Though I will admit that I could have gotten some of my own work done instead of posting this comment. But then again, seeing as this is the first comment that I've ever posted on a blog, it has real value for me too :-)

Cheers.

[Chris Lake]

The self-imposed pressure to be informed has victimized me too. I finally gave up watching TV altogether and just watch a few shows via download. I quit taking the paper and resist the impulse to read magazines unrelated to work. I reserve my reading time off-work to things I enjoy, not so much to learn from. If we don't make time for ourselves (which I think is what the topic boils down to) nobody else will. Focus on the big things and let the minutiae wait--it often goes away or becomes irrelevant.

Good luck to all who seek the right balance of hard work and play.

[Stephen]

Right on! You know I'm going through the same thing right now, and even struggling a bit. BUT... improving day by day.

[John A. Manley]

I know what you mean about the magazines. I used to subscribe to a few, way back. They often offer a good introduction to a specific field, but it stops there.

Seems every article is catering to the fact that someobdoy may be reading this for the first time. Also, everything is so short, it never gains any depth.

John
http://www.RealityCopywriting.com/true_stories

[Perry]

Ryan,

You are absolutely correct. I only clicked on the link in your email because this is a topic close to the top in my life right now. I have unsubscribed from at least 50 ezines in the last 6 months and I don't read many of the ones I get now. I still waste incredible amounts of time on email and other tasks that steal time from what's truly important. I have let most of my magazines go also. I'm dropping most of my investment newsletters as well. I'll keep two because I make money off those, the rest are going away. I can't give up books though. Although it's been at least a month since I picked up any fiction. Great topic. Thanks.

[Perry]

Ryan,

You are absolutely correct. I only clicked on the link in your email because this is a topic close to the top in my life right now. I have unsubscribed from at least 50 ezines in the last 6 months and I don't read many of the ones I get now. I still waste incredible amounts of time on email and other tasks that steal time from what's truly important. I have let most of my magazines go also. I'm dropping most of my investment newsletters as well. I'll keep two because I make money off those, the rest are going away. I can't give up books though. Although it's been at least a month since I picked up any fiction. Great topic. Thanks.

[Chad]

The only reading materisl I utilize now are two trade magazines to help improve and build my business and the weekend paper to stay up on the week's events. That's not to say I wasn't in that same boat.I never really thought of it as a "cost" but just as something that was consuming my time that could be used for better, productive, life enjoyment tasks. (i.e. - spending time with my wife and kids,marketing my business, etc.)
That is a good way to look at it though. Not from just a business standpoint but also from a life fulfillment view.

grins,

[Eldo Barkhuizen]

Hi Ryan

Such a wise way to go!

When this hour is gone, it's gone forever -- and what you could have achieved in this hour is lost for eternity.

I have a saying: "Look after the minutes, and the hours will look after themselves."

In other words, be meticulous about how you spend every minute, and you won't have to worry about the big picture.

Here are some sayings I've culled from C.R. Lightfoot, *The Handbook of Business Quotations* (Gulf, 1991):

"To choose time is to save time" (Francis Bacon).

"A man must be master of his hours and days, not their servant" (W.F. Book)

"Regret for time wasted can become a power for good in the time that remains" (A. Brisbane)

"An inch of gold will not buy an inch of time" (Chinese proverb)

"Everyone has his day and some days last longer than others" (Winston Churchill)

"Every man's greatest capital asset is his unexpired years of productive life" (P.W. Litchfield)

"Much may be done in those little shreds and patches of time which every day produces and which most men throw away" (C. C. Colton)

"It is the wisest who grieve most at the loss of time" (Dante Alighieri)

"Time is really the only capital that any human being has, and the one thing that he can't afford to lose" (T.A. Edison)

"From time waste there can be no salvage. It is the easiest of all to waste and the hardest to correct because it does not litter the floor" (Henry Ford, Snr.)

"Nothing is worth more than this day" (J. W. von Goethe)

"At the beginnning of every day we're all given 86,400 seconds. As each one ticks by, we've lost it forever in every way unless we find a way to invest that moment in the future" (T. Hopkins)

"Our greatest danger in life is in permitting the urgent things to crowd out the important" (C.E. Hummel)

"One man gets only a week's value out of a year while another man gets a full year's value out of a week" (C. Richards)

"It takes time to succeeed because success is merely the natural reward for taking time to do anything well" (J. Ross)

Best

Eldo

[Ray Edwards]

It's not all about elimination of activities; it's also about choosing the right ones to eliminate, and the right ones to keep (or add) -- as Ryan clearly says in his post.

One book worth reading (which speaks directly to this issue) is The War of Art, by Steven Pressfield. It deals with what I think is at the root of most of our unproductive activities: resistance.

Thanks for a stimulating discussion Ryan. Now... was reading this and responding a form of resistance?

Not for me.

How about for you, Intrepid Reader?

[Copywriting Maven]

Ryan, generally I'd agree with you. The only caveat I'd add is to allow for informational serendipity. Sometimes you just never know what you'll find.

[Cory Fossum]

I spent 3 hours last night watching the new movie Grindhouse.

I didn't learn a thing. I didn't take away a single bit of marketing knowledge. I am no wiser because of it.

I missed out on 3.5 hours of work or 3.5 hours with my family. I didn't exercise. I didn't interact with anyone accept my buddy who joined me. I drank a $3.50 bottle of water. I was out $25 at the end of the night.

And I wouldn't have traded it for the world!

My juices are recharged this morning. I laughed my tail off for 3 hours straight and had a huge vicarious endorphin rush throughout the movie.

I will be more productive today because I gave myself time to enjoy the "freedom" that we all do this for. And I had a blast.

Sometimes it's a movie. Sometimes it's a TV show. Sometimes it's a trashy celebrity magazine. But I simply can't do marketing 24 hours a day.

Whenever I pay too much attention to the opportunity costs of living the fun part of my life, I start to go bananas. And I actually do this most of the time. The result is that I literally don't sleep very well.

But last night I slept great! Mostly because I was exhausted from 3 hours of cinematic awesomeness. But also because I gave myself permission to forget about opportunity costs and go have some fun and let my brain rest for a while.

[Ryan Healy]

Great input, Cory! I often think about how to get more done faster. But what's the point of doing more faster? It's to have time to kick back and relax.

You've got to do that every now and again... preferably every day. :-)