Comments on: Your relationship to time and money http://www.lifebeyondcode.com/2006/01/31/your-relationship-to-time-and-money/ Personal and professional development for technology professionals. Thu, 18 Mar 2010 22:49:12 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: Anonymous http://www.lifebeyondcode.com/2006/01/31/your-relationship-to-time-and-money/comment-page-1/#comment-479 Anonymous Wed, 01 Feb 2006 13:58:00 +0000 http://www.blog.lifebeyondcode.com/2006/01/31/your-relationship-to-time-and-money/#comment-479 Brilliant analysis Bill! Thanks for sharing it with us. Cheers, Raj Brilliant analysis Bill!
Thanks for sharing it with us.
Cheers,
Raj

]]> By: Anonymous http://www.lifebeyondcode.com/2006/01/31/your-relationship-to-time-and-money/comment-page-1/#comment-478 Anonymous Wed, 01 Feb 2006 03:52:00 +0000 http://www.blog.lifebeyondcode.com/2006/01/31/your-relationship-to-time-and-money/#comment-478 I love the conclusions, Rajesh, about our willingness to invest time to help a friend vs. investing money in their success. However, my mind has been wrestling with the example. I think there's a complexity embedded in the narrative example that drifts away from your conclusion. Asking each of the four friends to contribute $100 1/4 of "Package Receivers' LLC" fee doesn't seem right. Assumptions: The package may be delivered during any of forty hours spread over four weekends. Each friend will wait up to ten hours, but will leave as soon as the package is delivered. There is an equal chance (2.5%) that the package will be delivered during any hour. If the package arrives, the friend who receives the package will inform the friends that going to the library on subsequent Saturdays will be unnecessary. Each friend values their time at $20/hr and would have 5 productive hours for a value of $100. Friend #1 (1st Saturday) Chance that the friend won't need to go to the library to wait = 0% Chance that the friend won't have to go to the library = 0% Chance that the friend will spend ten hours at the library = 77.5% Friend #2 (2nd Saturday) Chance that the friend won't need to go to the library to wait =25% Chance that the friend will spend the entire day at the library = 52.5% Friend #3 (3rd Saturday) Chance that the friend won't need to go to the library to wait = 50% Chance that the friend will spend ten hours at the library = 27.5% Friend #4 Chance that the friend won't need to go to the library = 75% Chance that the friend will spend ten hours at the library = 2.5% (package delivered during the last hour). If we're calculating opportunity costs for each friend, then all four friends have made differently weighted commitments. Friend #1 will likely (but not definitely) spend all ten hours waiting at the library. Friend #4 has made an "if-you-need-me" commitment. In your example, friend #1 may see $100 a great deal to honor a commitment and regain time for themselves. Friend #4 may see $100 as an unattractive proposition when compared with the small chance that they will be at the library all day. If you want to eliminate the variable of time, maybe John is waiting for a package that will be delivered on a Saturday at one of four locations--his primary residence, his office, his cross-town studio on the other side of town, and his lake-house. Also, what if the friends in this scenario valued their time at different rates? I love the conclusions, Rajesh, about our willingness to invest time to help a friend vs. investing money in their success.
However, my mind has been wrestling with the example. I think there’s a complexity embedded in the narrative example that drifts away from your conclusion.
Asking each of the four friends to contribute $100 1/4 of “Package Receivers’ LLC” fee doesn’t seem right.
Assumptions:
The package may be delivered during any of forty hours spread over four weekends.
Each friend will wait up to ten hours, but will leave as soon as the package is delivered.
There is an equal chance (2.5%) that the package will be delivered during any hour.
If the package arrives, the friend who receives the package will inform the friends that going to the library on subsequent Saturdays will be unnecessary.
Each friend values their time at $20/hr and would have 5 productive hours for a value of $100.
Friend #1 (1st Saturday)
Chance that the friend won’t need to go to the library to wait = 0%
Chance that the friend won’t have to go to the library = 0%
Chance that the friend will spend ten hours at the library = 77.5%
Friend #2 (2nd Saturday)
Chance that the friend won’t need to go to the library to wait =25%
Chance that the friend will spend the entire day at the library = 52.5%
Friend #3 (3rd Saturday)
Chance that the friend won’t need to go to the library to wait = 50%
Chance that the friend will spend ten hours at the library = 27.5%
Friend #4
Chance that the friend won’t need to go to the library = 75%
Chance that the friend will spend ten hours at the library = 2.5% (package delivered during the last hour).
If we’re calculating opportunity costs for each friend, then all four friends have made differently weighted commitments. Friend #1 will likely (but not definitely) spend all ten hours waiting at the library. Friend #4 has made an “if-you-need-me” commitment.
In your example, friend #1 may see $100 a great deal to honor a commitment and regain time for themselves. Friend #4 may see $100 as an unattractive proposition when compared with the small chance that they will be at the library all day.
If you want to eliminate the variable of time, maybe John is waiting for a package that will be delivered on a Saturday at one of four locations–his primary residence, his office, his cross-town studio on the other side of town, and his lake-house. Also, what if the friends in this scenario valued their time at different rates?

]]> By: Anonymous http://www.lifebeyondcode.com/2006/01/31/your-relationship-to-time-and-money/comment-page-1/#comment-477 Anonymous Tue, 31 Jan 2006 23:38:00 +0000 http://www.blog.lifebeyondcode.com/2006/01/31/your-relationship-to-time-and-money/#comment-477 Thanks David. Coming from you, this is a huge compliment. You made my day! David needs no introduction. He is a foremost authority on professional services firms and he is one of my heroes. For several years when managing professional services organizations, I have used David's "Managing the Professional Services Firm" as the bible. Thanks again David. Cheers, Raj Thanks David. Coming from you, this is a huge compliment. You made my day!
David needs no introduction. He is a foremost authority on professional services firms and he is one of my heroes. For several years when managing professional services organizations, I have used David’s “Managing the Professional Services Firm” as the bible.
Thanks again David.
Cheers,
Raj

]]> By: Anonymous http://www.lifebeyondcode.com/2006/01/31/your-relationship-to-time-and-money/comment-page-1/#comment-476 Anonymous Tue, 31 Jan 2006 22:29:00 +0000 http://www.blog.lifebeyondcode.com/2006/01/31/your-relationship-to-time-and-money/#comment-476 Brilliant! You are a stimulating thinker and write superbly well. Brilliant! You are a stimulating thinker and write superbly well.

]]>