The 3 Steps to Increase Your Life Margin as an Independent ConsultantApr 21, 2022
In the video I reference a "Friday AM Stand-Up for Consulting Business Owners." If you want to catch that on (most) Fridays, it's live on my LinkedIn profile. Be sure we're connected there.
When we talk about consulting margins, the most common are:
- Gross profit margin
- Operating profit margin and
- Net profit margin
But, there's a fourth type of margin that is overlooked by almost every consulting business owner.
It's the life margin.
OK, this isn't an official finance or accounting concept.
But, it is a concept my fractional CFO shared with me. As we were going over my 12-month plan, he started asking questions about
- my service offerings,
- the amount of time I'm spending working in my business vs. on my business,
- the amount of space I create in my business to develop new intellectual property and service offerings and
- how much time I carve out for life outside of the business.
Through this conversation, he was able to help me find 3-4 areas where I could increase my life margin without sacrificing anything in my business.
So, in today's article, I'm going to share the process for you to increase your life margin like I was able to via the advice from my fractional CFO.
What is Consulting Life Margin?
Richard Swenson M.D. describes margin in his book Margin: Restoring Emotional, Physical, Financial, and Time Reserves to Overloaded Lives as:
Margin is the space between our load and our limits and is related to our reserves and resilience. It is a buffer, a leeway, a gap; the place we go to heal, to relate, to reflect, to recharge our batteries, to focus on the things that matter most.
So, as a consultant, your life margin is that space between the time you're working (both on your business and in your business) and the time when you're not working on or thinking about your business.
Who Controls the Consulting Life Margin?
If you're like most corporate employees, you got very good at fitting all the things around your work.
You were constantly
- Even pretending to be present at home when your thoughts were consumed by work
But now, you’re a business owner.
You get to decide how you want your overall life to look, including how much time you spend working and what you're doing during that time.
There are no more rules for you.
You make the rules.
Step 1: Define Your Version of Life Margin
Since you have full control, the first step is to define your life margin.
You have 24 hours in a day, 168 hours in a week, etc.
How do you want to spend them?
Establish the ideal # of hours you'll spend on each category of life that's important to you:
- Delivering for clients
- Working ON your business
- Family time
- Personal time
Step 2. Ask "How Can I Achieve My Life Margin?"
Now that you know what you want your life margin to be, and how you'll use it, the next step is to align your business to that goal.
Here are some questions to ask yourself:
- Where is your current business model out of alignment with your overall life margin?
- What opportunities are there to increase your life margin?
- What business adjustments will increase your life margin?
Step 3. Align Your Business Model To Your Life Margin Goals
Now that you know what you want your life margin to look like, the next step is to align our consulting business model to that vision.
- Does my current consulting business model naturally align to the goals I have for the way I live my life?
For most consultants, the answer is no.
Is your answer no?
Given you're a consultant, I can safely assume you're very skilled at figuring out solutions and how to "make things work."
But, being skilled at making whatever "hand you're dealt work" is very different from figuring out how to live intentionally, in the exact way you want to.
Ask yourself: what changes can I make to my business model so that I am (1) creating results for my clients and (2) doing it in a way that creates the life margin I want to have.
Here are a few suggestions for adjustments to your business model, to create more life margin:
- Shorter engagements that allow room in between
- Leveraging sub-contractors
- Contracting an assistant to support you
- Establishing a 4-day work week
- Clarifying and setting client expectations re: your availability and response time
You're an independent consultant for a reason! You want to have the flexibility to work and live on your own terms.
Creating your vision for life margin, and implementing the changes to enable that vision to become reality, is one of the most important initiatives you'll undertake as a business owner.
It is almost always the difference between you inadvertently recreating the life you had in corporate versus creating the new life where you're living (and working) in exactly the way you want to be.
And Finally...To Put This Into Action
There are two ways to put this concept of Life Margin in place in your business:
1) TAKE the IC Business Predictability Assessment
After you answer the assessment questions, you'll receive a personalized report that highlights areas of opportunity for your consulting business.
It also includes resources and recommendations so you know exactly what to do next, to improve your business scores, and ultimately increase your income and increase your impact, all while creating more flexibility in your life.
2) BOOK A CALL to grow your independent consulting business