We left it yesterday with, “what does it mean to leverage leadership?” What it means is that we invest more of our time on leadership activities that generate bigger returns, and we spend less of our time on other activities that generate smaller returns. Investing versus spending. Here’s a money example. You have $10,000 in a savings account. With a rate of 0.05% you will earn about $50 in profit over ten years. The S&P 500 has historical annual returns of well over nine percent. If you got that over nine percent annual return on your $10,000 for 10 years, you will get about $16k in profit. Same capital. Same period of time. Bigger returns. We want to do the same thing as leaders. Invest more of our time where we get the bigger returns, and spend less of our time on “savings account” filler stuff. The investing of time in the “right things” is the leverage. All of this leaves us with another question. What leadership activity investments should we be making? That is for next time in post 4 of our series.
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