As nonprofit executives, we often undervalue our time.
We accept pointless meetings to be polite. We spend time on mundane or administrative tasks that others are responsible for. And we can have hours of conversation to make a trivial decision.
Time is our most precious resource. We can’t squeeze more hours into a day, and every year has about the same number of workdays. For this reason, I will often ask my clients, “What is an hour of your time worth?” I get one of three answers:
- The amount they get paid per hour, based on a 40-hour week: “I make $80,000 a year, so I guess about $40 to $41”
- The amount they would personally pay to get an hour of their time back: “I would pay $75 per pay period to accrue an additional hour of PTO”
- Uncertainty: they express not knowing how to value their time.
A CEO is ultimately responsible for every dollar that comes into the organization. So, in fact, each hour of their time has a value proportional to the total budget. Here’s an example:
Jane serves as the Executive Director of a local nonprofit organization with a total budget of $1.1 million. After vacation and holiday time, she works 46 weeks out of the year and would like to work 40-hours per week while also taking time off. For this reason, her goal is to work about 1,840 hours (46 weeks x 40 hours). Jane has a contract grant writer and a full-time development manager who helps generate revenue. But she is ultimately responsible for the $1.1 million in revenue necessary to operate. If the organization has a deficit of $250,000 this year, she can’t blame it on her development manager. What’s more, if that shortfall interrupts the organization’s ability to make payroll, she can’t scapegoat her grant writer and tell staff “it’s not my fault.”
For this reason, Jane should divide her total budget of $1.1 million by the 1,840 hours she works each year. When Jane does this quick equation, she is surprised to learn that an hour of her time is valued at an average of $598!
If you’re a grant writer or development professional, you can use this same method. But instead of considering the entire agency’s annual income, use the amount of money you are personally responsible for raising. As an example, a grant writer responsible for raising $300,000 in grant funds each year should value their time at $163 per hour ($300,000 divided by 1,840 hours).
Realistically, we know that every hour we work doesn’t actually generate 1/1840th of our annual budget. And you’ll always need to make time for a team member in crisis, a disgruntled board member, or an operational emergency. But knowing the organizational value of your time can help you better divide the hours in your days.
As Jane’s mindset started to shift, she realized that delegating tasks to others was essential. She assigned someone on staff to manage social media, stopped hosting unproductive meetings, and hired a virtual assistant for ten hours a week to manage her calendar and keep her on task. At first, these seemed like indulgent luxuries, but Jane was surprised at how much more productive and effective she was at her job.
Once Jane better prioritized her time, she also stopped needing to work most weekends and was able to take all of her PTO. Being more productive at work had a direct impact on her personal life.
I know not everyone loves to do math. So I’ve created a spreadsheet that you can use to calculate the value of an hour of your time. Enter the amount you’re responsible for annually, the number of PTO/vacation days you receive, and the number of holidays your organization takes. It’s that simple.
Easy Value of Your Time Calculator
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Why am I writing about this?
Through my coaching work with nonprofit executives, I have found that many chief executives and development directors undervalue their time. This causes them to take on too much and feel like their jobs are overwhelming and impossible. By helping them focus their time and attention, they and their organizations become more successful.
If you are a nonprofit executive looking for a coach, reach out to me at www.successfulnonprofits.com.
Additionally, check out the following Successful Nonprofits® resources if this post was helpful:
Podcast: Bringing New Levels of Meaningful Organization into Your Life with Emily Parks
this is great. One of the ways nonprofit executives should especially look at this is: if one hour of your time is worth, say $500, should you really be running around organizing a little community event that’s not going to raise any money and it’s not going to get you in front of potential great donors. Or should you be stuffing your own envelopes when you can outsource it and you can focus on making some phone calls to your donors and get in front of them. So many better things to do with your time.
Hey Erica – completely agree with you! Especially when it’s so easy to get a virtual assistant to help for 10 hours a week and volunteers who want to stuff envelopes for you – – – nonprofit executives should avoid spending their precious and valuable time on tasks with very little ROI. – Dolph