029: How to Determine Your Value at Work – In Dollars [Podcast]

What if your value at work was measured in dollars? What if someone took how much value you added to the company and subtracted it from how much you cost in salary and benefits? Someone is. But, do you know what the numbers are? Do you know your value?In this podcast I will show you how to find a real number so you can actually calculate your value. Just think how powerful it would be to show someone on paper that you add a substantial financial value to your employer! Photo courtesy of Flickr/Creative Commons/qthomasbower [/featured-image]Click to Listen*NOTE: If you are reading this in email, you will need to go to Itunes or my blog to get access to this show.Finding Your Value at WorkThe steps to this are pretty easy to imagine, but doing it is a lot harder. So we will start with the easy stuff and move up.Understand the Goal: First, get a clear picture of what you are trying to calculate. If you are operating as a Company of One (a service provider to your employer), then you need to be able to show value to them on their terms. While their terms may vary, money always speaks. So this is easy. How much profit do you bring? Here is the basic idea:MeRevenue (extra revenue or savings you bring)- Cost (Your Salary and benefits)-----------------------------------------------------------------MeProfit (Value you bring)Now it goes without saying (I hope) that your "MeProfit" needs to be greater than zero. In fact, it should be substantial. My rule of thumb is that your value to your employer (MeProfit) should be at least two times your salary. Create a Word Formula: Get a clear picture of what you do to add value. I do this is a word formula. Write down, in words, everything you do that you think adds value.In a recent example, a support engineer gave me these as part of her word formula. She actually had 10 items, but for sake of brevity I will just work with two.Installed software ahead of schedule (save labor)Located and tested new integration tools reducing equipment cost per locationFor your word formula, you might have a few or dozens of items.Find the Value of Each ItemTake the first example and get a value.Installed software ahead of schedule (save labor)Saves approximately $6,000 in labor costs with early installLast year installed SW at five plants within three weeks, two weeks before scheduleTotal Savings = $30,000 Now these numbers are not magic. They took her a little research and some good educated guesses. In her case, she knew a software install required trucks and teams to be dispatched to the locations. And her company knew the cost of moving a truck as well as the average cost per man-hour. So, using these numbers she came up with a cost saved. Not bad, one thing she did saved the company $30,000. Now consider her second value.Located and tested new integration tools being installed at sites therefore reducing equipment costSaves approximately $5000 per site installApproximately 20 sites have new integration tools installed that I researched and testedTotal Savings = $100,000Now assuming she makes $70,000 per year with 25% benefits, in two items she is over her salary and benefits.I am not including the other items here, but you get the idea. Once she was done with all 10 items, she had generated a cost savings of $250,500 per year to her eDale Callahan, Ph.D.Business Coach for Professionals Ready to Take Control Helping you move from stuck to in-demand — or start something of your own. Grab the Idea Engine: 7 prompts to find your next move Book a Next Step Strategy SessionDirector of Engineering Management @ UAB (205) 790-8447 dalecallahan.com LinkedIn

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