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SUNK COST

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Sunk Cost
By Colle Davis

Your past is not important. What you learned from your past is invaluable.

Everything paid for in the past is termed a ‘sunk cost.’ That cost is no longer useful or accurate. The impact is confirmed on a spreadsheet, BUT the effect has worn off, and a new perspective is available.

Key Takeaways Regarding Sunk Costs From Investopedia.

  • Sunk costs are those which have already been incurred and which are unrecoverable.
  • In business, sunk costs are typically not considered when making future decisions, as they are seen as irrelevant to current and future budgetary concerns.
  • Sunk costs contrast to relevant expenses, which are future costs that have yet to be incurred.
  • The sunk cost fallacy is a psychological barrier that ties people to unsuccessful endeavors simply because they have committed resources to it.
  • Examples of sunk costs include salaries, insurance, rent, nonrefundable deposits, or repairs (as long as each item is not recoverable).

Wisdom has a price. The more mistakes you make, if you do not repeat them, or die, the more knowledge you gain. Learning to take risks is an art form. Coaching gets you through the tricky part of ensuring the rewards are worth the investment.

The cost of an education or credential is to get in the door of an organization. Once you are granted entrance and have gained some experience, their value goes down; see, there is the sunk cost. There is no way to retrieve the money, but you retain the knowledge, contacts, and skill set necessary to graduate or get the certificate.

 My clients range from their mid-thirties through their sixties, and when we explore reaching their outcomes faster, they have all the experience and knowledge they need to do their job, their boss’ job, and in many cases, their boss’ boss’ job.

Stepping up to make the ask for a promotion, laying out the requirements to step into their boss’ boss’ job, and filling in the resources to take the job, is easy. At least, more accessible than most people believe.

Stepping over their boss or becoming a more prominent presence in the company and industry requires learning new skills and techniques for leveraging themselves into a more significant leadership role. 

What has to happen for you to get what you want in the next two years?

  1. You must know the target so your subconscious can work on it full-time.
  2. Begin to practice the skills and put in place the resources you need to take over that position.
  3. Expand your network to build your profile in the industry you want to play in for the next few years.

Is the process that simple? Yes, ad that process becomes much faster with a good coach, a supportive team, and some quick results using the new knowledge.

Can you do it alone? Sure, and it will take five to ten times as long.

Your choice. Do you use those sunk costs to your benefit, or let them drift away and become useless? Easy, right?

1st Suggestion: Don’t tell anyone what you are doing until they ask what has changed in you. You see differently. Their question is your validation that your work is having an impact.

 2nd Suggestion: My Coach’s Notes are listed on our webpage. They are also posted on LinkedIn if that is your playground. Use the information found in them to leverage who and what you are and want to become.

3rd Suggestion: Hire a great coach this month and reap the rewards of your investment in the next quarter or two.

https://www.theatlantic.com/magazine/archive/2018/09/cognitive-bias/565775/

 

For more tips and tricks on being a great leader, set up a Zoom session, email cdavis@mycoach.com or give me a call at 804- 467-1536 EST.

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