One of the best known authors of financial literacy, Robert Kiyosaki, described in his book “Cashflow Quadrant”, what the main difference between a self-employed person and a business owner is: The self-employed person trades his time against money while the business owner creates systems and processes to continuously generate income detached from their personal time.

This description summarizes greatly what the main point of working ON your business is.

The self-employed person sells hours. They find new clients, sell their services by the hour and fulfill the orders. They are – according to Robert Kiyosaki – the players in the Cashflow game that suffer the most. They have no job security and are responsible for their personal income. Their maximum income is limited by their personal time and if they get sick, it hits them hard financially.

The business owner on the other hand, creates his business in a way that it can run without him. He creates organizational structures, responsibilities, systems and processes that can run any time.



A good example is the comparison of a small local restaurant vs. the big golden M-restaurant chain that we all know – the one with the clown.

The local restaurant is highly depending on their owner or chef. If he or she is sick, the restaurant has a severe problem. The fast food chain is always open. The central person in creating brand awareness, Ray Kroc, was not even a cook. He died in 1984 and the business never stopped running.

You may argue that you are not a huge franchise company and that this is not relevant to you but stay with me – you will see why this is relevant for you.

Most businesses start with a founder who risks a secure job by starting his own business and become self-employed. And there is absolutely nothing wrong with that. In the beginning, the founder will have to complete most tasks personally just to get the business started. The issue is that many self-employed founders remain in this working mode. They run their business the same way they started it 5 or 10 years ago. They still trade their time for money and the business relies 100% on the owner and his performance. If the owner isn’t doing well, the entire business suffers. Usually, such businesses close down because the owner retires or runs out of money. Self-employed owners mainly work IN their business.

To make the shift to the business side of things – which, according to Robert Kiyosaki, is the place you actually want to be, because you will be able to generate much more money with less time and less personal risk involved – you need to start working ON your business.




If we think back of the big golden M, what Ray Kroc did, is not to think like a chef, but to think: “If I want to take the business somewhere else and I can’t be there personally, what do I need to put in place to make it work?” What he did seems boring for many business owners because he documented every step and created checklists and guidelines. He defined roles and responsibilities for every job position in one restaurant. He installed reporting systems to track the correct implementation, which guaranteed that every new hire was trained to perform exactly as he wanted – even when he was not there.

He put his focus on making sure that the business runs without him. He monitored, corrected and intervened when necessary, but he wasn’t making the burgers. This is what working ON your business means!

In order to reach this status, you need a change of perspective. I know how this feels and that can be very tough for many business owners. It’s your business, your baby. And I understand that you don’t like to give it away. But just as with children, you need to give it space to grow and not micro-manage it. Be the leader and not the soldier. Don’t make the burgers! Build a system that makes you money. – What is your vision for your company? Where do you want to take it to? How do you want your business to look like?

The jump from being self-employed to having a business requires thinking strategically, systemizing your business and building teams to implement your vision – or in short: It requires to WORK ON YOUR BUSINESS.

This article was originally published in Business Booster Today on September 23, 2019. Read the original post here

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