In recent weeks, I have been thinking about income and how people generate it. I have observed that most people generate income in 5 ways:
- Raw Strength:
This refers to people whose primary source of income is from the exertion of physical effort or the result of the sweat of their brow. These are the kind of people who make money through sheer hard work. E.g. laborers, hawkers, traders, etc. They make the lowest level of income. Most people in the Third World generate income by this means.
- Rewarded Certificate:
The second level of income generation refers to people who depend largely on a certificate they acquired from school; their main source of income is from a job that was secured through a degree or diploma that they have. They do not command any specific skill or expertise. Most fresh graduates operate at this level. Unfortunately, there are also many people who spend years in the world of work but do not go beyond this level. Such people earn only what their certificate permits them to earn.
- Relevant Skill:
This group refers to people who build a specific strength, expertise or competence. They become great at doing something in particular and or even own a small business that is reputed for something. Such people have more market value and higher bargaining power than those at the level of Rewarded Certificate. They may not even have a certificate but their skill and dexterity paves way for them. They earn more than most people do, especially more than people in the first two levels. They are the ones who get headhunted by other firms.
- Robust Brand:
If a person who operates at RS is strategic about managing his reputation and promoting his services, he eventually becomes a brand; he owns the minds of people for a particular market segment or product category. When their name is mentioned, many people can point to what they are known for. They become widely known for a product or service. This is one of the highest levels a person can operate at and naturally most people never get there. But it’s a level that is associated with great market value, high income and impeccable influence. Needless to say, people at this level earn more than those in the subsequent levels.
- Rich Business:
This level refers to people who generate income from a business that they started. They start a business that grows to become a big cash cow. They may also not necessarily be the founder of the business. They are intrapreneurs who are extremely skilled at managing businesses and make a fortune whilst doing that.
Three Questions I leave with you:
1. What level are you operating at now?
2. What level do you want to be at?
3. How are you going to get there?
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