Ask yourself again if you have or have not grown yearly based on the explanation while not focusing on the fact that we do not control the value of the naira. We need to keep growing so that we can leave a positive legacy for the next generation even if our past leaders left us with nothing. Secondly, focus on inflation – the general rise in prices without a corresponding rise in production level.
This is an area of focus because we need to ask ourselves what we have truly achieved. Inflation is a cost to you and you must begin to pay attention to it.
A simple example is that if the cost of items were, for example, N100 in 2015 and these items now cost N110, it means inflation is 10 per cent.
In this stead, if your income remains at N100, you will not be able to afford the items. If your investment did not generate more than N100, you would not be able to afford the same item and your investment would have reduced. Can we see why we must understand and constantly ensure that we know what the general prices are really telling us? As an individual, it means it will teach you to generate more income either from your employment, business or from other sources.
As a business entity, it means that you understand that your revenues have to be higher than that increase in prices. Otherwise, you have underperformed in real terms.
We need to focus on growth while understanding one of the cost elements that could assist that process. Our ability to grow our revenue and ensure that prices are either reducing or stable is the source of our wealth or ability to continue to grow.
Please note that if you are not growing, you are dying.
Time itself is a cost and time enables us understand that we must be compounding our revenue and our investments. Each passing day means that we ought to have increased because time keeps counting. Such a count means progress. If for example your average income was N1 per minute last year, you should be earning something in excess of N1 this year to show that you are learning and that the additional time given to you is worth it.
This is why we must keep measuring where we are, what we are doing, and understand why we are doing it for the purpose of growth. Growth is a law we must be aware of especially because we know that the price of not growing is death! We ought to keep pursuing increasing returns. A culture developed where we drive a focus on growth is not easily replicable by any competition.
This is more so, if we understand what results in our costs and what we do to make money and grow wealth that is peculiar to us. If the competition tries the same, they may be making a mistake as their cost construct may be different and their revenue source also different.
However, the focus on compounding what we have that is peculiar to us is the root of our success and peculiar growth in wealth. Therefore, begin to pay attention to growing revenue over and above the costs that you incur
on an annual, quarterly, monthly and daily basis. Determine your personal inflation index (i.e. cost assumption) in the first instance but this must be equal or higher than inflation rate.
Concept of marginal contribution and the time value of money in growing wealth.