Generally, this terminology is thrown around in the network marketing (or multilevel marketing) industry. Basically, income generating activities refer to the actions we take that have a direct impact on our current (or future) income. When you're trying to build a business, there are 1001 things that need to be done. Only a percentage of those actions are directly connected to your earnings. Typically, people who do well financially with their businesses are those who invested adequate time on income generating activities.
This idea of focusing on income related activities is extremely powerful. It has the ability to increase our financial results by 10X. If your income remained pretty consistent in 2016. It's probably because you weren't actively seeking out income producing actions. Sure you probably had a busy a year. But many of those actions didn't have a lasting impact. In 2017, let's try something different.
The idea of shifting your focus into incorporating more income generating actions applies to you whether you own your own business or you work for someone else. If you are employed it's a bit trickier but very doable.
Basically, as an employee, you are responsible for carrying out the tasks and work assigned to you. Unless you work in a sales type role, your actions don't directly impact the company's top line which makes it harder for you to engage in IGAs. In your case, income activities are the one's that will likely result in a promotion. In order to do that, you have to differentiate between your normal everyday work and that which helps you to move to the next level. Typically, that means developing your leadership skill set. There are other activities you should be engaged in that will have a direct impact on your earning potential. Being really, really good at your job does not mean that you'll automatically be perceived as someone who should take on more responsibility. If you aren't clear on what those activities are, have conversations with your supervisor or the people in the role that you want to have. Bottom line is that 100% of your focus should not be only on your daily activities. Activities are very temporary and they don't create the right long-term outcomes.
When I first entered the workforce, my main responsibilities were to do payroll, and a bunch of other administrative stuff. My boss, on the other hand, ran large meetings and challenged upper management on how to make the workplace more effective. That's when I shifted my focus towards being a stronger presenter and read countless books on how to manage employees and impact work culture. To me, those were income generating activities. And they resulted in several promotions, and a huge increase in income, in a short period of time.
As an entrepreneur, engaging in income generating activities is crucial. If I don't manage my time and focus properly, my revenue suffers.
I've talked to and coached several new and would-be entrepreneurs and the biggest mistake they make is failing to focus on the very actions that will put food on the table. They spend lots of energy on the "other stuff" that needs to get done. A bunch of time passes and they give up on their passion because it failed to produce results.
Part of the reason why we avoid doing IGAs is because those actions typically take us outside of our comfort zone. It means placing more sales calls, spending advertising dollars, or increasing our marketing efforts. Instead, we spend our time answering emails, tweaking our website or other administrative stuff.
One thing I urge you to do is identify your income generating actions. You can take a sheet of paper and draw a line down the middle. On one side you write your income earning actions. Everything else will fall under the non-income category. Chances are, the income earning list will be much shorter than it's counterpart. That's ok. We just need a clear idea of what they are. Not all income producing actions are created equal. So it's important to identify which bring in the most revenue.
From there you prioritize your income producing work over the non-income producing. The 80/20 rule states that 20% of our effort will produce 80% of our results. The 80% still has to get done, but it will give you a much smaller reward.
Nowadays, when I've compiled my to-do list, I double check to make sure that it isn't full of routine tasks. Those tasks still have to get done but they don't really create forward movement in my business.
Before I started writing this post, I made sure to complete a couple of actions that will likely generate income in the near future. My intention is to make this a daily habit. A coach of mine once said that the results we experience today are the result of the level of action we've engaged in over the past 90 days. I'll be honest and say that for some of that time, I completely lost focus on my true priorities. Once I got back on track, my revenue improved almost instantly.
Make 2017 the year that you get closer to financial freedom by focusing on the activities that matter most.