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How Google’s 70-20-10 Ratio Translates to Small Business

Posted by Kasey Bayne on April 29, 2015 at 12:19 PM

When Eric Schmidt was CEO at Google, he went beyond their initial “Don’t be evil” rule and instituted the 70-20-10 ratio for innovation. It works pretty simply:

  • 70% of time should be dedicated to core business tasks.
  • 20% of time should be dedicated to projects related to the core business.
  • 10% of time should be dedicated to projects unrelated to the core business.

70-20-10-rule

Of course, it’s easy for a huge company like Google to allocate resources in this way. But when you run your own venture, the idea of spending 30% of your time on non-core business tasks seems crazy. The thing is though, it doesn’t mean that ratio won’t work for small businesses—you just have to tweek it a bit. Here's how to think about it... 

70% of Time Should Be Dedicated To Current Business & Administration

As a small business owner, you know you have to do the work to get paid. You absolutely should devote most of your time to doing the work that provides you with an income. This not only means working on the actual projects, but also managing the administrative duties such as accounting and invoicing and all those other not-so-fun tasks that must be done.

20% of Time Should Be Spent Growing Your Business

When you already have enough work to fill your days (and probably your nights), it can be challenging to remember you also need to pursue more work. But projects end, clients or customers move on and it can be all too easy to find you’ve gone from too much work to not enough to pay the bills. If you commit to spending 20% of your time finding new work, crafting proposals, and networking you’ll find you can avoid those down times more easily.

10% of Time Should Be Dedicated To Passion Projects & Education

Burnout is a huge problem for small business owners. A perfect way to combat this is to commit to spending a few hours each week working only on things you love. This could be a side project, pro bono client work, or testing out a new trend in your industry. In addition, it’s a good idea to also include time to keep your skill set sharp, whether that means attending webinars or local events or even conferences.

This formula might seem overly simple, but it’s a great guideline for keeping you on track, ensure growth, and prevent burnout. (There’s a reason Eric Schmidt was the CEO at Google for a decade.) If you want to grow and stay sane, give the 70-20-10 rule a try—and let us know how it goes!

http://whatsnew.kashoo.com/webinars

Topics: Small Biz Tips