You need to create outsized value to get outsized returns

Work and rewards may not be correlated the way you think. Confusing effort and results is pretty common nowadays. Very few people are willing to pay exceptional money for effort. A lot of people are ready to pay it for results.

Do you like giving out money? I don’t. And I’m willing to make a bet your boss doesn’t either. So I think it’s time for a reality check. Out of those twenty apps you have on your smartphone, how many are you paying a premium on? Maybe five at best?

Think deeply about why this is the case.

We don’t reward efforts, we reward results

A lot of people seem to believe fairness is a one-way street. It’s not. You need to give to get, and often times, the giving needs to happen first.

Money is almost a religion now, so it’s easy to forget it’s actually a trade mechanism. I give you some money, and you give me some results. I give you more money, and you give me more results. As long as we’re both satisfied, we’ll keep making the trade.

Somewhere along the lines, things got blurry. I believe this is due to the inherent nature of knowledge work and our difficulty to differentiate between profitable and unprofitable work on a per-person scale.

Understand where your salary is coming from

How does your company make money and what part are you playing in that story? I’ve met a lot of people who don’t understand this. Or they never think about such things.

Often times, the people who misunderstand this the most, contribute the least to the company bottom line. How can you allocate your time well if you have no idea where the time should be allocated? How can you excel at your work if you don’t understand what you’re getting paid to do?

You’re paid to solve problems, not write code and run CI pipelines. As a matter of fact, both of these are a direct cost to the business. Code takes time to write and maintain, while the CI pipelines take resources to run. The business will be profitable if we make more money on that code than we put into it.

The same logic applies to every meeting, document, conversation, Slack thread, etc. You shouldn’t be impressed by a 10K LOC system. You should ask yourself whether we’re making or losing money on it.

You need leverage, not simply more hours

We’ve made sure that the business is at least breaking-even on our salary. But break-even isn’t the goal. That’s the bare minimum to stay employed.

If you want outsized returns such as promotions, equity, substantial bonuses or reputation, you need to generate surplus. You need to be one of the people whose output creates room for others to simply break-even while the business remains profitable.

You don’t 10x your salary by working 10x harder. You get it by creating 100x impact.

Leverage doesn’t mean doing more. It means doing more of what matters. These are the things that move markets, unblock teams, or save the company from making a bad bet. It’s solving real problems instead of polishing the easy ones.

Your compensation is a trailing indicator. Value comes first, returns come second. So if you want to change what you’re getting, change what you’re giving. Be ready to give first and give a lot.

And as always: ship value, not code.