Cost and value. These two are related but often mistaken for each other. The cost of something has to do with what it takes to attain or posses it. Value has to do with its worth.
Cost doesn’t determine value per se. Both are very subjective. One of the main reasons is that value is generally something that is inferred.
Something can be more valuable to some because of the sentiments attached to an item. A particular pencil (I have no idea why I chose that… whatever…) may be worth a lot for John because from his great-grandfather, every child in their family has used it for the first week of school. Or his great-grandmother used it to write his great-grandfather love letters. Whatever… You get the idea.
Cost is what people pay to get “stuff” (whatever that is).
People tend to dismiss things as too expensive based on the price tag. When they do that, they got it twisted. Wrong. How you determine how expensive something is, is through assessing what you are getting for the price you’re paying.
That, is how you determine value of something. What are you getting out for what you’re putting in?
This is what informs whether anything is worth your while in time or spending.
“Cost” also evades many. For instance we tend to thing something cost us what we pay at the checkout counter. We often overlook other things attached to it.
For instance, we overlook the time it took to make the decisions to acquire. We don’t take into account that we used fuel to get to some place. We make the emotional energy involved in making a case for getting something instead of the other when speaking to our partners or friends.
Value is what you’re willing to pay. Cost is what you may be asked to get something in exchange.
The point of my rambling (not comprehensive):
Look for the hidden costs in what things really cost. Understand that value is subjective and never assume you place the same value on particular things.
Leaders who understand cost, holistically, make wiser decision for the long game. At the same time if they understand the value their (individual) team members place on things they are able to speak into that and lead better.
This is not only a leadership thing. It is a life and relationships thing as well. Think about it. Yeah, think about it…
Have you ever witnessed instances were you confused cost and value?
[Photo Credit: Sweet One]