As a followup to my earlier article about confusing worth with value, I wanted to share a simple formula I learned from supercoach Michael Neill on how to analyze—and thereby increase—your value in the marketplace.
He called it Scope, Scale, and Scarcity.
The formula is easy. Determine where, on a scale of 1 to 10, you rate in each category. Then multiply those numbers times each other. The higher the product, the more likely you are to be well paid.
But first we need to define the terms.
SCOPE refers to the relative impact you have on an individual or industry. Low impact, like flipping burgers, rates a lower score. High impact, like brain surgery—literally a life and death situation—rates a higher score.
SCALE relates to the quantity of people you affect or reach. Fewer people, lower score. Many people, higher score.
SCARCITY describes relative level of uniqueness of what you do. Common, pedestrian, or ubiquitous jobs rate low. Unique or one-of-a-kind jobs rate high.
Here are some examples:
1. Fast Food Worker
Scope: 1 – impacts people very little
Scale: 3 – helps a fair amount of people each day
Scarcity: 1 – pretty much anyone can do this job
Overall score: 3
2. Brain Surgeon
Scope: 10 – high personal impact; literally saves lives
Scale: 1 – directly helps a small number of people
Scarcity: 8 – not a common job, but not uncommon either
Overall score: 80
3. LeBron James, NBA basketball superstar
Scope: 2 – provides entertainment, but usually not (although possible) life-altering
Scale: 10 – potentially reaching millions of people
Scarcity 10 – There is only one LeBron James
Overall Score: 200
Using the formula, we can see in the examples why some people are well paid and others are not. Note, these overall scores are not a directly-correlating, dollar-for-dollar scale. They merely indicate the relative reason why one person may be compensated more (or less) than another.
If you want to increase your earnings, look for ways to improve your scope, scale, or scarcity. If you want to launch your income into the stratosphere, upgrade all three.