Ryan McLean : Slightly Unconventional

#24 Sunk Cost Bias Friday 17th July 2015

iniartworksmallSomething you need to be aware of when running a business or doing projects is something that is called sunk cost bias and that is something that I am kind of dealing with the last couple of days.
Sunk cost bias basically means you make rational decision based on the investments that you have made in the past. So rather than saying, Okay, looking from where I am now, what is the best thing I can do to move forward and to move my business forward? You say, Well, I have already invested so much into this certain business idea it seems silly to give up now.
I remembered this happened to me when I was in Bible College. I was doing my third year of Bible College and I was burnt out emotionally, spiritually, physically.
I was getting sick all the time and I got engaged and we really had a big weekend celebrating and that kind of just made me realize, Okay, I should not be doing this. I should not be in Bible College. And I decided to quit right that weekend. I have been thinking about it but not really considering it and I decided, Okay, that is it. I am done. And I quit. And everyone was saying to me, You know, you have already done 3 years.
Is another 4 to 5 months going to be that bad? Why should you not just finish? And that is a good example of sunk cost bias, you think, Okay, I have put so much into this I may just go ahead and finish it even though it is not going to lead into an outcome that I want at all. An example from right now is the Podcast Fast eBook that I have been working on. I have probably spent 1 to 2 weeks on this eBook, on and off working on it; doing the screenshots and stuff like that and I know moving forward it is going to be another week at least. And is it going to make me money? Is it going to be worth it?
When I sit right now and I say, Well, what the best thing I can be doing to move my business forward in terms in terms of creating products and driving my business? That eBook falls pretty low on the scale. But I have this desire to finish it because I am more than halfway through. And that is my sunk cost bias.
I have already invested so much into this eBook that I want to go ahead and get it finished and get it out there. But I have decided not to let that bias take me over and so instead, I am looking at other things and I just have not been getting much sleep lately because I have been looking after my newborn son in the nights. And so my brain does not work as well as I would like for it to work. But what I realized today, for some reason, I do not even know why it came to mind but back in November of last year I just did this 30-day Property Journey – 30 podcast episodes of different things people could do each day to move them forward towards their goal of buying property, to grow their confidence and stuff like that. And I am like, Oh my goodness! This is an eBook! This is a written eBook.
I am pretty sure that it is all formatted as well. I have it in formatted blog posts so either myself went through it and edited it or I had an editor go through and do it. This is 30 chapters that I can just plug in and I have to work out how to hire an editor to go through it and edit this book. But this could potentially be 1 to 2 days of work which probably means 2 to 3 weeks of work to get this out there. But I already have an Australian Property Investing Book on Amazon. People liked that and they might want to buy another one and the 2 could feed off each other whereas if I did a podcasting book that is completely unrelated to property investing and so they are not going to work towards each other.
So it just makes a whole lot of sense to go ahead and create this eBook and get this eBook out there. And so that is what I am going to do. It is Friday afternoon, it is like 1 or 2 o’clock so I do not have much time to work on it this week because I have swimming. I have to leave home around 3:30 so I probably have an hour or 2. But this will all start to work towards and see if I can get this out there and I need to find an editor and work out how do you hire an editor for an eBook and how much does an editor cost because truthfully I have no idea at all.
That is where I am at. I hope you guys are having a great week. I hope you guys are moving forward in your businesses or in your ideas and you are feeling inspired by my journey and the turns that I go through.
Until next week, if you want instructions go and buy some furniture.

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