profit and loss statement

are you selling your life to your employer?

profit and loss statement

 

When I was a young buck, fresh out of accounting MBA school, I had a prestigious job working for one of the (at the time) six biggest accounting firms in the world. It was a small office, but it was the second biggest of the six in the city I lived in at the time. It was a well-respected firm and I was lauded by my school, friends, family and peers for landing a position there.  The future was so bright, I had to wear green accountant’s eyeshades.

If you aren’t familiar with the work-life structure of the big accounting firms, a little background is in order. I’ll refer to them as the Big 4 (today there are four – during my professional career one has disappeared – Andersen – and two have merged). In the Big 4, the corporate culture is up-or-out. What does that mean? Nobody remains in static positions. There are three basic levels: staff, manager and partner. Staff and managers have a number of subdivisions, but a new joiner will progress, inevitably from junior staff to senior staff to junior manager to senior manager to junior partner to senior partner. You either get promoted on schedule or you are pressured to leave… or fired.

Everyone works hard in the Big 4. I have worked until 6 am, showered and gone back to work. I have worked week after week, 12-14 hour days every day including Saturdays and Sundays. The deadlines are unmissable and the pressure is enormous. The staff and seniors are typically devoted to no more than a few clients at once, and they have very little discretion in which clients and which areas they work. Managers have more latitude, but typically take on far more responsibility. They are responsible for training, mentoring, reviewing and organizing the staff on the project, and at the same time they must manage the clients’ expectations, pursue collections and billings and meet firm expectations on landing new business. Partners’ responsibilities are intense; mistakes on their part can destroy the firm. They must be technically proficient in accounting principles, “rainmakers” and office leaders. The days of the cheerfully drunk partner who shows up for golf and cocktails are long, long gone.

Staff and managers work exceptionally hard, though. I had a decent salary compared to my peers but I also worked 100 hour work weeks. My hourly wage was approximately $9 per hour as a staff person. Babysitters in New Jersey typically demand a minimum of $10 per hour. By the time I was a manager things weren’t much better – when I jumped to private industry I received a huge pay raise for nothing other than getting out of the grind. Had I stayed until I was a partner, I would have received a partnership income in the (I guess, depending on the market and a million variables) range of a quarter million per year. Retirement at 50 would have been achievable with a partner’s pension. I always knew I didn’t want to stick around to make partner. My intention was to stay two years then bolt – but then I stayed another – and another – and the next thing you knew I realized I was facing a big choice.

The Big 4 payoff is like a lottery, like many other industries – consulting, financial services, you name it. You make partner, you get rewarded for those awful hours and those long busy seasons. If you leave before then, you have been suckered. You gave up a lot of hours at minimum wage to build someone else’s firm; someone else’s client relationships; someone else’s partnership share. I spent years toiling at an awful salary to strengthen my firm and enrich the partners.

Don’t work like this for an employer.

I regret those hours now. I have a good consulting gig, don’t get me wrong. Leaving at 6 pm is a late day for me. I have few responsibilities and very little pressure. But if I had taken my 20s and poured those 100 hour work weeks into my own business, or even a small firm where I could have shared in the growth, I would have benefited enormously – more than just having a six-figure salary. I do have a fearsome resume to show for it; people in my field generally know what it means to have been in the offices and firms and fields and industries I was in, and it makes a difference in landing consulting jobs now. But I built no assets for me.

So the point is this: if you are working insane hours, stop and figure out your hourly wage. Stop and ask yourself: if I quit today, or I quit 3 years from now, will my resume look much different? Am I building something for someone else or for myself? It may be that you’re happy with your position as an employee – but if you’re working past the 9 to 5, you’re donating your irreplacable time – YOUR LIFE - to your employer, free of charge. That’s an awful nice present. Think about whether you’re happy giving it. You could probably spend a lot of those spare hours – which can never be replaced – doing a lot of things for yourself.

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