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Using "Opportunity Cost" to Learn to Delegate.

Uncategorized Aug 07, 2023

By Kevin Organisciak, M.Ed.

Effective delegation is a critical skill for any business leader, especially in the context of managing a local tutoring and test preparation business. Delegation allows you to focus on strategic decisions, growth initiatives, and value-added tasks while ensuring that routine, time-consuming activities are managed efficiently.

One powerful concept that can guide your delegation strategy is the concept of opportunity cost. By understanding opportunity cost, you can make informed decisions about when to delegate routine tasks, when to delegate learning-intensive projects, and when to hire a team of experts for new initiatives. In this article, we'll explore how you can apply opportunity cost to optimize delegation in your tutoring and test preparation business.

  1. Delegating Routine Tasks

Routine tasks, while essential for the smooth operation of your tutoring business, can consume valuable time and energy that could be better invested in higher-impact activities.  Tutor-operators often do everything in order to start up a business but, at certain points, the time required to "do" becomes less productive than the time spent, tutoring. This is where the concept of opportunity cost comes into play. Opportunity cost refers to the value of the next best alternative that you forego when making a decision. In the context of routine tasks, the opportunity cost of not delegating these tasks lies in the potential to focus on critical areas such as tutoring, client acquisition, and curriculum development.

The most basic calculation of opportunity cost is this:  If you are paid $75/hr to tutor and you spend an hour not-tutoring, the opportunity cost = $75.  

Common examples include tasks like scheduling sessions, answering emails, and basic administrative work could be delegated to a dedicated administrative assistant or a virtual assistant. By doing so, you free up your time to engage with clients, create new learning materials, and explore growth opportunities. Additionally, the Pareto Principle, or the 80/20 rule, suggests that roughly 80% of the outcomes come from 20% of the inputs. Apply this principle to identify the most impactful routine tasks that require your personal attention while delegating the rest.

  1. Delegating Learning-Intensive Projects

In the world of education, there are often projects that require a steep learning curve before implementation. This might include adopting new technology, designing a sophisticated curriculum, or incorporating innovative teaching methods. Instead of investing excessive time and effort in acquiring new skills, consider the opportunity cost of delegating these projects to experts who already possess the required knowledge.

By delegating learning-intensive projects, you can accelerate the implementation timeline and ensure higher-quality outcomes. For instance, if you're considering incorporating virtual reality-based learning into your test preparation courses, hiring a VR education specialist could save you months of learning and experimentation. The opportunity cost here is the potential delay in launching the new approach and missing out on revenue and client satisfaction.

  1. Building New Initiatives and Campaigns

When it comes to launching new initiatives and campaigns, such as expanding your tutoring business to include additional subjects or introducing specialized test preparation programs, opportunity cost plays a crucial role in deciding between utilizing your existing staff and hiring a team of experts. In some cases, your existing staff may need to learn as they go, which could lead to a longer learning curve and potentially suboptimal results.

However, hiring a team of experts from the outset minimizes the opportunity cost of delayed implementation and maximizes the chances of success. These experts bring in-depth knowledge and experience, allowing you to hit the ground running and quickly achieve your key performance indicators (KPIs). KPIs, or Key Performance Indicators, are quantifiable metrics that help you measure the success of your initiatives. For instance, if your goal is to increase student enrollment by 20% in the next quarter, hiring a marketing team with a proven track record can significantly improve your chances of achieving this target.


Effective Delegation: Setting Targets, Regular Review, and Feedback

In the realm of effective delegation, successful business leaders follow a structured approach that includes setting clear targets, conducting regular reviews and providing constructive feedback, and establishing parameters such as budget, deadlines, and deliverables. It's important to differentiate between delegation and abdication of responsibilities.

Delegation involves entrusting tasks while maintaining oversight, whereas abdication may lead to unchecked processes and subpar outcomes. Anecdotal cautionary tale: Imagine a tutoring business owner who decided to delegate the entire curriculum development process for a new test preparation program without establishing clear guidelines or reviewing progress. The result was a curriculum that didn't align with the business's objectives and required significant revisions, leading to missed deadlines and frustrated students. In short, when you delegate, make a plan, set progress review meetings, and add detail such as deadlines, dates, and deliverables. 


In the competitive landscape of tutoring and test preparation, effective delegation can be a game-changer for your business's success. By applying the concept of opportunity cost, you can strategically delegate routine tasks, learning-intensive projects, and new initiatives to optimize your resources and focus on high-impact activities. Remember to consider the Pareto Principle and leverage KPIs to guide your decision-making process. Ultimately, mastering the art of delegation through the lens of opportunity cost will empower you to lead your tutoring and test preparation business to greater heights.




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