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One of the principles that underpins the 7 Habits of Highly Effective People is Stephen Covey’s powerful idea of P/PC – Production and Production Capacity. Stephen Covey uses the age old fable of “The Goose That Laid the Golden Egg” to explain this concept:

A poor farmer one day discovers that his goose has started laying golden eggs. He doesn’t believe his luck at first but he quickly convinces himself that he’s discovered a way to lift himself from poverty.

Soon, he becomes a very rich man – the goose lays a golden egg every day producing riches beyond his dreams as a poor farmer.

Then he becomes greedy – he doesn’t want to wait for more golden eggs so he cuts open the goose to find more eggs immediately.

Of course, there are no eggs inside the goose and he has no more income. What’s worse is that he has killed the goose and will never have any more income. The story ends with the foolish farmer dying in poverty, having killed his goose and wasted all his money.

How does the goose relate to the 7 Habits?

The point of this story is that the goose represents PC or Production Capacity – the ability to lay golden eggs. The golden eggs represent P or Production – the number of eggs that are produced. There is a natural balance between P and PC. You have to take care of production capacity – the golden goose – in order to guarantee that you will always have production the golden eggs.

This natural law can be applied to all areas of your life, your business or even to multinational corporations. Some examples might help.

For Example, relationships are an area where this concept is often abused with disastrous results.

You may abuse your position to get short term gain. Say you want to get one of your children to do something, for example do the dishes. You could just order them to do it. In your haste to get it done, you could sacrifice your long term relationship and the chance that they will do it into the future for the sake of short term production – getting it done now.

A company may sacrifice it’s long term relationship with customers – it’s capacity to produce income by getting them to buy and buy again, for the short term gain of a quick profit. How many times have you seen this happen?

Another area is your health – overworking may give you a boost in income in the short term, but in the long term you’ll end up burnt out and ill and unable to go to work! Overeating may give you short term gratification, but in the long run you’re on the road to ill health.

I hope that you have got the idea of the relationship between production and production capacity and how it can translate to many different areas of your life or your business.

The other message you should notice from these examples is that finding the right balance P and PC is a very difficult thing to do. You can spend your entire life learning how to do this. Stephen Covey constantly returns to this important subject throughout The 7 Habits of Highly Effective People and it is an important part of his final habit “Sharpen the Saw”.

So you want more – doesn’t this break the natural law?

You’ve seen that for any asset there is a natural balance between what it can produce it’s production capacity and using it to produce. You’ve also seen that you will have to spend some time maintaining the capacity. How is it possible to increase production beyond this natural balance point?

The answer is easy – you need to add more units of capacity – in the case of the golden goose that would be like breeding a flock of golden geese.

You have to be aware that some resources are naturally limited – each individual person has their own capacity and unless you hire more that will be their limit.

Some resources are more ‘elastic’. You can develop your body by dedicating time to training so that you can do more physical work. You can develop your mind to be more effective – to make better decision faster, to enable you to make more money…

You’ve just read about one of the fundamental natural laws that is discussed in the 7 habits of highly effective people. You now know you need to balance the need to produce against the need to maintain your ability to produce. Take some time to think about your own life – are you running down your resources and jeopardizing your future? How are you going to ensure you have capacity for the future?

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How To Avoid Sacrificing Your Future Today