Setting Expectations

Greetings.  I am back from vacation - had a really nice time in Florida with my wife and kids.  While we had some interesting weather (tornados and storms), we also had some absolutely beautiful days.  Of course, I learned more from the stormy days than the sunny ones...isn't that how life is?  But that's for another blog day.

Anyway, we had some challenges as a family during the stormy days.  Much of it having to do with life not meeting our expectations.  I was thinking about this over the last few days and was reminded today about something that Paul wrote in his letter to the church in Philippi.  In the first chapter of this letter, Paul says that he can't decide whether it is better that he live or die.  He is focused on doing everything he can to be useful.  To use whatever the day brings.  Seems we could learn something about that.  Paul is able to find joy even while in prison.  Glad that the prison guard knows he's there for his faith.  Glad that it is an encouragement to others to be bold about their faith.  Amazing to me when I think that we allow a bit of bad weather to change our attitude.  Sunny - Happy, Rainy - Bummed.  I'm victim to this as much as anyone, but what I am reminded of is the fact that we shouldn't let our circumstances change our attitude, drive, determination.

In my business I am currently facing some challenges due to the unrest in the middle east.  Frustrating.  Disappointing.  Disheartening.  But should it be?  I think that allowing my circumstances to be disheartening is where I start to miss the mark.

Part of overcoming this is to do a better job of setting and managing expectations.  Now, I am not suggesting that we set the bar so low that anything is better than our expectation.  A defeatist attitude is not what I am advocating.  What I am suggesting is that we set our objectives and build our action plans based on what we can best determine will happen.  Build in some contingencies, and then move forward, confident that if we work our plan, we will have put ourselves in the best possible position for success.  Sure there will be set-backs and unexpected challenges, but with this attitude, we should be able to quickly assess the situation, lean into our pre-determined contingencies, and adjust.

Road blocks, economic conditions, and storms of all kinds, shouldn't affect our attitude or add stress to our lives.  Planning ahead, recognizing those things outside of our control, and setting reasonable expectations, is the key to a enjoyable and joyful life...and vacation too.

Best,

jvt

Shrinking the World

If you are like me, there are times when the world feels large and ominous.  Events like last week's Tsunami and the continuing devastation in Japan can really make us glad we don't live by the coast.  It's easy to feel like those events are very far away.  I have also observed that the impressions and views we have about those who live so very far away from us are often misguided, and sometimes just flat wrong.

I've been thinking about these ideas this week as my daughter is studying the events surrounding World War II.  Frankly, I felt a bit embarrassed to try to explain why the world in general, and the U.S. in particular did nothing to stop Hilter, Mussolini, and Japan as they reached beyond their boarders.  I have no doubt that it is easier looking back at events that happened three quarters of a century ago than it was at the time.  Sadly, I sometimes wonder if we've grow much beyond the viewpoints prevalent in the 1930s and 40s.  When Italy invaded Ethiopian, we yawned.  When Hilter invaded Sudetenland, Czechoslovakia, we hardly squeeked.  What's worse, the UK prime minister, Chamberlain's policy of appeasement aside, his comments still resonate today, "How horrible, fantastic, incredible it is that we should be digging trenches and trying on gas-masks here because of a quarrel in a far away country between people of whom we know nothing" (Underline added).  What if those of us in Chicago said that about the people of Norfolk, VA, (home of Norfolk Naval Base and headquarters of NATO, yes, that NATO) which is about the same driving distance (870mi) as London is from Sudeten, Czeck Republic.



Distribution of Supplies in Japan



So, all this to say, that while we might be appalled today at the idea that people less than 900 miles away would be considered too foreign to fight for, I suspect that we sometimes find ourselves feeling the same about the plight of those that are separated by culture even in our own backyard, let alone those in Japan who are now struggling for daily survival in one of the richest countries in the world.  One organization making a difference is Samaritan's Purse.  Samaritan’s Purse is sending more than 90 tons of emergency aid to bring help to disaster victims in Japan.  Supporting them could make the difference in the lives of many, and as you become connected to those in "far away lands", I can guarantee that your world will become smaller, and the needs and concerns of those both far-away and right next store will become important to you. 

Best,

John.

Controlling Costs - in your business - in your home.

Having watched and read with great frustration the arguing about the new budget proposal by the Obama administration, I cannot help but provide some perspective which might be helpful for our government (if they'd only listen to me!), but hopefully very helpful for you in your business or in your household.
There is one rule: Live within your means.  This may seem simple, but over and over I see our government and individuals and business leaders struggling to do this...if they even try.  What do I really mean?  I mean, DO NOT SPEND MORE THAN TO TAKE IN!  Again, common sense, but not so common.  Obama's new budget adds almost $9.4 Trillion to the National debt over the next 10 years, and more than $1.1 Trillion next year alone.  What this means is that next year, the U.S. Federal Government will borrow $1.10 out of $3.74 it spends!
So, I am the first one to recognize and acknowledge that investment spending - Capital spending - is an absolute necessity and an important part of every business and household.  Leveraging your money can be a very important way of building wealth.  For your business, making capital investments is a way of utilizing your borrowing power to invest for the future.  For your household, it has historically made sense to borrow money in order to purchase property that will appreciate and grow in value.  Some might argue this has always been risky, but few times in our brief history has the idea of property appreciation been more risky than today.
So, how can you make this change? I'll give you five quick ways:
1) Review all of your spending - put everything on the table, even those sacred cows like your candy bar runs, or your Sunday dinners out.
2) Prioritize and look for ways to delay spending.  Maybe you can go another month without a pair of new shoes.  Maybe your business just can't afford to hire another engineer, or administrative assistant at this time.
3) Invest in productivity improvements.  For your business, this might mean finding ways to do more with the same.  Automation can be a huge benefit and might be worth an investment.  What is the payback?  Can you reduce your monthly fixed costs by making the investment?   For your home you might want to think about doing your bills on-line.  This has saved us many dollars in stamps.  You might also look at low cost sourcing.  For your home, this might mean going to Aldi or another discount store.  For your business, it might mean consolidating your parts purchases with just a few suppliers to gain volume increases.
4) Conserve cash.  For your business, this means reducing inventory - move to just in time manufacturing.  Delay large investments that show little likelihood of short-term gain.  For your home, this might mean waiting another 6 months before buying a new car, or not taking an Spring vacation, but instead scheduling a summer vacation now when the prices are still low.  If only our government would think about this.  Maybe they could delay cost of living increases.
5) Rethink your entire approach to spending.  Building cash reservces in an absolute necessity.  If you can retire debt and move from a credit basis to a cash basis for your business or your home, you will reap huge benefits.  For your home, this means saving until you have enough to buy with cash.  If you do this, the interest savings alone will be significant.  Dave Ramsey is one of my favorites.  The Total Money Makeover is one good resource.

Yon can improve your business and get your personal/family spending under control.  You will then have the authority and the evidence to speak up to our government officials and hold them to the same sort of fiscally responsible behavior.

Best to you,
jvt.