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.

Habits that can change your life

One of the most impactful books that I have read is Stephen Covey's The 7 Habits of Highly Effective People.  While I believe that all 7 habits can have a significant and positive influence on your success, there are two which I would like to discuss today.  The first two of Covey's seven habits are so powerful that if you can begin to live by them, I am convinced they can change your entire life.
1. Be Proactive.  You are more than the sum of your experiences.  You are more than the sum of your genetic code.  The argument isn't between Nature and Nurture.  It may be hard to believe, but you have the power to choose how you respond to every situation.  In fact, you are the only one who can decide how much value to place on others' opinions, even those closest to you.  We've all experienced it.  Someone we dislike, or who is unimportant to us has something negative to say about us. Their opinion about us matters little.  However, when someone we respect or someone close to us has the same opinion, we are devastated.  You may not believe it, you may not want to believe it, but you alone place value on the opinions of those around you.  Being proactive means saying, "I can, I choose, I will."  It means saying, "Let's look at our options."
2) The second habit is Begin with the End in Mind.  If you don't shoot at a target, you'll never hit your mark.  It is easy to just let life happen.  We look up and the year is almost over. we blink and our kids are nearly grown.  It is easy to get distracted.  Remember the sirens from Homer's Odyssey (check out O brother, Where Art Thou? for a spin on this classic) - they entice and draw us away from our purpose.  Beginning with the end in mind is a way to stay focused on the future.  Whether you want to set a target for the year, or a mission for your life, it is a huge benefit to start your journey by first thinking about where you want to end up.  Not just material things, but things of lasting value.  What do you want people to say about you?  When your time on earth is over, what will be worth the investment?  Max Lucado's new book, Outlive your life is along a similar line.  Lucado asks us the same question.  What were we made for?  Lucado tells us that our purpose is to make a difference in the lives of those around us. 

Each of us has to determine what target we are aiming for and then pursue it with passion and wholehearted commitment.  Don't let life happen to you, be proactive.  Don't wander aimlessly, chart a course. 

My best to you,

jvt

What's it take to Win?

Greetings.  Today I'm doing something a bit different.  I am asking you to respond. What does it take to win?  Many people seem to believe is a zero sum gain.  In other words, I cannot win unless you lose.  Win-Win is not in their vocabulary...or if they do use it, they really only mean, "I win, you don't know you lose".

I am convinced that an attitude focused on winning is an absolute necessity for business success.  So, if that's true, what does it take to gain and maintain that winning attitude, build a winning team, and succeed.  I realize there are all sorts of definitions for success and many people will claim they are successful because they have a great family, or good friends, or have learned to be content.  I am not challenging the concepts, but if I am honest with you, my first reaction to those types of comments is that I wonder whether they really set out to have a great family...in other words, was that their initial definition of success, or have they worked hard to redefine what success means to them.

I suspect that some of you will find me to be focused on the wrong thing when I tell you that my definition of winning includes it ALL.  I am not satisfied with only having success in one area of my life.  I am not satisfied with only winning at relationships, or with my family, or in being appreciated.  I want to succeed in every part of my life.  That's not to say that I believe I am winning everywhere.  It's also not saying that I will win everywhere, but at the same time that I am learning to be content, in any circumstances (as the Apostle Paul wrote), my desire to push ahead, strive for the next step, find ways around obstacles, savor every moment, cultivate every open field, try something new, remains.

How about you?  How do you live contented at what is, and yet "press on to gain the prize".

I want your comments and thoughts.  I'll provide some of my own as well, but over the course of time, I'll likely come back to this theme again ad again.

In the meantime, my Peace and Joy be yours today.

John.

Integrity - the true sign of Leadership

There are two qualities I seek in all the employees I hire.  One is high self-motivation (I'll write on this later), the other is Integrity.  You might think that this a no-brainer, and some of you just said, "of course." However, I have found that this characteristic is not universal among employees.

Many people claim to be ethical, even honest, but being upright and a person of integrity is more than being ethical.  Integrity requires a level of consistency that is often at odds with business today. Integrity requires that a leader not make exceptions to rules and expectations even in the face of significant arguments to the contrary.  Gerstner, in his book recounting the IBM turn-around has much to say about the kinds of executives he sought and challenges to integrity.  Examples included arguments to compensate above established parameters in order to 'keep an employee', or requests to pay unearned bonuses to 'maintain morale'.  These are often viewed as ethical and reasonable departures from stated policy.  Gerstner considers them an integrity issue.  His conclusion is that companies which tolerate lapses in integrity are destined to fail.

Nehemiah faced his own issues with Integrity in the power structure within Jerusalem (Neh. 5) The officials were loaning money to those who were in need and struggling.  The people were struggling due to famine, a poor economy due to a lack of safety, high unemployment, and loss of earning power due to the focus on building the wall. When people couldn't pay, these lenders began to foreclose.  Those suffering included many who were working on the wall.  There was a huge uproar and Nehemiah knew he had to do something.  What is amazing is that the lenders certainly had 'every right' to loan, charge interest, and foreclose.  It was their money to do with as they wished.  Today, many would claim the same right.

However, the Mosaic Law, which had been ignored for many years, forbid the children of Israel from charging one another interest.  Not only that but, Nehemiah and his team were loaning money at no interest, feeding many daily, and attempting to establish a healthy economic environment by improving the safety and well-being of those within Jerusalem.

 

What the officials were doing was not 'illegal' under Babylonian law, and we might even say they were enterprising, responsible businessmen.  We might even be tempted to say they were engaged in honorable activities, even helping sustain the local economy.   However, what they were doing was not an example of integrity.  They loaned to those who couldn't pay.  They foreclosed without care for their brothers.  They sought to benefit from the improvements in Jerusalem without personally contributing to the outcome.

In contrast stood Nehemiah.  Not only was he supporting many who were in need, and loaning without interest, but Nehemiah, sought not personal gain as Leader in Jerusalem.  That's not to say he didn't desire to be paid, desire the respect of others, or seek success.  As governor, Nehemiah received a salary, money for his expenses, and had the right to tax the citizens of Jerusalem.  His predecessors not only spent all their allotted expense budget on themselves, but taxed the people to line their own pockets.

When push came to shove, only a man of integrity could appeal to the wealthy and challenge them to change their ways.  He points to the Law.  He points to the example of the men who came with him from Babylon.  His authority, his power, came not solely from his position, in fact he never threatened. He never ordered, he appealed.  It was Nehemiah's integrity that won the day.

With the observation of MLK, Jr.'s birthday, we have one more example of how integrity in leadership has the power to reform a nation.  You, too, can impact your family, community, and workplace by being a person of integrity.

jvt

Dealing with Adversaries

Happy Friday!  Have you registered to receive an email notice about new postings?  Enter your email in the box on the right and you will receive a link each time we post.

My last commentary talked about Nehemiah and his early response to a crisis he was facing.  I think a review of his story can also teach us about how to address adversaries in our lives and business.

Nehemiah faced opposition to his plans to rebuild the wall around Jerusalem.  His antagonists were led by a guy named Sanballat. While Sanballat may have had some legitimate authority in the region, he had no part of Jerusalem.  However, he didn't want the walls built for a number of reasons.

- New power in the region threatening him

- What was good for Jerusalem was bad for him (he had a "zero sum gain" view of the world) 
- He didn't care for the Jews

Isn't it the same for many of us?  Our adversaries at work, or in our lives, or even within our own family, think our success is their failure, or they think we are a threat to their power base, or they just don't like us very much.  These people can cause us real difficulties and make our lives miserable-- if we let them.

Nehemiah provides us with some good ideas on how to handle adversaries.

1) Pray about them.  Sanballat and his cohorts ridiculed and harrassed Nehemiah and those working on the way.  Nehemiah prayed that God would repay them for their rotten ways.


2) Confront lies and false accusations head on.  Sanballat accused Nehemiah of setting up his own kingdom in opposition to the King of Babylon (his employer).  Something like accusing him of going behind his bosses back.  He even threatened to tell the King what he was accusing Nehemiah of doing.  Nehemiah said, "Nothing of the kind is going on. You are making it all up." It is a figment of your imagination.  Nehemiah didn't try to befriend Danballat or convince him of the truth, he just said, "You are wrong.". That's it.  Don't let your adversaries misconstrue your actions or attach false motives to your behavior.


3)Ignore them - Stay Focused.  Sanballat tried to distract Nehemiah and even befriend him by inviting him to meet with them and 'join' their team.  Nehemiah wasn't fooled.  He knew this was an attempt to distract and perhaps even to gain some power over him through the relationship.  Nehemiah ignored Sanballat and told him that he was far too busy to break away from his task.  Why should the work suffer while I go off to meet with you?

4) Sanballat threatened to harm Nehemiah and the workers.  Nehemiah didn't get scared, didn't quit, he planned and prepared.  They "prayed and posted a guard."  He fortified the workers and kept his eyes open to be sure that he was ready to defend against any attack.


We may not be able to prevent others from coming against us, but we don't have to be easy targets.  In addition, we can heed the words of Paul, who said, as much as it is in your power, be at peace with all men.  These steps above provide us some clear methods for dealing with adversaries.


Trust God.  Pray, and post a guard.  Be on your watch, but don't become distracted.  Ignore those who have nothing good to say and stay focused on the tasks and goals ahead.


Best to you!

jvt