Posts

Business planning – the need for a strong mind

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In my last business planning post, I shared my belief (born out of my own professional experiences) that even though all people dream and the majority of them have the entrepreneurial streak, most everyday entrepreneurs lack the mind skills to steer their business and wealth dreams through to successful implementation.

This is because implementation requires more than just doing.  Firstly it means having a strong will to act.  But activity alone is not enough.  People at work all over the world spend a lot of time every day at work generating activity that is totally unrelated to any profitable purpose.

Business implementation requires focused and productive activity; and that usually means stepping out of your comfort zone and doing the hard stuff that drives directly towards achieving your goal.

Essentially, that means deliberately steering yourself away from the familiar and making decisions in areas that you don’t fully understand.  Often those decisions can prove to be wrong and you must stay positive and optimistic while trying to find the right path.  So implementation can be a long, difficult and frustrating journey.

It is one thing to solve technical problems, but starting a business invariably relies on other people saying YES.  Think about it!  You are not in business until at least one customer says YES to you.

Depending on the type of new business and the start up proposal you are trying to implement, there are several other stakeholders who may need to say YES also.  These include key employees, suppliers, financiers and collaborators.

The process of winning support can be a very frustrating, particularly when people say NO.  It can undermine self confidence and stretch out the anticipated period of implementation.

It may also be the case that you forego income through this period so that you can remain 100% focused and committed to the task.  So it is not hard to imagine how the pressure can quickly build.

There comes a time when decisions need to be made whether to keep going or quit.  This is where determination and tenacity enter the mix.  Only a strong mind can keep going in the face of excruciating pressure to quit.

I will tell you why it is all in the mind in my next business planning blog. Check out my other blog at http://www.aikido-secrets–to-calm-success.com

Until next time!

Gary

Business planning – the business mind

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In business planning, much has been written and said about entrepreneurial thinking and the traits that entrepreneurs have in common.  But not much is said about actually developing the mind set that supports entrepreneurial thinking.

Let’s widen the definition of entrepreneur beyond the person with the big business idea who has the charisma and tenacity to win support for its successful implementation.

Now let’s call them the ‘everyday entrepreneur’ and include anyone who has a dream; has the guts to take a risk and have a go; and who gets a result, either good or bad.  So in my view, that can be:

  • Every business owner
  • Any action-driven risk taker in any context – e.g. business, sport, science
  • Anyone who attempts to network for gain; and
  • Anyone who addresses groups or speaks publicly

That’s a lot of people.  Well that’s my point!

Most heroes go unnoticed in this world, as do most entrepreneurs.  Your name doesn’t have to be Richard Branson, Dick Smith or Donald Trump to take a risk and have a go.

Many people try and many people stumble because they run into problems that they feel ill-equipped to solve.  That’s why it’s a common to hear of entrepreneurs having many failures before finally achieving success.

It is my experience over the past 30 years that all people have dreams; the majority have the entrepreneurial streak (in the wider definition), but most lack the mind skills to see it through to successful implementation.

More on business planning – the business mind in my next blog.

Check out my other blog at http://www.aikido-secrets–to-calm-success.com

Until next time!

Gary

Business planning – beware the borrowing trap

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How’s this for poor business planning?  When someone goes completely broke, it’s almost always because they borrowed money.  Ironically, it is not the poor who fall from grace and go broke.  This is because generally the poor can’t borrow money easily.

It is those with higher income and easy access to borrowing who at most at risk.  In many cases, it is also those who should know better, such as financial professionals in large companies.  But there is no accounting for greed!

Borrowing money is also glamorously referred to as ‘leveraging’.  Borrowed money comes in many forms – e.g. personal loans, secured loans, margin loans, mortgages, and credit cards.

Borrowing money to invest instantly puts you at risk to lose more than your original investment.  The recent Global Financial Crisis (GFC) has demonstrated that.  It’s just that when viewed through the rose coloured glasses of a booming economy, it doesn’t look that way.

Borrowing money for personal reasons (non investment) is financial suicide.  The risk is high from the start because whatever it is you buy with the borrowed money (e.g. a car) makes no income and therefore contributes nothing to ease the repayment burden.

It sounds old fashioned but if you handle all your financial affairs and investments on a cash basis, it is almost impossible to lose everything, no matter of what unforeseen event may happen in the world.

Until next time!

Gary

If you are looking for a basic book that explains personal finance in a common sense way, you won’t find better value for money than

GET A FINANCIAL LIFE written by Beth Kobliner

→ available now in the Amazon library → on the right hand side of this page →

It focuses on personal finance into your twenties and thirties but in my opinion, it is a basic handbook for people of all ages.  This book is an investment in itself. It is only USD $10.77 and when you land on Amazon’s site you will see cheaper options.

Business planning – income is the foundation of your wealth

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Critical to business planning is the science of financial management.  Financial management is all about the source and use of money.  I refer to it as a science because whether in business or in personal finance, there are certain rules you must observe in every day financial management.

One of the foundation stones of financial management is:

Your career and therefore your income provide your wealth!

Your income is the foundation of all of your wealth building.  Therefore, your prime focus should be on generating income, rather than borrowing money.

Your focus should also be on saving your income instead of spending it.  It is the part of your income that you save that forms the backbone of your future investments.

It is most likely that you will make far more money from your business or profession than you will from your investments.  Your investments can make your future more secure and your retirement more prosperous, but without income, investments alone will not take you from rags to riches.

Only very rarely does someone make a large fortune from investments.  When that happens, it may appear to be a hot tip or good luck but it is generally achieved by someone with a high income and savings potential.

When planning investments, your priority should be to preserve what you have.  Preserving what you have will be an unlikely outcome if you pursue complicated schemes that promise high returns in the short term.

Until next time!

Gary

For an introductory look at Personal Finance it is hard to go past this book.

TURNING MONEY INTO WEALTH (5th Edition) by Arthur J Keown.

→ available now in the Amazon library → top right on this page → → →

This is an American introductory finance book written by a Professor of Finance at Virginia Tech Pamplin College of Business.  Although it is primarily a text book, it is a surprisingly easy read.

It has to be said that USA tax laws and other regulations contained in this book are different to those in Australia but the author provides a great presentation of the fundamental principles of personal finance, which are universal foundation principles.   That is valuable information if you are looking to enhance your financial education.