Up Your Cash Flow / Goldstein 76-80

80 PAYMENT OF EXPENSES: 4 methods of determining how bills will be paid

 

Alternative 1: Assume that all expenses are paid during the months they are incurred.

 

Alternative 2: Take a look at each expense item on the profit and loss budget, then decide when that expense will be paid.

 

Alternative 3: Assume a certain percentage of the bills incurred each month will be paid during the month incurred, a percentage in the first month following that month, and a percentage in the second month following that month incurred.

 

Alternative 4: To add more precision to Alternative 3, you could actually take your total expenses for a given month, subtract all those payments that you know will be paid during the month incurred, and then compute the balance left in the manner indicated in Alternative 3.

 

Other Receipts: When doing your cash flow forecasting, it is necessary to assume the inflow of any additional funds that come either from investors, bank loans, sale of assets, or any other source. It is important to know when these amounts will be received to apply them to your projections for the proper month.

 

Additional Payments: ...necessary to include in your forecast any additional cash being disbursed for deposits, purchase of assets, down payment on the purchase of assets, principal payments on loans outstanding, payment for deposits of income taxes, payroll taxes, and any other cash out-flow you feel will be incurred during the period you are forecasting.

 

Words of Caution---seek professional help.

The Pursuit of WOW/Peters 110-116

116 ...some start-ups do thrive...what distinguishes them from the losers?

• Distinction
• Soul
• Passion
• Details
• Culture
• Community
• Good Books
• A Pal
• Perseverance
• A Taste for Reinvention

Intellectual Capital/Stewart 200-201

201 Today's economic seas therefore cannot be navigated by the old stars above, but by internal compasses and gyroscopes. Instead of security, seek resilience. Chart your contribution, not your position.

 

New Signs of Trouble

1) Are you learning. If your job has become easy, someone else will do it for less.

2) If your job were open, would you get it?

3) Are you being milked?

4) Do you know what you contribute?

5) What would you do if your job disappeared tomorrow?

6) Are you having fun yet?

7) Are you worried about your job?

GOOD TO GREAT/COLLINS 142-148

147 Technology-induced change is nothing new. The real question is not, What is the role of technology? Rather, the real question is, How do gtg organizations think differently about technology.

 

 148 Every gtg company become a pioneer in the application of technology, but the technologies themselves varied greatly.

The Pursuit of WOW/Peters 107-110

108 There is a distinct difference between doing something "for" the market and being part "of" the market.

 

110 ...thinking about the importance of context and thence packaging.  In short, damn few of us (save for the Japanese, who are fanatics on the topic) take packaging anywhere nearly as seriously as we should. It's a lost opportunity--a big one, in fact.

GOOD TO GREAT/COLLINS 141-142

142 A CULTURE OF DISCIPLINE--Key Points

• Sustained great results depend upon building a culture full of self-disciplined people who take disciplined action, fanatically consistent with the three circles.
• Bureaucratic cultures arise to compensate for incompetence and lack of discipline, which arise from having the wrong people on the bus in the first place. If you get the right people on the bus, and the wrong people off, you don't need stultifying bureaucracy.
• A culture of discipline involves a duality. On the one hand, it requires people who adhere to a consistent system; yet, on the other hand, it gives people freedom and responsibility within the framework of that system.
• A culture of discipline is not just about action. It is about getting disciplined people who engage in disciplined thought and who then take disciplined action.
• The gtg companies appear boring and pedestrian looking in from the outside, but upon closer inspection, they're full of people who display extreme diligence and stunning intensity (they "rinse their cottage cheese").
• Do not confuse a culture of discipline with a tyrant who disciplines--they are very different concepts, one highly functional, the other highly dysfunctional. Savior CEO's who personally discipline through sheer force of personality unusually fail to produce sustained results.
• The single most important form of discipline for sustained results is fanatical adherence to the Hedgehog Concept and the willingness to shun opportunities that fall outside the three circles.

 

Unexpected Findings

• The more an organization has the discipline to stay within its three circles, with almost religious consistency, the more it will have opportunities for growth.
• The fact that something is a "once-in-a-lifetime opportunity" is irrelevant, unless it fits within the three-circles. A great company will have many once-in-a-lifetime opportunities.
• The purpose of budgeting in a gtg company is not to decide how much each activity gets, but to decide which arenas best fit with the Hedgehog Concept and should be fully funded and which should not be funded at all.
• "Stop doing" lists are more important than "to do" lists.

Up Your Cash Flow / Goldstein 75-76

76 Cash Collections.

 

Generally, there are four alternative methods that can be used to determine how cash is going to be collected. Use the alternative you feel most comfortable with.

 

Alternative 1. If you are in the 100 percent cash-and-carry business all sales are collected in the month the sales are made.

 

Alternative 2. Be arbitrary.Guess what you believe the collections will be during each month of the year.

 

Alternative 3. Go back to prior years to see what each month's relationship of collections is to the year's total. Apply that percentage to the total annual collection you expect to receive.

 

Alternative 3. Assume that a month's sales will be converted to cash consistently in the months following the month of the sale.  (45% in the month of the sale, 40% in the first month following the sale, and 15 percent in the second month following the sale)

 

GOOD TO GREAT/COLLINS 140-141

141 Of course, the key here is the little caveat, "When you are right." But how do you know when you're right? In studying the companies, we learned that "being right" just isn't that hard if you have all the pieces in place. If you have Level 5 leaders who get the right people on the bus, if you confront the brutal facts of reality, if you create a climate where the truth is heard, if you have a Council and work within the three circles, if you frame all decisions in the context of a crystalline Hedgehog Concept, if you act from understanding, not bravado--if you do all these things, then you are likely to be right on the big decisions. The real question is, once you know the right thing, do you have the discipline to do the right thing and, equally important, to stop doing the wrong things?

The Pursuit of WOW/Peters 104-107

105 Just show one's face for 10 or 15 minutes... and the who world would have started spinning in the opposite direction.

 

 107 Just a 10-15 minutes--900 ticks of the clock, max--effort would literally have launched the entire operation in a brand-new refreshed direction.

 

 New England Securities...employees are encouraged to...

• Take risks. Don't Play it safe
• Make mistakes. Don't try to avoid them
• Take initiative. Don't wait for instructions.
• Spend energy on solutions, not on emotions.
• Shoot for total quality. Don't shave standards
• Break things. Welcome destruction. It's the first step in the creative process.
• Focus on opportunities, not problems.
• Experiment
• Take personal responsibility for fixing things. Don't blame others for what you don't like.
• Try easier, not harder.
• Stay calm
• Smile
• Have fun.

Intellectual Capital/Stewart 198-200

200 We cannot offer job security, but through challenging work you can learn marketable skills.  Act as if you are self-employed, working for Me, Inc.  Any given job is temporary. You are responsible for managing your own career.

 

Companies haven't accepted the view of temporary employment the way employees have.