C. Lynn Northrup, CPA, CPIM
We’re facing the biggest challenge we’ve ever faced in our country and the world. Millions of people are without jobs and many businesses have been forced to shut down. We’re dealing with the Corona Virus crisis, the silent killer sweeping the country and the world. People are asking what we should do and how can we survive. I don’t the answers to the future. My advice is rather than panicking, take this time to work on your business and prepare for a future after the crisis.
Working on our business, what does that mean? Here’s what I think it means and some ideas on what we should be doing:
- Brainstorming for new ideas
- Assess your strategies and adjust for the future as best you can
- Evaluate and assess all the new risks
- Figure out how much money you will need to survive and ways to access it
- It’s essential to orient your business to the reality of new economic and market conditions
- Consider how to maximize assets to get the most bang for the buck
- How can the stimulus package be used to maximize your cash flow?
- Think about managing the scale of your business to fit and adjust to the future reality
This list could continue, but this gives you some thoughts and ideas on where to start working and focusing.
In addition to these ideas and thoughts, it’s essential to realize that there are only 4 ways to grow your business:
- Increase the number of customers of the type you want
- Increase the frequency of the transactions
- Increase the average value of each sale
- Increase the effectiveness of each business process
It all really boils down to these 4 ways and they need to be quantified in order to create focus on the right steps. Remember that what you can measure, you can manage, and produce the result as a result creating effective processes.
So, in the mist of all the fear and chaos, take the time to contemplate and consider different scenarios. Both the good and the bad. Plan for the worst and plan for the best. This will put you a better position to act and do what needs to be done.
It is important to understand that there are different entity (organizational) structures for conducting business. The form or type of organization will depend on the business purpose, a structure to provide legal protection, the size of the business, and the ease and cost to create the business organization.
Here are the common types of business organizations:
- Sole proprietorship
- Limited Liability Partnership
- S Corporation
- C Corporation
Each of these business organizations are described to provide background and understanding.
The Sole Proprietorship is the most common and easiest from of business organization to create. Typically, it is created by a person wanting to start a business out of their house or garage. The sole proprietor invests in their business, usually from their own savings, and begins operations. The type of business might be a service business, a small craft, or a distribution business. It also might involve an internet based business selling products, conducting affiliate marketing, and utilizing social media techniques.
A simple accounting system is used with these businesses which might include Quick Books, Xero, or other compatible bookkeeping/accounting system. The disadvantage of sole proprietorships is that it is exposed to legal liability with no limitation. The business of a sole proprietor itself does not pay income taxes. Profits and losses from the sole proprietor business flow through directly to the individual’s 1040 tax return on Schedule C and then taxed at the individual’s tax rate. However, it should be noted that profit reported on Schedule C is also subject to Self-Employment tax.
Sole proprietorships are the easiest business to form and operate. If a person does business under any name other than their true name, most states will require the filing of a fictitious business name which is known as a “Doing Business As” or a DBA Statement. These forms are available at the county recorder’s office as well as through some newspapers. There is no tax effect if a sole proprietor takes money out of their business, or transfers money to or from their business. However, it is a good idea to set up a draw account to help identify amounts that are not business but are for personal use.
Advantages of a Sole Proprietorship:
- All business tax advantages flow to the owner.
- Organizational costs are low.
- Legal & Accounting fees can be lower.
- State & Federal taxes may be lower.
- Administration is less complicated.
- Can be easily converted to another entity.
Disadvantages of a Sole Proprietorship:
- Personal liability.
- Inability to income split.
- Limited fringe benefits.
- Subject to Self-employment tax.
This covers the basic elements of sole proprietorships.
Partnerships can be defined as a relationship between two or more people (an individual, a corporation, a trust, an estate, or another partnership) who carry on a trade or business with each person in the relationship contributing money, property, labor or skill and with each expecting to share in the profits and losses of the business.
The partnership will be based on a partnership agreement together with any modifications and agreed to by each partner. The partnership agreement and any modifications can be either oral or written.
A partner’s share of income, gains, losses, deduction, or credits will typically be spelled out in the partnership agreement. The partnership agreement and any modification will be disregarded if the allocations to a partner under the agreement fail to have a substantial economic effect. An allocation will have a substantial economic if there is a reasonable possibility that the allocation will affect the dollar amount of a partners’ shares of partnership income or loss independently of tax consequences and the partner actually receives the economic benefit or bears the economic burden corresponding to the allocation.
Partnerships can have both general and limited partners. Limited partners are partners whose personal liability for the partnership is limited to the amount of money or other property they contributed to the partnership. Limited partners are not generally considered to materially participate in trade or business activities conducted through partnerships.
Limited partnerships can allow a sole proprietor to have part of his/her income from the business to be taxed in lower rather than the sole proprietor’s higher brackets. Family partnerships are a popular income-splitting concept by utilizing §704(e). One thing to note is that when the partnership is not recognized for tax purposes, the tax liability stays with the sole proprietor. Family members can contribute a capital interest in a partnership that can be withdrawn from the partnership or upon the liquidation of the partnership. The right to share in the earnings and profits is not a capital interest in the partnership. Family members in such partnerships can only include husband and wife, ancestors, lineal descendants, and any trust created for the benefit of such persons.
Advantages of partnerships include:
- Income is taxed to the partners rather than to the partnership.
- Distributed income is not subject to double taxation.
- Losses and credits will generally pass through to partners.
- The liability of limited partners is normally limited as in a corporation.
- There can be more than one class of partners.
- Partners can obtain basis for partnership liabilities.
- Special allocations are permitted.
- A partnership can be used to transfer value and income within a family group by making family members partners.
Disadvantages of a partnership include:
- The liability of general partners is not limited.
- Partners are taxed on earnings even if the earnings are not distributed.
- Partners cannot exclude certain tax favored fringe benefits from their taxable income.
- Partners may be required to file numerous state individual tax returns for multistate partnership businesses.
- In the absence of a business purpose, a partnership must use either a calendar year or the same year as the partners who own a majority of the interests in the partnership.
Limited Liability Companies
LLC’s are non-corporate businesses that provide its members with limited liability, a single tax, and the option to actively participate in the entity’s management. The IRS does not recognize an LLC as a distinct entity so for tax purposes the LLC may be treated as:
- A partnership,
- An association taxable as a corporation, or
- A trust.
While LLC’s have the corporate characteristics of limited liability, they are usually treated as a partnership for federal tax purposes since they can be organized without continuity of life, centralized management, or free transfer ability of interests.
When a limited liability company (LLC) is a partnership they include benefits such as the following:
- It provides the pass-through attributes provided under partnership tax rules;
- Limited liability to all members;
- It offers control membership control over the business without the risk that management participation will cost members their limited liability; and
- Provides freedom from S corporation eligibility requirements.
In addition, when an LLC holds assets with fair value in excess of basis, the availability of such an adjustment can be helpful by helping the transferring member to obtain a higher price for their interest. These situations are not available to shareholders of C corporations.
There are some non-tax benefits of LLCs which include:
- They can provide members with unique economic, voting, and other rights without creating a second class of stock.
- Rights of members can be modified by amending the LLC operating agreement which is not a publicly filed document.
- LLC members can be elected according to procedures set forth in the operating agreement.
- LLC members are not susceptible to piercing the corporate veil attacks solely as a consequence of the member’s failure to satisfy certain administrative formalities.
There are some disadvantages of LLCs which include:
- Uncertainty over self-employment taxes.
- They can be restricted to certain businesses and professions.
- In some instances, there can be additional taxes and filing fees.
- They are required to use the calendar method for accounting and taxes.
- A cancellation of indebtedness might stick to a member.
- There are issues with recourse and non-recourse debt.
- LLCs have no at-risk amounts because of the limited liability afforded to each member.
To sum up, LLCs are non-corporate businesses that provide members with limited liability, a single tax, and the option to participate actively in the entity’s management.
There are two types of corporations, S corporations and C corporations. We’ll discuss both together with their advantages and disadvantages. First, it is important to point out the characteristics of a corporation which include:
- Associates (shareholders).
- An objective to carry on a business or profession and to divide the profits from the business.
- Continuity of life.
- Centralized management.
- Limited liability to the associates.
- Free transfer ability of interests.
C corporations have a number of tax advantages over S corporations and unincorporated businesses. First, C corporations can be used to split income between itself and its owners with potentially lower overall tax rates.
C corporations can deduct fringe benefits paid for its employees in contrast to S corporations who are not able to deduct these expenses for employees who are 2% or larger shareholder. Unincorporated businesses cannot deduct these payments for its owners. C corporations can elect a fiscal tax year whereas S corporations and partnerships must be on a fiscal year for the most part with some limited exceptions. Corporations are able to deduct up to 80% of the dividends they receive from investments in other domestic Corporations.
C corporations can have an unlimited number of owners and multiple classes of stock ownership. The owners of the shares are not restricted to being United States citizens or to the numbers of shareholders. Forming a corporation involves a transfer of money, property or both by prospective shareholders in exchange for capital stock in the corporation. When money is exchanged for stock, the shareholder or corporation realizes no gain or loss. The stock received by the shareholder has a basis equal to the money transferred to the corporation by the shareholder.
There are a number of complex restrictions associated with corporations which are beyond the scope of this post. The most significant issue is that C corporations are not allowed to use the cash basis of accounting and are required to use the accrual method. The accrual method requires that income needs to be reported when it is earned in contrast to the cash method of accounting used by sole proprietors, S corporations, qualifying partnerships, qualified personal service corporations, and small businesses with less than $5 million in gross receipts.
Because of the restrictions and complexity of C corporations, most small businesses and service companies will not use this method of business formation. These reasons when combined with the double taxation of earnings of C corporations will cause smaller entities to form as an S corporation, partnership, LLC, or as a sole proprietor.
Domestic corporations can avoid double taxation by electing to be treated as an S corporation allowing small business corporations to elect special rules under Subchapter S. The treatment allows S corporations to be treated similar to partnerships whereby income, deductions, credits, and gains and losses are passed through to shareholders on a pro rata basis. S corporations are taxed like a partnership in that it pays no taxes, and its income and deductions pass through to the shareholder.
Here are some of the advantages of S corporations:
- S corporations can distribute its profits to shareholders with only a single tax in sharp contrast to C corporations where a double tax is incurred because dividends are not deductible.
- Losses of S corporations are deductible by shareholders in contrast to C corporations where losses are not deductible by shareholders.
- A new corporation may elect S corporation status in its initial year of operation in order to utilize losses even though they may ultimately want to be taxed as a C corporation.
- An S corporation is exempted from the accrual method of accounting rules and can use the cash method of accounting.
- An S corporation provides a corporate shield for liability purposes for those who want the income and losses taxed to them, but do not want the potential liability problems of a partnership.
- S corporations can adopt tax deductible and non-deductible fringe benefit plans subject to special rules and limitation applicable to these plans.
- An interest deduction is allowed for funds borrowed by a shareholder to purchase stock in the S corporation and such interest constitutes business interest when the shareholder materially participates in the business.
- Many problems of C corporations such as alternative minimum taxes and personal holding taxes do not apply to S corporations.
There are some disadvantages associated with S corporations:
- Because there is no corporate tax rate it makes deferred compensation programs impractical.
- There is no opportunity to accumulate corporate earnings at a lower tax bracket which makes it difficult for S corporations to reinvest profits in the business.
- Split-dollar and other non-deductible fringe benefits for shareholders can’t be paid for by lower taxed corporate funds.
- The 80% dividend received deduction is lost.
- In some states, the S corporation election will not avoid the double tax.
- A new or dissident shareholder can cause termination of the Subchapter S election through a disqualified transfer of stock.
- S corporations lack the flexibility that partners, and partnerships have to equalize the outside basis of owner’s interest with the inside basis of the entity’s assets.
- All income, except long term capital gains, received by the corporation are taxable to shareholders.
- More record keeping may be required to maintain accurate records for basis in shareholders stock to maintain the accumulated adjustments account, and to determine the tax ability of distributions.
Becoming an S Corporation
In order to become an S corporation, it must be formed in accordance with both state and federal laws. The corporate capitalization involves the transfer of money and/or property to the corporation in return for stock. The corporation must meet the requirements of S corporation status and all shareholders must consent to the S corporation status. The corporation will utilize a tax year status unless it meets special requirement to select another tax year and it will have to file Form 2553, Election by a Small Business Corporation, to indicate that it chooses S corporation status.
S corporation status is only permitted to “small business corporations.” S corporations are limited to a maximum of 100 shareholders who are U.S. citizens and non-resident aliens are prohibited from being shareholders. While this is the primary rule, resident aliens who possess a green card could be a shareholder, but this puts the corporation in jeopardy should this status change after achieving S corporation status. The requirement is to have only individuals as shareholders who are advised to establish a buy-sell agreement that restricts transfers to ineligible persons.
There are some special situations that allow estates and certain trusts to be a shareholder. In these instances, it is essential that the laws and regulations be carefully followed so as to not jeopardize the sub-chapter S status of the organization. Non-resident aliens may not be S corporation shareholders. In addition, a C corporation is not allowed to be a shareholder in an S corporation.
There you have the basics of business entities.
Change starts with a sense of true urgency and in most cases needs to be created to make things happen. The enemy of urgency is complacency. Complacent people don’t look for new opportunities and they pay more attention to their internal feelings than external feelings. They tend to move slow when they need to move fast. What ever worked in the past is what guides them.
While anxiety and fear can drive behavior that might be mistaken for urgency, the resulting actions tend to be non-productive. This is called false urgency resulting from failure. The thought process from a sense of false urgency usually is not productive and proactive. It typically is mindless wheel spinning that creates no positive results.
A true sense of urgency is created and recreated by communicating the existence of great opportunities together with the existing hazards and roadblocks. People engaged in a true sense of urgency exhibit a strong need to move and win, now. The biggest challenge about creating a sense of urgency is taking the first step in initiating the action needed to succeed in a changing world. Real urgency isn’t a natural state of affairs because it needs to continually be created to get change initiatives moving and in the right direction. In a constantly changing world, the good news is that there are an over abundant number of opportunities that can be utilized to create true urgencies.
A true sense of urgency evolves from a set of feelings that creates a compulsive determination to move right now. True urgency is a process of winning the hearts and minds of the people needed to make change happen. Mindless emotion doesn’t get the job done. Winning change strategies utilize sound, ambitious, but logical goals using methods allowing people to experience the feelings that embrace the determination needed to make things happen.
The strategy for producing a true sense of urgency focuses on creating very alert, visibly oriented action, aimed at winning with daily progress toward achieving the vision and goals targeted at core emotional feelings. Here are the four tactics needed to make this strategy successful:
- Reconnect internal reality with external opportunities and obstacles using data, people, video, and other media.
- Avoid acting anxious or angry and always effectively demonstrate your own sense of urgency in meetings, one-on-one interactions and other communication with the people engaged in the change process.
- Take the opportunity to determine if crises can be used to your advantage and always proceed with caution.
- Remove the negative and urgency skeptics and keep the group complacent to avoid destructive negative urgency.
In addition to these four tactics is the necessity of keeping up the pressure to maintain a sense of continued urgency. The trap that can occur is achieving success and then losing your momentum of continuous improvement. Short-term success does not always translate to long-term results.
Here are some thoughts on maintaining urgency after making a successful change. Always be on the alert for potential declines in the sense of urgency. Realize that complacency can set in so be ready with backup solutions to maintain momentum. Take advantage of new developments to apply to change initiatives and improvements. Essentially, building a culture acting with a high sense of urgency will focus on the strategy for producing a true sense of urgency and application of the four tactics that are needed to make a positive change become a constant.
Solving problems and making decisions go hand in hand. Here’s some tips on how to do a better job of defining problems and how to make good decisions on effective solutions. First, let’s address problem solving.
Here are the three steps to solving problems. First, clearly identify the problem. Second, clarify the problem, and then find the cause. The process of thinking or solving a problem only happens after you have captured and fully understand the problem. The biggest hurdle in solving problems is thinking you know everything and that nothing needs to be changed.
Since “perception is 9/10ths of the law,” there is a tendency to base decisions and actions on what’s perceived to be true. The key to diagnosing problems is separating truth from what seems to be true. Don’t jump to conclusions.
Learn to think out of the box and master the obvious. Look for potential mental blind spots and avoid them. Sort out the facts, avoid ambiguous and vague descriptions and don’t act on assumptions.
Here’s a diagnostic approach to dealing with problems:
- And how?
Other steps should include this five-step process:
- Define the problem.
- Clarify your objectives.
- Develop creative alternatives.
- Consider the consequences.
- Analyze the trade-offs.
Defining the parameters of a problem is essential. Dig into the issues and make sure that you’re focusing on the right things. Be flexible and evaluate all the parameters and be willing to shift based on changing circumstances.
Problems need to be captured, developed, examined, and then given a shape. Try to understand the magnitude of what you don’t know. The current reality of the situation is easy to miss, avoid, or ignore.
A key step in solving problems is carefully examining the details and writing them down. This helps to clarify uncertainty. Writing down the problem creates conciseness, accuracy, and gives you a better understanding of the problem.
Following this process helps clarify what you know, what you don’t know, and what you are trying to find out. It helps you separate problems from the details so you can better understand the nature and scope of the real problem.
Clarification lets you evaluate the size and gravity of a problem and puts you on a fast track toward finding a solution. From this point, you can address increasing productivity, improving quality, doing things faster, and reducing costs.
The next and most important step in the process is taking action to implement the solutions. Don’t procrastinate! Just act and implement the solution. Just think about how much time is wasted by thinking and talking about what we are going to do. Just doing it saves a lot of time and produces more results.
Small business owners need help managing their business. They are challenged daily with complex issues and decisions that significantly impact their profits. Having an experienced and skilled advisor help them make decisions increases profitability.
Too many CPAs are comfortable just doing the tax return. Success requires constant monitoring so key concepts and ideas are considered and not overlooked. In addition, clients get wrapped up in day to day details and frequently don’t stop to capture the big picture.
Helping small business succeed is an on-going process of education and providing them with a blueprint for success. CPAs and advisors need to be proactively engaged in raising questions and listening. This produces an action-oriented environment to identify the issues and develop effective solutions. It provides what I call, a road map to success.
The road map to success focuses on profitability and building business value. It is an approach that applies a blend of financial and non-financial measurements to make sure results are on track. It is a process of continuous assessment of the business and triggers action and produces results. A primary tool that I use with clients is a rolling forecast of financial results that considers actual results combined with our best estimate of future results. This gives a view of profitability in addition to expected cash flows.
I conduct monthly meetings to review results and go over the rolling forecast. This enables evaluation of business plans and strategies allowing for an effective and profitable business process. It also sets the stage for problem identification and implementation of solutions. From here, we create a Journey to Results with a road map to achievement.
The road map gives clients an approach to focus on their business. We can scope out what needs to be done and address the reality of economic and market conditions. Products and services are optimized and allows business owners to get the most bang for their buck.
This coaching or advisory process is what I provide to every client. It works, so why not give it a try and see what your business can achieve.
Building success in business and in life requires five essential ingredients. First, you need a vision of where you want to go and what you want to accomplish. Then you need to establish goals and objectives, otherwise you’re just wandering aimlessly with no direction. Goals and objectives form the foundation for action plans and steps that are needed. Finally, you need to measure your progress. It seems simple, but amazingly many businesses don’t follow these steps.
I have coached and taught the tools and techniques needed to achieve business success to hundreds of businesses and thousands of students over the years. Now these tools and techniques have been combined into affordable self-paced programs. The programs include Creating Success, Accounting Basics, Basics of Business Financial Management, and Basic Business Skills.
In addition, I created the Boot Camp for Small Business to establish a foundation for small businesses to grow and increase their value. These self-paced training programs provide the secrets to building business success and provide a roadmap to start a journey to results. The Boot Camp says that when you get the strategy right, the profit will follow. When there is profit potential – there is access to capital.
Accounting is the language of business. Business success is dependent on accounting. Accounting Basics teaches business how to measure results, how to analyze business transactions, and manage cash flow. It also spells out the techniques for budgeting and planning, how to understand profit and loss statements, and how to read balance sheets.
The Basics of Business Financial Management focuses on how to use financial reporting tools. Students learn how to manage debt, management of cash flow, and how to create a budget. The training program provides all the steps needed to create financial plans and forecast financial results.
The Basic Business Skills training program provides the tools needed to grow your business. Businesses learn how to sell and market their products including the techniques of pricing. The essentials of business law are spelled out. Business operations and the basics of managing inventory are also included in the program. This program helps businesses achieve success, maximize profits, and cash flow.
These training programs provide the secrets to building business success. The Boot Camp provides the following essentials:
- Attract more customers
- Get them to come back more often
- Get them to spend more each time
- Get them to recommend you to their friends
Sadly, very few businesses have a strategy focused on these growth steps.
Businesses and individuals can benefit from the knowledge provided by these programs. That’s why I created them.
I have been taking some time to listen to my own advice. What do clients and prospective clients want from me? What makes me different from all the other advisors and coaches trying to gain client trust?
This lead me down the path of trying to understand what people want from me and how can I do a better job of helping them. Here are some of the things I think business want and need.
Businesses want to get things done. They want their advisors to anticipate their needs. They want fast results because there is a lot to get done. They want advisors to tell them how to “improve profits” and “gain a competitive advantage.” Try to talk to them in language that they understand and that is not tech-talk.
Advisors and clients need to plan their work together. Businesses want help in measuring and monitoring everything, so they can achieve better results. Tell them like it is and don’t fudge the facts.
Make sure that you’re available and around. Ask them questions about non-accounting and non-technical things and make sure that you understand their objectives.
Help them learn from you. Also, train their people so they can share the expertise you have to offer. Be out front and dig into the operations. Think about the problems and give business owners access when they’re worried.
Give them something new and different. Make them stand out. Give in from time to time, but don’t ever give up. Yield on means and methods, but NOT on their goals.
Clients want your help to build better a business. They want help with their commitment to grow and create a vision of what truly can happen. Finally, help them access the resources and systems to make it happen.
Provide high quality problem evaluation, assessments, planning, education, and solutions for individuals and businesses. The solutions network ranges from tax and estate planning, business succession, financial planning, financial management, business strategy and operational guidance. My focus is on the creation and protection of wealth for business owners.
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There isn’t an individual or a business that doesn’t have problems of some type. In many instances we’re not aware of the problem or the exact nature of its components. It’s difficult to solve problems when we’re not sure that we have one or why we have it. Therefore, identifying problems and finding solutions to them is critical to success.
I’m a CPA, a consultant, and a businessman. My job is to help identify problems and find solutions to them. Developing relations with individuals and businesses enables me to provide a wide range of advice to take advantage of opportunities and tackle problems.
Achieving these objectives develops from understanding a business or an individual’s situation. By asking the right questions and listening carefully we can develop an understanding of your situation, problems, and opportunities. One of the tools used to accomplish meaningful understanding is by reviewing and assessing the situation. Information gathering helps reveal the problems and in many instances, provides solutions.
I was fortunate to be exposed to a wide range of professionals when working in the consulting department of a large national CPA firm. This experience enabled me to learn about the full range of available services offered and receive training from these pros. These experiences helped me develop programs for Thompson Reuters and the Boot Camp for Small Business.
Services for individuals include estate planning, retirement planning, risk management and educational programs. Business services include planning ranging from strategy, family business succession, and annual business planning. Other services range from marketing and sales to operations.
I have been able to take my experience as a controller and chief financial officer to help businesses improve management of their financial operations and accounting. Teaching accounting, financial management, and a business skills course through Villanova University added another level of management expertise to help identify problems and solutions to business issues.
These experiences have allowed me to help individuals and businesses succeed. It starts with a needs assessment to determine problem areas. Once problem areas are identified, the process of finding and implementing solutions can begin. In instances where I don’t have the expertise to deal with a problem, I have a network of professional resources that has the capability of implementing a solution.
It’s important to realize that finding solutions is the way to create success.
Effective thinking is what separates superior performance from average performance. It is a mindset that allows your talent to excel. Thinking effectively is not something you have or don’t have. It is developed from experience and coaching.
Effective thinking is like confidence, composure, and mental toughness. When you think effectively it shows based on how you look, feel, and behave. Think of effective thinking as a state of mind and a way of performing and reacting mentally. It is not etched in stone and can change based on the situation.
Think about what you want to have happen versus what you don’t want to happen. Thinking effectively is a choice you make every day. Try to reward your effective thinking just like you would any other performance. It takes practice and perseverance to achieve effective thinking on a consistent basis.
People tend to spend energy on things that are non-productive. It is essential to place your focus and energy on what you need to do and avoid things and situations that don’t matter and that you can’t control. One way to get control over how your energy is focused is to identify and document all the factors that you cannot directly control. Then list all the factors that you can control that impact your thinking and actions. Finally, identify areas over which you have some control.
For items where you have no control there are three ways to deal with these thoughts:
- You can worry about these factors and let them negatively impact your thinking and performance.
- You can forget the uncontrollable factors since you can’t do anything about them.
- Or you can “just let go” of the non-controllable factors and make up your mind to overcome them with your thinking and performance.
For factors where you have some control, the key is to handle these situations in the best way possible and not let them negatively impact your thinking and performance. It is important to realize that there will always be things over which you will never have complete control. This is a fact of life so do the best you can and move on.
Effective thinking requires that you regularly assess your thinking and performance. This helps to figure out how to improve and get better. By understanding factors affecting your performance you can commit and respond to them appropriately. This process will take some time, so be patient. Just remember, your decisions, not the surrounding non-controllable factors will determine your destiny, your thinking, and performance.
Learning is the process of acquiring knowledge. It is an opportunity to understand yourself and the environment surrounding you. It prepares you to respond effectively whenever you face similar situations. Learning boils down to realizing what you did wrong and taking steps to make sure it doesn’t happen again.
Learning is a never-ending process and you’ll never “learn it all.” But if you don’t try, you will fall short of what’s possible. You may not learn everything there is to know about a topic, but you’ll end up with more knowledge just by putting forth the effort.
Learning isn’t a top-down process so try and be open to everything and everybody. This approach allows you to accumulate knowledge and information you never imagined was possible. Learning is acquiring new knowledge and doesn’t need to occur in any set fashion. Try listening to people you thought had nothing to teach. You might be surprised regarding the knowledge gained by following this approach.
Figure out what process works for you. Then, decide on what doesn’t work. The key to success is to then do what works. Learning gives you an assessment and validation of what works and what doesn’t.
When assessing learning needs, address the topics and issues that you need to help improve your life and advance your career. Learning can be in the form of books, courses, video, or images. In some instances, you might engage multiple formats in the process.
The key is to keep an open mind regarding your needs and requirements. Think about the possibilities that will improve your capability and situation. However, be realistic relative on your ability to absorb and utilize new knowledge. The goal should be continuous improvement in areas that make sense and fit with your objectives.
Approach learning with the proper mental attitude and a positive outlook. There always is going to be something new to learn. The secret to success is to never stop trying to improve.
Since we’re on the topic of learning, here are business programs I have developed:
- Creating Success
- Small Business Success Program
- Small Business Boot Camp (covers the essentials all business owners need to understand)
- Accounting Basics
- Basics of Business Financial Management
- Basic Business Skills (a mini-MBA program)
These programs will help take you and your business to new levels of success.