Creative accounting…

I returned to Galesburg, Illinois last month for Homecoming weekend.  My major at Knox College was Accounting and Business Administration. Perhaps that started my interactions with creativity during my sales career. 

Walmart's Sam Walton had a few creative interactions, too: 

Nowadays, you hear a lot about fancy accounting methods… but back then we were using the ESP method… It's a pretty basic method: if you can't make your books balance, you take however much they're off by and enter it under the heading ESP, which stands for, “Error Some Place."

I benefited from a creative sales entry at ADP once.  I had booked a large, National Account order right before the end of our fiscal year.  It not only qualified me for President’s Club but it qualified my VP of Sales, as well.  Then the fit hit the shan… 

The customer called me apologetically to cancel the order.  I was crushed.  I informed my VP right away because: 

Bad news does not improve with age. 

D. Michael Abrashoff 

There was no way around it – or so I thought. 

Fast forward to the beach 8 weeks later with my VP of Sales and our spouses.  I asked my boss why that “No Start” didn’t cost me (and him) President’s Club? 

Turns out he, our Controller, and General Manager decided to enter that negative accounting transaction as a “UBV”, unexplained business variance.  

Creative accounting at its best.

                                                            GAP

When life gets tough we could get a helmet… or… we could leverage the peace and share the power of a positive perspective.

Make it up in volume…

Much has been said about making money.  Losing money?  A little less popular of a topic.  Not as glitzy I suppose.  Glitzy or not, we don’t have to be a sage, seerer, or soothsayer to know the most common way businesses go out of business is losing money, true? 

Not having a firm grasp of costs (which results in losing money) has plagued companies throughout the ages.  I quoted a former IBM CEO earlier this year: 

There were times when we lost money on every PC we sold, and so we were conflicted - if sales were down, was that bad news or good news? 

Louis V. Gerstner, Jr.

I spent my entire career selling modern technology to business executives.  Each deal was hotly contested by multiple vendors.  Each client would share a few common goals – cut costs; improve margins; have reliable data to make better decisions; etc.  The client’s evaluation committee could get quite political.  My advantage?   I knew Todd: 

Todd's Political Principles 

·         No matter what they're talking about, they're talking about money.

·         Truth varies.  

One of my client stands above all the others.  Not solely because it was the largest sales transaction I ever closed; but because of the business justification their VP and Controller, Pete Krejci, shared.

At our very first meeting Pete said: 

Gary, I’m probably going to spend $2 million with Oracle; I’m willing to spend $50k just to ensure it works. 

An interesting introduction, don’t you think? 

I sold Pete’s company, UnoVen, Oracle’s Enterprise Resource Planning (ERP) system back in the day.  UnoVen was a joint venture between Unocal Oil Company and Venezuela.  Unocal had a refinery on the southeast side of Chicago; Venezuela had the oil.  UnoVen sold their finished products through a couple hundred gas stations in the Chicagoland area. 

UnoVen had the usual goals – cut costs; improve margins; etc.  But in Pete’s case, he was having a particularly hard time getting his division managers to realize the importance of reliable data for making good business decisions.  He explained his business case this way: 

Gary, what keeps me up at night is when I tell my division managers we’re losing a penny a gallon at the pump, they respond; don’t worry.  We’ll make it up in volume. 

And that is how businesses go out of business.

                                                            GAP

When life gets tough we could get a helmet… or… we could leverage the peace and share the power of a positive perspective.

Salute to women…

I like to reflect on life’s little moments.  Like picking up horse manure in my wife’s indoor arena recently; reminded how blessed we are having an indoor arena!  Not to mention the awesomeness of my wife’s horses:  

The smell of horse manure brought to mind this story of my wife and salespeople. 

We were visiting vendor booths at the National Western Stock Show several years ago.  My wife was focused on the builders of buildings, barns, and arenas.  She was a “lead”.  As a sales professional, I get a kick out of how other salespeople “qualify” leads.  Most leads turn out to be “just looking”.  A few actually buy.  But how do you separate “lookers” from “buyers”?  I mean salespeople aren’t clairvoyant: 

At a recent annual meeting of the International Association of Clairvoyants, the meeting began by reading the minutes of next year's meeting. 

                   Unknown Sage 

I know sales cold-calling is tough; trade show leads are not much warmer.  However, how many deals are lost simply for lack of follow-up?  Rick Page once said: 

Sell the way the customer buys and allocate your resources accordingly. 

Either she didn’t seem credible (under the “this woman is too good to be true” syndrome), or the salespeople we spoke to were overly adept at qualifying.  True - I did most of the talking (no surprise there)… describing what we wanted; when we wanted it; and, most importantly, who our decision-maker was.  My soft-spoken wife was “VITO” (from the book Selling to VITO: Very Important Top Officer).  Straight forward?  Guess not.  

My wife was looking for a custom-built, indoor riding arena.  The final design was a 110 foot by 65 foot; two-story building; sitting on a quarter acre of our property.  One would think salespeople would be chomping at the bit to follow up on lead like this.  Guess not. 

She spoke to eleven vendors.  Four followed up.  Four.  Was she worthy of a follow up from the other seven?  Guess not. 

The first vendor quoted her a price per square foot over the phone.  No appointment; no explanation on useable square feet; no references; no visuals!  Very efficient, but she was actually expecting a sales meeting.  The second vendor would only meet if I (the “husband”) was present.  He refused to believe my wife was VITO.  Was she amused?  Nope - just insulted. 

The third vendor scheduled an onsite appointment.  He shared drawings and a pricing worksheet.  He set up two references so she could see examples of his work and talk with his customers.  After checking on county building codes, he returned for a final consultation along with his proposal.  All of these sales meetings were conducted thoroughly and professionally.  He won her business. 

The fourth vendor?  He called in June.  The Stock Show was in January; the arena was finished in May. 

Is “Make them beg” the motto of some salespeople?  Norman R. Augustine commented on business executives condoning this type of sales (in)efficiency: 

It nonetheless spoke highly of the firm's management that they seemed to be going out of business in an orderly fashion. 

I always believed salespeople are not qualified to qualify prospects (aka “leads”).  Did I waste time with “unqualified” leads?  Occasionally.  But other times I was closing the deal while my competitors were debating whether to follow up, or not.  I believe first in; best dressed; wins the “modern buyer’s” business! 

Really, my wife is VITO.  I’m just the poop-picker-upper! 

                      GAP 

When life gets tough we could get a helmet… or… we could leverage the peace and share the power of a positive perspective.

Oh well…

Hey everyone – its income tax week!  Hooray! 

Actually, we’ve been given a Covid extension until May – but who’s counting?  (Other than the IRS!)  Do you think our elected officials are cheering on the sideline as our tax returns flow in?  Oh well.  

Does it ever seem to you that no matter how you complete your income tax return; no matter how much outside, expert advice you leverage; no matter what plans you put in place to lessen your tax impact next year, you still seem to be funding everything? 

On the one hand… 

I dislike the immense level of government spending that takes place today at the federal, state, county, city and even master association level.  The media reminds us of the tremendous waste that seems to occur every day; every way.  Today, with our anytime, anywhere, all-the-time, political action committees – they all have a position on the state of our federal, state, and local taxation, true?  Could it be some of our taxes are funding their messages?  Oh well. 

On the other hand… 

When there is a natural disaster; when we hear of a scientific breakthrough funded by a government grant; or when we simply have a friend or family member in need who receives financial or medical support from a social services program… well, I for one am happy I live in America. 

This time is one time during the year when we total it up.  Sometimes we like the resulting sum; other times we don’t.  Talk about “new math”! 

The Income Tax has made more liars out of the American people than golf has.

                        Will Rogers 

Question:  If I work from home and my dog barks when the FedEx driver arrives; does she qualify as my receptionist – and can I write-off the cost of her dog food?  No?  Oh well. 

All in all, when I reflect on my financial picture – I am blessed.  How about you?  I suppose it all depends.  Filing income taxes forces us to look at our W-2; our 401k; our IRA; our mortgage interest; our real estate taxes; and all of the other numbers the IRS wants us to look at; and report on.  That’s one way we measure; some years good - some, not so much.  

When we look in the mirror, often our not-so-much years are self-inflicted: 

More and more these days I find myself pondering on how to reconcile my net income with my gross habits.                               

John Kirk Nelson 

We heard growing up that, “Money isn’t everything”.  Does that perspective apply as adults?  Hopefully so.  Our top line income, even when reduced by taxes, still can be more than enough for a man that is easily contented.  Unfortunately, the itch of discontent rears its head all too often.  I mean, how many billions does it take to content our billionaires?  

Nevertheless, it’s not what we make that counts; it’s what we save.  Today, “line of credit” seems to have replaced the importance of savings.  Like our federal government, line of credit means “debt”.  Unlike the Fed, we can’t just print money.  Oh well. 

We are looking forward to 2021 – this will be our best year ever!  We can stay in control of how we define “best” by following the guidance of the world-renowned author and poet, Robert Lewis Stevenson: 

Don’t judge each day by the harvest you reap, but by the seeds you plant.                                

And no – the seeds are not tax deductible.  Oh well. 

GAP 

When life gets tough we could get a helmet… or… we could leverage the peace and share the power of a positive perspective.

A Bear and a Beer…

Springtime is here; warmer weather; reminds us summer is on its way.  Summer makes me think of a cold beer on a hot day; which makes me think of my Dad.  He loved a cold beer on hot days. 

When I think about my Dad I can’t help but remember his perspective about how much things cost.  He’d always pine, “Oh, the cost of gas is outlandish!”  Or he would complain about the price of bananas; milk; bread; you name it.

I bet you’ve heard these complaints from the older generation.  They are “Depression Era Babies”; people who grew up in very different times than ours.  Now, I don’t like over spending any more than the next guy, but I know I am truly blessed.   Of course, I get that annual shock about this time of year when income taxes are filed.  Reminds me of the saying from our favorite, Unknown Sage,

When I first started working I used to dream of the day when I might be earning the salary I'm starving on now.

When my 401-k statement arrives?  Well, my Dad’s complaints on how far a dollar can’t go any more come back to mind.  I think of the,

Market Terminology for Dummies:

Bull Market - A random market movement causing the investor to mistake himself for a financial genius.

Momentum Investing - The fine art of buying high and selling low.

Standard & Poor - Your investment strategy in a nutshell.

Mailbits.com

         

So it’s obvious that I’m going to be working for “a while”.  Let’s just say that I’m not quite to the point of being a Wal-Mart Greeter, but I am paying closer attention to where their employment application kiosks are located.  I’m trying not to let this get me down, though - I love my work, and I’m blessed with my income. 

I’d like to keep working as long as I’m physically (and mentally) able.  If you saw my golf game you’d tell me not to retire yet either.  However, like my Dad I confess that I’m starting to pay closer attention to how much things cost.  Norman Augustine, the former head of Martin Marietta Corporation did also.  He shared this story:

A bear who, displaying a $5 bill, had entered a bar and ordered a beer and; the owner of the bar directed the bartender to give the bear the beer, saying that since the bear didn't look very smart to only give it 25 cents in change.  Having done as he had been instructed, and having watched incredulously as the bear placidly sipped the beer, the bartender finally could no longer contain himself and sought to engage the bear in conversation.  You know, he said to the bear, we don't get many bears in this bar.  To which the bear is said to have replied, at $4.75 a beer, it's no wonder.

Funny thing about money; no matter how much we make, it’s not quite enough to take our minds off the price of things.  How we deal with the delta between our take home pay and our household budget has a lot to do with our daily outlook, yes?

“Houseless”, adj. 

Having paid all taxes on household goods.

Ambrose Bierce 

So whether it was my Dad’s watchful eye on prices; filing income taxes each year; or that bear placidly sipping his beer; all serve to remind me that my glass is truly half-full.

GAP

When life gets tough we could get a helmet… or… we could leverage the peace and share the power of a positive perspective.