The Aha Moment A Lesson Learned From Stephen Strasburg And The Washington Nationals - Aug 30, 2010
Posted by: Edward Baloga in Articles
Ed Baloga is a New York based partner and business advisor with B2BCFO® and can be reached at ebaloga@b2bcfo.com.
Where's The Beef - Jul 26, 2010
Posted by: Edward Baloga in Articles
This memorable line spoken by Clara Peller of Wendy’s fame came to our attention in January 1984. The campaign ended the following year. It referred to an imaginary competitor’s enormous looking hamburger. In fact, that bun only had a minuscule hamburger patty inside. The line even made its way into politics during the 1984 presidential election.
In today’s online, web-connected world, the line that marketers need to ask themselves is, “Where’s the content?”
This question is answered in an interesting article called The 10 Commandments of Content Marketing by Eric Anderson, VP of Marketing at White Horse, a digital marketing agency based in the Pacific Northwest. He contends that it is no longer enough to have just a web site. The idea that advertising and social media are mutually exclusive is no longer the case. A summary of these Commandments is outlined below:
#1 Content shall be shareable
Advertising is about creating something worth passing on. Broadcast advertisers that top the viral video charts week after week don't shout -- they amuse, entertain, and inspire.
#2 Content shall be malleable
How does the message fit the medium? Brands are built on trust. And trust is built on relevance. Good content is always relevant.
#3 Content shall be collaborative
Doritos let consumers create the brand's Super Bowl ads. These ads were the most-favored and most-recalled of the Super Bowl, and they were the most-shared (see #1).
#4 Content shall be measurable
When you put content out on social networks, on YouTube, on blogs, etc. -- you can measure the traffic that comes back.
#5 Content shall be fearless
Content concerns itself with an exchange of ideas, so it morphs and evolves as new ideas are added.
#6 Content shall invite comment
Most content produced for our customers will fail. This is a good thing; success depends on knowing when things fail, so we can try something else.
Almost every hiring manager or recruiting firm, when posting a job description looks for a similar trait, “Ability to multitask.” This may be attributed to the digital age in which we live.
But do we really multitask?
Author Dave Crenshaw, The Myth of Multitasking: How "Doing It All" Gets Nothing Done, might describe the ability to walk and chew gum as “background tasking.” The idea of multitasking is nothing more than refocusing your attention from one task to another.
In her 2008 article in The New Atlantis, The Myth of Multitasking, Christine Rosen writes, “Used for decades to describe the parallel processing abilities of computers, multitasking is now shorthand for the human attempt to do simultaneously as many things as possible, as quickly as possible, preferably marshalling the power of as many technologies as possible.” Among a number of research studies that she writes about, Rosen describes one study at Vanderbilt University. One of its conclusions was that a bottleneck occurs in the brain when it is forced to respond to several stimuli at once. As a result, task-switching leads to time lost as the brain determines which task to perform.
In a recent New York Times article, Your Brain on Computers: Hooked on Gadgets, and Paying a Mental Price, author Matt Richtel, writes, “While many people say multitasking makes them more productive, research shows otherwise. Heavy multitaskers actually have more trouble focusing and shutting out irrelevant information, scientists say, and they experience more stress.” He cites a research study by Eyal Ophir at Stanford University on multitasking that concluded that multitaskers had trouble filtering out irrelevant information and that they were less efficient at juggling problems.
Are we becoming victims of information overload? Melina Uncapher, a neurobiologist on the Stanford team says that this idea was supported by more and more research. Richtel also mentions a study at the University of California, Irvine, which found that people interrupted by e-mail reported significantly increased stress compared with those who focused on the task at hand. Dr. Gary Small, a psychiatrist at the University of California, Los Angeles says that stress hormones have been shown to reduce short-term memory.
Rosen suggests that maybe we need to pay more attention to the task at hand and to exercise judgment about what objects are worthy of our attention. She offers a quote from Isaac Newton. When asked about his particular genius, he responded that if he had made any discoveries, it was “owing more to patient attention than to any other talent.”
Who Is Driving Your Car - May 25, 2010
Posted by: Edward Baloga in Articles
I am often asked, “A CFO and controller are the same thing, aren’t they?” Or it might be, “Isn’t a controller a lower paid chief financial officer?” The question generally comes from a business owner. In general, an entrepreneurial company might have one position or the other (unlike their big company counterparts which usually have both positions).
In many cases, a person might have the title of CFO but not the skill set. I recently met a business owner who said that his top financial person was a controller. An appropriate title I thought. I learned that the person was going to school at night to get their bachelors degree in accounting. They had been with the Company for a number of years and their salary was such, that a “bigger” title was needed to justify the amount. Don’t get me wrong, the person was very capable at making journal entries and making sure that the month end depreciation was posted to the books. However, they didn’t have the experience or training to deal with some of the strategic issues that the $20+ million business was facing, e.g., creating a business plan needed for a loan extension from the Company’s bankers.
So what exactly makes a chief financial officer different? Think of your business as a car traveling down the highway. When the controller is driving, he or she is constantly looking in the rear view mirror seeing what has already gone by. Many duties of a controller might be similar. They are concerned with the day to day mechanics of the accounting department. Was the payroll processed? Did the accounts payable clerk record the vendor invoices received last week? And so on…
Although a CFO needs to look in the rear view mirror once in a while, they are more focused on the road ahead. They are looking to see if there are any potholes in the highway to steer around. Are there detours to be navigated? During a long road trip, he (or she) is looking at a map to determine the easiest (a/k/a least expensive) and best route to take. Think of a business plan as being the road map for your business. There are going to be bumps in the road and modifications to your plan will be needed. If your staff and advisors have been down that road before, the trip will be much more enjoyable.
If you need assistance driving your business to your next destination, call Ed Baloga, a New York based partner with B2B CFO® at 914.474.9547 or via email at ebaloga@b2bcfo.com.
The Gray Lady And Financial Statements - Mar 29, 2010
Posted by: Edward Baloga in Articles
A number of years ago, shortly after joining a multi unit retailer with approximately 200 locations, the assistant controller faxed me the monthly income statement given to the board of directors. It looked like a trial balance of every account. It was 2 pages and contained close to 100 lines and had 10 columns. It was the wrong document.
I picked up the phone. “Steve, you sent me a trial balance. I wanted an income statement.” He told me that is what he sent. I looked and it was indeed an income statement. Upon closer inspection, I noticed that there was something wrong with the variance figures. Actual revenue in one category exceeded the budget but yet the variance was negative as it had a minus sign in front of it. I asked him about the error. He replied that the calculation was correct. I needed to look at the small print at the top of the column which showed Dr./Cr. (I will save you the accounting jargon, but basically, an increase in revenue is shown as a Credit (Cr.), which is sometimes shown with a minus sign).
“Steve, how many accountants do we have on the board?”
“None,” he replied.
I proceeded to explain that not everyone understands the idea of debits and credits. What if there was dirt on the glass of the copying machine? That speck of dirt might look like a minus sign on the copy changing the meaning of the variance. I told him to use parentheses instead of minus signs and not to use them for debits versus credits. When someone sees a variance, they understand that brackets are bad and positive numbers are good.
Next was the length of the report. Why so long? It had every conceivable income and expense detail in it. Steve said that he was trying to cover everything in the one document. I asked him to take a look at the New York Times (a/k/a the “Gray Lady”). The most important story for the day is always above the fold and in the extreme right-hand column. Not every angle to the story was covered in that particular article. There were additional stories inside about the headline event. I told him to keep his audience in mind - stay away from the technical accounting stuff and stick to the message he was trying to convey, i.e., we exceeded revenue estimates for the month and were able to keep payroll costs well under budget.
He ended up creating a summary statement with basic information that showed key drivers and indicators. It was a simple document. Senior executives and board members could easily get a sense of what was going on in the business with a quick scan of the statement. If they wanted details on a particular revenue or expense category, the details were inside.
If you need help organizing the headline stories for your stakeholders, call Ed Baloga, Partner with Read more...
Its The Most Wonderful Time Of The Year Or Everything Old Is New Again - Dec 10, 2009
Posted by: Edward Baloga in Articles
If you want to listen to the Andy Williams’ classic while reading, here is the link on YouTube http://www.youtube.com/watch?v=gFtb3EtjEic
Having spent a number of years in the toy industry, this time of year was always fun. How could you not smile even when putting in endless hours finalizing budgets? There were talking Alvin and the Chipmunk toys on the bookshelves or the latest edition of Matchbox cars on the desk.
One thing about the toy industry, many toys are not necessarily new ideas. They are an update of an older one. There is nothing wrong with that. People make a lot of money by updating existing ideas. Today, kids use paintball guns. Back in the 80’s and 90’s, they played Laser Tag (the gun emitted a light that set off a sensor on an opponent’s vest). When I was a kid, we used die-cast metal cap guns (there were a lot of arguments about whether you got your opponent or he got you). Even Rubik’s Cube has been updated (an iPhone-like electronic version).
Every so often, a company’s big idea to update or reinvent a product comes up
short. New Coke anyone? Even Coca-Cola’s competition isn’t immune. Earlier this year, Pepsi’s Tropicana Orange Juice staged a major re-branding by updating its iconic image to a more contemporary one. Sales promptly dropped 20%. In less than two months they went back to the original image. The problem was that it was harder to find the product on store shelves. It looked like other more generic brands.
Many companies look to reinvent the way they do business. There is one company that comes to mind that has transformed itself a few times. It started as a time recording company, became an office equipment company, then computer hardware. Today it gets the lion’s share of its revenue from technology services. Ever hear of IBM?
Many small business owners find that they must reinvent themselves to compete in today’s world. An acquaintance of mine (an owner of a printing company) feels that in 5-7 years, his company will not be providing traditional print services, but will be more of a marketing design and consulting company. He is laying the foundation now.
The key to making changes in your business is to plan accordingly. The decision comes down to dollars and cents. To put it another way, it is you....
Posted by: Edward Baloga in Articles This was a phrase uttered countless times by Ed Sullivan, an institution on Sunday nights. The Ed Sullivan Show ran from 1948 until 1971 (originally called Toast of the Town and renamed in 1955). Comedian Alan King once quipped, "Ed does nothing, but he does it better that anyone else on television.” The show was even immortalized in song, Hymn for a Sunday Evening, from the 1960’s musical, Bye Bye Birdie. One lasting memory of mine is the plate spinner that would appear on the show (that and the puppet named Topo Gigio, an Italian mouse). The juggler had long, flexible poles and he would start to spin plates on top of them. He continued adding plates to the remaining poles. He didn’t have any trouble keeping the first few plates spinning. As a plate would start to slow down and wobble, the juggler would go back and vibrate the pole until the plate regained its momentum to stay in place a little while longer. When the number of plates increased to 10 or so, he did a great deal of running around. Once in a while a plate slowed down enough that it fell and broke. He would quickly start spinning another plate on that pole. When the number got up above 15 or more, a few more plates would crash to the ground until finally, he gave up and they all came crashing to the ground. I am sure many business owners can relate to plate spinning. In his book, The Danger Zone, Lost in the Growth Transition, Jerry Mills describes how owners (called Finders) create successful businesses by creating products and services to sell, building relationships with customers, and creating relationships with vendors. Finders perform activities that bring sales and cash into the company. This initial success causes the Finder to expand these activities. Eventually, this sales growth cannot be supported by the company’s infrastructure or the line of credit from the bank may be insufficient. Customer service may suffer and sales flatten. The cash needs of the business start to exceed the cash being generated. This is the beginning of The Danger Zone. These are tasks that many Finders may not be good at, but more importantly, do not like doing. Think of a homebuilder that has a reputation for building quality homes with fine craftsmanship. They probably did not get that reputation because they knew how to balance a bank statement. Posted by: Edward Baloga in Articles
It is estimated that 8%-10% of the US population (24 million to 30 million individuals) suffers from diabetes. This includes both diagnosed cases as well as those individuals who may have the disease but have not yet been diagnosed. Why should this be a concern to employers? Diabetes costs $116 billion annually in direct medical costs and is estimated to cost another $58 billion annually in indirect costs (loss of work, disability, loss of life). As an employer, you can make sure that your health insurer provides programs to help your employees manage their disease. This is something that won’t cost you anything. After all, it is in the insurance company’s best interest to make sure your employees maintain their health, i.e., less complications means lower number of claims paid. It also means that your experience rating as it relates to your employees becomes more favorable resulting in lower premiums. Another reason why you should be aware of diabetes is the Americans with Disabilities Act (ADA). The ADA is a federal law that prohibits discrimination against individuals with disabilities. Diabetes may be considered a disability under the law. Unfortunately, I learned about the ADA the hard way. My older son was diagnosed with Type 1 diabetes in 2002 when he was 6 years old and certain accommodations had to be made in school. Approximately 10% of the individuals with diabetes have this more serious form of diabetes. Type 1 diabetes (juvenile diabetes)
Type 2 (non-insulin-dependent or adult-onset)
Gestational Diabetes This quote was originally attributed to sportscaster Dan Cook. Cook used the expression in a television broadcast on May 10, 1978, before a Washington Bullets-San Antonio Spurs playoff basketball game and popularized by Bullets’ Coach Dick Motta. Later, first use of the quote was attributed to the late Ralph Carpenter, the former Texas Tech sports information director, commenting when the Aggies rallied for a 72-72 tie late in the SWC tournament finals two years earlier in March 1976. Dewey Defeats Truman anyone?<....
Posted by: Edward Baloga in Articles I recently attended a seminar conducted by Skip Weisman. After completing a 20-year career in Minor League Professional Baseball management, Skip launched Weisman Success Resources to help small to medium sized companies improve their approach to their businesses. "Champions do not necessarily do extraordinary things, but Champions always do fundamental things extraordinarily well!” Think about it – it’s the little things that count. One of the most boring drills in spring training is the pitcher covering first when the ball is hit to the right side of the infield. The drill is repeated over and over. Can you recall a time when your team’s pitcher failed to cover first and the runner eventually scored? It’s the little things. Even in this month’s playoffs, you can see examples. The Twins’ Nick Punto assumed that a ground ball up the middle went through to the outfield. He rounded third and headed for home. The Yankees’ Derek Jeter fielded it behind second base and threw the ball home to catcher Jorge Posada, who threw to Alex Rodriguez and caught Punto diving back to third. Nick Punto was quoted as saying, “I wanted to dig a hole, crawl inside it and die. It was really embarrassing.” One would have thought that the Twins learned in the fourth inning of a scoreless Game 2. Carlos Gomez fell rounding second on a single by Matt Tolbert. Delmon Young was heading home; Gomez failed to get in a rundown and was tagged out before Young could score, costing the Twins a run and possibly the game. We know what happened in the series. It is when the little things are done correctly and become second nature, an organization proceeds to the next level. In his article at WeismanSuccessResources.com , Weisman writes that there are five areas on which company leaders must focus to create a “Champion Culture" which results in a high performing, high morale workplace that will generate outstanding results and set you apart from the competition. With Skip’s permission I am sharing them below: A number of years ago, I was a partner in a small business. Our bank was sponsoring a one day workshop called Accounting for Non-financial Managers. My partner was going to attend. Jack, by education and training, was very much a marketing person (he was involved in a number of nationally known ad campaigns and slogans). More than anything else, he hated the idea of not being prepared. As a result, he spent several hours going through the course materials in the days leading up to the workshop. The night before the workshop, he came into my office. He indicated that he was unsure about the definition of cash flow. He spent the several minutes giving me a dissertation on what he thought it was. He ended it by showing me a formula that looked something like this: I studied it for a few seconds and then proceeded to the whiteboard and wrote down step-by-step instructions for determining the cash flow of our business: I turned to him and said, “Simply put, if our cash receipts are greater than our disbursements, then we had a positive cash flow for the week. We are a small business, don’t over analyze it. This isn’t rocket science.” [Editor’s note: The author is incorrect. The formula cited above is rocket science. It is known as the Tsiolkovsky Rocket Equation named for Konstantin Tsiolkovsky, a Russian scholar, who described his theory in a scientific paper published in 1903. It is a mathematical equation that relates the delta-v with the effective exhaust velocity and the initial and end mass of a rocket.] The next day, Jack went to the workshop and the instructor asked for the definition of cash flow. A number of participants proceeded to give answers worthy of a Harvard Business School Case Study. When he got to my partner, Jack repeated the explanation that we covered the night before. The instructor exclaimed, “That’s it! You are small businesses owners. Don’t make it more complicated than i....
Posted by: Edward Baloga in Articles
It was officially known as the Woodstock Art and Music Festival and took place August 15-18, 1969. The concert was originally intended as a way for Michael Lang, John Roberts, Joel Rosenman, and Artie Kornfeld to establish and promote a recording studio in Woodstock, NY. Several recording artists had relocated there, most notably Bob Dylan (today Levon Helm has a recording studio there). The concert was to take place in Wallkill, NY (about 45 miles south of Woodstock). The organizers told town officials that they were expecting 50,000 people to attend. A month before the concert, town officials grew nervous revoked the concert permit. The organizers quickly partnered with Elliot Tiber, whose parents owned a motel in NY’s Catskill Mountains in the town of White Lake (the Catskills is a resort area about 90 miles northwest of NYC where many people from the city would spend their summers). Tiber had a permit from the town of Bethel, NY for a music and arts festival. He had conceived a festival as a way to publicize the family’s motel. The organizers rented 600 acres of nearby dairy land from Max Yasgur. Acts were quickly signed and fees were in the $8,000 to $12,000 range. Jimi Hendrix was to receive $32,000. So other acts didn’t try to raise their price, organizers let it be known that Hendrix was to play two sets, one Sunday and a second on Monday, so it was really $16,000 per performance. In reality, Hendrix was only playing one set on Monday as his contract stated that no other act was to follow him. A total of 186,000 tickets were sold in advance of the concert. Organizers thought they would get another 20,000 or so in walk-up sales. Word of the event quickly spread. Traffic jams on the NYS Thruway and Route 17 (the main highway through the Catskills) ranged from 10 to 20 miles. The crowd grew quickly and fences erected to control access were torn down. Most estimates put the attendance at 500,000. The organizers were not equipped to deal with sanitation issues, food shortages and of course the rains that came. Woodstock Ventures eventually lost $1.4 million related to the concert and the aftermath. In spite of the massive crowds, the numbers of arrests and medical emergencies were small as compared to the number of attendees. Fast forward 25 years to 1994 – the original organizers staged a concert in Saugerties, NY (about 70 miles northeast of Bethel). Fees for musical acts were much, much higher. The promoters had the foresight to line up sponsors (Pepsi was the concert’s main sponsor) and sold TV rights to pay-per-view. However, they never did figure out how to prevent gate crashers. Approximately 300,000 tickets were sold. Another 50,000 of entered free. That was the difference between making and losing money. Michael Lang, one of the promoters of the 1994 event as well as the 1969 festival, said, "In true Woodstock style, the communal spirit lived, i....
Posted by: Edward Baloga in Articles When I was younger, several of us were over a friend’s house watching television. My friend decided he wanted to make brownies. His dad said, “There’s a box of brownie mix in the cabinet. Just follow the directions.” You could hear cabinets being opened and closed. A few minutes later, my friend yelled out from the kitchen, “Are you sure about the directions?” His dad told him yes and to read the back of the box. Several minutes go by and my friend yelled out, “Ewwww – this is gross!” “What’s wrong?” He appeared in the doorway with a mixing bowl in one arm. His other arm was covered in brownie mix from his finger tips to his wrist. His dad asked him why he didn’t use the wooden mixing spoon. “The directions on the box said mix by hand!” The marketing people probably assumed that anyone reading the directions would know that mix by hand meant don’t use to use an electric mixer. It was obvious to them, so why wouldn’t it be obvious to everyone else? You are probably thinking, “What does this have to do with my financial statements?” Have you ever given monthly financial statements to your banker without providing any explanations for any of the items listed? Maybe you thought it wasn’t necessary. An income statement is straight forward, so why bother? Anyone can see that the numbers add up. You give the statements to your banker and he makes several observations: Several years ago, a friend of mine related a story to me about when he was looking to expand his business. He talked to his attorney, tax accountant and banker. His attorney advised him to set up a new company. His accountant said to offer the new item as an expanded product line within his existing business. The banker said it didn't matter to him as my friend would still have to offer a personal guarantee on any monies borrowed (his insurance agent weighed in also, but that is a story for another day). Needless to say he got extremely frustrated going back and forth between business advisors trying to understand their advice. Much of what was said to him was technical in nature. In addition, he was trying to reconcile their different points of view. Part of the problem was that he was trying to coordinate everything himself and still run the day-to-day operations of his business. He finally threw up his hands and said the heck with it. I asked him the background of his most senior accounting employee. He replied that she was a bookkeeper by training (a very capable one he added). Many business owners feel that they cannot afford a CFO and must do everything themselves. Some aren't sure how a chief financial officer adds value. Among other things, a CFO is like a conductor of an orchestra. The conductor interprets the composer's music. The conductor needs to make sure that each section is playing the correct movement at any given time. He or she may not actually be playing the violin or trumpet, but they need to make sure that all of the musicians are working as one. This is like a CFO. They make sure that your business advisors and employees are on the same page and speaking the same language. If your business is in need of a conductor, contact Ed Baloga, Partner with B2B CFO® at 914.474.9547 or at ebaloga@b2bcfo.com.
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Tonight We Have A Re E Ally Big Shew - Dec 3, 2009
The Finder starts performing more and more administrative duties called Minding Activities. These might include:
There may be other distractions that may even cause ....
November Is National Diabetes Awareness Month - Nov 19, 2009
This form of the disease can occur at any age, but most commonly is diagnosed from infancy to the 30s. In this type of diabetes, a person's pancreas produces little or no insulin. It is an autoimmune disease and one does not “outgrow it” as they get older. People with type 1 diabetes must inject insulin several times every day for the rest of their lives. Others such as my son wear an insulin pump that delivers insulin via a cannula inserted under the skin (24 hours a day, 7 days a week).
Type 2 diabetes typically develops after age 40, but can appear earlier, and has more recently begun to appear with more frequency in children. In this form of diabetes the pancreas still produces insulin, but the body does not produce enough or is not able to use it effectively. Type 2 is a metabolic disorder and in many cases can be managed with weight loss and exercise.
…until the fat lady sings.
The saying refers to a Richard Wagner opera suite, Der Ring des Nibelungen and its last part, Götterdämmerung. The "fat lady" is traditionally presented as a very buxom lady with horned helmet, spear and round shield. The aria lasts almost ten minutes and marks the end of the opera.
Obviously, the advertising department at the Philadelphia Inquirer isn’t familiar with the quote or another one by that great American philosopher, Yogi Berra, “It ain’t over till its over.”
The Inquirer ran this ad for Macy’s on Monday congratulating the Phillies on winning back-to-back championships. There was a minor problem; the Phillies trailed the Yankees, having lost three games while winning one (the earliest that the Phillies could win the Series is Game 7 on Thursday).
Play Ball - Oct 21, 2009
Taking Woodstock Lessons Learned 40 Years Later - Aug 27, 2009
Mix By Hand - Aug 10, 2009
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