September 21, 2011
by LaurieKauffman
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Forbes blog: “It’s All Based on Trust”

By: Laurie Kauffman, Contributor

Read the full entry from Forbes

Quick … how do you know trust when you see it?

My little company helps clients find good prospects, develop entrancing, quantified value propositions, and maintain the promise post-sale. This frequently involves a bunch of people in a room with a flip chart. Early in my career I developed a style of giving a little content then popping a quiz. This woke up the room and ensured they would take me seriously.

After questions on capital expenditures vs. operating expenses, cash flow and revenue, and costs vs. expenses, I asked:
“What is the meaning of shareholder equity, found at the bottom of every Balance Sheet?”

Someone said:
“Shareholder equity is treating shareholders fairly.”

Want to join the discussion? Comment on the full entry from Forbes

June 27, 2011
by LaurieKauffman
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How To Ask For What You’re Worth

First of all, the whole concept of one person being “worth” more than another is profoundly disturbing. I’ve been to Mumbai and seen whole neighborhoods of children living in pipes.

Finance is a very crude discipline, yet it is a prism through which all human activity flows. Money is a way of keeping score, but it is certainly not the only way.

Still, we all have to live, and part of that living is asking for what you’re worth.

The best way to figure this out is to make some assumptions about what value you will produce for your employer, and how that value will be measured. As long as you “give back more than you take” you will be a net positive. Every buyer wants a bargain, and every seller wants a deal. So imagine you are the buyer.

What, at the end of the day, will you get for your money?

-  the ability to generate sales?

-  the ability to serve clients (who in turn generate sales)?

- the ability to save more money than you cost?

- the ability to just keep the lights on?

You guessed it –these are listed in order of “financial goodness”, and probably every hire is made for a combination of reasons.

Say you come up with a really big number, more than the “buyer” was anticipating. Put it out there, but insert the magic phrase, “This is what I would be comfortable earning two years from now, based on the following results (which you enumerate because you looked at the discussion from the buyer’s perspective). Can you help me get there?”

If your buyer looks faint at this point, the next best step is to offer to work three or four days a week for the lower rate. Or ask for every other Friday off.  Never give something away without getting something back.

The other key point is to make sure you are projecting (eg acting) the part. In improv, we focus on physicality, emotion, and tone of voice. Mice don’t make $50,000, and neither do pompous jerks. You want to walk into the room and make sure every piece of visual information matches whatever number you think, from the buyer’s point of view, is fair. You are creating a believable world where your salary wish comes true.

Write and share your stories of asking or being asked for money. That way we can all learn.

 

 

 

 

 

June 21, 2011
by LaurieKauffman
4 Comments

Questions Can Be Answers

Most questions about money really don’t have answers — or at least one answer. Nobody knows why the Dow goes up or down, what the value of the dollar will be next year against the Euro, or how much I will get for my house if I ever decide to sell it.

I started the Fully Invested Project because, in my day job, I kick off all of my work with the opportunity for my audience to ask well-structured questions After a very brief intro, I put them in small groups of 4-6 and ask them to come up with two financial questions, one “business” and one “personal”. People typically ask things like:

-Why does my client want to own their assets?

-What goes through the mind of a financial decision-maker?

-What does EBITDA, free cash flow, OPM or (insert weird acronym here) really mean and why should I care?

- Should I lease a car?

-Should I pay off my mortgage?

-Should I buy a certain stock?

 

These questions tell me what is on the mind of my audience and their approximate level of business acumen, so I can gear the rest of our time together to where they are in real life.

In answering their questions, my goal is to have them see that:

-the business questions and the personal questions are the same;

-they already know a lot about the world of money and financial decision-making;

-they know how to quantify the unquantifiable.

This works, because I’ve set it up so their “expected case assumptions” are embedded in their questions. There are three kinds of assumptions: best (my book will be on the New York Times Bestseller List. Hint..), worst, no one will ever buy it, and expected case (Oprah will call me next year on my birthday, just to say hi.). The best questions are when the asker “shows what they know”.

In improv, it’s generally a bad idea to ask questions.

Hi Joe.

Hi.

How are you?

Fine.

But the scene is already dead. Instead, we try to convey assumptions about who we are to our scene partner, where the scene is taking place, and the general dynamic of the situation. It is easier to do this with statements but great scenes can begin with questions like these:

“Have you seen my lucky shorts?”

“If we name the baby Gertrude, will your mother be upset?”

“General, have we secured the perimeter?”

These questions work because, in improv and in money, the best questions are when we show what we know.

 

Got some good questions?  Examples of really bad ones? Send ‘em on!

June 20, 2011
by LaurieKauffman
4 Comments

Lying Costs Money

My electric company lied to me. Last week we had a power outage just as I was about to watch one of the quarterfinal games in the CONCACAF soccer tournament. Although I pined for the game, it was actually nice. We grilled dinner on the deck, listened to the neighborhood, and watched the sunset. Then I called the electric company, using my cell phone because of course the phones were out.

A recorded voice said thank you for your call your call is very important to us, asked me if I wanted to buy more services, then informed me that someday the outage would be fixed.  If I had a life-threatening emergency I could press another number.

If I really was having a life-threatening emergency I would have died because there is no way I would have made it thru voice mail hell. On a cell phone no less.( I did go ask my fragile neighbor if SHE was having an emergency. This was part altruism and part selfishness because I wanted to see what would happen if we pressed the number in the Interactive Voice Response Unit to indicate danger. Maybe my power would get fixed faster along with hers…..but alas, she was fine).

My call was obviously not the tiniest bit important to the power company. This mismatch between what people who take my money SAY and what they actually DO is called cognitive dissonance and I believe it is really lying and that lying costs money.

I would much rather the electric company say something like:

“You, the citizenry, have deregulated us to the point where competition is so fierce that we do not choose to spend our meager profits on  serving you by phone. We repeat: you will get no service. Instead, all of our resources are going to actually fix the outage. If a wire is down, or you have a life-threatening emergency, call the police.”

At least they would earn my respect. In the world of money, the most competitively distinctive product wins. The same is true of improv. The more each troupe defines and sticks to its own unique deal, the more interesting they are to watch.

In money and in improv,  we want to get what we pay for and know what we’re buying. This means everything about the product:

-what it’s called

-where it’s sold (or presented)

-how much it costs

-all the bells and whistles

-how we pay

-when we pay

have to match the point of the product in the first place.

 

And no lies! Sorry you don’t have cash, but we need a deposit. “Thankyouforyourcallyourcallisveryimportanttous“. Offer me peanuts when you’ve delayed the flight three times and I’ve missed my son’s soccer game. Tell me your show is all made up and play the same characters over and over again from show to show. The list goes on.

Send me your best example of the worst lies, and, if you’re up to it, what the company should do instead. At worst, it will make a great stand-up schtick!

June 14, 2011
by LaurieKauffman
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Status…Quid?

Carrie Bradshaw would say it’s in the shoes. Body language experts tell us it’s in the gait. In improv, it’s the status changes that bring the funny.

A hoity-toity gentleman is asked to get out of his (imaginary) rental car to allow the preumptive prior renter to search for the bag of money  hidden under the seat. The gentleman harumphs a little, then agrees, because he is after all, well-bred. The con-artist gets in and, of course, absconds with the car and the cash. The look on the gentleman’s face is priceless. We laugh.

Who doesn’t want to see The Donald’s comb-over blowing in the breeze? Politicians brought low by rank hypocracy? Real Housewives filing for bancruptcy?

All of these examples are mean, and basically, zero-sum, but we all know comedy is pain.

When it comes to money, tho, we are telegraphing our own status with every breath we take. Try this experiment next time you are in a group of 10 or less. Rank the people around the table in terms of status, with 10 being high and 1 being low. How did you do it?

(Hint: Carrie may be right, but not always in the way you think.)

I once played an improv game where a deck of cards was distributed. We held up the card we were dealt facing outwards on our foreheads, and were instructed to interact with others based on what we saw. This lasted about 5 minutes, then we were asked to line up in order. We did it perfectly, managing even small gaps (2s vs. 4s) perfectly.

Whatever money you have or don’t have, want or don’t want, is obvious to everyone around you anyway. The process of deconstrucing the clues is fascinating and the next step is projecting them on purpose! Then we can talk about the real fun: changing status.

In the meantime, I’d love to know what status clues you’ve uncovered. Send ‘em on!

 

 

Copyright Laurie Kauffman, 2011 |