If you’ve been following this blog for any period, you may have noticed that I follow the mantra that planning is a process, not an event. Thoughtful planning is a skill that can be developed over some time using experience and the amazing plethora of resources at our fingertips. In our age of technology, planning can occur at a moment’s notice. I occasionally use OpenTable to make a restaurant reservation on the fly when walking in a particular neighborhood in Chicago and wanting someplace nice or interesting to eat that is nearby. One is always treated better with a reservation without the wait, even if it’s made fifteen or twenty minutes before walking into the restaurant door. That’s as close to impulse planning as I get. For everything else, I strive to be a planner.
Bottom Line #1. “Plans are worthless, but planning is invaluable.”
Peter Drucker.
What this quote means to me is that planning creates options. During my sales leadership days, I was pretty good at forecasting sales. In layman’s terms, it’s when one can expect to receive a purchase order when crunching numbers on the CRM tools that we were using. I had a proven and documented track record of about 90-95% accuracy on a month-to-month basis. Did that matter to anyone not even the micromanagers above me? Heck no, because no one in senior management or manufacturing did anything with the forecast. What mattered was if the sales targets were met monthly, quarterly or annually.
It was always a bullshit exercise to appease the bean counters in the company and “empty suit” micro-managers that didn’t add much value to the sales process to increase customer satisfaction.
Forecasting from a sales perspective was just another facet of corporate busywork disguised as “planning”. No one did anything productive with a forecast to ensure the product was ready when the customer wanted it. However, forecast planning is invaluable to a talented leader who can see trends and make any necessary changes.
So back to Peter Drucker’s quote. Why “plans are worthless” is a result of the many moving parts that change regularly, which results in small adjustments to the plan. The purpose of planning, in my opinion, is to keep track of all these moving parts so that you can make adjustments for you to move closer to the result that you are looking for.
Bottom Line #2. Planning helps you keep track of the variables while you strive to achieve a goal or an outcome.
It’s impossible to plan for anything or everything unless you narrow your focus on your vulnerabilities or weaknesses. So what weaknesses should we focus on in this piece? How about credit card debt, mortgage debt, spending habits, and cash flow for some simple examples?
To simplify the example, the average person between the ages of 35-64 has over $100K worth of debt. Check out the Money magazine article in the hyperlink. To me, that’s not so scary. What is scary is wondering what would happen if your very own cash flow spigot got turned off and your bi-weekly salary suddenly stopped. What would you do? How long can your cash reserves keep you afloat without that steady paycheck? Have you ever gone through this scenario as a fire drill to learn what your reaction would be and how you would feel? How prepared are you in reality?
If you’ve read my previous blog post, you’ve come to learn that I’m between jobs. (Whether it’s for the next month or the next 33 years is not the point, though the choice is entirely mine.) This unfortunate event occurred 200 days sooner than I wanted, yet well-timed for the summer break. This milestone, however, was in my planning curriculum for slightly over ten years.
This blog is partly a result of this planning and the place where I share
many of the tools and experiences on how I, no, we (Mrsfromthebachrow included) can deal with the loss of this steady paycheck. Will I miss this steady corporate paycheck and the benefits? Heck Ya! However, in no way will it put us in dire straits to make ends meet because we saved and planned for these periods by living well below our means for the past 33 years. I’ll have to thank my parents for instilling some of these sensible values upon me which we took up a couple of notches.
We made plenty of financial mistakes and decisions, but we stuck to the plans and made adjustments. We learned how to value our time and money and avoided spending on things that did not fit into our definition of value. After 33 years, our good decisions and hard work outnumbered the bad decisions. The end result: slowly and painlessly accumulated enough FU Money.
Sure, it would have been nice to learn this faster and take 15 years off the school of hard knocks. That’s where this blog comes in. So, kids, this is where my hindsight can be your foresight comes in.
Bottom Line #3 “Live like no one else, so LATER you can live like no one else.” Dave Ramsey.
You see, “later” is what I’ve written about in the past regarding your “future self”. Planning is about creating more enjoyable opportunities for your future self.
Bottom Line #4. Take the skills that you already incorporate into vacation planning and try and plan the two weeks after you return from vacation. Imagine seeing your credit card bill before you return from the vacation you are planning.
Looking at my most successful accomplishments and effective leadership results, I’ve come to realize and re-learn how to focus on the “Why” component and clearly define purpose first and foremost. After this, everything else lined up more easily and the “job” component became especially more enjoyable. The other soft benefits realized provided an incredible payback: Competition and company politics at my former places of employment were never of any concern to me.
Having FU Money tips the scales in your favor, no matter what.
I came across the blog piece in the hyperlink below that connected all of the dots to my message. For now, I’d like to share this about how a true professional handles a situation that we all find ourselves in at one time or another. The Jim Collins video embedded in the article is based on the movie The Gambler.
http://fi180.com/2017/05/29/power-fu-money/
One final bottom thought.
Bottom Line #5: “The most difficult decision is to act. The rest is merely tenacity”. – Amelia Earhart.
Even if you’re not into the FU money concept, paying attention to your current cash flow demonstrates what you value by measuring what you are spending your time, health, and money on.
How should you start? Check out each hyperlink in this article and do something about it. (Bottom line #5)
After that follow this link to the article that will start you with some basics.
Comments are always welcome. Let me know if you are out there.
If you’re not into commenting, at the very least, I certainly would appreciate it if you could please pass the blog on to others in your networks and social circuit.
I love it whenever people get together and share opinions.Great site, stick with it!