Strategy Business Consulting

Scott Pfeiffer and Phil Yanov on combating loneliness and building your resilience!

How to fight the Loneliness Epidemic by Connecting Better Phil Yanov and Scott Pfeiffer discuss the growing epidemic of loneliness and social isolation, citing a government report that excessive isolation is as detrimental to your health as smoking 15 ci******es a day. We provide practical tips on how to combat loneliness by intentionally building social r...

"Think about the small daily habits or routines that keep you productive and focused. How do these daily practices contribute to your success?"From "Entrepreneur's Gratitude Journal," by Claire Pfeiffer and Scott Pfeiffer.

How to fight the Loneliness Epidemic by Connecting Better Phil Yanov and Scott Pfeiffer discuss the growing epidemic of loneliness and social isolation, citing a government report that excessive isolation is as detrimental to your health as smoking 15 ci******es a day. We provide practical tips on how to combat loneliness by intentionally building social r...

Why are you doing this?

Knowing your "why" is a foundational strategy question.

You want to earn money, take care of your family, etc. - but that is why you work, not why you do this work. I'd like to know, out of all the work you could be doing, why this?

Why this work?

How is it meaningful to you?

A personal core values exercise may help provide clarity.

For me, I consult because (i) I enjoy working on a lot of different things with a lot of different people, (ii) I get the opportunity to work with entrepreneurs I like and respect, (iii) I work with businesses whose problems I enjoy solving, and (iv) I get joy from helping others succeed (their “Thank you I could not have done it without you” is pure gold for me) and I get great value from my flexibility.

Added bonus: I get a sense of calm, having many sources of income, and not being reliant on just one.

Those are my “why’s.”

From here, I can glean some important strategy implications: (i) vet clients on personality fit; if your why is working with people you like and respect, only take on those clients, (ii) take on clients in the stages of business where your expertise is deep; you enjoy those problems – avoid the temptation to take on clients with other problems you will not enjoy, (iii) ditch ungrateful, grumbly clients; if they don't appreciate your work, you will begin to find the work tedious, and (iv) avoid the temptation to over-rely on one client, even if they offer more $$.

Now, I have some Strategy Barriers that help me make strategic decisions - and a framework for making big decisions consistently is the heart of strategy.

Every phone number we've sold tells a story. Whether it’s for branding, memorable marketing, or just a personal touch, each one of our 10,000 customers saw the value in having a unique, custom number and chose us to be a part of their journey. 📱✨

A massive thank you to our dedicated team, and of course, a heartfelt thanks to every single one of our 10,000 customers for placing your trust in us. You've made every effort worth it! ❤️

Here’s to the next 10,000 and to keeping the world connected in style! 🌍🌟

Gratitude is a part of resilience. It is one part of the trait of perspective that helps make you resilient and able to function even through hard times.

Sometimes, we lose perspective and have a hard time overcoming adversity. To recover our resilience, we need to regain perspective. Gratitude can help.

If you're having a tough time, consider starting a gratitude journal. You don't have to do it forever, and it doesn't have to take a long time. Just jot down one thing you are grateful for, once per day. That's it. Do it for however many days it takes. Or longer if you are getting benefit from it.

Some tips:

Be specific. "I'm grateful that Henry took the time to call me today and we had a great conversation" is better than "I'm grateful for Henry."

Think of specific people, not classes of people, and specific incidents. If you write about the same person more than once, highlight a different detail or act.

Consider what your life would be like without things. On a cold, rainy day you can be quite grateful for your dry, warm home. I'm often grateful for running water and plumbing - what historic privilege I live in.

Capture little surprises - the unexpected can be quite powerful.

Be consistent, but give yourself grace. This is not one more thing to fail at.

Just try again. Hopefully, after a few days, you will feel your perspective shift and you will feel better able to continue to march and triumph over all adversity.

Part of Strategy is making tough choices. For large, complex, strategic decisions, you can follow the Decision Quality (DQ) framework.

DQ has six requirements for a good decision:

· An appropriate frame
· Creative alternatives
· Relevant and reliable information
· Clear values and trade-offs
· Sound reasoning
· Commitment to action

The frame specifies the problem and what is to be decided.

Along with the frame, the alternatives (what we can do), information (what we know but can’t control), and our values (what we want and hope to achieve) and trade-offs (the various costs and benefits of our actions/inactions) must be clarified before a quality decision can be made. These form the decision basis.

We then apply sound reasoning to make the best choice given what we want in light of what we know.

Finally, no decision can be said to have been made until resources are committed.

Do you use DQ in your strategic decision making? Or do you use another structure you like?

Do Your Employees Feel Respected? Lessons from a firm staffed by prison inmates.

Your balance sheet lists all of your business's assets, liabilities, and equity on a particular date. To understand the balance sheet, you should understand these terms:

Assets. Assets are all the things with a monetary value that the company owns. Cash, securities, accounts receivable, inventory, land, buildings, vehicles, furniture, intellectual property, etc. Assets are generally things that can be sold to somebody else.



Liabilities. Liabilities are the debts of the company: money owed to suppliers (trade debt), debts owed to banks or other lenders (notes), accounts payable, taxes due. Anything the company owes to someone else that must be repaid is a liability.

Equity. Equity is the net asset value of the company to its owners at any point in time. Equity reflects the amounts the owners have put into the company (unless an owner made a loan to the company, which is a liability), plus retained earnings, or minus retained losses. On a balance sheet, the Assets always equal the Liabilities plus the Equity. That’s how the balance sheet ‘balances.’ To calculate your company’s Equity, then, you subtract the Company’s Liabilities from its Assets.

Debt-to-Equity Ratio: Your company’s debt-to-equity ratio is calculated by dividing the Liabilities by the Equity. For example:



A company with $1,000,000 in Assets, $750,000 in Liabilities, and $250,000 in Equity (remember, Assets = Liabilities + Equity) has a debt-to-equity ratio (Debt/Equity) of 3.0 (meaning that creditors are providing three times more to the company than the shareholders). A good rule of thumb is to look for a debt-to-equity ratio of 2.0 or less.

Lenders and investors care about the debt-to-equity ratio – the more debt you have in comparison to your equity, the less likely you are to attract a lender or investor.



A related term is the Debt Ratio, which measures Liabilities divided by Assets. In the example above, that would be 0.75: which is quite good. If your liabilities exceed your assets (1.0 or greater), then you have negative equity and risk of insolvency.

Companies with debt that generate profits that exceed the cost of the debt will see their assets increase faster than their liabilities, which increases Equity. If you are generating profits below your costs of borrowing, you will gradually decrease Equity as Liabilities grow in comparison to Assets.

Thus, looking at the Debt Ratio over time - say by comparing a balance sheet dated 1/1/ # # with a balance sheet dated 12/31/ # # – will quickly tell you whether profits are greater than the costs of borrowing. If the debt ratio increases over time, there is trouble.

Strategic planning is essential for business, but not all companies do it right. Too often, people mistake operations plans for strategic plans, and strategy sessions bog down.

Let’s talk about the differences and how they work together so that you can plan better.

Strategy (in business) is the art of maneuvering your company to an advantageous position relative to its competitors. There are two primary spheres of competition: competition for customers and competition for vendors. Competition for vendors includes all inputs: employees, capital, goods, and services.

Strategic planning in competition for customers includes things like the range of products or services you offer, pricing, customer service, quality, branding, marketing, etc.

Strategic planning in competition for employees might include salary range, promotion opportunities, working conditions, culture, etc.

The value created in one area can also create value in other areas. For example, better working conditions create employee value that lowers overall cost and has a complementary effect of longer-term employees through lower turnover. These valued employees become more skilled at their jobs, are more productive, and deliver higher customer satisfaction. This creates a related customer-facing business advantage.

The goal of strategic planning, then, is to create systems that work together to create sustainable advantages in the competition for customers and vendors.

How do you tell the difference between Strategic Planning and Operational plans?

Strategic planning focuses on competitiveness: How do we look at the state of our business (strengths and weaknesses) and the state of the market (for customers, employees, etc.) and respond to changes in those markets (opportunities and threats) in a way that gives us an advantage relative to our competitors?

Operational planning focuses on efficiency: How do our various departments (IT, Sales, Marketing, Dev, etc.) create plans and procedures to implement the strategy efficiently?

Operational planning is important, and as the diagram shows – at its highest levels, it overlaps with strategy. Determining the plans, procedures, and resources needed to achieve our strategic goals is both the final step of strategy and the first step of operations. But true operational planning needs to be detailed and carried out separately from strategy.

Strategy is a plan to create value for customers or vendors in order to gain an advantage for the business. Operations are how to efficiently implement the strategy with the highest price and the lowest cost consistent with that created advantage.

I've been going over the four common Financial Statements, because it is critical for entrepreneurs to be able to read and understand them

I've gone over the Profit and Loss Statement, the Balance Sheet, and the Cash Flow Statement.

Today, I'll go over the Statement of Changes in Equity.

The Equity Statement looks specifically at the ways in which the “Equity” portion of the balance sheet changed over any given period - it looks at a given period and measures the change in that portion of the balance sheet over that time.

Assume, for example, we had a balance sheet dated 1/1/2020, and another balance sheet dated 12/31/2021. Imagine also that the Equity portions of those two balance sheets (the Share Capital and the Retained Earnings) were different. Some change had occurred to the equity over the period.

The Statement of Changes in Equity for the Year Ended 12/31/2021 would explain, in detail, the reasons for those changes.

The Statement breaks down the reasons for the changes into categories (changes in accounting policy or corrections from a prior period, issuing or redemption of capital shares, income, etc.).

The Statement of Changes in Equity is most often used in a small business setting where there are non-managing investors who want an easy to review document that details what has happened with their investment, without having to wade through all the other Statements to figure that out.

Financial Statements can be used by business owners to better understand their business and its assets and cash flows, and to make decisions.

Financial Statements are used by the business’s professional advisers to make legal, business and tax/accounting recommendations.

Financial Statements are used by investors to decide whether to invest in your business or to monitor their investment. Financial Statements are used by banks and other lenders to decide whether to make credit available to the business.

The ability to understand and provide accurate financial statements can be critical for small business owners. In future posts, we will look at some of the analysis you can do with these documents to better understand your business.

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While the Income Statement and the Balance Sheet are the two most asked for and provided Financial Statements in a small business setting, the other two Financial Statements: The Statement of Cash Flows and the Statement of Changes in Equity; are still important to understand and can help the business owner to help better understand the business, even when they are not being asked for by outsiders.

The Statement of Cash Flows covers much of the same information as the Profit and Loss Statement. It covers items of income and expense for a certain period.

The Statement of Cash Flows has two important differences, however.

First, the Statement of Cash Flows is always a cash-basis statement. It measures the actual movement of cash in and out of the company.

If the Income Statement was prepared on an accrual basis, the Statement of Cash Flows becomes critical to understand the company’s actual cash position at any given time.

For example, if your company is owed a lot of money, it has not yet been paid, the Profit and Loss Statement (accrual basis) may show a healthy cash flow, when in fact the bank account is empty.

The Statement of Cash Flows will reveal the drought of cash and alert you to take action to get those bills collected, raise cash, or delay expenses.

The other important difference is that the Statement of Cash Flows includes movements of money that are not included on the Income Statement because they are not items of income or expense (receiving or paying loans, for example) and it does not include items that are on the Income Statement that do not involve actual movements of money (like depreciation expenses).

In that way, the Statement of Cash Flows is a more accurate measure of the movement of cash and of your business’s cash position even when the Income Statement was prepared on a cash basis.

I'll post tomorrow about the Statement of Changes in Equity - Follow so you don't miss it. Like and reshare to help others find this if you found it useful!

Entrepreneurs must understand the financial statements and how they work. In the last thread, I discussed the four financial statements, and gave an overview of the Income Statement. It's below if you missed it.

Today, I'll run through the basics of the second financial statement: the Statement of Financial Position, more commonly known as the Balance Sheet.

The Balance Sheet is used to show a business’s assets, liabilities and equity at any given point in time. Balance sheets have a single date on them, and speak as of that day. Typically, one would present an Income Statement for a given period, along with a balance sheet for the last day of that period. An Income Statement “for the year ended 12/31/2021”, then, might be accompanied by a Balance Sheet dated 12/31/2021.

The Balance Sheet shows all of the business’s assets (cash, accounts receivable, inventory, equipment, property, etc.). All of the values of all of the assets are totaled as “Total Assets”. Note that the balance sheet shows the depreciated value of those assets, and detailed balance sheets will show the original basis (amount you paid, generally) of the asset, and then show how much depreciation has been taken and the net asset value (basis minus depreciation).

The Balance Sheet then shows liabilities (trade payables, the principal amount of debts, taxes owed but not yet paid) and equity (the value of all shares in the company plus any retained earnings). The total of all liabilities and equity together must equal the total of assets. In other words, assets balances with liabilities plus equity. That is why it is called a “balance sheet”: because it must balance. Any increase in a business’s assets, without a corresponding increase in a company’s liabilities, increases the company’s equity.

Let's say I borrow $100 from a friend. I put the $100 in the bank. The Assets on my balance sheet increases by $100 (Cash), and the Liabilities on my balance sheet also increases by $100 (debt).

The net profit or loss from operations is also shown on the balance sheet: as retained earnings in the equity section. So, if I spend the $100 on operating expenses, the assets section of the balance sheet is reduced by $100 (less cash), and the liability section of the balance sheet is also reduced by $100 (debit to earnings).

Understanding how different payments or revenues affect the profit and loss statement and the balance sheet provides a lot of insight.

The P&L and the Balance Sheet are the two most commonly asked for Financial Statements in a small business setting. The other two Financial Statements, though, are important to understand and can be used by the business owner to help better understand the business. I'll go over those next time.

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Financial Statements are records that present your business’s financial activity in a clear and concise way. These records are used by a variety of people to review your business’s financial health.

It is important for entrepreneurs to understand the different records that make up the financial statements and how they work. Properly used and understood, financial statements let you, the small business owner, understand and manage your own business more effectively, and help you present an accurate representation of the financial health of your business to important allies.

There are four documents that generally make up the financial statements of any business. They are:

The Income Statement (also called the Profit and Loss Statement or the “P&L”);

The Balance Sheet (more formally the Statement of Financial Position);

The Statement of Cash Flows; and

The Statement of Changes in Equity.

The P&L shows items of income and expense, and, properly formatted, helps you understand profitability, margins, and to see change over time.

The Balance Sheet is a date certain document that shows assets and liabilities at any given point.

The Cash Flow Statement helps you understand how money moves in and out of the business, regardless of the tax impact. It differs from the P&L because it includes cash flows that are not income or expense, and excludes items of income and expense that are not cash (e.g. depreciation).

The Equity Statement focuses on how your equity position in the business changed over time.

Each of these tells the story of your business in a different way. Taken together, they should offer the whole picture.

In the coming days, we will look at the financial statements in more detail, and talk about some of the analysis you can do with your financial statements to help you see into your business.

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Greetings Strategists!

Welcome to Issue No. 2 of The Strategist, the monthly newsletter from Strategy Business Consulting, and me, Scott Pfeiffer.

Each month, in the Mind Your Own Business section, you will get one new article that will help you build the business you want.

In this month's newsletter, I talk about competitive advantage, something a business does or tries to do better than its competitors.

Knowing your competitive advantage gives you a yardstick to measure everything by and will help you act intentionally to make your business successful.

In the In Case You Missed It section, I'll give you links to some of my LinkedIn posts from past months: I write weekly on topics like Build Business Value, Strategy Planning, Information Security, Get Things Done, Partnerships, Networking, and Resilience.

Next, you'll get links to other opportunities to Connect With Me.

I hope you find this newsletter valuable.

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Every Business Has a Competitive Advantage Mind Your Own Business — Every Company has a Competetive Advantage Knowing what your competitive advantage is will drive your marketing and advertising efforts and give your actions an advantageous clarity. A framework I find helpful for thinking about competitive advantage is to divide those adva

A SWOT Analysis is a useful planning tool for a group of partners or a management team. It helps everyone to hear the others' opinions about the company and to get everyone sharing a common vision.

To perform one, get everyone together in a distraction-free environment and brainstorm these issues out. Go deep and ask "why". Write answers down on a whiteboard for discussion.

Strengths and Weaknesses are internally focused questions. What strengths does the company have that gives it a competitive edge in the marketplace, and what weaknesses give the business room for improvement? Think in terms of people, processes, culture, customers, offerings, technology and equipment - where do your competitive advantages come from and where are you behind?

Opportunities and threats are externally focused. What new opportunities can we exploit to reach our long term goals, given our current strengths? What threats are out there - in terms of competitors, bad actors, regulators, market forces, etc. - that can interrupt our progress or set us back?

Discuss the answers you brainstorm and make a list for each SWOT that everyone agrees on. Then go the extra mile and create action:

How will we exploit each strength and take advantage of each opportunity? What is the next step?

How will we address each weakness and mitigate each threat? What is the next step?

After you have done a couple, they get easier, and much of the time is "what has changed since we last did this?" and "did the steps we took on each item work?" "Why or why not?"

I love leading this exercise for teams. Have you done this in your business? How did it go?

I don't sell hours anymore.

Hours are a poor proxy for value, for me and for my customer.

When you buy a toaster or a car or a company, you never ask "how many hours did you take to make that?"

I charge based on the value I will bring to the company I work with, not the time I spend. For most of my customers - where I serve as a regular member of their management team - it's a flat monthly fee.

I recognize this puts the risk squarely on the customer: what if they don't get value?

So I balance the risk by (i) not having a contract, and (ii) billing each month in arrears. The invoice you get on August 1 was for July services. If you feel you are not getting value, don't pay it. There's no contract so you won't get sued for the money. I may chose to stop working with you, but that's your entire downside.

I'd be interested to know how other coaches and consultants handle this problem. Do you still bill by the hour? Do you find that an appropriate measure of value for you and your customer? If not, how do you balance risk in the engagement?

Entrepreneurs, do you prefer to buy hours or do you like the certainty of flat fees?

Phil Yanov and I are putting together a group coaching cohort for coaches, consultants, and trainers and your answers would be enlightening!

Your actions reveal your priorities.

Priorities shift over time, even over the course of the day, but paying attention to what you make time for and what you always seem to cut out is informative.

To shift your actual priorities to match your ideals, try experiments!

Want to work with me? I bring a wealth of experience to you and your management team. My arrangements are flexible. I only work with a handful of companies at a time, so space is limited. If you're interested, let's talk!

Do you want cutting-edge business insights delivered every month to your inbox? Look no further — Issue No. 5 of “The Strategist,” my monthly newsletter is out now.

This month’s article is about marketing and networking with intention and how to create ideal customer profiles and buyer personas.

This issue also includes links to all my LinkedIn Posts, in case you missed them, and a personal note with my book recommendation for the month and a few events you can’t miss.

When you sign up to receive the newsletter, you’ll also receive a chapter of my book, “Building Business Value” for free.

Follow the link to subscribe: https://www.fscottp.com/strategist.

The Strategist Newsletter — STRATEGY BUSINESS CONSULTING

Have you completed your Asset Inventory? Great!

Now it’s time to do a Risk Assessment. This is the foundation of all good information security management plans.

Here is one way to perform that risk assessment:

1. Assemble a diverse team from across disciplines.

2. Make a list of the risks to consider.

3. Consider human and environmental threats.

4. Human threats can come from inside (employees) and include poor training, mistake, and intentional sabotage by a disgruntled employee or outside from former employees, business rivals, criminals, and non-criminal hackers.

5. Environmental threats include fire, flood, or even loss of power or internet.

6. For each threat, consider that threat’s impact on the confidentiality of your information, the availability of your information, and the integrity of your information.

7. Now, rate the risk those threats pose (on a scale of 1-3) as to each information item in your asset inventory on two vectors:
How likely is it that this threat will materialize?
If it happens, how bad will it be?

8. Decide what risks to treat. For example, you could decide to accept all risks with a combined score of 2-3 or less and treat risks of 4-6.

9. Treatment can include either outsourcing the risk or putting a mitigation or control in place to reduce the risk.

Retaining talent is a key driver of business value.

I devote a chapter of my book “Build Business Value” to attracting and retaining employees. But retaining talent is about more than just paying well.

Employees, like all people, have a deep need to feel that they belong to a group and that the group finds them to be significant. To retain talent, you must give those employees feelings of belonging and significance.

People feel belonging and significance when they are treated as valued individuals, and not as replaceable cogs in a machine. It requires managers to develop listening skills and empathy.

Here are a few ways you can enhance belonging and significance in your company:

- Listen to their ideas. Certainly never dismiss any idea out of hand. Regularly ask employees how you can make their work more efficient. Give their feedback due consideration and explain decisions that affect their work with more than an “I told you so.”

- Help them make career progress. Change is a constant, and everyone wants to feel they are moving forward. Your employees need to see the path forward in your organization, or they will look for the path forward in another organization.

Also - don’t force them down the path you see, have a continual dialogue with your direct reports about where they see their career going, support efforts to better themselves, and help to guide them along a path to success.

- Give specific praise. Once a year, bland statements like “you had a good year” aren’t going to cut it. You should make a habit of noticing when someone does a good job and specifically praising them. Specificity lends credibility to a statement and makes the recipient feel seen and valued.

- Don’t manage by fear and intimidation. You would think this was common sense, but it is a big problem. As a manager, you have to be in control of your emotions. Every time you yell at an employee, curse them, belittle them, condescend to them, or are otherwise offensive, you tell them that they don’t belong and are not significant. Every time you do it, you make them a bit more likely to leave and directly diminish your business's value.

Employee recruiting and retention are hot topics among my clients lately.

How do you find and retain talent in this volatile market?

I have some ideas, but first, let’s talk about a way to measure employee satisfaction. It’s called eNPS (Employee Net Promoter Score).

Why attempt to measure employee satisfaction?

So that we can establish a baseline, and measure over time to assess the impact of employee satisfaction efforts.

How does eNPS work? It’s actually pretty simple.

Conduct an anonymous survey of your employees. Ask this question:

On a scale of 1-10, how likely are you to recommend this company as a place to work?

Then, divide the responses into three categories based on their answer:

9-10: Promoters
7-8: Passives
1-6: Detractors

Finally, take the percentage of respondents who are Promoters, and subtract the percentage of respondents who are Detractors.

This gives you a Net Score of 100 (everyone is a Promoter and there are no Passives or Detractors) to -100 (everyone is a Detractor and there are no Promoters or Passives)

Any positive number is good. Over 50 is great. Over 75 is outstanding. If you’re in the negative, you’ve got real work to do.

You should take this measurement over time, and track changes.

You can, of course, ask more and more detailed questions as well, using the same format. You can ask about pay or benefits or work-life balance, etc.