Archive for November, 2008

Real Risks in Real Life

Friday, November 14th, 2008

Some unplanned off road driving

Some unplanned off road driving

Right now I’m living in Alaska - in the winter. The question I pose “Is it more dangerous for me to be living in Alaska in the winter or in the lower 48, any other time of the year? Now if you look at what most people worry about - someone breaking into their house, being mugged or assaulted, being slammed by a drunk driver, the possibility of a terrorist attack, or getting leveled by e-coli from the local salad bar - I’d say I am much safer in Alaska in the winter as the possibility of any of those happening to me up here are very slim. HOWEVER, most of the aforementioned risks are also very rare for anyone in the lower 48. We just think they are more prevalent because of the media’s preference for news of the dreary, dire, and disastrous.

If you are aware of risk management techniques - you will look at each possible event that could happen in your life, and assess the probability of that risk occurring, the impact if it did occur, and what you can do to prevent it from occurring and/or what you can to if it does occur, and how you can minimize the impact of the risk on you (this is the purpose of insurance).

There are very real, and very significant risks facing me every day in Alaska. The roads up here are perpetually icy. I have managed the risks of icy roads by getting studded snow tires on my four wheel drive car. My neighbors do the same. Yesterday, I drove one of my neighbors into town when I saw her on the side of the road when her car careened off the road into a deep ditch. Today, I had to bring another neighbor to the ferry. These folks live what is normally a ten minute drive away - today it took me 30 minutes to get to their house. I gave myself an hour to get there and good thing as my car went sideways several times. We gave ourselves two hours to get to the ferry -normally a 20 minute drive. This was a good weather day - it was still an adventure. And last week, a huge grizzly was breaking into people’s food stores (regardless of where they kept their food stores). You can’t rationalize with an animal that is higher on the food chain then you are. They aren’t coming after you because of some malevolent sociopath streak. Think chicken or burgers here because this is how they think of us. Risk management for the grizzly is to make sure you keep your garbage locked up in a bear proof container and clean fish or game by a river where you can quickly dispose of the guts in the river. If your neighbors don’t follow these practices, you could still find yourself face to face with a very hungry carnivore. Then if the bears and the icy roads don’t get you, you could also come face to face with one of the deadliest animals up here - a moose. Yes moose kill more people in Alaska than bears do. They stomp you to death. Or you run into them on those icy roads at night. Moose eyes do not reflect so you can’t see them until you hit them - especially if you’re driving in a snow storm or ice fog.

I like living up here in the winter - it puts life in perspective.

What is Accelerated Learning?

Wednesday, November 12th, 2008

Levels of Learning

Levels of Learning

Being in the field of “accelerating” learning, I hear this question quite often. Accelerated Learning is just making it faster and easier to learn and master new skills. Learning has four basic components:

Awareness - people first become aware of what it is they don’t know. Just becoming aware of not knowing something isn’t enough to drive desire to learn more though. When combined with “purpose” - that is a reason to learn more, then people develop the desire to learn more about the topic.

Knowledge - this is where people accumulate facts about the specific topic. Knowledge of a subject is exhibited by the ability to recall facts and to synthesize the information in the area sufficiently to answer test questions on the subject, and to communicate about the subject.

Skill - this is where people can use what they know to accomplish a specific task.

Mastery - this is where people can achieve consistent results with their skills. Mastery is where power and success come with learning new material.

So Accelerated Learning in the way I’ve developed courses for Cheetah Learning means getting people to a level of mastery in the subject area very quickly.

I first became aware of the concept of Accelerated Learning in the early 90’s. By 2000, I had developed mastery in creating accelerated learning curricula. In 1998 I was a research scientist and started testing out some ideas on how to teach people project management in a way that they would develop mastery in doing the fundamentals of project management in one day. This means that they would be able to leave the class and the next day be able to achieve consistent results with their new project management skills. This became the basis of the Cheetah Project Management technique.

There are three fundamental components of creating accelerated learning courses so that people are able to master new skills faster:

1. Put the mind in a peak performing state.

2. Engage multiple forms of intelligence.

3. Set up the experience so that it makes it easy to recall and retain the new knowledge and become proficient in the new skills.

If you’d like to learn more, I discuss the topic of how we create our accelerated learning curricula on the radio show Power Learning co-hosted with Scot Nichols, the Executive Director of the Center for Advanced Learning Concepts.

How to Create Curricula that Uses Accelerated Learning

How to Create Curricula that Uses Accelerated Learning

Why November 11th for Veteran’s Day?

Tuesday, November 11th, 2008

Veteran’s Day is celebrated on November 11th because WWI ended on the 11th hour of the 11th day of the 11th month in 1918. In 1926 Congress created a national holiday known as Armistice day. However when another world war broke out, in 1954, President Eisenhower changed the day to recognize all veterans. In 1968, Veterans Day was changed to the fourth Monday in October. However, November 11th had significant historical precedence, and in 1978, Veterans Day observance was returned to the original day.

Being a Veteran myself (US Air Force 1980 - 1987) - we are commemorating all Veterans this day by offering a 10% discount for our students. Use the promotion code “thanksvets” for any course on Cheetah Learning or Cheetah PM and receive a 10% discount.

Veterans Day Interview - History and Personal Significance

A Foreclosure From the Other Perspective

Tuesday, November 11th, 2008

First place purchased on land contract.   It was just a shell when we got it.  No windows, no floors, just the logs.

First place purchased on land contract. It was just a shell when we got it. No windows, no floors, just the logs.

About six years ago I started playing real life monopoly in Alaska. I got into “family rescue” real estate investment. On my first trip to Alaska, near my friend’s cabin lived a couple with a three week old baby. They were living in the guy’s woodshop. The new mom was not happy about the situation. She wanted to move, but they couldn’t afford to. I purchased their place on a land contract to help them out. My friends offered to help me finish the places and my first corporate retreat center in Alaska was born. Over the next several years, I helped out several other families in similar situations. I’d help them move on in their lives, do a land contract and in a couple of years, own the property outright.

Then people started approaching me to purchase the properties. Some I’d sell, some I wouldn’t. I’ve done two of my own land contracts so far. One has worked out great, one not great at all. I’ve made some mistakes, I’ve learned a lot.

I started foreclosure on my first property yesterday. I’m not at all happy about having to do this. The person has not paid the mortgage since January 2008. And then started to rent the place out for at least twice the monthly mortgage - and still didn’t pay the mortgage. I gave the character plenty of chances to come good on the deal, and after numerous assurances, and no follow through, I am pushed into doing a foreclosure. Who is the loser in this situation? I’m going to have to fork over almost $7k to do the foreclosure. Do we ever hear from the lending institutions who are forced into doing the foreclosure because people are not paying their mortgage? My homeowner essentially had a place to live at half rent for a year, rent free since January and then an income source since May.

I predict that many more people will go into land contract deals as it becomes harder and harder for people to get conventional mortgages. Hopefully what I have learned here can help others. Here are my lessons learned:

1. Make sure that the person purchasing your property has to put at least 30% down. This way they have substantial skin in the game if they default on the mortgage payment and have a lot to lose if they just walk away from the property.

2. Charge at least a couple points above what they would get from a conventional bank on the mortgage. This way they are motivated to get another lender as soon as possible and you get all your money for the property sooner.

3. Don’t be swayed by a high credit score - that might mean they just got a small credit line and paid their bills on time. The credit score has absolutely no bearing on their intent or ability to pay on a mortgage.

4. Make sure they understand that you can and will foreclose on the property if they stop paying what they owe you. Get the appropriate legal guidance and follow it.

5. Don’t be swayed by emotional endorsements of the person’s character. It ultimately comes down to will they honor your deal or not. If they start to default on payments they need to quickly understand the repercussions are the same with you as they would be with a bank. Be kind, but firm. Direct them to resources that can help, but don’t become that resource. If you continue to bail them out, you will be enabling irresponsibility that will perpetuate the problem.

6. Set up the payback period for no more than 5 years with a balloon payment due at the end.   Make sure the payments are more than what it would cost them in rent.   With the mortgage that is now in foreclosure, the payments were lower than what it would’ve been in they were paying rent on a similar cabin in the area.  One would think this character would’ve done all they could to keep that type of deal going.

I’d do a land contract again, and I’d purchase property on a land contract again. I think it’s overall a good way to go. One bad apple doesn’t represent a bad tree.

More on the World Economy and What to Do About It

Monday, November 10th, 2008

What is the top issue the project management community should tackle?

What is the top issue the project management community should tackle?

So, if our Project Managers feel by about 33% that the world economy is the biggest issue that we should be creating projects to resolve, just what are those problems we need to resolve? Just what is the basis of the problems of the world economy? It seems we certainly have enough things to work on that would keep all of us very well employed for years with infrastructure, global warming, energy self-sufficiency, poverty, and hunger. And if we focused our attention on solving problems in those domains, we’d actually fix the problems with the world economy.

The film clip from the blog post below - http://tinyurl.com/27jppm - shows that the problem is actually with our entire monetary management system. Banks make money so they can create the new loans they issue based on outstanding loans they have out.   There are two types of money - Central Bank Money (real money) and Commercial Bank Money (money created by the Fractional Reserve Laws). Our whole system works as long as we are willing to continue financing all our expansion. The issue is becoming that our expansion (the issues with global warming, and natural resource depletion), is impacting our ability to continue expanding and continuing this system. For more information, review the films references.

The film poses four questions:

1. Why do governments choose to borrow money from private banks at interest when goverment could create all the interest-free money it needs, itself?

2. Why create money as debt at all? Why do we even have this system where we are giving new loans based on the value of the loans outstanding? Why not create money that circulates permanently?

3. How can a money system dependent on perpetually accelerating growth be used to build a sustainable economy?

4. What specifically needs to be changed to create a sustainable economy?

A system that is built up based on the ability of an individual or a business to develop and grow if and only if they can get financing through debt is bound at some point in time to fail. When the powers that be cease to be willing to fund the individuals or the businesses money to stay afloat, they need to adopt other practices.

I have the good fortune to live in a small rural town in Alaska part of the year. Many people up here live a self-sufficient lifestyle. They have very minimal financial needs and are able to create a fantastic lifestyle with minimal to no support from the local bank. And most of these folks don’t need to horde salmon either with subsistence permits (see blog post from yesterday). The majority of people I know do not have a mortgage on their homes, don’t carry credit cards, and many have spent years becoming exquisite craftsman in their trades. Some even have extensive businesses where they export their products out if the area.

If you are scared by the current worldwide economic woes - I recommend you become smart, not scared. We all have four sources of capital to leverage to generate our own prosperity (just like my neighbors in Alaska). Those sources of capital are - social, knowledge, skills, and operating infrastructure. We all have access to these sources of capital and hold the keys to develop and grow those. Work on eliminating your dependency on debt to achieve your goals. I went this route over 8 years ago and I have achieved a level of success most people only dream of. You can do it as well. You don’t need to live in slavery to the banks. If you’d like more information or encouragement on doing this yourself, feel free to comment.

Like I say to my children, if it stops working, stop doing it. Our reliance on credit to capitalize our development and growth is no longer working. Time to stop doing it. Time to adopt more effective practices. Others are already doing it and living by practices that create a peaceful, prosperous and sustainable existence.

Money as Debt

Monday, November 10th, 2008

Money as Debt Video

Money as Debt Video

This is a fantastic video that explains what money is in today’s world. It shows why to create long term sustainable success we really need to emancipate ourselves from the idea that to pursue our goals we need to get financing. (See my blog post a couple below this one that explains what we do instead of get financing). It is VERY aligned with the Spiritual Money book and the techniques taught in the Project Prosperity course. For people who really want to emancipate themselves from the shackles of debt and control by the banks - this is for YOU. The link was sent to me from my twitter pal - PragueBob. Thanks Bob.

http://tinyurl.com/27jppm

Grizzly Eats 150 Pounds of Fish Out of Family’s Freezer

Sunday, November 9th, 2008

Grizzly's Have Families to Feed Too

Grizzly's Have Families to Feed Too

Yes, this is a true story and it happened last week in Haines. The project behind this headline though is what is fascinating. Lets look at what I will call “Project Fish.” In Alaska, any state resident can get a “subsistence” fishing permit. This allows them to drift net fish for sockeye salmon. You can only drift net fish for sockeye (the most desireable of the salmon) with either a subsistence or a commercial permit. The goal is to catch enough fish to feed your family for a year (i.e. the reason for the term “subsistence.”). So the ultimate end game of “Project Fish” is to procure sufficient fish to feed your family throughout the year.

There are a number of ways to reach your end objective with “Project Fish.” Lets just look at three:

1. Get a subsistence permit and get the fish yourself. To capture enough fish to feed a family of four for the year, lets assume the family consumes 2 pounds of fish per day, if they ate fish every day of the year, they would need about 730 pounds of fish. (This is a LOT of fish). If each fish weighs fifteen pounds and they get ten pounds of usable meat per fish, this means they need to get 73 fish. If we assume they can catch approximately 7 fish per outing (some outings they will get none, and some they may hit the mother lode). This means they go out fishing ten times. Each fishing trip takes approximately six hours, and uses at least 5 gallons of gas. When they get home with the fish, it takes about a half hour to process each fish - this is another 3.5 hours. For easier math, lets just round this up to 10 hours for two people to catch and process 7 fish, that generates 70 pounds of usable protein. They then have to store the fish in a freezer so it can be consumed throughout the year. The freezer costs about $100 per year to run. The gas per trip is approximately $20. For ten trips that is $200 and for the year there are about $300 in maintenance costs to the boat. Lets assume they make a modest living and their time is each worth $20 per hour. This means it costs $4000 of their time to catch and process the fish (this is an “opportunity” cost as they are forsaking pursuing other opportunities where they could make $4000 - the opportunity costs are probably actually much higher for this specific family as they are able to bill out their time at far higher than $20 per hour). So, to feed their family of four fish every day for a year, it costs them $4600 (or $6.30 per pound of fish). Now lets toss in the expected monetary value of some large predator breaking into their freezer and eating about a quarter of their stash. The probability of this happening in alaska is yes, fairly high, especially if you clean the fish in your yard near where you are storing your fish. There are other risks as well - the freezer stops working and you lose all your fish (this happened to another family I know). Lets put the bear risk at 50% and the risk of the freezer not working at 25%. The bear risk tacks on another $450 to the price of the fish and the freezer not working risk tosses another $1075. This increases the price per pound of the usable fish protein for the family to $8.52.

2. Purchase the fish from a commercial fisherman during the sockeye season. The fisherman charges you $15 per fish (such a deal - you are afterall purchasing 73 fish, they do give you quantity discounts). It still takes two people a half hour each to process each fish. You still have your freezer costs. For comparison sake, lets still assume you are getting the 73 fish for the family of four. So it still takes a considerable amount of time to process the fish - 36.5 hours. You still have the freezer risk and depending on where you clean the fish, you may still have the bear risk. The total cost per pound of fish (including the same risks) with this scenario is $5.72. That is $2.80 less per pound of fish and you get the added benefit of you are supporting the commercial fishermen in the town. Good will in the community - priceless (see my post below on the value of social capital).

3. Purchase the fish as you want it from the local fish store (sometimes you can get deals - but it’s between $10 and $15 per pound depending on the time of year). In business terms this is called “Just in Time” - it has been a very hot manufacturing concept for the past decade. Assuming you eat fish three times a week as recommended by the AMA, this is 156 times per year. Your fish costs will be $3650 per year. You lose the need to have a freezer, you lose the risk of attracting very dangerous predators to your home. You save yourself at least a week’s worth of work (how much is your time worth) from scenario 1 and 2. AND you don’t subject your family to eating salmon every day of the year. You can mix it up a bit. Protein at even $5.72 per pound is a bit steep when you look at the cost of chicken, beef, pork, and the protein you get by mixing complex carbohydrates. Yes, salmon is good for you, but it does get a bit old every day of the year. I know, I often hear about it from my neighbors when they are over eating my grass fed, organic, belgium blue beef (my cows - a whole other story).

So the moral of this story - work on your career, support your local fisherman and your local fish dealer. Keep your family safe from the bears and be a part of the larger community by doing what it is you do best and supporting other people with what they do best.

P.S. It appears a homeowner in the neighborhood where the bear was grazing on unsecured food sources and garbage shot the bear. http://www.chilkatvalleynews.com/story-2.html What really galls me about this - the folks who horded the salmon as “subsistence” fishing that prompted the bear to raid their freezer consider themselves “environmentalists.” What total hypocrisy. The folks I know who truly need to subsistence fish and do so with some prudence, also make sure they secure the sources of food from bears so they don’t have to needlessly kill dangerous wildlife near their homes. A lack of project management leads to a dead bear.

“It’s the Economy, Stupid”

Saturday, November 8th, 2008

Lets All Participate in Our Own Recovery

Lets All Participate in Our Own Recovery

The title of this post was a slogan from George H. Bush’s (senior Bush) failed 1992 Presidential campaign. Sixteen years later, the same line appears to apply. On International Project Management Day, we surveyed our Project Managers on what they thought the most pressing problems we needed to work on as project managers were. The results were:

World Economy - 31%

Energy Conservation - 17%

Hunger - 15%

Global Warming - 13%

Poverty - 12%

Infrastructure - 12%

Albert Einstein said that you can’t solve a problem with the same thinking that went into creating it. The problems with the World’s Economy is that the FIRST thing people think when they want to do a project is how do I get the money to do this. What needs to change is the first thing people need to think is what do I need to do to successfully complete this project (it might not be about the money at all). I have found time and time again it is NEVER about the money that drives a desire to solve a problem - it is about the will to solve the problem. In my previous post, I mentioned there are FOUR other sources of capital we all have at our immediate disposal: Social, Knowledge, Brand, and Operating. These four sources of capital developed and put into play synergistically create long term sustainable success - far more enduring than just getting a loan from a bank or developing a reliance on credit cards.

The resources to solve the World Economy issues will require a fundamental shift in driving the will to work. I was recently at a picnic that my accountants hosted. I was sitting at a table with this gentleman who said his son’s were out of “work” because of the economy. I asked him if they were able bodied. He said, yes they were strapping young men in good health. I assured him they could always find work. I know a young man from Haines, Alaska that is never without “work.” Why, because he is willing to roll up his sleeves and do whatever is necessary to get the job done. He is willing to do the WORK. I got to watch this guy while he was working on one of my job sites. He didn’t go out partying with the guys after work, got a good nights rest and was always at work early ready to go. He was the best guy on the job, and the youngest. Yes it might not be his ideal WORK - but he is quite willing to WORK and shows up everyday ready to work. Recently, I met another guy who upon losing his nice desk job, took work doing day labor to make an income until things turned in his favor. On the flip side, I was visiting south India and went to a very popular beach with several thousand people that was literally covered with litter. All it would take for that beach to get cleaned up was for each person there to pick up a couple of pieces of litter. It didn’t appear anyone there wanted to do even that level of minimal work. The “work” is there for those willing and READY to go out and DO it. Yes the pay might not be ideal and it might not be in what you specifically want to do in the moment - but it is there.

Project Managers can help put the world back to work. But they can’t do it alone - they will need people willing and ready to do the work. Yes the jobs might not be the ideal job that someone wants for their lifelong career. But instead of waiting for a handout - give others a hand up and go do the work people need done. “WE” doing the work of what needs to be done are going to create a more stable and sustainable future - NOT the government doing bailouts of our financial institutions who got us into this mess to begin with with easy credit.

There is a joke that the reasons American’s don’t own more elephants is because no one has offered them one for $1 down and easy payments. The days of easy payments are over - but it doesn’t mean we are over. It means purchasing stupid things that we don’t need just because the payment terms were good are over. When we figure out how to develop and leverage our four sources of capital, we don’t need their stinkin money anyhow.

Think about how you solve your problems today. For holiday presents, if you don’t have the cash on hand, do you finance the holidays with your credit cards? What if you took a different approach and only gave what it was you could afford at the time - and if that gift was just a gift of your time, so be it? If you’re of the mindset that you get whatever it is you want to get today, regardless of how you’re going to pay for it tomorrow, YOU are part of the problem, NOT part of the solution.

I don’t use credit at all, for ANYTHING. I figure out how to solve my problems and reach my goals with the four sources of capital I do have within me at all times. Like the others I’ve seen around me who are successful even in tough times, I take care of myself - body, mind and soul so that I am ready to work, roll up my sleeves and get the job done. This is the type of thinking we need to adopt to solve the problems of the world economy - NOT a hand out from the government to continue “easy payments” available mentality.

Leverage your four sources of capital to creatively solve your problems, reach your goals and help others do the same. Make sure you consistently show up in life ready for work. This will create the money you want and need rather than relying on a loan, a credit card, or a handout. How we each deal with our own role in this will go a long way to solving the problem.

I love dissension - if you think I’ve got it all wrong, feel free to comment.

What Entrepreneurs Need More than Financial Capital to Be Successful

Friday, November 7th, 2008

Tell Me More........

Tell Me More........

I’ve been running my business for over 20 years. I was never able to get financial capital to fund my ideas. This might be the main reason I am SO successful today. I tried all types of ways to capitalize business ideas throughout the years - including courting numerous financiers. I tanked my second business after I spent more time trying to get investors than I did getting customers. I took a three year employed vacation and regrouped. I had the good fortune to land in a job with a great boss who encouraged me to improve my project management skills. She said I was good at getting things done, but would become GREAT at getting things done with better project management skills. When I was starting Cheetah Learning, I wanted to do things differently than I had in the past and one of those things was to generate the money I needed to run and grow my business based on sales - NOT based on financing. I leveraged four sources of capital to create long term sustainable success with my business:

Social Capital - relationships

Knowledge Capital - skills, talents, strengths (which included great project management skills).

Brand Capital - credentials, reputation, past works

Operating Capital - home office, computer, phones, car, public library

EVERY successful business owner I know who is still in business and who has been in business for the long term does NOT rely on financing for their day to day operations. If you listen to the government and the media, you’d believe that you need bank financing in order to run a viable business. I didn’t, and many other people I know who are incredibly successful as well haven’t relied on financing either. What you do need is to fully develop and leverage the other four sources of capital.

If you’re stuck because you believe that to get or keep your business going you have to get someone to back your play, check out my course called Project Prosperity - www.cheetahlearning.com. For people following my blog - use the promotion code everydaypm and get a 20% discount.

Gratitude, The Most Important Element of My Projects

Friday, November 7th, 2008

November Sky at 3:00 PM Over Lynn Canal, Alaska

November Sky at 3:00 PM Over Lynn Canal, Alaska

The best part of any project for me is when I get to sit back and enjoy what it was we set out to create with that project.   Really think about - when do you receive the value of a project?   Sure, it’s fun to do projects, but you do the project because you want the benefit of what you’re creating.    What is the value if you just pop from one project to the next, never stopping to enjoy the benefits of what you created?    I took this picture this afternoon when I was out walking the dogs.   I live in the most beautiful setting on the planet.   This is project “life” for me - creating the type of life that I’m excited to wake up and live to the fullest every single day.   What more important project is there?