Today I am all the way to Chapter 5 in “Ben Franklin’s 12 Rules of Management.” If you are just coming to this series, I a reading through the book and posting the things that I find inspiring or interesting. Once again, I must suggest that you pick up the book and discover the rest for yourself.

To Ben Franklin, it is important to do two things well, work hard and save. His idea of working hard and being thrifty has been a present trait in successful people and businesses since before America even declared it’s independence on July 4, 1776.

He was such a symbolic icon for this type of lifestyle that a chain of variety stores was named after him. In between World War I and World War II, the stores expanded rapidly across the nation. These stores are where Sam Walton got his start in chain stores.

In 1945 Sam Walton opened up a Ben Franklin store and that moved the number of Walton managed franchises up to 15. In fact, Sam Walton proposed the idea of making it a thrift store to the top executives in 1962. When they rejected his idea, Sam Walton went off and founded Wal-Mart.

A neat little bit of history, but then the book went on about the importance of communication in today’s world.

1. Personal Networks

– Today it is very important to know people that can get the things done that you want done. A lot of times it is easier to have more knowledgeable or powerful people help you out.

2. Personal Communications

– With today’s technology, it is extremely easy to keep contact with somebody. (I’m sure you already knew that =D ) When two parties exchange products or services a market is created, and this can only be done with communication.

3. Speed of Response

– Due once again to today’s technology; markets are created everywhere and for nearly everything. Businesses can create demand now with a prototype rather than waiting for the product launch down the road.

4. Number of Successful failures

– Failures can provide strategic focus and create a stronger organization tomorrow.

5. Frequency of new experiences

- The basic premise here is that if everything is the same, nothing will improve. If you don’t have something new happen, you will not be able to go to the next level.

The remainder of the chapter goes on to talk about frugality and how luxury can creep up on you if you are not mindful. The book as a whole is very good, check it out.

Today I will continue to go over the concept of competition, enemies, and partnerships as described in chapter four in the book, “Ben Franklin’s 12 Rules of Management” by Blaine McCormick. As I go through the chapters I will be extracting information that I find interesting or useful. [Read part 1 here]

Enemies are useful…
In today’s business world we think of other companies generally as competition. They are the enemy. Perhaps we should be thanking them or becoming their partners.

It’s hard to determine who our enemies really are. The book gives the example of Apple Computer going after IBM in the 80’s and part of the 90’s, meanwhile Microsoft was working under their radar. Microsoft kept a low profile until they launched Windows and this nearly wiped out Apple.

The analogy that I’ll give you is all about risk, not just risk, but the board game Risk. Let’s say you are concentrating on taking over North America. It is not unlikely that you could be in a constant struggle with an opponent going after the same area. Both of your armies will be considerably weaker and vulnerable to attack from somebody who has been sitting quietly in South America for the past five turns.

In a blurred second, the person controlling South America turns in a set of cards giving him an enormous amount of armies and plows through taking over the entire continent of North America and taking you and the other out of the game. So by focusing on one ‘enemy’ you have blinded yourself to the reality that the rest of the world exists.

Not everyone is your enemy. Sometimes you can accomplish a lot more when you team up and partner with others who will bring in new ideas, methods, and skills to the proverbial table.

Your enemies have good advice and feedback for you. It’s not something that will be directly given to you. If they are beating you, perhaps the feedback indicates you need better products or marketing. If you are beating them, perhaps it is to not get arrogant or cocky. The best way to stay in tune is to not insulate yourself with “yes-men” as many companies do.

Little Favors Lead to Big Favors…
This section of the book describes how favors can build up trust. The example given is that it is a lot easier to convince somebody to put up a sign in their yard after you have talked them into wearing a button for a certain political candidate.

Even with a post this long I have excluded quite a large bit of the chapter’s information. I would encourage you to run to the library, or the bookstore, or just click to Amazon and get a copy.

Today I will be going over the concept of competition, enemies, and partnerships. This post will be continued on Saturday. [Read part 2 here]

This is the fourth post out of twelve as I read through the book “Ben Franklin’s 12 Rules of Management” by Blaine McCormick. As I go through the chapters I will be extracting information that I find interesting or useful.

In this chapter of the book we are shown that Influence is more important than victory. The underlying idea is that it is more important to create working relationships than it is to be a cutthroat competitor. More than one person or company can win, and creating trust is always win-win.

Tit-for-Tat…
We are shown four rules that governed a simple game for navigating treacherous social situations. The game was called Tit-for-Tat and was programmed to follow four simple rules.

1) Never be the first to pick a fight.
2) Be retaliatory when it is necessary.
3) Be forgiving when asked.
4) Be completely clear about your intentions.

This little model is very straightforward and will work in most business situations. The company must not attack anyone. The company must punish those who attack them. The company must forgive others when they are asked. Lastly the company must be clear about their intentions, which is probably to maximize profits.

Understanding the Socratic Method…
In case you aren’t familiar with the Socratic Method, it is basically using questioning to undermine another person’s argument. After a series of questions the person with the original statement will believe they have found their flaw by themselves and therefore won’t be upset at the person asking the questions.

[continued]

You should never spend more than 30-40% of your income on personal housing. However, anyone wonder if housing and real estate could be the answer to making money instead of paying money to a landlord?

I’ve heard mixed reviews about David Bach’s newest book, “The Automatic Millionaire Homeowner”. Does his book sell success? I’m not sure, though click here for an excerpt of the book’s intro that Aridni readers might enjoy before any of us invest a couple of bucks on this “key to success.”

Let us know if you’ve read the book or have any thoughts, as we’re preparing to update our good books to read link of books we’d read again and again and those we’ll never pick up again.

This is the third segment in the book review for Blaine McCormick’s “Ben Franklin’s 12 Rules of Management.” In total I will be posting twelve as I discover the rules and extract tidbits from the book. I encourage you to pick up a copy of the book and read along as I will be omitting portions in the interest of keeping the integrity of Blaine’s work.

Franklin’s third rule of management is ‘Seek to manage yourself, then to manage others.” The major idea behind this chapter is that it is important to set a positive example by managing yourself. After you have are able to do this, than managing others should be no problem whatsoever.

You are in charge of being your own manager. In life and work you are in charge. The book contains an excellent quote on the subject, “If you never learn to manage yourself, somebody else will always be managing you.”

While this chapter is much lighter than the first two, the message is still equally as valid. Seek to improve what you do on a regular basis before trying to motivate those under you. The chapter ends with a great statement on benefit of getting self managed people on your workforce. “Rather than eliminating the need for managers, self-managing workers actually change the role of the manager’s job. Managers are liberated from the role of motivator and scorekeeper and can concentrate more on such activities as growing the business and building up external contacts”

Dave Ramsey had a net-worth of over $1 million when he was 26 years old. He had built up his wealth by investing in real-estate and the stock market. Since going bankrupt in the mid 80’s he has certainly learned his lesson as he has worked back up. He currently is host to the radio show “Life, Love, and the Pursuit of Piles of Cash” and is an author.

Here are the basic steps he has for people to become clear of debt and start building up their wealth. A precursor to the steps is figuring out your budget to determine the amount you can afford.

1. Get at least $1,000 cash (a “baby” emergency fund) in the bank as soon as possible.
2. Pay off all debt ASAP (except the house) using what he calls the “debt snowball method.” (seen at bottom of post)
3. Build your emergency fund up to three to six months of living expenses.
4. Invest 15 percent of household income into Roth IRAs and pre-tax retirement accounts.
5. Save for your kids’ college fund(s).
6. Pay off your personal home early.
7. Build wealth and give! Invest in mutual funds and real estate.

Dave Ramsey has something he calls ‘Gazelle Intensity’ where the basic idea is to ‘outmaneuver the enemy and run for your life.’ You can discover more about David Ramsey and his methods by reading his books or by catching his nationally syndicated radio show.
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