Banks are often accused of being nit-picky and overzealous when they examine documents against a letter of credit. It seems they want every “t” crossed and every “i” dotted. Would you believe one exporter did not get paid because of a simple apostrophe?
The United States remains one of the few countries that employs the imperial measurement system. As if that doesn’t generate enough confusion, it becomes even worse when Americans use abbreviations, which make no logical sense to the rest of the world.
HOW BIG WAS THAT T.V.?
The merchandise description in one letter of credit stated, “Shipment of TV sets with 24” screens.” The description on the invoice presented stated, “Shipment of TV sets with 24’ screens,” and the bank rejected the documents because of this discrepancy. In the United States an apostrophe and quotation marks have different meanings when used to signify a unit of measure. An apostrophe designates feet. Quotation marks designate inches.
In an earlier blog, we related the story of Holstein cows, 24 months pregnant. The use of a dash makes a significant difference between 24 months and 2-4 months.
IMPLICATIONS OF "DISCREPANCIES"
Is a bank too nick-picky to note these discrepancies? Probably not, because of the implications. The burden of accuracy falls on the preparer of the documents. Before they are sent to the bank for examination, the preparer must understand and follow the requirements of the letter of credit as well as the rules stipulated in the UCP 600.
After years of resistance, oil executives are raising global-warming issue ahead of summit
By BILL SPINDLE and FRANCIS X. ROCCA, of the Wall Street Journal.
Oil companies are ratcheting up their involvement in the debate over climate change as governments, activists, churches and some big investors gear up for a global summit on the issue at the end of the year in Paris.
The stated goal of the summit is to keep manmade warming limited to two degrees Celsius above preindustrial levels, but governments remain far apart on how to achieve it.
Meeting such a goal will require far-reaching changes in energy-consumption patterns and likely efforts to put a cost on carbon use, many experts say. Activists have long focused much of their effort on trying to rein in the use of resource companies’ bread and butter: carbon-emitting fossil fuels.
RELATED Interview -- Mining Interest on C&C
Pope Francis is planning to weigh in on the environment in an encyclical—a letter intended to develop and explain Catholic teaching—due within the next few weeks, which has made Rome one of the focal points in the global-warming debate. Exxon Mobil Corp.recently dispatched one of its senior lobbyists and a planning executive to Rome in an attempt to brief the Vatican on its outlook for energy markets.
For years, shareholder activists have urged resource companies to curb emissions. More recently, some big investors are taking global warming into consideration in their portfolio building. The Church of England and Norway’s sovereign-wealth fund, one of the world’s biggest institutional investors, have sold off shares in pure-play coal companies.
‘We have to stop being defensive.’
—Total CEO Patrick Pouyanné
At the same time, some of the resource companies’ own shareholders are pushing them to scale back their dependence on carbon-based fuels, worried about the future financial impact of heightened global-warming regulation. Oil, mining and coal companies also are anticipating rules to limit emissions that would make oil and natural gas more costly, potentially reducing demand for the fuels.
This has led to a change in behavior. Where in the past executives could be dismissive of the climate-change debate or leap to defend their companies, industry officials are now raising the issue themselves and proposing remedies such as the imposition of a carbon tax.
“We have to stop being defensive,” Total SA Chief Executive Patrick Pouyanné told a major industry conference in Houston last month. “In the end, it won’t be solved by diplomacy only, but by private players, economic players like us.”
Total, Saudi Aramco, Eni SpA, BG PLC, Royal Dutch Shell PLC and others have formed an industry group specifically to add their collective voice to the climate debate, and they are trying to bring other leading international oil-and-gas companies into the group.
“Business is engaged in a way I’ve never seen before,” said Rachel Kyte, head of the climate-change division of the World Bank.
Similarly, the mining industry’s “approach to sustainable development has evolved,” said Gary Goldberg, chief executive of Newmont Mining Corp., one of the world’s biggest gold-mining companies. “It still needs to be addressed globally, and you still need to come up with a global solution.”
In February, Shell Chief Executive Ben van Beurden told a group of executives decked out in tuxedos and formal gowns at an oil-and-gas conference in London that they could no longer keep a “low profile on the issue” of climate change ahead of United Nations-sponsored talks in Paris this year that could result in new global carbon-emissions limits.
“We have to make sure that our voice is heard by members of government, by civil society and the general public,” he said.
The Vatican is another important constituency. In an unusually explicit mix of the political and pastoral, Pope Francis has said he wants his encyclical about the environment to come out before the Paris climate meeting, so that it can “make a contribution” to deliberations there.
“The minute the word got out that the pope was working on this, we had a lot of people contributing,” said Cardinal Peter Turkson of Ghana, who heads the Vatican office in charge of drafting the encyclical. “We listened to everybody who had something to say: physicians, academicians, students; people in all walks of life, including people from the oil industry.”
The Exxon briefing took place over a small private lunch at the home of a U.S. diplomat in the U.S. Embassy to the Holy See. A second Exxon lobbyist who is based in Italy attended the meeting, Exxon said.
The meeting also was attended by Curtis McKenzie, a Canadian national with experience in finance and the oil-and-gas industry. Mr. McKenzie has had several duties in Cardinal Turkson’s office, including administrative and research tasks and media relations, all on a voluntary basis. Such arrangements happen occasionally in Vatican offices, some of which serve much like mini-think tanks.
Vatican officials weren’t present, Mr. McKenzie said. He said he isn’t directly involved in work related to the encyclical. A lay member of the Franciscan religious order and a university professor also attended the meeting, but neither has connections to the Vatican, he said.
The encyclical pointedly wasn’t discussed at the meeting, Exxon and Mr. McKenzie said. The Exxon planning official gave a 16-slide PowerPoint presentation covering the company’s broad outlook for the global industry and energy use—a talk Exxon spokesman Alan Jeffers said its executives have delivered hundreds of times this year, including to another group of legislators and government officials, on the same trip to Rome.
Exxon said that interacting with the Vatican isn’t unusual for the company. “Exxon Mobil has a long-standing relationship with the Vatican and our people have had numerous interactions with Vatican officials over the years,” Mr. Jeffers said in an emailed comment.
Exxon and others are increasingly engaged with shareholders voicing concerns about the impact of carbon regulations on the value of their assets. Their argument: If governments rein in carbon emissions, companies may not be able to extract all the oil or metal they claim as reserves.
In response, Exxon published two reports a year ago arguing that governments are unlikely to impose restrictions that will slow economic growth. That virtually assures that fossil fuels will remain valuable, Exxon says.
Rex Tillerson, Exxon’s chairman and chief executive, told thousands of executives and industry officials at a recent industry conference that “everyone agrees” that even three decades from now about 80% of the world’s energy supply will come from fossil fuels.
“We think we’re in a business the world needs,” he said. “What we have to do is deliver in a way that is acceptable to the public.”
—Daniel Gilbert and John W. Miller contributed to this article.
An importer requested a bank to issue a letter of credit for ladies fashion dresses from Italy. When the importer completed the application for the letter of credit, he indicated the tenor of the drafts at 180 days sight with discount charges for the applicant.
Additionally, the letter of credit was issued as a revolving letter of credit with the balance reinstated on the first day of each month until the letter of credit expired six months later. This allowed the beneficiary to make shipments each month equal to the amount of the letter of credit.
BANKERS' ACCEPTANCES INCREASED THE RISK
This arrangement permitted the bank to make payment to the supplier in Italy upon receipt of the required shipping documents. The bank would then delay payment to the buyer for 180 days and the buyer agreed to pay for the cost of interest during the 180 days period.
Initially, everything went as planned. The bank received documents and found them in compliance with the terms of letter of credit. They remitted the payment to Italy, created a “Banker's Acceptance” for 180 days, and charged the cost of financing to the buyer. The bank released the documents so the buyer could clear the goods through customs, sell the dresses and collect the money before the due date of the draft.
WHERE IS THE PAYMENT?
The bank waited for the clock to wind down to the payment date, 180 days later. And wait they did. On the 180th day, when the bank requested payment from the buyer, they learned the buyer could not pay.
The buyer informed the bank that he was preparing to file for bankruptcy and the unsold dresses were in a warehouse. Since the bank had a lien on the assets of the company, the bank’s lending officer began arrangements to seize them. Unfortunately, the only assets available were the ladies fashion dresses, now 180 days old and no longer in season.
The bank’s loss increased exponentially because by the time they realized they had a problem with the shipment made in the first month, they had already obligated themselves for shipments made the subsequent five months.
HOW REAL IS "SELF-LIQUIDATING?"
The bank ultimately sold the dresses. The recovery of funds amounted to less than 50% of the bank’s loan and they took a loss for the balance of the unpaid loan.
While letters of credit seem self-liquidating and self-securing because of the underlying transactions, banks need to cautiously ascertain the value of goods and determine if they can be readily liquidated, or face the resulting consequences as illustrated in this lesson. Once it becomes known that a bank has distressed merchandise, the value of the merchandise drops significantly. Bankers, who do not have expertise in selling merchandise, eagerly find a buyer as quickly as possible even if it results in a loss.
This lesson illustrates why banks should be very cautious when issuing letters of credit; It carries the same risk as when a customer applies for a loan. Usually banks prefer not to rely on the underlying transaction as collateral. They typically will want some other collateral as well and often will require the applicant to secure the letter of credit with cash in an account at the bank.
The most common ways we refer to people at work are possibly the most destructive business terms ever devised. It's time to purge them from our terminology.
A few years ago, Bob Chapman, CEO of Barry Wehmiller, asked a military general,"How do you train or condition people to kill other people?" His answer was, "We don't. We teach them to take out targets that make bad decisions." Chapman went on to rightly observe, "The military uses language to dehumanize the taking of lives. We do the same thing in business." When we refer to people as "head count", "human capital", and a "human resource" we unintentionally dehumanize them as well.
How Did We Get Here?
In his 1909 groundbreaking paper titled,"The Principles of Scientific Management"Frederick Taylor developed the idea of "task allocation", which broke work down into the simplest, most mundane tasks ("put this nut on that bolt"). This intentionally took all the thinking out of work, turned it into a rote "task", and in the process, fully dehumanized the worker. Charlie Chaplin described the result as,"Machine men, with machine minds and machine hearts."
Slave, Stiff, Cog, Hand...
The very concept of an employee came from the Factory System period of 1850-1970, which not so subtly turned employees into "stuff". The factory system needed people to run the machines, but the less human they acted and the more they resembled machines, the better the system worked. We've left the machines behind, but it's still convenient to see people as "stuff", as extensions of machines. When you search the thesaurus for synonyms for"employee", some of the more disturbing synonyms listed are things like "slave", "cog", "hand", "hired gun", "desk jockey", "hireling", and "working stiff." What we call people at work doesn't have a respectable history. With that legacy in hand, it's very easy to see how we got here.
Things That Dehumanize
Acommon definition of racismis, "prejudice, discrimination, or antagonism directed against someone on the belief that one's own race is superior." When we refer to people at work as "head count", "cogs", "work force", "capital", or as a "resource", we conveniently reduce them to something inferior and less human. We did this to people for centuries to enslave them. Doing it to people to dehumanize them at work is nowhere near as egregious, but it is built on the same principles of false superiority and inferiority. If we don't have to see people as fully human, it makes it easier to make decisions that negatively impact them.
There are a number of ways we refer to people at work that are deconstructive. All of them should be as off-limits as any racial slur, not because they are on the same level, but because both are dehumanizing. Here are some of the worst:
Head count
Work force
Human capital
...And the most subtle and insidious of all, "human resources", which reduces people to the level of a chair, computer, forklift, or other business resource.
All of these terms make it easier to see people as "cogs in a wheel", allowing us to make decisions without as much regard for the individual human beings involved.
As with most legacy terminology, we don't think about the roots of such terms and usually don't mean to use them pejoratively. But words are powerful and communicate; or with repetition, actually determine what we really believe. So let's ban terms like these that make people seem less human, and that are worn out in exhaustion in our time. We can do better.
If you have a Human Resources department, it's time to change the name to something that emphasizes humanity and deemphasizes people as a resource. The very existence of such a department might be a related problem we can talk about in another post.
I'm not humancapital, or a humanresource. I'm a humanbeing. Going forward, please refer to me that way at work.
By Scott Gurvey
The Keystone XL Oil Pipeline has been one of the most controversial of energy issues since it was first commissioned in 2010. The new pipeline, actually the final phase of a four phase project of Calgary based TransCanada Corp., would double existing capacity to move oil extracted from Canadian tar sands in Alberta to refineries in Texas. Critics like Friends of the Earthcomplain the pipeline would “carry one of the world’s dirtiest fuels”. Environmentalists say production of tar sands oil means increased carbon dioxide emissions, water use and chemical contamination when compared to other oil sources and to date the U.S. government has not approved construction.
Pipeline safety is also an issue in the Keystone debate. Even though moving oil through pipelines is generally considered safer than the alternatives of rail or truck transport, the number of pipeline accidents reported each year remains “unacceptable” according to James Stafford, the editor of Oilprice.com. The U.S. Department of Transportation reports more than 62,000 barrels of oil were spilled in 703 incidents in 2014 alone.
Preventing spills has traditionally been a question of frequent, costly inspections. Inspections which have often failed to detect small amounts of corrosion, metal loss or tiny cracks which later result of major breaks. That is changing now in great part because of new technologies being developed for the Internet of Things.
These remote monitoring solutions, often called Supervisory Control and Data Acquisition (SCADA) systems, can provide operators with the ability to detect problems and intervene, taking action before a major fault event occurs.
The latest IoT technologies permit the low cost placement of sensors and other monitoring equipment along the pipeline, capable of transmitting status information in real time. Stafford says “there seems to be a sea change in the pipeline industry…. Pipeline companies will see dollars saved by using cost-effective monitoring systems to reduce pipeline leaks.”
Enter the Smart Pig
Robotic instruments, known as intelligent or “Smart Pigs” (The original pigs were made from straw wrapped in wire and used for cleaning. They made a squealing noise while traveling through the pipe, sounding to some like a pig squealing, which gave pigs their name) can now be deployed to both clean and inspect the pipeline from the inside, reporting its progress and findings contemporaneously often without stopping the flow of product. The result is more frequent inspections and the ability to dispatch repair crews to a location when needed, rather than tying them up making labor intensive inspections.
The U.S. DoT maintains a fact sheet designed to guide the industry on the use of smart pigs to make in-line inspections of pipeline systems.
The smart pigs collect great volumes of information, and IoT technologies allow oil companies to both retrieve and analyze that data in a timely manner. The Canadian communications company Telus provides oil pipeline monitoring and management services using wireless network connectivity to collect information on pipeline pressures and temperatures and pump station status. These stations are often located in remote locations and physical surroundings where manual “meter reading” is difficult.
Cloud Analytics
Toronto based Fox-Tek offers an alternative, “pig-less” approach, placing a series of sensors on the outside of the pipeline. Fiber optic sensors are also employed to detect bends, strains and stress. These sensors may be able to detect small cracks that the smart pigs miss. Another innovation harnesses the “cloud” to bring computing power in the form of a data analytics package. The smart pig scans generate such massive amounts of data that it often takes months to analyze. Cloud based analytic software can reduce the massive amounts of raw data to graphs charts and diagrams summarizing what a pipeline operator most needs to know about temperature, pressure, rates of corrosion and even geological events which can effect pipeline safety.
The scaling ability of cloud computing allows the data analysis to proceed rapidly without incurring unacceptable cost. The effect is to use smart software to detect small problems before they grow into big ones.
Enter the Drones
Aerial observations have long been an element of pipeline safety inspections. Helicopters have been equipped with laser spectroscopic systems to detect leaks of both product and methane gas; infrared sensors to detect potential structural failures and to record pictures for visual inspections.
Now the development of intelligent drone vehicles, connected using IoT technologies, promises to provide additional utility for visual pipeline inspection at a lower cost. At the 2014 Intel Developer Forum, the company’s Kevin Williams demonstrated a drone with infrared sensors and gateway communications capability for pipeline monitoring.
The drone not only gathers data from its onboard sensors, it is also capable of operating autonomously when positioned over sectors of the pipeline where network connectivity is not possible. In these circumstances, the drone records the data and continues its inspection. When it reaches a section of the pipeline where connectivity is possible it establishes a connection for transmits the data it has previously acquired.
Transporting oil is always going to be a business requiring considerable care with an emphasis on safety. But the new technologies promise to have a positive impact on both the economics of pipeline operations and their environmental impact as they allow the industry to move from a position of reacting to problems after they arise to one of proactive prediction of impending problems in time to take remedial steps to prevent them from occurring.
Scott Gurvey - For more than 20 years, Scott Gurvey was the New York bureau chief and senior correspondent of the PBS broadcast Nightly Business Report. Gurvey conducted interviews with the CEOs of the world's leading corporations, and wrote a Web column, Public Offerings, for the PBS website.
Connect & Collaborate continues our Brave Leaders series with Heidi Ganahl, Founder and CEO of Camp Bow Wow. Heidi built her business from a single doggie day care location in 2000, to a $80 million with more than 200 franchises in 40 states and Canada. Her success is impressive, and her business ideas keep coming.
Nominated via #BraveLeadersCO by Debbie Brown, director of the Colorado Women's Alliance who said of Heidi, "Bravery is how you face adversity.", Heidi's path wasn't easy, as she overcame the loss of her husband, and subsequent bad investment decisions before launching Camp Bow Wow. Now she's a great example of pulling it together and teaching others to find their own success.
Tune in for our Brave Leaders feature right after our interview with Colleen Stanley, founder and president of Sales Leadership Incorporated.
Vistage Chair Pat Maley gives us access to the brilliant speakers in the Vistage network, including Colleen, speaker and author of the book Emotional Intelligence for Sales Success.
Colleen Stanley shares how emotional intelligence impacts sales, and the neuroscience behind emotion management. She believes Emotional Intelligence can be learned and applied to further improve sales success in any business.
Listen Saturday at 1:00 PM on 710 KNUS – Please let us know what you think of our program, either by commenting here or on Facebook at Connect & Collaborate with ICOSA or join the discussion on Twitter @ICOSAMagazine.
By Bill Tucker, contributor at Forbes.
Vortex Bladeless is a radical company. It wants to completely change the way we get energy from the wind. Think wind stick instead of a massive tower with blades that capture blowing winds.
Wind stick. Really. Lest you think I’m mad, I’ve included a picture of this bladeless generator that helps with the visualization and explains the company name.
See? There are no blades. What that “stick” (the company prefers, mast) does is capitalize on an effect of the wind which has been a very serious problem for architects and engineers for decades.
When wind hits a structure and flows over its surfaces the flow changes and generates a cyclical pattern of vortices at the tail end of the flow. This is known as the vortex shedding effect which creates something known as vorticity and that is what Vortex Bladeless uses to generate energy. For those who need a explanation that exceeds my ability to fully explain, check out this link from Columbia University on the subject and then come back and join the rest of us who won’t wait for you. (you’re clearly ahead of us anyway)
If you are still here with me, the company likes to give a classic example of vorticity that is immediately understandable; the collapse of the Tacoma Narrows Bridge that came apart three months after it opened in 1940. This clip posted on YouTube from a film made as the bridge undulated, wavered and ultimately shows the very dramatic effect of vortex shedding. Powerful stuff. Engineers immediately changed the way they designed and built bridges as a result of this incident.
What the engineers at Vortex Bladeless are doing is embracing this effect instead of avoiding the aerodynamic instabilities to capitalize on the oscillation and therefore capture the energy. The mast is designed to oscillate in the wind (which is very different from Blowing in the Wind). As you can see in the picture above, this is not your usual wind turbine. It consists of a fixed mast, a power generator that has no moving parts which come into contact with each other and a semi-rigid fiberglass cylinder. The power generator is a system of magnetic coupling devices which means there are no gears needing lubrication and an overall system needing less maintenance.
According to David Suriol Puigvert, one of the company’s co-founders (there are 3), the costs of a Votex system are dramatically lower than traditional wind turbines. The company publically claims maintenance costs that are 80% below a traditional wind turbine with manufacturing costs that are 53% lower. The lower maintenance & manufacturing costs add up an estimated lower cost per kilowatt.
In addition to the lower carbon footprint of a wind turbine, Vortex claims even further reductions. Because there are no spinning blades, no birds are caught up and sent to their deaths in the name of greener energy. And the lack of blades means something else; much lower noise. Did you know there is a bi-annual conference for the purpose of resolving noise complaints from the large utility-scale turbines? I didn’t. Having driven by large wind farms in the mid-west I can say that I never noticed a problem yet it’s good to know a lot of attention is being given to the issue.
The fly in this very cool ointment is that the technology is a proven concept and is currently is being tested and fine tuned in the field. This means we are about a year away from the reality of Vortex generated electricity. Initially, the co-founders were looking at large generating devices. That remains a longer-term goal but a much shorter range goal is a device of 4kW Vortex that would be about 13 meters tall (40’) and weigh about 220lbs. The company sees this generator being used in conjunction with solar generation for homes that are either off the grid or want to be off the grid. They are also developing a 100W device that will stand about 3 meters (9’) tall weighing about 22lbs. It is named the Vortex Atlantis and the company believes it can be used in off-grid areas to bring power to third world/developing villages where power could be a matter of life and again, used with solar generation. Those devices are forecast to be on the market in roughly a year.A 1MW generator is currently forecast to be about 3 years from market.
Just a quick word about the company before wrapping up. Vortex is a Spanish tech start-up. Its funding, so far, has come from a Repsol Foundation Grant, a loan from the Spanish Government and venture capitalists in Spain (Spanish Angels). In February of this year, Vortex Bladeless relocated to Boston. Here it is working with Harvard University, SunEdison, IDEO and is working with venture capitalists for its next round of Series A funding. Due to public interest in investing in the company, they will launch a crowdfunding campaign on June 1. As always, look before you leap. This is very exciting technology but let your brain guide your investing not your excitement.
By Tim Smith
If you’re anything like me, you live and breathe online, Tweeting your interesting thoughts, Instagramming your dinner, posting photos of your kid on Facebook. We’re living in a world where we have so much more than we’ve ever had right at our fingertips. So controlling your home with smartphone apps and automated systems is a no-brainer — this technology makes life easier and takes the headache out of many common tasks from vacuuming to flipping on light switches.
Here are five automation products that will cut your energy bills, keep your home secure, and lighten the list of everyday chores:
This device allows you to control the heating and cooling settings remotely, with programming for weekdays, weekends, and individual preferences. If your schedule changes each week, this is a great product for you. The initial costs are more than made up through energy savings throughout the year.
The CWA2000 detects motion in your business, your home, or your yard, and it can be installed for indoor or outdoor use. It has adjustable sensitivity control and can be adapted for up to eight sensors. With a 120 degree wide sensory ability, it detects movement at up to 30 feet.
Cost for a single camera is $99.99, with a monthly charge of $9.99, based on a 24-month agreement
Are you concerned with home safety while you’re away? This package contains one camera, for outdoor use, and can be programmed to take live video or a snapshot. Additional cameras can be added if desired. This equipment is available through AT&T.
The technology for robotic vacuuming continues to improve. The newest Roomba model, the 800 series, uses an AeroForce Performance Cleaning System to pick up 50% more dust, debris, and dirt, with very little maintenance. The newest Roomba sells for $599.99, and the basic iRobot Roomba Model 560 starts at $199.99.
You can turn your lights on — or off — from anywhere in the world using your smartphone, iPhone, or iPad. This controller replaces a standard light switch and works through your Wi-Fi system. This is simple enough for most DIYers.
Take advantage of the technology at your fingertips, and save time and money through the use of automated systems. For more home automation ideas check out Modernize.com.
As we have discussed in various other blogs, letters of credit contain precise requirements that the beneficiary must meet in order to receive payment. The letter of credit must also state the specific documents needed to meet the requirements.
Then, other conditions may exist such as whether partial shipments are allowed or not. If allowed, the beneficiary may make a partial shipment, present documents and get paid for the value of the goods shipped. Later he may make another shipment, present documents and receive payment, etc.
One beneficiary enjoys telling the story of the letter of credit he received for the shipment of “one live cow.” The letter of credit contained the condition that partial shipments were not allowed.
He thought this condition rather humorous since a partial shipment would be, well, utterly impossible!
OK, so you're building the business of your dreams. But do you have any reference point for how your business actually affects you personally? If you don't, you just might be building a trap for yourself, not the business of your dreams.
If you don't have a handle on the Seven Stages of Business Ownership, you're likely to flame out personally, even if your business is successful.
Will You Be Owned By Your Business?
Just about every business founder/owner makes the mistake of assuming that if they build a great business, they'll automatically get a life, too. Big mistake. If you're building a business, you need to be as intentional about eventually getting a life as you are about building the business. Building the business always comes first, but if you don't intend to USE your business to build your ideal lifestyle, you won't own the business; the business will own you.
There are plenty of tools to grade what stage your business is in, but none for measuring how your business is impacting you. Here's one from our book, Making Money is Killing Your Business that focuses on what the business is doing for (or to) you personally.
As you read through the Seven Stages of Business Ownership, ask yourself,
1) What stage am I in personally, and
2) What stage is my goal? You can stop anywhere from Stage Five through Seven. But if you stop at Stage Four, which most business owners do, you will always be a hostage to your business. Stages One through Four are about generating money. Stages Five through Seven are about ensuring your business generates both time and money for you.
Get to at least Stage Five so you can have both.
Stage One--Start Up
Pouring time and ideas into creating the business & getting it off the ground. This is fun!
Stage Two--Survival
Survival is everything; funding is drying up. Urgently driving sales. We burn a lot of fuel on takeoff. I didn't think it would be this hard."
Stage Three--Subsistence
Regularly breaking even--woo hoo! But the business is totally dependent on me. Tension..."If I stop, the business stops. Must keep going...
Stage Four--Stability (& Growth)Regularly profitable, finally. The "American Dream!", followed in a few years by quiet desperation. Outwardly successful, inwardly deflated. My business owns me."
Stage Five--Success
Now others can "make the chairs." The business makes money when I'm not around and I don't have to stitch it back together when I return. Only 5%-ish of business owners ever get to Stage Five. You can make millions and be stuck in Stage Four for decades because you have no time to enjoy the money. The reason only 5% make it? The Big Mindset Shift. They decide to demand that their business give them BOTH time and money, not just money. It's that simple. "I'm off the treadmill!"
Stage Six--SignificanceLeadership inplaceThe owner is about vision and guidance, not production. "I'm focused on making a difference, not making a chair."
Stage Seven--SuccessionLeadership incharge. The owner delegates guidance and focuses on vision, passing the day2day torch of leadership to others. They become "the myth"--when they walk in, people whisper, "Hey, that's the person who started it all." Leadership--"I used to solve and decide. Now I ask questions."
Beware Stages Four and Six
Stage four is the most dangerous stage. The urge to escape any future risk to get to the next stage keeps us on the treadmill for years, if not decades. But stopping at this stage ensures you bought a job, not a company, and will ensure you regularly fall back into Stages Two and Three.
Stage Six is the second most dangerous stage. If you go off and "play" too quickly at this stage, you will come back to a disaster. Focus for just a little bit longer, and make sure someone else is giving day-to-day guidance, and reporting transparently to you.
Which Stage is Your Objective?
Where are you? What's the one thingyou need to donowto get to the next stage? There's a hundred things you could do; just do the next one. If you can't get past Stage Four, it's head trash. Nobody is as good, competent, experienced, committed, etc. You made that come true. Stop it.
If you're in Stage Five or greater--congratulations--take the next month off with pay. They won't miss you!
Inspired by our partnership with KNUS for Leadercast 2015, the Colorado Business Roundtable is proud to identify brave Colorado leaders by launching our own Brave Leaders series. Each week, we will talk with one of our nominated #BraveLeadersCO about their perception of bravery, and who exemplifies those qualities to them. Listen for the Brave Leaders series every Saturday on 710KNUS in the final half hour of Connect & Collaborate.
Our Brave Leader this week is former Governor Bill Ritter, now director of the Center for the New Energy Economy (CNEE) at Colorado State University. Governor Ritter will share his thoughts on leadership and risk, and tell us about the man who inspires him. Ritter found inspiration in his years as Denver District Attorney, from fellow D.A., Philip Van Cise who fought corruption among the corrupt, in Denver at the start of the roaring 20s.
Steve House tells us about his journey from business and healthcare, to a gubernatorial campaign, and ultimately, his current position with the Colorado Republican Party.
Bill Schilling shares the Wyoming Business Alliance's efforts to bring about real conversation about business and economic development to business leaders in each county in Wyoming as a part of Tour 23; a series of four hour meetings throughout the state.
Listen Saturday at 1:00 PM on 710 KNUS – Please let us know what you think of our program, either by commenting here or on Facebook at Connect & Collaborate with ICOSA or join the discussion on Twitter @ICOSAMagazine.
Daimler Trucks North America is the first to get approval for self-driving commercial vehicles in the United States. The Freightliner Inspiration Truck, and other trucks like it, could have massive implications for the future of transportation.
The Inspiration truck features a system called Highway Pilot, which uses stereoscopic cameras and radar sensors to give it an autonomous autopilot mode when cruising on the highway. The truck can steer to stay between lane markers and adjust its speed and braking to maintain a safe following distance behind other cars on the road all while the driver is free to do other things.
It’s considered a “level 3” autonomous vehicle, meaning it enables hands-off highway driving under certain circumstances, but requires a driver to be present, ready to take the helm in an emergency or to pass other vehicles in the truck’s path. The driver is likewise required to assume control of the vehicle when exiting the highway, driving over local roads and pulling up to the loading dock for making or taking deliveries.
For the record, a “level 4″ vehicle would be able to perform all driving functions and monitor roadway conditions for an entire trip, truly freeing up the valuable resource of human time.
Daimler executives are being careful to allay fears of human employment disruption. “We don’t want to get rid of drivers,” says Sven Ennerst, head of Daimler Trucks’ development department. Daimler continues by repeatedly saying the technology won’t can’t change lanes on its own, it won’t be market-ready for a decade, and could never fully replace human drivers.
The reality remains that that it is a big step towards addressing a massive market need: safe and reliable transportation.
Some large freight carriers have already started incorporating innovative new safety features like blind spot monitoring, adaptive cruise control, and lane departure warnings. The economic case for these technologies is clear.
“Commercial vehicles are a safety issue,” says Xavier Mosquet, head of Boston Consulting Group’s North America automotive division. “And therefore anything that can get commercial vehicles out of trouble has a lot of value.”
With America's driver shortage continuing to worsen, good truck drivers cost more these days. Costs are also rising for companies that cut corners and hire unsafe drivers. Liability in a commercial truck accident is increasingly falling on the shipper.
HWP - Highway Pilot
In order to get the autonomous vehicle license plate from the state of Nevada, Daimler needed to prove the system could safely cover 10,000 miles on its own. This was done on test tracks in Germany and on quiet roads in Nevada.
Daimler ran a small study (16 drivers on a test track) to see how this autonomous system affects drivers. EEG readings showed they were 25 percent less tired than they were when they had to steer themselves.
Customers are very much interested in this system, according to Daimler. That’s no surprise: Making driving a job for the computer can reduce accidents, improve fuel efficiency, and maybe keep trucks on the road for longer, says Noël Perry, an economist who specializes in transportation and logistics. “They all love this.”
It takes an act of bravery just to start a business, to take a risk to grow that business, or putting everything on the line to do the right thing, no matter what your career ambition. That's precisely what we at Connect & Collaborate seek to celebrate with every business leader we introduce you to each week.
In our Pro-Business Colorado Edition, Dave Tabor of the Colorado Association of Commerce and Industry (CACI) introduces us to Susan Cirocki, President and Owner of Arrow Sheet Metal Products Company, and Chris Cumpton, President and Owner of Integrity Electrical Solutions.
Besides owning and operating their businesses, Susan and Chris are married - to each other- giving them a unique perspective on running small businesses and managing their own relationship. One advantage is having a built-in business consultant who really understands your business, though they admit they limit their work talk after 7:00PM for the sake of their marriage. In our interview, they share more insight on business and beyond.
Speaking of bravery, we proudly bring you the first in our Brave Leader series, inspired by Leadercast and this year's theme, The Brave Ones. The Colorado Business Roundtable wanted to take it a step further, and honor Colorado's brave leader through our #BraveLeadersCO campaign.
Listen Saturday at 1:00 PM on 710 KNUS – Please let us know what you think of our program, either by commenting here or on Facebook at Connect & Collaborate with ICOSA or join the discussion on Twitter @ICOSAMagazine.
It wasn't too long ago that Denver was still considered a cow town. That's all changed now, thanks to those who saw the city's potential. But it took more than vision, it required brave leadership to guide Denver into it's place as a world class city.
As President and CEO of the Metro Denver Economic Development Corporation, Tom Clark would never accept any credit, but his leadership inspired the spirit of cooperation that transformed Denver's economy and overall growth.
"For us it's always been an issue of diversification of the economy. If you think about the economy thirty years ago here it was Coors, Carbon, and the Coldwar. That was it. If one of them went down, things got really bad here. So the goal in economic development is try to get the economy as diverse as you can." says Tom Clark.
Combined with attracting cutting edge industries, such diversification provides a strong, long-term economy that provides good jobs.
In order to build that economy, Clark focused on collaboration, and avoiding political turmoil by establishing a code of ethics shared by surrounding communities. Denver and neighboring towns worked together to attract businesses, build DIA, creating FasTracks, sports stadiums and more. For all of these advancement, Clark credits the remarkable "Grace, humility and teamwork" displayed by all of the leaders in Denver's metropolitan community.
Learn more about his remarkable collaboration efforts Saturday at 1:00 on 710 KNUS. We also encourage you to have a laugh by watching this video honoring Tom Clarke as the Most Interesting Man in Metro Denver.
Listen Saturday at 1:00 PM on 710 KNUS – Please let us know what you think of our program, either by commenting here or on Facebook at Connect & Collaborate with ICOSA or join the discussion on Twitter @ICOSAMagazine.
Rudolph W. Giuliani is the former Mayor of New York City. After joining the office of the United States Attorney for the Southern District of New York, Rudy Giuliani rose quickly through the ranks, becoming the Chief of the Narcotics Unit at age 29. After the inauguration of Ronald Reagan in 1981, Giuliani was named Associate Attorney General, the third highest position in the U.S. Department of Justice. In 1983, President Reagan appointed Rudy Giuliani as the United States Attorney for the Southern District of New York. Giuliani spearheaded successful efforts against organized crime, white-collar criminals, drug dealers and corrupt elected officials. Few U.S. Attorneys in history can match his record of 4,152 convictions with only 25 reversals. In 1993, Rudy Giuliani was elected Mayor of the City of New York. He focused on reducing crime, reforming welfare, and improving the quality of life and was re-elected in 1997.Under Mayor Giuliani’s leadership, overall crime was cut by 56%, murder was cut by 66%, and New York City—once considered the crime capital of the country—became the safest large city in America according to the FBI. Mayor Giuliani also implemented the largest and most successful welfare-towork initiative in the country, turning welfare offices into Job Centers and reduced welfare rolls by 640,000—nearly 60%.
On September 11, 2001, America suffered the worst attack in its history when terrorists crashed planes into the Twin Towers of the World Trade Center. Mayor Giuliani was widely lauded for his steady hand during challenging times. He was named “Person of the Year” by Time magazine, knighted by the Queen of England, dubbed “Rudy the Rock” by French President Jacques Chirac, and former first lady Nancy Reagan presented him with the Ronald Reagan Presidential Freedom Award. Rudy Giuliani is an American hero. His views on leadership have helped shape our country, and have the capacity to transform the leadership of our organizations and businesses as well.
MAYOR, CITY OF COMPTONPOSITIVE CHANGE REQUIRES EXTREME BOLDNESS
On June 4, 2013, Aja Brown made history as the City of Compton’s youngest elected Mayor at the age of 31. With over 10 years of experience in community and economic development, Mayor Aja Brown has proven to be a strategic visionary concentrated on improving outcomes through policy reform, innovation and strategic partnerships, proudly serving the citizens of Compton. Since induction, Mayor Brown has made major strides in improving the quality of life for Compton residents and stakeholders alike. Mayor Brown has launched several community initiatives including the “Compton Community Policing Task Force,” a network of law enforcement agencies and community activist that implement gang intervention and prevention strategies, tackling complex social issues such as human trafficking head on.
Mayor Brown has received the prestigious University of Southern California 2014 Young Alumni Merit Award, participated as the 2013 Pat Brown Institute Distinguished Lecturer, is the recipient of the National Action Network Martin Luther King Award and is a strong advocate for youth, women’s rights and equality. Mayor Aja Brown’s bold brand of leadership is turning the tide in one of America’s most troubled cities.
OIL AND GAS INDUSTRY UPDATE
The lower energy price environment is affecting new production and may be dampening broader economic growth in Colorado. Our contention remains that lower energy prices are a net negative to the Colorado economy since the state is a top 10 producer of both oil and gas. The severity of the dampening depends on the duration of the low price environment. Counties with significant industry production and employment will experience the greatest impact, but economies that participate in the supply chain will also be impacted. The energy economy of 2014 and 2015 looks vastly different than even three years ago. A lag is observed between prices and economic activity.
Background
Oil and gas prices recorded a precipitous decline in 2014 that has extended into early spring 2015. As of mid-April, the West Texas Intermediate (WTI) spot price was 49% below the June 20, 2014, peak. Prices are 38% below the five-year average. Price volatility has stabilized compared to three months ago. The WTI has now recorded 10 months of yearover-year declines. Drilling permits and starts are down for the first three months of 2015 year-over-year in Colorado, and the rig count is down more than 40% year-over-year.
Natural gas prices are also off peak from 2014, down 44% in April. The average monthly price topped out at $6.00 per million BTUs in February before falling, to $2.63, in April (as of April 15).
The impact of gasoline prices is readily observable to consumers. Prices topped $3.71 per gallon on August 18, 2014, before falling 48%, to $1.93, in Colorado on January 19, 2015, according to the Energy Information Administration (EIA). Despite prices rebounding 25%, the average in Colorado of $2.41 on April 20, 2015, remains 34% below the same period a year ago, and 30% below the five-year average.
Employment
The Mining and Logging industry lagged the state entering the recession and led the state in its recovery. Employment in the Mining and Logging industry in Colorado is made up of mostly oil and gas workers (~80%). The industry continued to add jobs in 2008, a full eight months after the recession took hold on total employment in Colorado. However, the Mining and Logging industry quickly shed jobs as well, losing one-quarter of total employment in 12 months. As of March 2015, the industry was 18% above 2008 peak employment compared to 6% for total employment in the state.
Historical Perspective
Colorado’s oil and gas industry has changed dramatically over the past 10 years. In 2004, the value of natural gas production eclipsed oil production nearly 7 to 1, and the epicenter of Colorado energy production was in the gas-rich fields of La Plata, Montezuma, and Garfield counties. Garfield and Weld counties jockeyed for the top position in the number of drilling permits each year. The DenverJulesberg Basin quickly rivaled new drilling in the Piceance and San Juan basins. In 2014, oil production in Colorado totaled an estimated 93 million barrels, growing by 28 million barrels from 2013 (which is more than the total production in 2007). Natural gas production in 2014 was 9.2% below the 2011 peak.
During the last major price event in 2009, extraction jobs remained stable and pipeline transportation jobs increased (13%), but drilling (-49%), support activities (-19%), and pipeline construction (-27%) jobs decreased sharply. Industry wages declined by $604 million in a single year. However, employment rebounded strongly and led the state in the employment recovery following the recession.
Price Impact
While lower prices are a boost to the consumer (income effect), the downside risk of these lower prices is that Colorado’s energy economy slows, dragging down some of the strong growth that the state has benefited from postrecession. The energy industry pays above-average wages ($104,626 in 2013) and employs almost 34,000 workers upstream and midstream (30,000 employees, 4,000 sole proprietors). While many of these workers may not be affected by falling prices, the exploration and drilling jobs are among the first to be impacted. Monthly data through March show seasonally adjusted Mining and Logging employment decreasing month-over-month for the last two months, and the pace of growth slowing to 8.9% year-over– year, the slowest pace since February 2014.
Modeling the impact of lower oil and gas prices on the state economy, state GDP grows at a slower rate, but the impact of the lower prices is not recessionary. Total employment grows 1.1 percentage points slower in the state due to the oil price decline in 2015, but employment grows faster in 2016 and 2017 as oil prices rebound above $80 per barrel.
Richard Wobbekind Executive Director| Business Research Division [email protected] | 303-492-1147
Brian Lewandowski Associate Director | Business Research Division [email protected] | 303-492-3307
Leeds School of Business University of Colorado Boulder Direct: 303-492-3307 | http://leeds.colorado.edu/brd 420 UCB | Boulder, CO 80309
Seth Godin is the author of 17 books that have been best-sellers around the world and have been translated into more than 35 languages. In addition to his writing and speaking, Seth Godin was founder of Squidoo.com, a leading site recently sold to HubPages. His blog is one of the most popular in the world. Before his work as a writer and blogger, Godin was Vice President of Direct Marketing at Yahoo!, a job he got after selling them his pioneering 1990s online startup, Yoyodyne. In 2013, Godin was inducted into the Direct Marketing Hall of Fame, one of three chosen for this honor.
Any business idea is only as good as the subsequent marketing idea that helps it get noticed. Seth Godin has developed into one of the foremost authorities on ideas of marketing, innovation, and creativity. He’s sold millions of books, 17 of which have been bestsellers around the world. He’s launched multiple companies, and has turned the publishing industry on its head by launching his latest book series via Kickstarter. Godin knows that the best leadership, and the best marketing ideas come from ordinary people who put in the work required to discover the greatness inside of them.
Tesla Motors is expected to announce a new product later this week: Residential and Commercial Battery Systems.
It's clear Tesla is expanding its close partnership with Panasonic, the world's largest manufacturer of Lithium Ion Batteries, through the upcoming Gigafactory plant in Sparks, Nevada. Investors and Tesla advocates immediately speculated that the new product line would be a battery system.
The new product and business model were originally alluded to by founder Elon Musk on his twitter account.
Major new Tesla product line -- not a car -- will be unveiled at our Hawthorne Design Studio on Thurs 8pm, April 30
While formally being announced on April 30th, Tesla seems to have confirmed this reasoning through a letter to investors. The letter confirmed a "home battery" and a "very large utility scale battery."
There is intriguing business genius with this move. The company is planning on scaling up battery production with the aim to achieve massive economies of scale. Designing a high potential battery product for homes and businesses could help create demand and expand its market position into the electric utility world.
For the customers, it makes economic sense to buy and store electricity at night when the price is low. The system could even sell unneeded electricity back to the grid when prices are high.
Widely implemented, systems like these could help the expansion of renewable energy sources that provide power intermittently when the sun shines or the wind blows.
Around 300 customers have already installed Tesla's batteries in their homes, reports The Guardian. "It’s clean, it’s quiet and it looks good in the garage," investment analyst Trip Chowdhry told the newspaper, adding that the system appeals to customers who want a constant connection to the internet. "If you are a gadget person living a digital life — you have iPhones and computers and you always want to be connected — the storage battery is a dream come true."
Helping businesses to do business better. That's the goal of almost any chamber of commerce. The Parker Area Chamber of Commerce does this better than most, by scheduling great events and speakers to inspire and encourage their members.
Dennis Houston, President and CEO of the Parker Area Chamber joins us to discuss their efforts to serve northern Douglas county, by monitoring and influencing relevant legislation, while also building a calendar of fun events.
One such event is slated for May 5th, as PACC invites Marketing Strategist, Kyle Sexton to speak talk about Social Media for Business. Kyle is an expert on incorporating social media with business market, and is the author of soon to be three books. The latest title will release this summer, Social Media Mullet. Kyle joins us for a preview of the event, his thoughts on strategy and a sense of humor about the whole thing.
You can still register for the event on May 5th, 8:00 to 11:00 at the PACE Center. Click here for registration details.
Later in the program, we continue our series of interviews with our state legislators, featuring Representative Rhonda Fields of District 42 in Aurora.
Rhonda tells us what led her to her work at the capitol, and which bills she working to pass, including: Advanced Practice Nurse Prescriptive Authority (SB 197) which would allow nurses in under-served areas to write prescriptions, Interactive Electronic Harassment - Cyberbullying (HB 1072) which would help eliminate loopholes to ensure that anyone harassed through social media or electronic means has recourse, and No Detention for Truancy (SB185) which would remove the juvenile court's jurisdiction over truancy, and several other bills.
Listen Saturday at 1:00 PM on 710 KNUS – Please let us know what you think of our program, either by commenting here or on Facebook at Connect & Collaborate with ICOSA or join the discussion on Twitter @ICOSAMagazine.
Pipeline safety is also an issue in the Keystone debate. Even though moving oil through pipelines is generally considered safer than the alternatives of rail or truck transport, the number of pipeline accidents reported each year remains “unacceptable” according to 
Robotic instruments, known as intelligent or “Smart Pigs” (The original pigs were made from straw wrapped in wire and used for cleaning. They made a squealing noise while traveling through the pipe, sounding to some like a pig squealing, which gave pigs their name) can now be deployed to both clean and inspect the pipeline from the inside, reporting its progress and findings contemporaneously often without stopping the flow of product. The result is more frequent inspections and the ability to dispatch repair crews to a location when needed, rather than tying them up making labor intensive inspections.
Aerial observations have long been an element of pipeline safety inspections. Helicopters have been equipped with laser spectroscopic systems to detect leaks of both product and methane gas; infrared sensors to detect potential structural failures and to record pictures for visual inspections.
