"L" Ratios Liquidity and Leverage

In the world of finance, the word leverage is used for debt.

Liquidity ratios tell you about a company's ability to meet its financial obligations, including debt, payroll, vendor payments, and so on.

• Current Ratio. This is a prime measure of how solvent a company is. It's so popular with lenders that it's sometimes called the bankers ratio. Generally speaking, the higher the ratio, the better financial condition a company is in. A company that has $3.2 million in current assets and $1.2 million in current liabilities would have a current ratio of 2.7 to 1. That company would be generally healthier than one with a current ratio of 2.2 to 1. To calculate the current ratio, divide total current assets by total current liabilities.

• Quick Ratio. This ratio isn't faster to compute than any other--it simply measures the ratio of a company's assets that can be quickly liquidated and used to pay debts. Thus, it ignores inventory, which can be hard to liquidate (and if you do have to liquidate inventory quickly, you typically get less for it than you would otherwise). This ratio is sometimes called the acid-test ratio because it measures a company's ability to deal instantly with its liabilities. To calculate the quick ratio, divide current assets minus inventory by current liabilities.

Leverage ratios tell you how, and how extensively, a company uses debt. In the world of finance, the word leverage is used for debt.

• Interest coverage. This measures a company's margin of safety: how many times over the company can make its interest payments. To calculate interest coverage, divide income before interest and taxes by interest expense.
• Debt to Equity. This measure provides a description of how well the company is making use of borrowed money to enhance the return on owner's equity. To calculate the debt-to-equity ratio, divide total liabilities by owners' equity.

ACTION POINT: Understand the value of liquidity and leverage for your company's financial health.

Operating Ratios

...these measures provide an assessment of a company's operating efficiency.


By linking various income statement and balance sheet figures, these measures provide an assessment of a company's operating efficiency.

• Asset turnover. This shows how efficiently a company uses its assets. To calculate asset turnover, divide revenue by total assets. The higher the number the better.

• Days receivables. It's best to collect on receivables promptly. This measure tells you in concrete terms how long it actually takes a company to what it's owed. A company that takes forty-five days to collect its receivables will need significantly more working capital than one that takes four days to collect. There are different methods to calculate days receivables. One way is to divide ending accounts receivable by revenue per day.

• Days payables. This measure tells you how many days it takes a company to pay its suppliers. The more days it takes, the longer a company has cash to work with. There are different methods to calculate days payables. One way is to divide ending accounts payable by cost of goods sold per day.
  

• Days inventory. This is a measure of how long it takes a company to sell the average amount of inventory on hand during a given period of time. The longer it takes to sell the inventory, the more the company's cash gets tied up and the greater the likelihood that the inventory will not be sold at full value. To calculate days inventory, divide average inventory by cost of goods sold per day.

ACTION ITEM: Evaluate your operation through the ratios above.

Profitability Ratios

These measurements evaluate a company's level of profitability by expressing sales and profits as a percentage of various other items.


By themselves, financial statements tell you quite a bit: how much profit the company made, where it spent its money, how large its debts are. But how do you interpret all the numbers these statements provide? For example, is the company's profit large or small? Is the level of debt healthy or not?

Ratio analysis provides a means of digging deeper into the information contained in the three financial statements. A financial ratio is two key numbers from a company's financial statements expressed in relation to each other. The ratios that follow are relevant across a wide spectrum of industries but are most meaningful when compared against the same measures for other companies in the same industry.

These measurements evaluate a company's level of profitability by expressing sales and profits as a percentage of various other items.

• Return on assets (ROA). ROA provides a quantitative description how well a company has invested in its assets. To calculate ROA, divide net income by total assets.

• Return on equity (ROE). ROE shows the return on the portion of the company's financing that is provided by owners. To calculate ROE, divide net income by owners' equity.

• Return on sales (ROS). Also known as net profit margin, ROS is a way to measure how sales translate into bottom-line profit. For example, if a company makes a profit of $10 for every $100 in sales, the ROS is 10/100, or 10 percent. To calculate ROS divide net income by the revenue.

• Gross Profit Margin. A ratio that measures the percentage of gross profit relative to revenue, gross margin reflects the profitability of the company's products or services.

• Earnings before interest and taxes. (EBIT) margin. Many analysts use this indicator, also known as operating margin, to see how profitable a company's operating activities are. To calculate EBIT margin, divide operating profit by revenue.

ACTION POINT: Evaluate your operations profitability based on the profitability ratios above.

Using Financial Statements to Measure Financial Health

...they tell three different but related stories about how well your company is doing financially.


The three financial statements offer three different perspectives on your companies financial performance. That is, they tell three different but related stories about how well your company is doing financially.

• The income statement shows the bottom line: it indicates how much profit or loss a company generates over a period of time.
• The balance sheet shows a company's financial position at a specific point in time. That is, it gives a snapshot of the company's financial situation--its assets, liabilities, and equity--on a given day
• The cash flow statement tells where the company's cash comes form and where it goes--in other words, the flow of cash in, through, and out of the company.

Another way to understand the interrelationships is as follows:

• The income statement tells you whether your company is making a profit
• The balance sheet tells you how efficiently the company is utilizing its assets and how well it is managing its liabilities in pursuit of profits.
• The cash flow statement tells you whether the company is turning profits into cash.

ACTION POINT: Understand your companies health through the lens of the three key financial statements.

The Cash Flow Statement

The cash flow statement doesn't measure the same things as the income statement.

A cash flow statement gives you a peek into a company's checking account. Like a bank statement, it tells how much cash was on hand a the beginning of the period, and how much was on hand at the end of the period. I then describes how the company spent its cash.

If you're a manager in a large corporation, changes in the company's cash flow won't typically have an impact on your day-to-day functioning. But you can affect cash flow in your company. And it's a good idea to stay up to date with your company's cash flow projections, because they may come into play when you prepare your budget for the upcoming year. For example, if cash is tight, you will probably be asked to be conservative in your spending. Alternative, if the company is flush with cash, you may have opportunities to make new investments.

If you're a manager in a small company, you're probably keenly aware of the firms cash flow situation and feel its impact almost every day. The cash flow statement is useful because it shows whether your company is turning profits into cash--and that ability is ultimately what will keep your company solvent. You can see in the example below that cash flow of $95,500 was generated.

STATEMENT OF CASH FLOWS, 2004

Net Income $347,000
Depreciation $42,500
Accounts receivable $(43,000)
Inventory $(80,000)
Prepaid expenses $(25,000)
Accounts payable $20,000
Accrued expenses $21,000
Income tax payable $8,000

Cash Flow from Operations $291,000
Property, Plant, Equipment $(7,500)

Cash Flow from Investing Activities $(7,500)

Short-term Debt $(91,000)
Long-term borrowings $90,000
Contributed capital $0
Cash dividends to stockholders $(188,000)

Cash Flow from Financing activities $(188,000)

Increase in cash during year $95,500

The cash flow statement doesn't measure the same things as the income statement. If there is not cash transactions, it cannot be reflected on a cash flow statement. Notice, however, that the cash flow statement starts with net income. Then, through a series of adjustments based on the increases and decreases in asset and liability accounts from the balance sheet, the cash flow statement translates this net income into cash.

In general, a company looks to three sources of cash: ongoing operations, investment activities, and financing activities. It's traditional to start with ongoing operations.

Accounts Receivable - the amount that customers owe for products and services.
Accounts Payable - the amount the company owes its vendors for supplies but not yet paid for.

Investment activities can be:

• Cash the company uses to invest in financial instruments or property, plant and equipment.
• Proceeds from the sale of plant, property and equipment
• Proceeds from converting its investments into cash.

Financing activities include raising money by borrowing in the capital markets and issuing stock. Dividends must be paid out of cash flow; they represent a decrease in cash flow.

ACTION POINT: Understand the activities that affect the companies cash position.

Third Fruit of the Spirit: Peace

My peace I give you. John 14:27

The third Fruit of the Spirit is Peace. Peace is the pervasive sense of contentment that comes from being rooted in God while being fully aware of one's own nothingness. It is a state that endures beyond the ups and downs of life, beyond the emotions of joy and sorrow. At the deepest level one knows that all is well, that everything is just right despite all appearances to the contrary. At all times one can pray wit Jesus, "Father, into your hands I commend my spirit" (Luke 23:46)

Philippians 4:7
And the peace of God, which transcends all understanding, will guard your hearts and your minds in Christ Jesus.

The Balance Sheet

companies prepare balance sheets as a means of summarizing their financial positions at a given point in time.


Most people go to a doctor once a year to get a checkup--a snapshot of their physical well-being at a particular time. Similarly, companies prepare balance sheets as a means of summarizing their financial positions at a given point in time.


Assets = liabilities + owner's equity


Assets are the things a company invests in so that it can conduct business--examples include financial instruments, land, buildings, and equipment. in order to acquire necessary assets, a company often borrows money from others or makes promises to pay others. That money, which is owed to creditors, is called liabilities. Owners equity, also know as shareholders' equity, includes the capital that investors have provided and the profits retained by the company over time. If a company has $3 million in assets and $2 million in liabilities, it would have owners' equity of $1 million.


Assets = liabilities + owner's equity
$3MM = $2MM + $1MM


By contrast, a company with $3MM in assets and $4MM in liabilities would have negative equity of $1MM--and serious problems as well.


Thus, the balance sheet provides a description of how much, and where, the company has invested (its assets)--broken down into how much of this money comes from creditors (liabilities) and how much comes from stockholders (equity). Moreover, the balance sheet gives you an idea of how efficiently your company is utilizing its assets and how well it is managing its liabilities.


Balance sheet data is most helpful when it's compared with information from a previous year. The balance sheet begins by listing the assets that are the most easily converted to cash: cash on hand, receivables, and inventory. These are called current assets.


Next, the balance sheet tallies other assets that have value but are tougher to convert to cash--for example, buildings and equipment. These are called fixed or long term assets.


Since most long-term assets, except land, depreciate over time, the company must also include accumulated depreciating in this part of the calculation. Gross property, plan, and equipment minus accumulated depreciation equals the current book value of property, plant, and equipment.


Subtracting current liabilities form current assets gives you the company's working capital. Working capital gives you an idea of how much money the company has tied up in operating activities. Just how much is adequate for the company depends on the industry and the company's plans.


Most long term liabilities are loans.


Owner's equity comprises retained earnings (net profits that accumulate in a company after any dividends are paid) and contributed capital (capital received in exchange for stock).



ACTION POINT: Become familiar with the key components of the balance sheet to evaluate the health of your organization.

The Income Statement

The income statement tells you whether the company is making a profit...

You might want to invest in a company for many reasons. Perhaps it's a leader in the industry. or its CEO has a great record of turning companies around. Or its products are on the cutting edge of technology. but if the company is not turning a profit (otherwise known as net income or earnings), or it doesn't show strong potential to become profitable over the medium term, you probably wouldn't want to invest in it.

The income statement tells you whether the company is making a profit--that is, whether it has positive net income. (This is why the income statement is also called a profit and loss statement.) It shows a company's profitability for a specific period of time-typically, monthly, quarterly, and annually.

How does an income statement present this profitability picture? It starts with a company's revenue: how much money has come in the door from its operations. various costs--from the costs of making and storing goods, to depreciation of plant and equipment, to interest and taxes--are then subtracted from the revenue. The bottom line--what's left over--is the net income or profit.

When looking at an income statement consider the following key terms:

• The cost of goods sold is what it cost for the materials that are being produced or sold. It included the acquisition cost for the raw materials, transportation and any direct labor costs.
• Gross profit is obtained by subtracting the cost of goods sold from the revenue--it is the profitability of the company's products or services.
• Operating expenses include administrative employee salaries, rents, sales and marketing costs, as well as other costs of business not directly attributed to manufacturing or obtaining a product.
• Depreciation is a way of estimating the "consumption" of an asset over time. A computer, for example, might have a useful life of three years. Thus, according to the matching principle, the company would not expense the full value of the computer all in the first year of its purchase, but as it is actually used over a span of three years.

By subtracting operating expanses and depreciation from gross profit you get operating income--often called earnings before interest and taxes, or EBIT.

• Interest expense refers to the interest charged on loans a company takes out.
• Income tax is levied by the government on corporate income.

ACTION POINT: Understand the items that are reported on the income statement to evaluate profitability for your operation.

Accounting Methods

Most companies use accrual accounting: revenue and expenses are booked when they are incurred...

Financial statements follow the same general format from company to company. Depending on the nature of the company's business, however, specific line items may vary. Still, the statements are usually similar enough to allow you to compare one business's performance against anther's. The reason for this similarity is that accountants abide by generally accepted accounting principles, or GAAP.

Most companies use accrual accounting: revenue and expenses are booked when they are incurred, regardless of when they are actually received or paid. This system relies on the matching principle, which helps companies understand the true causes and effects of business activities. Accordingly:

• Revenues are recognized during the period in which the sales activity occurred.
• Expenses are recognized in the same period as their associated revenues.

For example, at Amalgamated Hat Rack Company, which manufactures hat racks from imitation moose antlers, the revenue for a customer order is booked when each hat rack is sold--even if payment is made on account and the cash is not received immediately. similarly, If AHR receives two thousand brass hooks from a contracted supply company, those hooks are not all expensed at once. Rather, they are expensed on a per-unit basis: if it takes five brass hooks to make one hat rack, then the brass hooks are expensed five at a time as each hat rack is sold.

Occasionally, a very small company will begin its existence using cash-basis accounting, which counts transactions when cash actually changes hands. This practice is less conservative when it comes to expense recognition, but sometimes more conservative when it comes to revenue recognition. But as companies increase in size and complexity, it becomes more important to match revenues and expenses in the appropriate time periods, so they tent to switch over to accrual accounting.

ACTION POINT: Understand the difference between accrual and cash basis accounting.

Understanding Financial Statements

But it is pretty to see what money can do. --Samuel Pepys

Companies do many things: build cars, process data, provide services, and even launch satellites. But the underlying purpose for all for-profit companies is to make money. As a for-
profit manager, your job is to help the company make money--preferably, more money each year. Even if you work in the nonprofit or government sectors, where net income is neither the only nor the most important bottom line, it is still vital that you carefully monitor how much money comes in and where it gets spent.

You can help your company make money by reducing costs, increasing revenues, or both. You can also help the organization be financially successful by making good investments and using its assets to their fullest extent. The best managers don't just mind the budget--they look for the right combination of controlling costs, improving sales, and utilizing assets.

How's your company's financial health? Where does its revenue come form, and where does it spend its money? How much profit is it making? Where is its cash coming form, and where is it going to? Companies provide answers to such questions in three documents, called financial statements: the income statement, the balance sheet, and the cash flow statement.

ACTION POINT: Consider the questions above to evaluate your organizations health.

Why Understand Finance?

...it will explain what you need to know to be an intelligent consumer of financial concepts in making business decisions.

No matter where you work in your organization, understanding basic financial concepts will help you do your job better and contribute to your company’s efforts to stay in business and turn a profit.

Understanding Finance explains the basics of this important subject. It will not into make you a finance expert, nor will it qualify you to become a financial analyst, controller, or chief financial officer. But it will explain what you need to know to be an intelligent consumer of financial concepts in making business decisions.

Reduced to its essentials, business finance is about acquiring and allocating the resources a company needs to operate. Regarding resource acquisition, finance is concerned with questions such as:

• How will our company acquire and finance its inventory, equipment, and other physical assets?

• Should we use the owner’s money, borrowed funds, or internally generated cash for resources acquisitions?

• How long does it take to collect money owed to us by customers?

And regarding resource allocation, finance helps mangers answer questions like:

• If we could invest in several ventures, how might we determine which would ultimately generate the greatest value?

• What return must an investment produce to be worth making? And how should we measure return?

• How can we determine the profitability of our company’s different offerings?

Sometimes finance is also part of a company’s information system along with accounting, to produce financial statements, budgets, and forecasts. These documents give you the numbers your need to ask key questions and to make savvy decisions for your own division, department, or team if you interpret and use them correctly.

ACTION POINT: Understand finance from the perspective of resource acquisition and allocation.

Second Fruit of the Spirit: Joy

The joy of the Lord is your strength.
Nehemiah 8:10

The second Fruit of the Spirit is Joy. Joy is an abiding sense of well-being based on the experience of a conscious relationship with God. It is the sign of liberation from the false self and the growing awareness of the true self. Flowing from joy comes the freedom to accept the present moment and its content without trying to change it. Bliss might be described as the fullness of joy. It is the abiding sense of being loved by God and of being permanently established in his presence. it is the experience of the living water that flows from the divine Source in our inmost being, which Jesus spoke about in John's Gospel.

John 7:37-39
Jesus stood and said in a loud voice, "If anyone is thirsty, let him come to me and drink. Whoever believes in me, as the Scripture has said, streams of living water will flow from within him." By this he meant the Spirit, whom those who believed in him were later to receive.

Boys 2 Men

When is it that boys make the turn toward manhood? I pondered that as I watched a boy leave home for the first time this past week. Born on the east-side, he knew first hand the grit of gangs, violence, and fatherless homes. A mom that cared, an athletic gift from God and a junior college football scholarship provided the opportunity to educate his mind and exercise his talent.

I had come to know Kris during the last two years. He was the popular star athlete with blazing speed and a tough guy reputation. He is a quiet, scared boy that longs to please others. The uncertainty of the future with it’s temptations, decisions and increasing weight of personal responsibility will make him a man.

I knew he was scared. I knew he was sad. I knew he would miss his mom. I knew he would miss his friends. I knew he would miss our family. On his last night he left a note telling us that. Here some highlights:

“I really learned a lot from each of y'all,...” “You will always be in my heart and on my shoulder,...” “The first time I met you I didn’t think I would like you but you turned out to be great,...” “Thank you so much for the fun times,...” “I never thought I would get it right..., but you changed me into a better boy/man.” and the PS, “Thanks for letting me have the experience of having a close family.”

Bags packed for the future and tears shed for the past meant it was time to face the fear and hope that lay ahead. Such is the way for boys 2 men.

How to Teach Smart People How to Learn III

The idea at work

People often profess to be open to critique and new learning, but their actions suggest a very different set of governing values or theories-in-use:

• The desire to remain in unilateral control
• The goal of maximizing "winning" while minimizing "losing"
• The belief that negative feelings should be suppressed
• The desire to appear as rational as possible

Taken together, these values betray a profoundly defensive posture: a need to avoid embarrassment, threat, or feelings of vulnerability and incompetence.

Fortunately, it is possible for individuals and organizations to develop more productive patterns of behavior. Two suggestions for how to make this happen:

1. Apply the same kind of "tough reasoning" you use to conduct strategic analysis. Collect the most objective data you can find, Make your inferences explicit and test them constantly. Submit your conclusions to the toughest test of all: make sure they aren't self-serving or impossible for others to verify.
2. Model the desired changes first. When the leadership demonstrates its willingness to examine critically its own theories-in-use, changing them as indicated, everyone will find it easier to do the same.

ACTION POINT: Avoid defensiveness and self serving assumptions by critically testing them first.

How to Teach Smart People How to Learn II

The fact is, more and more jobs--no matter what the title--are taking the contours of "knowledge work."

The propensity among professionals to behave defensively helps shed light on the second mistake that companies make about learning. The common assumption is that getting people to learn is largely a matter of motivation. When people have the right attitudes and commitment, learning automatically follows. So companies focus on creating new organizational structures-compensation programs, performance reviews, corporate cultures, and the like--that are designed to create motivated and committed employees.


But effective double loop-loop learning is not simply a function of how people feel. It is a reflection of how they think--that is, the cognitive rules of reasoning they use to design and implement their actions.

Companies can learn how to resolve the learning dilemma. What it takes is to make the ways managers and employees reason about their behavior a focus of organizational learning and continuous improvement programs. Teaching people how to reason about their behavior in new and more effective ways breaks down the defenses that block learning.

The fact is, more and more jobs--no matter what the title--are taking the contours of "knowledge work."

ACTION POINT: People at all levels of the organization must combine the mastery of some highly specialized technical expertise with the ability to work effectively in teams, form productive relationships with clients and customers, and critically reflect on and then change their own organizational practices.

How to Teach Smart People How to Learn

A company that aspires to succeed in the tougher business environment of today's world must first resolve a basic dilemma: success in the marketplace increasingly depends on learning, yet most people don't know how to learn. What's more, those members of the organization that many assume to be the best at learning are, in fact, not very good at it. I am talking about the well-educated, high powered, high-commitment professionals who occupy key leadership positions in the modern corporation.

Most companies not only have tremendous difficulty addressing this learning dilemma; they aren't even aware that it exists. The reason: they misunderstand what learning is and how to bring it about. As a result they tend to make two mistakes in their efforts to become a learning organization.

First, most people define learning too narrowly as mere "problem solving," so they focus on identifying and correcting errors in the external environment. Solving problems is important. But if learning is to persist, managers and employees must also look inward. They need to reflect critically on their own behavior, identify the ways the often inadvertently contribute to the organization's problems, and then change how they act. In particular, they must learn how the very way they go about defining and solving problems can be a source of problems in its own right.

I have coined the terms "single loop" and "double loop" learning to capture this crucial distinction. To give a simple analogy: a thermostat that automatically turns on the heat whenever the temperature in a room drops below 68 degrees is a good example of single-loop learning. A thermostat that could ask, "Why am I set at 68 degrees?" and then explore whether or not some other temperature might more economically achieve the goal of heating the room would be engaging in double-loop learning.

Highly skilled professionals are frequently very good at single-loop learning. After all, they have spent much of their lives acquiring academic credentials, mastering one or a number of intellectual disciplines, and applying those disciplines to solve real-world problems. But ironically, this very fact helps explain why professionals are often so bad at double-loop learning.

Put simply, because many professionals are almost always successful at what they do, they rarely experience failure. And because they have rarely failed, they have never learned how to learn from failure. So when ever their single-loop learning strategies go wrong, they become defensive, screen out criticism, and put the "blame" on anyone and everyone but themselves. In short their ability to learn shuts down precisely at the moment they need it the most.

ACTION POINT: Learn from your mistakes.

How to Care for Yourself

Neglect yourself and your own needs, and you'll soon be overwhelmed by the pressures that build on those in leadership positions.

Leadership is principally concerned with key tasks and perspectives--but it also has its personal side. Neglect yourself and your own needs, and you'll soon be overwhelmed by the pressures that build on those in leadership positions.

There are several things--small and large--you can do to avoid the darker side of leadership--the stress that often accompanies the role. The fact that you are succeeding in your career and that your leadership and vision are bringing benefits to the organization should ease your mind. Nevertheless, be wise and try these stress-relieving tactics.

• Talk regularly with a confidant--for example, a spouse or trusted friend--about your chief concerns at work.
• If you don't have a mentor, get one. You should be mentored by at least one relatively senior and influential guiding light who is invested in your development and success, and whose advice you can trust without hesitation.
• Take advantage of professional development seminars that help refine your leadership skills.
• Find a sanctuary, a place you can go to at regular intervals that affords you "a view from the balcony": the chance to reflect on overarching patterns and issues in your work life.
• Don't take things personally if someone criticizes you. As the leader, you're often the lighting rod for other issues.
• Practice relaxation techniques such as deep breathing, taking a short walk, or stretching your body.
• Don't forget to exercise regularly--it relieves stress, helps you sleep better, and gives you more energy.
• And remember: Delegation is not a sign of weakness. It makes you a better leader, develops the potential of your staff, and helps you avoid burnout. So, go ahead, shed some tasks. Delegate to subordinates whatever responsibilities you can, but don't pass of just the tedious tasks. Once you've delegated a task, make sure not to let it get pushed back up to you.

ACTION POINT: Acknowledge the stress you feel. The burdens of leadership can be daunting.

Adapting Your Style

...try to respond to them in ways that address their particular needs and interests.

The members of your group will have different capabilities, needs, and growth potential. Stay flexible in dealing with them; try to respond to them in ways that address their particular needs and interests.

• Be direct with people who are just learning a new skill. They need very specific instructions and on going feedback.
• Support people who are learning skills but are still gaining experience. They need direction, but also the freedom to make some mistakes and encouragement to keep going.
• Encourage people who may be highly competent, but who may lack self-confidence. Use positive reinforcement to help them recognize their developing abilities.
• Delegate to highly motivated and experienced people. Don't just delegate work that you find unpleasant. Determine whose expertise or personal experience is suited to a "stretch" assignment, then give that person the freedom and support he needs to succeed.

ACTION POINT: Be specific, supportive, encouraging when people are learning new skills. Delegate and give freedom to your highly motivated and experienced people.

First Fruit of the Spirit: Charity

He will be silent in His love...
Zephaniah 3:17

The first Fruit of the Spirit is is Charity or, in the Greek, Agape, which means self-giving love as opposed to self-seeking love. Most of us know love as desiring something or someone. This is the kind of love the Greeks called Eros, a powerful and necessary kind of love but one that is meant to grow into the self-giving love that the Gospel calls charity. Charity is not alms giving. It is rather a participation in God's unconditional love...The growth of charity leads to self-surrender to God and to the compassionate love of others. The quality of Christ's love is the source of its vitality; the continual tender and loving awareness of the presence of God is its reward...Where does this charity come from? It is being infused into us in the silent seedbed of contemplative prayer.

Romans 5:5
God's love has been poured into our hearts through the Holy Spirit that has been given to us.

Saturday Brain Test and an Irish Blessing

How's your Brain?

This is a trick -- so don't say we didn't warn you.

READ THIS SENTENCE:

FEATURE FILMS ARE THE RESULT

OF YEARS OF SCIENTIFIC RESEARCH

COMBINED WITH THE EXPERIENCE OF YEARS.

Now, count the F's in the sentence. Only once -- don't go back and count them again.

There are six F's in the sentence you read in the paragraph on the reverse side. An average intelligence recollects three of them. If you spotted four, you're above average. if you get five, you can turn up your nose at most anybody. If you got all six you're a genius, and a lot too good to be wasting your time on foolishness like this.

Now on to the Blessing

Its a blessing to be Irish

And to look with Irish eyes

On the very special heritage

All sons of Erin prize...

It's a blessing to be Irish

And to celebrate in style

With other who are loyal

To the dear old Emerald Isle...

It's a blessing to be Irish

Sure it always will be, too --

As long as there's an Ireland

And Irish folks like you!

Today's post courtesy of some old papers left by my father that were given to my sister. Last night she shared them with me and I thought I would share them with you.

If you took the test, leave a comment and let us know your score.

Atmosphere of Trust

"You can't believe how many times I'd be sitting home replaying a game I had just played. I'd watch myself come off a pick, and I'd see Danny Ainge, wide open in the corner, and I'd say to myself, "Geez, how did I miss him?" Then I'd go in the next day to say to Danny, "Hey, you were wide open on that play last night in the third quarter. My fault, call for me next time, and I'll get you the ball." Larry Bird

The value of creating an atmosphere of trust is worth the extra effort it may entail because it can:

• reinforce trust among team members
• bring people together so they can focus on issues
• help you regulate the friction that is often necessary to do the job
• uphold principles of mutual respect and consideration
• focus on behavior, not personality
• give workers a sense of purpose
• create opportunities for others' professional growth
• foster a positive attitude
• protect a team's members

ACTION POINT: Credibility is imperative if you are to lead people and achieve your vision.

Create a Trusting Environment

...become a cohesive team, working toward the vision for the benefit of all

A work environment based on trust allows the individuals of a group to become a cohesive team, working toward the vision for the benefit of all. To achieve this kind of environment,

• Treat everyone, at every level of the hierarchy, with respect and consideration.
• Give everyone's ideas serious consideration.
• Be fair, kind, and courteous at all times.
• Never put other people down.
• Be honest. Admit it when you make a mistake or when you don't have the answer.
• Protect your group. Define a boundary around your group and shelter them from interference. Got to bat for your team to get the resources you need. Show courage in sticking up for your people.
• Do not tolerate scapegoating or misapplied blame.
• Use every reasonable opportunity to foster others professional growth.

ACTION POINT: Create an environment of trust for your organization.

Care For Your People

Empower your people to develop their own leadership skills.

The people within your own group--whether that group is a company, department, or team--are critical for achieving your vision. Motivating them, caring for them, and leading them is your primary duty.

Make sure they are with you. Once you are certain your people understand the vision, the mission, and the steps to be taken en route, create a sense of urgency about your shared endeavors. Keep your people excited about what they're doing.

Be prepared for resistance to change. Most people dislike change, even when they know the change is for the better. Rather than ignore that fear of change, recognize and deal with it openly.

Acknowledge and celebrate successes. And continue to celebrate successes, right up to the end. Celebrations can be large and small. A cheer for all, a lunch or picnic, t-shirts or caps--anything to keep spirits up.

Keep people informed. People don't like feeling excluded from the news of progress or of problems. By keeping your people updated, they will be ready to help solve problems as they arise.

Remain committed to the vision. Your commitment will be a model for everyone in the group. If they see you working hard to attain the goals, they will join you.

Empower your people to develop their own leadership skills. The benefits of supporting and trusting others can be enormous. You will gain loyalty as well as experienced and productive employees.

ACTION POINT: Understand the importance of caring for and developing your people.

How to Motivate the People You Need

Work to win over those key people who aren't enthusiastically behind you or who for some reason may feel threatened by you and your vision.

To ensure that your vision is embraced and fulfilled, you have to pay attention to the people around you--those who will help and those who may hinder your progress. Take care to handle both the political and the personal sides of leading and implementing your vision.

Know who could hinder you or help you. Take the time necessary to identify those who might resist you in some way--for example, by blocking your access to needed resources. Plan how you will deal with such problems. Work to win over those key people who aren't enthusiastically behind you or who for some reason may feel threatened by you and your vision.

An effective leader has to be a persuasive communicator. Building coalitions is when this skill becomes particularly useful. You will need cooperation from people at all levels of your organization and beyond.

Choose carefully whom you assign to important roles. People in key positions need to be competent in their roles and loyal to your vision.

If the changes you are making are significant, then make sure everyone is involved and understands what's happening. If you are realigning the company's organizational structure, for example, do it quickly and fairly.

You may not be able to make dramatic changes simultaneously. There may be technical or political barriers. But even if you can make only small changes that show success, you'll be on your way. Any movement toward your vision should be noted as positive.

ACTION POINT: Pay close attention to the politics, people and progress that are necessary for pursuing your vision.

Develop Your Vision

"A Buddhist monk once said, 'When you wash dishes, wash dishes.' At first the monk's zen-like thought seemed obvious to me, of no particular value, but upon reflection it began to make more sense. Eventually, I translated it into a phrase that had great significance: 'When in charge, be in charge.' And being in charge means that you must create the future." Gordon Sullivan, Chief of Staff, U.S. Army (retired)

You may have a general notion of where you would like your organization to go, but to craft a vision, take the following steps to ensure as much buy-in from stakeholders as possible.

Consider first the shared values and ideals of the organization. You won't get very far if you don't adhere to the basic beliefs of the group. Retain whatever is still useful and valuable from the former vision and mission. You don't always have to throw out the entire past to move forward.

Discuss your ideas with various stakeholders. Talk to your superiors and subordinates, and use lateral networking to get valuable information, input, an dearly support across various functions and departments. Find out what they want and need, and, most importantly, how they react to your vision.

Make sure that all perspectives are represented. Failure to listen to a powerful group or voice can result in problems later on. For example, certain stakeholders may be unwilling to support you at a critical juncture. if you don't incorporate the opinion of an important group, your vision may not address all relevant organizational needs.

Use the results of your research wisely. Incorporate what you learned to define a vision that is both realistic and focused. An effective vision is achievable. Even if it is ambitious, you, your team, and your stakeholders need to be imagining the same set of outcomes.

Ask your team to provide reality checks to help clarify the vision. Listen to those closed to you. Remain flexible. You may have to keep reassessing and revising your vision until it's right.

Clearly define the vision's benefits to all involved. Determine the benefits not only to your unit, but to the broader organization--employees, stakeholders, and customers alike. If these stakeholders know "what's in it for me," they'll be more likely to embrace the vision and offer assistance when asked.

ACTION POINT: Think in terms of satisfying deep human needs. People want to achieve; they want to feel that they belong; they want to have self-esteem and a feeling of control over their lives. If your vision helps to satisfy these needs, you will have plenty of support.

Divine Indwelling

God lives in us... 1 John 4:12

The start, middle, and end of the spiritual journey is the conviction that God is always present. As we progress in this journey, we perceive God's presence more and more. As we emerge from childhood into full, reflective, self-consciousness, our concept of how God is present in us is usually vague and primitive. The spiritual journey is a gradual process of enlarging our emotional, mental, and physical relationship with the divine reality that is present in us but not ordinarily accessible to our emotions or concepts... The fundamental theological principle of the spiritual journey is the Divine Indwelling. The Trinity is present within us as the source of our being on every level.

1 John 4:12
No one has ever seen God; but if we love one another God lives in us and his love is made complete in us.

Independence Day

“America was not built on fear. America was built on courage, on imagination, and unbeatable determination to do the job at hand.”
- Harry S. Truman

“When in the Course of human events it becomes necessary for one people to dissolve the political bands which have connected them with another and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature’s God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation. We hold these truths to be self-evident, that all men are crated equal, that they are endowed by their Creator with certain unalienable Rights that among these are Life, Liberty and the pursuit of Happiness…" The Declaration of Independence 1776

“And this idea that the government is beholden to the people, that it has no other source of power except the sovereign people, is still the newest and the most unique idea in all the long history of man’s relation to man. … This is the issue, …whether we believe in our capacity for self-government or whether we abandon the American Revolution and confess that a little intellectual elite in a far-distant capital can plan our lives for us better than we can plan them ourselves. … You and I have a rendezvous with destiny. We’ll preserve for our children this, the last best hope of man on earth, or we’ll sentence them to take the last step into a thousand years of darkness.” Ronald Reagan, 1964

"It is time for us to realize that we're too great a nation to limit ourselves to small dreams. We're not, as some would have us believe, doomed to an inevitable decline. I do not believe in a fate that will fall on us no matter what we do. I do believe in a fate that will fall on us if we do nothing. So with all the creative energy of our command, let us begin an era of national renewal. Let us renew our determination, our courage, and our strength. And let us renew our faith and hope." Ronald Reagan 1981

ACTION POINT: Celebrate the birthday of this great and amazing country. Happy Birthday America!!!

Vision - Clearly stated and Empowering

"When the road ahead is unclear, vision can take you only so far." Loren Gary

A vision provides a clear picture of a better future. it offers trust, faith, and hope for everyone in the organization. it becomes a guide for an organization to move from past beliefs, activities, and goals to a future path more suited to the changing needs of the organization and the demands of the economic environment.

A vision should be:

simple and idealistic. It should appeal to core values of the organization.

challenging but realistic. It's fine for the vision to have lofty language--you want it to be large enough to touch people;s core needs for achievement, recognition, and a sense of belonging. But the lofty language has to be easily translated into a realistic competitive strategy. The goals can be aggressive, but they must also be achievable.

focused. It should serve as a guide in decision making

beneficial for the organizations stakeholders--customers, stockholders, and employees. It should clearly define the benefits to these various constituencies.

easy to explain and understand. Even if implementing the vision is a complicated process, explaining it should be simple. People won't support what they can't understand.

ACTION POINT: Consider the simplicity, ideals, challenges, focus, benefits and clarity of your vision.

How to Craft a Vision

...vision doesn't need to be brilliant or innovative

A vision is a mind-picture of your hoped-for end result: what it will look like, how it will function, what it will produce, and how things will be changed by it. A simple, clear, and enduring vision of a better future is a leader's most important motivational tool; you'll refer to it time and again, explaining its benefits and relevance to various audiences as you work to keep them on board. The result of broad-based strategic thinking about the company's most key constituencies and a willingness to take calculated risks, a vision doesn't need to be brilliant or innovative. In fact, some of the best can seem mundane.

In the professional world, the word vision has been confused with other important concepts, such as mission statement, strategic objective, or slogans. But a vision, though related to these other concepts, over arches them and gives them meaning.

ACTION POINT: Picture your desired result when crafting a vision.