In a compelling discussion, Andrew Carroll, a seasoned CPA and consultant at CFOAndrew, shares his expertise on navigating financial crises. He highlights the crucial difference between deferred and lost demand, guiding leaders in strategic planning. Carroll emphasizes that hedging is vital for protecting assets, not just saving businesses. He also sheds light on essential governmental programs like the Emergency Sick Pay and Economic Injury Disaster Loan, providing practical insights for leaders to enhance their financial literacy and make informed decisions.
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volunteer_activism ADVICE
Pause and Plan
Pause and think about what's happening and how it might play out.
Plan for different scenarios and how your business might need to respond.
insights INSIGHT
Counterintuitive Leadership
The best leaders are calm when others panic, and agitated when others are complacent.
Gather facts, analyze costs and benefits, and weigh risks to make rational decisions with incomplete information.
volunteer_activism ADVICE
Powell's 40-70 Rule
Effective leaders make decisions when they have 40-70% of the information.
Waiting for more information can lead to missed opportunities.
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A Manager's Guide to Knowing What the Numbers Really Mean
Joe Knight
Karen Berman
John Case
Financial Intelligence provides a clear and accessible guide to financial concepts, helping managers understand income statements, balance sheets, cash flow statements, and key financial ratios. It emphasizes the importance of financial literacy in business decision-making and offers practical advice on interpreting financial data.
The Dumb Things Smart People Do with Their Money
Jill Schlesinger
In 'The Dumb Things Smart People Do with Their Money,' Jill Schlesinger provides insights and advice on a range of financial topics. The book highlights thirteen costly mistakes people often make, such as buying financial products they don't understand, taking on too much college debt, and failing to protect their identity. Schlesinger draws on her experience as a Wall Street trader, investment adviser, and money expert to offer practical and accessible rules for managing finances. She also delves into the emotional side of money and how it affects decision-making, using personal stories and real-life examples to illustrate her points.
Andrew Carroll: CFOAndrew
Andrew is a CPA and consultant at CFOAndrew who advises leaders and businesses on financial questions and change. He supports organizations in navigating taxes, investments, insurance, business strategy, operations, mergers and acquisitions, and accounting.
Key Points
Know the difference between deferred demand and lost demand and consider that in your strategy going forward.
Leverage is meant to protect a business, not save it.
Hedging is the most important thing you can do with your money.
Business owners and leaders should consider unemployment programs and, in The United States, Emergency Sick Pay, Economic Injury Disaster Loan Emergency Advance, and the Paycheck Protection Program.
Use the formula P=40 to 70, in which P stands for the probability of success and the numbers indicate the percentage of information acquired. Once the information is in the 40 to 70 range, go with your gut. -Colin Powell
Resources Mentioned
CFOAndrew
Related Episodes
Improve Your Financial Intelligence, with Joe Knight (episode 244)
How to Approach Corporate Budgeting, with Jody Wodrich (episode 355)
Four Rules to Get Control of Your Money, with Jesse Mecham (episode 356)
Dumb Things Smart People Do With Money, with Jill Schlesinger (episode 396)
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