Daniel’s Reviews > The Personal MBA > Status Update

Delegation is assigning the task to someone else—is effective for anything another person can do 80% as well as you can. In order to delegate, you must have someone to delegate to. Employees, contractors, or outsourcers.

Deferment is putting the task off until later—is effective for tasks that aren’t critical or time dependent. Don’t feel bad about putting somethings off;

There are only four ways to do something: completion, deletion, delegation, and deferment.

Completion is doing the task—is best for important tasks that only you can do particularly well.

Deletion is eliminating the task—is effective for anything that’s unimportant or unnecessary. If it’s not worth doing, don’t hesitate to get rid of it.

Amortization is the process of spreading the cost of a resource investment over its estimated useful life. With this we can decide whether an investment in a resource will make financial sense.

Overhead is the minimun resources required for your business to continue operating.

This includes all the things you need to run your business every month, regardless of whether you sell anything: salaries, rent, utilities, equipment repairs, and so on.

Financial Ratios: its the comparison of two important elements of your business.

They allow you to make comparisons between businesses or help you decide whether or not certain parts of the business are healthy.

Like:

Profitability Ratios: indicate a business ability to generate profit.

Leverage Ratios: indicate how your company uses debt.

Liquidity Ratios: indicate the ability of a business to pay its bills.

Cash Flow Statement: its an examination of a company’s bank account over a certain period of time.

Balance Sheet: its a snapshot of what a business owns and what it owes at a particular moment in time.
Assets - Liabilities = Owner’sEquity

Income Statement: its an estimate of the Profit over a certain period of time, once revenue is matched with expenses.
Revenue - CostOfGoodsSold - Expenses - Taxes = NetProfit

Finance is the art and science of watching how money flows into and out of a business, then deciding how to allocate it, and determining whether or not what you are doing is producing the result you want.

Accounting is the process of ensuring the data you use to make financial decisions is as complete and accurate as possible.

A system is a process made explicit and repeatable. A series of steps that has been formalized in some way.
The primary benefit of creating a system is that you can examine the processes and explicit steps and make improvements.
Also by defining the rules of how the system operates, you can automate day-to-day operations. Then you are free to focus efforts on continually improving the system instead of operating it.

Quality = Performance - Expectations

If you don’t meet customer’s expectations, no matter how good the product performance is in absolute terms, customers will not be satisfied and this will hurt the business reputation.
Always promise only what you can deliver.
After you meet customer expectations, surprise them with exceeding their expectations in terms of: performance, aesthetics, serviceability, ….

The only book you need to understand the fundamentals of business!