Marketing has pretty much been around forever in one form or another. Since the day when humans first started trading whatever it was that they first traded, marketing was there. Marketing was the stories they used to convince other humans to trade. Humans have come a long way since then, (Well, we like to think we have) and marketing has too.
The methods of marketing have changed and improved, and we've become a lot more efficient at telling our stories and getting our marketing messages out there. eMarketing is the product of the meeting between modern communication technologies and the age-old marketing principles that humans have always applied.
That said, the specifics are reasonably complex and are best handled piece by piece. So we’ve decided to break it all down and tackle the parts one at a time. This week we’ll be looking at the "what" and "why" of eMarketing, outlining the benefits and pointing out how it differs from traditional marketing methods.
Very simply put, eMarketing or electronic marketing refers to the application of marketing principles and techniques via electronic media and more specifically the Internet. The terms eMarketing, Internet marketing and online marketing, are frequently interchanged, and can often be considered synonymous.
eMarketing is the process of marketing a brand using the Internet. It includes both direct response marketing and indirect marketing elements and uses a range of technologies to help connect businesses to their customers.
By such a definition, eMarketing encompasses all the activities a business conducts via the worldwide web with the aim of attracting new business, retaining current business and developing its brand identity.
is it important?
When implemented correctly, the return on investment (ROI) from eMarketing can far exceed that of traditional marketing strategies.
Whether you're a "bricks and mortar" business or a concern operating purely online, the Internet is a force that cannot be ignored. It can be a means to reach literally millions of people every year. It's at the forefront of a redefinition of way businesses interact with their customers.
The benefits of eMarketing over traditional marketing
Reach
The nature of the internet means businesses now have a truly global reach. While traditional media costs limit this kind of reach to huge multinationals, eMarketing opens up new avenues for smaller businesses, on a much smaller budget, to access potential consumers from all over the world.
Scope
Internet marketing allows the marketer to reach consumers in a wide range of ways and enables them to offer a wide range of products and services. eMarketing includes, among other things, information management, public relations, customer service and sales. With the range of new technologies becoming available all the time, this scope can only grow.
Interactivity
Whereas traditional marketing is largely about getting a brand's message out there, eMarketing facilitates conversations between companies and consumers. With a two-way communication channel, companies can feed off of the responses of their consumers, making them more dynamic and adaptive.
Immediacy
Internet marketing is able to, in ways never before imagined, provide an immediate impact.
Imagine you're reading your favourite magazine. You see a double-page advert for some new product or service, maybe BMW's latest luxury sedan or Apple's latest iPod offering. With this kind of traditional media, it's not that easy for you, the consumer, to take the step from hearing about a product to actual acquisition.
With eMarketing, it’s easy to make that step as simple as possible, meaning that within a few short clicks you could have booked a test drive or ordered the iPod. And all of this can happen regardless of normal office hours. Effectively, Internet marketing makes business hours 24 hours per day, 7 days per week for every week of the year.
By closing the gap between providing information and eliciting a consumer reaction, the consumer's buying cycle is speeded up and advertising spend can go much further in creating immediate leads.
Demographics and targeting
Generally speaking, the demographics of the Internet are a marketer's dream. Internet users, considered as a group, have greater buying power and could perhaps be considered as a population group skewed towards the middle-classes.
Buying power is not all though. The nature of the Internet is such that its users will tend to organise themselves into far more focussed groupings. Savvy marketers who know where to look can quite easily find access to the niche markets they wish to target. Marketing messages are most effective when they are presented directly to the audience most likely to be interested. The Internet creates the perfect environment for niche marketing to targeted groups.
Adaptivity and closed loop marketing
Closed Loop Marketing requires the constant measurement and analysis of the results of marketing initiatives. By continuously tracking the response and effectiveness of a campaign, the marketer can be far more dynamic in adapting to consumers' wants and needs.
With eMarketing, responses can be analysed in real-time and campaigns can be tweaked continuously. Combined with the immediacy of the Internet as a medium, this means that there's minimal advertising spend wasted on less than effective campaigns.
Maximum marketing efficiency from eMarketing creates new opportunities to seize strategic competitive advantages.
The combination of all these factors results in an improved ROI and ultimately, more customers, happier customers and an improved bottom line.
Monday, April 26, 2010
e-mktng 2
eMarketing is essentially part of marketing. But what is the difference between eMarketing and Internet or web marketing? What are the eMarketing tools? And how do marketers plan for eMarketing? This lesson aims to answer these questions.
Marketing is an organizational function and a set of processes for creating, communicating and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.
Therefore eMarketing by its very nature is one aspect of an organizational function and a set of processes for creating, communicating and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders. As such an aspect, eMarketing has its own approaches and tools that contribute to the achievement of marketing goals and objectives.
This also helps us to differentiate between eMarketing and E-commerce, since E-Commerce is simply buying and selling online.
What is the difference between eMarketing and internet or web marketing?
There is no real difference between eMarketing and internet or web marketing. However, with the arrival of mobile technologies such as PDA's and 3G mobile phones, as well as Interactive Television, both terms tend to be stretched to include these new media technologies. On the other hand, others would see eMarketing and internet or web marketing as subtly different.
internet marketing is achieving marketing objectives through applying digital technologies.
eMarketing is achieving marketing objectives through use of electronic communications technology.
Whilst this distinction is wholly acceptable, it is difficult to see where the distinction lies between digital technologies and electronic communications technologies, especially with the convergence of technologies such as mobile devices.
What are the eMarketing tools?
The Internet has a number of tools to offer to the marketer.
* A company can distribute via the Internet e.g. Amazon.com.
* A company can use the Internet as a way of building and maintaining a customer relationship e.g. Dell.com.
* The money collection part of a transaction could be done online e.g. electricity and telephone bills.
* Leads can be generated by attracting potential customers to sign-up for short periods of time, before signing up for the long-term e.g. which.co.uk.
* The Internet could be used for advertising e.g. Google Adwords.
* Finally, the web can be used as a way of collecting direct responses e.g. as part of a voting system for a game show.
How do marketers plan for eMarketing?
There are two ways of looking at this.
* An existing organization may embark upon some eMarketing as part of their marketing plan.
* An organization trades solely on the Internet and so their marketing plan focuses purely on eMarketing.
The marketing plan in either case is the next step, whether focused upon eMarketing or all marketing. The next lessons focus upon a tailor-made eMarketing plan which conforms to the acronym AOSTC (from our generic marketing planning lesson).
* A - Audit - An audit of internal strengths and weaknesses, an external opportunities and threats.
* O - Objectives - SMART eMarketing objectives.
* S - Strategy - eMarketing strategies.
* T - Tactics - an eMarketing mix.
* C - Controls - measuring the performance of our eMarketing plan.
Marketing is an organizational function and a set of processes for creating, communicating and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.
Therefore eMarketing by its very nature is one aspect of an organizational function and a set of processes for creating, communicating and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders. As such an aspect, eMarketing has its own approaches and tools that contribute to the achievement of marketing goals and objectives.
This also helps us to differentiate between eMarketing and E-commerce, since E-Commerce is simply buying and selling online.
What is the difference between eMarketing and internet or web marketing?
There is no real difference between eMarketing and internet or web marketing. However, with the arrival of mobile technologies such as PDA's and 3G mobile phones, as well as Interactive Television, both terms tend to be stretched to include these new media technologies. On the other hand, others would see eMarketing and internet or web marketing as subtly different.
internet marketing is achieving marketing objectives through applying digital technologies.
eMarketing is achieving marketing objectives through use of electronic communications technology.
Whilst this distinction is wholly acceptable, it is difficult to see where the distinction lies between digital technologies and electronic communications technologies, especially with the convergence of technologies such as mobile devices.
What are the eMarketing tools?
The Internet has a number of tools to offer to the marketer.
* A company can distribute via the Internet e.g. Amazon.com.
* A company can use the Internet as a way of building and maintaining a customer relationship e.g. Dell.com.
* The money collection part of a transaction could be done online e.g. electricity and telephone bills.
* Leads can be generated by attracting potential customers to sign-up for short periods of time, before signing up for the long-term e.g. which.co.uk.
* The Internet could be used for advertising e.g. Google Adwords.
* Finally, the web can be used as a way of collecting direct responses e.g. as part of a voting system for a game show.
How do marketers plan for eMarketing?
There are two ways of looking at this.
* An existing organization may embark upon some eMarketing as part of their marketing plan.
* An organization trades solely on the Internet and so their marketing plan focuses purely on eMarketing.
The marketing plan in either case is the next step, whether focused upon eMarketing or all marketing. The next lessons focus upon a tailor-made eMarketing plan which conforms to the acronym AOSTC (from our generic marketing planning lesson).
* A - Audit - An audit of internal strengths and weaknesses, an external opportunities and threats.
* O - Objectives - SMART eMarketing objectives.
* S - Strategy - eMarketing strategies.
* T - Tactics - an eMarketing mix.
* C - Controls - measuring the performance of our eMarketing plan.
e-publishers
* Negligible investment by the publisher translates to a greater willingness to take on untried writers and non-traditional characters, story lines, and manuscript lengths.
* Faster publishing time for accepted manuscripts. Rather than waiting up to two years for a manuscript to see print, e-publishing generally publishes work within a few weeks to a few months after acceptance.
* Greater flexibility within the writer/publisher relationship. E-publishing affords more say to writers in preparing works for publication. A paper publisher might ask a writer to change a character, plot line, or other features of a story to make it more marketable. An e-publisher might also make suggestions, but the writer will generally have more say. The writer might also be instrumental in providing graphics for the work, such as an electronic jacket.
* Writers have the ability to update text often and easily at virtually no cost. This is particularly handy for works related to fast-moving industries such as computer technology. Since the e-publisher does not have an investment in printed books already lining shelves, text can be electronically updated in seconds.
* E-publishing offers greater longevity for works with slower sales. While paper publishers will remove slow movers from active status , electronic storage affords unlimited archiving. This gives new writers time to build a following by having their entire catalog available over extended periods of time.
* Works published electronically have an ISBN number, just like printed books. This means anyone can walk into a storefront bookstore and order an electronic copy of the book.
* Writers get a higher percentage of royalties through e-publishing because the initial financial layout for the publisher is so much less than for a paper publisher. Some writers receive as much as 70% of the profits in royalties.
* With e-publishing writers normally retain all other rights to the work, such as the option to go to a paper publisher later, adapt a screenplay, or use the work in some other capacity. Paper publishers, on the other hand, tend to covet as many rights as possible from the writer in the initial boilerplate contract.
If this all sounds a little too rosy, note the disadvantages of e-publishing:
* To date, electronic works sell far fewer copies than paper books. Many people aren’t aware of e-publishing and others prefer reading a book from print rather than electronically. Good sales, according to one e-publisher, amount to 500 copies for a successful manuscript.
* Writers are responsible for providing their own ongoing marketing for e-published work. A book might be great, but if nobody knows about it, it won’t sell. Authors also can’t count on the public seeing their books on shelves or in store windows.
* If interested in building credentials, e-published works do not carry the same weight as traditional paper publishers. The sense is that the bar is somehow lower for e-published works than for printed works. However, this may change with time as e-publishing becomes more established.
* Writers do not receive an advance. This is not just a financial disadvantage, but might disqualify e-published authors from participating in certain organizations where membership requirements include works paid by advance. That said, sales royalties are often paid more frequently by e-publishers, such as quarterly rather than annually.
* Piracy is another concern in the e-publishing industry. It is a fairly simple thing, technically speaking, for a recipient of an e-work to edit the file, make several copies, and sell the work out from under the nose of the e-publisher and author. Some e-publishers counter that the relatively small market for e-works provides little impetus for this.
* Prices are not always significantly cheaper for e-works, despite the lower overhead. This might be a deterrent to sales.
Despite the disadvantages, e-publishing can be a good way for a new writer to gain a following. Romance, science fiction, murder mystery and fantasy are all possible genres for e-publishing. It is also ideal for How-To books that must be updated frequently. Businesses can also save money on employee manuals and training materials by e-publishing them. An added advantage here is that works can be clickable. Table of contents and indexes can all make navigating through technical e-books a breeze.
E-publishers can be found online using any search engine. Read contracts carefully and consider the e-publisher’s catalog before deciding which company might be best to handle your work.
* Faster publishing time for accepted manuscripts. Rather than waiting up to two years for a manuscript to see print, e-publishing generally publishes work within a few weeks to a few months after acceptance.
* Greater flexibility within the writer/publisher relationship. E-publishing affords more say to writers in preparing works for publication. A paper publisher might ask a writer to change a character, plot line, or other features of a story to make it more marketable. An e-publisher might also make suggestions, but the writer will generally have more say. The writer might also be instrumental in providing graphics for the work, such as an electronic jacket.
* Writers have the ability to update text often and easily at virtually no cost. This is particularly handy for works related to fast-moving industries such as computer technology. Since the e-publisher does not have an investment in printed books already lining shelves, text can be electronically updated in seconds.
* E-publishing offers greater longevity for works with slower sales. While paper publishers will remove slow movers from active status , electronic storage affords unlimited archiving. This gives new writers time to build a following by having their entire catalog available over extended periods of time.
* Works published electronically have an ISBN number, just like printed books. This means anyone can walk into a storefront bookstore and order an electronic copy of the book.
* Writers get a higher percentage of royalties through e-publishing because the initial financial layout for the publisher is so much less than for a paper publisher. Some writers receive as much as 70% of the profits in royalties.
* With e-publishing writers normally retain all other rights to the work, such as the option to go to a paper publisher later, adapt a screenplay, or use the work in some other capacity. Paper publishers, on the other hand, tend to covet as many rights as possible from the writer in the initial boilerplate contract.
If this all sounds a little too rosy, note the disadvantages of e-publishing:
* To date, electronic works sell far fewer copies than paper books. Many people aren’t aware of e-publishing and others prefer reading a book from print rather than electronically. Good sales, according to one e-publisher, amount to 500 copies for a successful manuscript.
* Writers are responsible for providing their own ongoing marketing for e-published work. A book might be great, but if nobody knows about it, it won’t sell. Authors also can’t count on the public seeing their books on shelves or in store windows.
* If interested in building credentials, e-published works do not carry the same weight as traditional paper publishers. The sense is that the bar is somehow lower for e-published works than for printed works. However, this may change with time as e-publishing becomes more established.
* Writers do not receive an advance. This is not just a financial disadvantage, but might disqualify e-published authors from participating in certain organizations where membership requirements include works paid by advance. That said, sales royalties are often paid more frequently by e-publishers, such as quarterly rather than annually.
* Piracy is another concern in the e-publishing industry. It is a fairly simple thing, technically speaking, for a recipient of an e-work to edit the file, make several copies, and sell the work out from under the nose of the e-publisher and author. Some e-publishers counter that the relatively small market for e-works provides little impetus for this.
* Prices are not always significantly cheaper for e-works, despite the lower overhead. This might be a deterrent to sales.
Despite the disadvantages, e-publishing can be a good way for a new writer to gain a following. Romance, science fiction, murder mystery and fantasy are all possible genres for e-publishing. It is also ideal for How-To books that must be updated frequently. Businesses can also save money on employee manuals and training materials by e-publishing them. An added advantage here is that works can be clickable. Table of contents and indexes can all make navigating through technical e-books a breeze.
E-publishers can be found online using any search engine. Read contracts carefully and consider the e-publisher’s catalog before deciding which company might be best to handle your work.
Chicken--Auction
Chicken market is used to represent one of the stock market trends represented through the index. Bearish and bullish markets implicate downward and upward trends respectively, whereas a chicken market interprets no significant movement of the stock market index. The term chicken is used for an investor who is afraid to take risks.
e Auction
Auctions are common in markets where the goods sold are valuable (like art) or when their prices can't be easily determined. The process of an auction aims to find a fair price for the goods by identifying buyers who need them the most. Such auctions are called forward auctions. In forward auctions buyers compete with each other by placing bids for the goods to be sold.
At metal junction, we pioneered the concept of eAuctions for steel by moving the entire process of auctions to the Internet. With state-of-art technology and unique services to support buyers and sellers in the decision making, financing and logistics stages we make sure that our auction tools help enterprises realize their sales and procurement goals with considerable cost savings.
e Auction
Auctions are common in markets where the goods sold are valuable (like art) or when their prices can't be easily determined. The process of an auction aims to find a fair price for the goods by identifying buyers who need them the most. Such auctions are called forward auctions. In forward auctions buyers compete with each other by placing bids for the goods to be sold.
At metal junction, we pioneered the concept of eAuctions for steel by moving the entire process of auctions to the Internet. With state-of-art technology and unique services to support buyers and sellers in the decision making, financing and logistics stages we make sure that our auction tools help enterprises realize their sales and procurement goals with considerable cost savings.
- People do not naturally want to be led by you. It may come as a shock, but no one is particularly interested in working for U.
- A promotion and a title might bestow grudging tolerance and even a little bit of deference, but never credibility or true respect. First, prove your credibility and then earn their respect.
- Everyone has an agenda…they just don’t always share it.
- New leaders like to believe that everyone looks at business challenges, department objectives and initiatives from the same perspective – theirs. Learn to truly pay attention to your associates, in order to understand their unique agendas,motivations, interests, and ambitions.
- The personal problems of your associates will become your problems if you let them (and sometimes you can’t help it).
- New Managers, and even experienced ones, attract their team’s personal problems like flowers attract bees. You will find yourself on the receiving end of people’s challenges in their personal lives, with their health, their finances, their romances, their children, and just about every other dilemma that humans encounter.
- Learn to keep the focus on business but remember to be a human being.
- Your instinct says “Do it because I’m the boss.” Your instinct is wrong.“Because I said so” is best left for your parenting chores and checked at the door when you enter the office. Success comes when you realize that “you” are not the subject. It takes time to learn and internalize the parable of “The Scorpion and the Frog.”
- Recognize that people do not change their nature.
- We all have weaknesses; don’t make them your focal point.
- It’s not your responsibility to fix the flaws of your associates. Learn to leverage people’s strengths and develop teams where the members have complementary skills, and you will succeed beyond your wildest dreams.
- Note: I’ll admit, new leaders tend to start off overly nit-picky; but I’m sure Art would agree that there are times when weaknesses do have to be addressed.
- The key to leading people is obvious. Too bad no one will tell you what it is. Well, Art will – the answer is “Respect”. It’s all about treating people with respect.
- The most important part of your job is probably not in your job description.
- Creating an effective work environment is your real job.
- Beware of over-investing your time and energy with the wrong people.
- Every manager will at some point get to deal with a “brilliant problem child” employee – with outstanding technical skills but fatal flaws when it comes to people skills. These employees lack the emotional intelligence to recognize their aberrant behaviors, and therefore rarely if ever change. When dealing these employees, be fair and be decisive.
- You are responsible for your team’s results. It’s your name on the door and you are accountable. It’s not pleasant to feel the cold hand of reality slapping you across the face, but then again, its real life.
Sunday, April 18, 2010
effective mngt
In management, effectiveness is concerned with increasing the total out put, while efficiency is concerned with reducing the inputs required for achieving a given level of output. In many situations the effectiveness and efficiency go together. A company that makes high level of profits is also likely to have low unit cost per unit of production. But there can also be situations where increase in effectiveness may result in reduced efficiency. Some example such situations are given below.
* At times higher total production may be possible by giving overtime, to workmen, which involves higher rates of wages. This may increase unit cost of production, still profits may be higher because increase in cost is more than made up by increase in total revenue.
* Unit labour cost may also increase for higher production for other reasons such as payment of incentive for higher production and use of contract labour.
* All project manager face situations where faster completion of a pproject can be achieved at higher costs, an managers often choose to incur higher costs as earlier production means higher effectiveness in terms of starting to receive benefit of the completed project output earlier.
* In some project the completion deadline may be very important - for example, organizing an international sporting event. In a situation like this, it is important to ensure that all preparations are made in time, even if it is possible at substantial extra costs.
* At times higher total production may be possible by giving overtime, to workmen, which involves higher rates of wages. This may increase unit cost of production, still profits may be higher because increase in cost is more than made up by increase in total revenue.
* Unit labour cost may also increase for higher production for other reasons such as payment of incentive for higher production and use of contract labour.
* All project manager face situations where faster completion of a pproject can be achieved at higher costs, an managers often choose to incur higher costs as earlier production means higher effectiveness in terms of starting to receive benefit of the completed project output earlier.
* In some project the completion deadline may be very important - for example, organizing an international sporting event. In a situation like this, it is important to ensure that all preparations are made in time, even if it is possible at substantial extra costs.
Monday, April 12, 2010
management quotes---philips kotler
- "Management by objectives works if you first think through your objectives. Ninety percent of the time you haven't."
- "So much of what we call management consists in making it difficult for people to work."
- Somebody once said that in looking for people to hire, you look for three qualities: integrity, intelligence, and energy. But if they don't have the first, the other two will kill you.
- “The most important thing in communication is to hear what isn't being said.”
- “The purpose of business is to create and keep a customer.”
- “Follow effective action with quiet reflection. From the quiet reflection will come even more effective action.”
- “The productivity of work is not the responsibility of the worker but of the manager.”
- “Efficiency is doing things right; effectiveness is doing the right things.”
- “Management is doing things right; leadership is doing the right things.”
- “Unless commitment is made, there are only promises and hopes; but no plans.”
- “Efficiency is doing better what is already being done.”
- “Teaching is the only major occupation of man for which we have not yet developed tools that make an average person capable of competence and performance. In teaching we rely on the "naturals," the ones who somehow know how to teach.”
- “What you have to do and the way you have to do it is incredibly simple. Whether you are willing to do it, that's another matter.”
- “Plans are only good intentions unless they immediately degenerate into hard work.”
- “Today knowledge has power. It controls access to opportunity and advancement.”
- “Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window.”
- “We now accept the fact that learning is a lifelong process of keeping abreast of change. And the most pressing task is to teach people how to learn.”
- “Objectives are not fate; they are direction. They are not commands; they are commitments. They do not determine the future; they are means to mobilize the resources and energies of the business for the making of the future.”
- A manager is responsible for the application and performance of knowledge.
- Accept the fact that we have to treat almost anybody as a volunteer.
- Business, that's easily defined - it's other people's money.
- Checking the results of a decision against its expectations shows executives what their strengths are, where they need to improve, and where they lack knowledge or information.
- Company cultures are like country cultures. Never try to change one. Try, instead, to work with what you've got.
- Effective leadership is not about making speeches or being liked; leadership is defined by results not attributes.
- Efficiency is doing things right; effectiveness is doing the right things.
- Executives owe it to the organization and to their fellow workers not to tolerate nonperforming individuals in important jobs.
- Few companies that installed computers to reduce the employment of clerks have realized their expectations... They now need more, and more expensive clerks even though they call them 'operators' or 'programmers.'
- Follow effective action with quiet reflection. From the quiet reflection will come even more effective action.
- Innovation is the specific instrument of entrepreneurship. The act that endows resources with a new capacity to create wealth.
- Knowledge has to be improved, challenged, and increased constantly, or it vanishes.
- Making good decisions is a crucial skill at every level.
- Management by objective works - if you know the objectives. Ninety percent of the time you don't.
- Management is doing things right; leadership is doing the right things.
- Most discussions of decision making assume that only senior executives make decisions or that only senior executives' decisions matter. This is a dangerous mistake.
- Most of what we call management consists of making it difficult for people to get their work done.
- My greatest strength as a consultant is to be ignorant and ask a few questions.
- Never mind your happiness; do your duty.
- No institution can possibly survive if it needs geniuses or supermen to manage it. It must be organized in such a way as to be able to get along under a leadership composed of average human beings.
- People who don't take risks generally make about two big mistakes a year. People who do take risks generally make about two big mistakes a year.
- Plans are only good intentions unless they immediately degenerate into hard work.
- Rank does not confer privilege or give power. It imposes responsibility.
- So much of what we call management consists in making it difficult for people to work.
- Suppliers and especially manufacturers have market power because they have information about a product or a service that the customer does not and cannot have, and does not need if he can trust the brand. This explains the profitability of brands.
- Teaching is the only major occupation of man for which we have not yet developed tools that make an average person capable of competence and performance. In teaching we rely on the "naturals," the ones who somehow know how to teach.
- The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself.
- The best way to predict the future is to create it.
- The entrepreneur always searches for change, responds to it, and exploits it as an opportunity.
- The most efficient way to produce anything is to bring together under one management as many as possible of the activities needed to turn out the product.
- The most important thing in communication is hearing what isn't said.
- The new information technology... Internet and e-mail... have practically eliminated the physical costs of communications.
- The only thing we know about the future is that it will be different.
- The productivity of work is not the responsibility of the worker but of the manager.
- The purpose of a business is to create a customer.
- There is nothing so useless as doing efficiently that which should not be done at all.
- Time is the scarcest resource and unless it is managed nothing else can be managed.
- Today knowledge has power. It controls access to opportunity and advancement.
- Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window.
- Unless commitment is made, there are only promises and hopes... but no plans.
- We can say with certainty - or 90% probability - that the new industries that are about to be born will have nothing to do with information.
- We now accept the fact that learning is a lifelong process of keeping abreast of change. And the most pressing task is to teach people how to learn.
- When a subject becomes totally obsolete we make it a required course.
Sunday, April 11, 2010
stocky info
Stocks are a tricky market. Many people love the thrill and thrive on being on the edge of disaster at any moment. If you want
to dabble in stocks and futures, day trading may be for you.
What is day trading anyway? It reminds you of seeing all those people in colorful jackets in the bullpen at the New York Stock
Exchange yelling and trading paper with scribbles on it as the digital ticker tape scrolls around the room. Day trading
involves stocks but also other investment instruments that demonstrate such market changes that can be traded successfully from
day to day. What you are trading on is the difference between the buying price and the selling price.
It can be a complicated business to trade stocks and other instruments, so day traders need to know the market and have a
strategy for getting the useful information to make them some money. The Internet has given people savvy in the financial
market the ability to day trade for themselves because of access to up-to-the-minute market data.
Day traders work within markets that can be traded on a daily basis because of the changes in their markets. We mentioned
stocks but other options are currencies (based on exchange rates), commodities (like gold and oil, based on daily rates) and
futures (future contracts) to name a few. Futures are popular because it is not actually about owning anything. You are trading
contracts that say something will be sold for a specific price in the future. Money is made on the difference between buying
and selling prices just like with other instruments useful for day trading.
Start with a market that doesn’t move very fast so you can get the hang of it. You will need money to deposit with your
brokerage before you begin trading. Sometimes that determines which markets are suitable for you to begin with. Shoot for
markets with low tick value and also low tick size (the minimum change in price that is required).
As a beginner day trader, you will most likely choose to enter trades based on the volatility and liquidity of the stock.
Volatility is a measure of how much the stock is supposed to fluctuate in a day. Those that have a greater fluctuation risk
could mean huge profits or huge losses. Liquidity refers to how well you’ll move within that stock price.
Use your charts and data available. Finding an entry point is your target. You may want to trade on the low and high of the day
to buy and sell. Another strategy is trading based on financial news. Buy when volume is low and sell when it begins to show
signs of a reversal.
Day trading can be lucrative once you learn the ropes. Start in a slower, more stable market as you get your bearings and
choose the strategy that works for you.
Put simply, a stock market is the place where people buy and sell shares of stock in publicly traded companies. Brokers connect
potential buyers and sellers who agree to transactions at an agreed-upon price.
When the stock market operates the way it should, the most efficiently-run companies will receive more investments than the
others who are not. The best businesses will then thrive and those that are not will become extinct or adapt.
Today, stock markets are thriving and are getting more sophisticated. There is now a slow transition of the traditional stock
markets (and stock exchanges) into the virtual world and online stocks transactions will all be done online.
For an aspiring investor or a broker wannabe, there are still certain things one should be familiar with in a real-world stock
market trading. One of them is the so-called stock index.
Stock indexes
A stock index is the statistical average of a particular stock exchange or sector. Stocks of parts of the same exchange, or the
same industry or the same companies are classified and grouped into indexes.
The most common (and well-known) stock indexes in the U.S. are the Dow Jones Industrial Average, the New York Stock Exchange
composite index, and the Standard & Poor 500 Composite Stock Price Index.
Stock indexes are usually studied by experts for a definitive look into the overall perspective of the economic health of a
certain industry group or the whole of a stock exchange, for instance.
Kinds of indexes
Stock indexes are calculated in different ways, each type serving a purpose. Price Weighted Indexes are those that are based
solely on the price of stocks. This index group does not consider the importance of any particular stock or the company size.
The Market Value Weighted Index is the one that does consider the company size of the stocks group with them. This group
considers the price shifts of small companies even if they have less influence than the big ones. Another type, the one that is
based on the number of shares rather than the total value is called the Market-share Weighted Index.
Other index uses
Aside from giving overall outlook on particular economies, indexes are also used as investment instruments. Passively Managed
Mutual Funds are mutual funds based on indexes.
Regular managed funds have been found to be outperformed by this index-based passively managed mutual fund.
The big indexes
The Dow Jones Industrial Average is one of the best-known indexes in the U.S. Presently, it follows the stock movements of 30
of the most influential companies in America.
Dow Jones is considered to be a price-weighted average index because it gives more influence to more expensive stocks. Many
analysts say that price-weighting does not really give an accurate picture of the different stock market movements. They also
added that 30 companies is still short to form an accurate assessment.
S & P 500 Index is based on 500 US corporations that are carefully chosen to represent a much extensive swathe of the country’s
economic activity. Although regarded as second only to Dow Jones, economic experts feel that it is an accurate predictor of the
state and condition of the economy.
All in all, stock indexes have a perfect role to perform in a stock market – an indicator of the market’s health or that of its
group or even the strength of one particular stock itself in the market.
There are cash plans that cover for the cost of travelling to a hospital or keeping a relative with the patient
Taking a health plan does not mean all our expenses on hospitalisation is covered. To name a few, travelling to and fro from
the hospital, special diet expenses and expenses for relative staying with patient are not covered under medical plans.
Should you chase dividend funds?
However, there are certain plans that cater to these specific needs as well. Tata AIG General Insurance, Bajaj Allianz General
Insurance and Royal Sundaram General Insurance offer hospital cash plans. These plans can be purchased mostly with the medical
insurance policies.
To avail off this facility, the policy holder should be hospitalised either in a registered hospital or in a hospital with a
minimum of 15 beds. And, hospitalisation could be due to sickness or accident.
Premium: As per Tata AIG General Insurance’s website, this plan is available for any individual aged between 18 to 59 years and
includes self, spouse and two dependent children aged between 6 months and 18 years or up to 23 years, if studying in an
accredited institution of higher learning and unmarried.
Strategies for SIP investment
If a family of four buys a cover of Rs 5.5 lakh from Tata AIG, the annual premium would be Rs 4,669 inclusive of service tax.
Benefits provided under this would be hospitalisation due to sickness (Rs 1,000 per day), hospitalisation due to accident (Rs
2,000 per day), medical expenses reimbursement in the event of an accident (Rs 10,000).
With Bajaj Allianz - 30 days Rs 500 Plan, a family of four would pay a premium of Rs 1,362 inclusive of service tax.
Hospitalisation due to illness (in a general) would receive Rs 500 a day, admission in ICU due to illness would get Rs 1,000
per day. Hospitalisation due to accident (general) would get Rs 500 a day and accident admission in ICU would get Rs 1,000. A
premium up to Rs 15,000 a year is eligible for tax exemption under section 80D.
Exclusions: Hospitalisation within 30 days from the time of purchasing the policy, pre-existing diseases, dental treatment or
surgery, pregnancy-related treatment, childbirth, natural perils like avalanche, earthquake, volcanic eruptions, accidents from
drunken driving are not covered by the policy.
Keep track of these changes with your investments
The waiting period for Tata AIG General Insurance’s Individual Accident and Sickness Hospital Cash is 90 days, unless
hospitalisation is caused by injury. Routine physical examination where there are no objective indications or impairment in
normal health, laboratory diagnostic or X-ray examinations is also not covered, including expenses incurred outside India.
Claim settlement: The illness or claim should be immediately reported to the insurer on phone or in writing (email/letter). The
claimant will need to submit a complete claim form along with documents required - attending doctor's report, hospital
discharge card or proof with details of treatment, bills with prescriptions, pathological or X-ray reports.
After submission of the necessary documents, the insurance company's claim team would assess the claim for completeness of
documentation and admissibility and send a written communication to the insured for additional documents if any or if the claim
is deemed to be inadmissible as per policy.
to dabble in stocks and futures, day trading may be for you.
What is day trading anyway? It reminds you of seeing all those people in colorful jackets in the bullpen at the New York Stock
Exchange yelling and trading paper with scribbles on it as the digital ticker tape scrolls around the room. Day trading
involves stocks but also other investment instruments that demonstrate such market changes that can be traded successfully from
day to day. What you are trading on is the difference between the buying price and the selling price.
It can be a complicated business to trade stocks and other instruments, so day traders need to know the market and have a
strategy for getting the useful information to make them some money. The Internet has given people savvy in the financial
market the ability to day trade for themselves because of access to up-to-the-minute market data.
Day traders work within markets that can be traded on a daily basis because of the changes in their markets. We mentioned
stocks but other options are currencies (based on exchange rates), commodities (like gold and oil, based on daily rates) and
futures (future contracts) to name a few. Futures are popular because it is not actually about owning anything. You are trading
contracts that say something will be sold for a specific price in the future. Money is made on the difference between buying
and selling prices just like with other instruments useful for day trading.
Start with a market that doesn’t move very fast so you can get the hang of it. You will need money to deposit with your
brokerage before you begin trading. Sometimes that determines which markets are suitable for you to begin with. Shoot for
markets with low tick value and also low tick size (the minimum change in price that is required).
As a beginner day trader, you will most likely choose to enter trades based on the volatility and liquidity of the stock.
Volatility is a measure of how much the stock is supposed to fluctuate in a day. Those that have a greater fluctuation risk
could mean huge profits or huge losses. Liquidity refers to how well you’ll move within that stock price.
Use your charts and data available. Finding an entry point is your target. You may want to trade on the low and high of the day
to buy and sell. Another strategy is trading based on financial news. Buy when volume is low and sell when it begins to show
signs of a reversal.
Day trading can be lucrative once you learn the ropes. Start in a slower, more stable market as you get your bearings and
choose the strategy that works for you.
Put simply, a stock market is the place where people buy and sell shares of stock in publicly traded companies. Brokers connect
potential buyers and sellers who agree to transactions at an agreed-upon price.
When the stock market operates the way it should, the most efficiently-run companies will receive more investments than the
others who are not. The best businesses will then thrive and those that are not will become extinct or adapt.
Today, stock markets are thriving and are getting more sophisticated. There is now a slow transition of the traditional stock
markets (and stock exchanges) into the virtual world and online stocks transactions will all be done online.
For an aspiring investor or a broker wannabe, there are still certain things one should be familiar with in a real-world stock
market trading. One of them is the so-called stock index.
Stock indexes
A stock index is the statistical average of a particular stock exchange or sector. Stocks of parts of the same exchange, or the
same industry or the same companies are classified and grouped into indexes.
The most common (and well-known) stock indexes in the U.S. are the Dow Jones Industrial Average, the New York Stock Exchange
composite index, and the Standard & Poor 500 Composite Stock Price Index.
Stock indexes are usually studied by experts for a definitive look into the overall perspective of the economic health of a
certain industry group or the whole of a stock exchange, for instance.
Kinds of indexes
Stock indexes are calculated in different ways, each type serving a purpose. Price Weighted Indexes are those that are based
solely on the price of stocks. This index group does not consider the importance of any particular stock or the company size.
The Market Value Weighted Index is the one that does consider the company size of the stocks group with them. This group
considers the price shifts of small companies even if they have less influence than the big ones. Another type, the one that is
based on the number of shares rather than the total value is called the Market-share Weighted Index.
Other index uses
Aside from giving overall outlook on particular economies, indexes are also used as investment instruments. Passively Managed
Mutual Funds are mutual funds based on indexes.
Regular managed funds have been found to be outperformed by this index-based passively managed mutual fund.
The big indexes
The Dow Jones Industrial Average is one of the best-known indexes in the U.S. Presently, it follows the stock movements of 30
of the most influential companies in America.
Dow Jones is considered to be a price-weighted average index because it gives more influence to more expensive stocks. Many
analysts say that price-weighting does not really give an accurate picture of the different stock market movements. They also
added that 30 companies is still short to form an accurate assessment.
S & P 500 Index is based on 500 US corporations that are carefully chosen to represent a much extensive swathe of the country’s
economic activity. Although regarded as second only to Dow Jones, economic experts feel that it is an accurate predictor of the
state and condition of the economy.
All in all, stock indexes have a perfect role to perform in a stock market – an indicator of the market’s health or that of its
group or even the strength of one particular stock itself in the market.
There are cash plans that cover for the cost of travelling to a hospital or keeping a relative with the patient
Taking a health plan does not mean all our expenses on hospitalisation is covered. To name a few, travelling to and fro from
the hospital, special diet expenses and expenses for relative staying with patient are not covered under medical plans.
Should you chase dividend funds?
However, there are certain plans that cater to these specific needs as well. Tata AIG General Insurance, Bajaj Allianz General
Insurance and Royal Sundaram General Insurance offer hospital cash plans. These plans can be purchased mostly with the medical
insurance policies.
To avail off this facility, the policy holder should be hospitalised either in a registered hospital or in a hospital with a
minimum of 15 beds. And, hospitalisation could be due to sickness or accident.
Premium: As per Tata AIG General Insurance’s website, this plan is available for any individual aged between 18 to 59 years and
includes self, spouse and two dependent children aged between 6 months and 18 years or up to 23 years, if studying in an
accredited institution of higher learning and unmarried.
Strategies for SIP investment
If a family of four buys a cover of Rs 5.5 lakh from Tata AIG, the annual premium would be Rs 4,669 inclusive of service tax.
Benefits provided under this would be hospitalisation due to sickness (Rs 1,000 per day), hospitalisation due to accident (Rs
2,000 per day), medical expenses reimbursement in the event of an accident (Rs 10,000).
With Bajaj Allianz - 30 days Rs 500 Plan, a family of four would pay a premium of Rs 1,362 inclusive of service tax.
Hospitalisation due to illness (in a general) would receive Rs 500 a day, admission in ICU due to illness would get Rs 1,000
per day. Hospitalisation due to accident (general) would get Rs 500 a day and accident admission in ICU would get Rs 1,000. A
premium up to Rs 15,000 a year is eligible for tax exemption under section 80D.
Exclusions: Hospitalisation within 30 days from the time of purchasing the policy, pre-existing diseases, dental treatment or
surgery, pregnancy-related treatment, childbirth, natural perils like avalanche, earthquake, volcanic eruptions, accidents from
drunken driving are not covered by the policy.
Keep track of these changes with your investments
The waiting period for Tata AIG General Insurance’s Individual Accident and Sickness Hospital Cash is 90 days, unless
hospitalisation is caused by injury. Routine physical examination where there are no objective indications or impairment in
normal health, laboratory diagnostic or X-ray examinations is also not covered, including expenses incurred outside India.
Claim settlement: The illness or claim should be immediately reported to the insurer on phone or in writing (email/letter). The
claimant will need to submit a complete claim form along with documents required - attending doctor's report, hospital
discharge card or proof with details of treatment, bills with prescriptions, pathological or X-ray reports.
After submission of the necessary documents, the insurance company's claim team would assess the claim for completeness of
documentation and admissibility and send a written communication to the insured for additional documents if any or if the claim
is deemed to be inadmissible as per policy.
Saturday, April 10, 2010
Importanat info
1. Reinvest :::: When you first make money, you may be tempted to spend it. Don't. Instead, reinvest the profits. Warren Buffett learned this early on. In high school, he and a pal bought a pinball machine to pun in a barbershop. With the money they earned, they bought more machines until they had eight in different shops. When the friends sold the venture, Warren Buffett used the proceeds to buy stocks and to start another small business. By age 26, he'd amassed $174,000 - $1.4 million in today's money. Even a small sum can turn into great wealth.
2.Willing To Be Different: Don't base your decisions upon what everyone is saying or doing. When Warren Buffett began managing money in 1956 with $100,000 cobbled together from a handful of investors, he was dubbed an oddball. He worked in Omaha, not Wall Street, and he refused to tell his parents where he was putting their money. People predicted that he'd fail, but when he closed his partnership 14 years later, it was worth more than $100 million. Instead of following the crowd, he looked for undervalued investments and ended up vastly beating the market average every single year. To Warren Buffett, the average is just that -- what everybody else is doing. to be above average, you need to measure yourself by what he calls the Inner Scorecard, judging yourself by your own standards and not the world's.
3. Never Suck Your Thumb: Gather in advance any information you need to make a decision, and ask a friend or relative to make sure that you stick to a deadline. Warren Buffett prides himself on swiftly making up his mind and acting on it. He calls any unnecessary sitting and thinking "thumb sucking." When people offer him a business or an investment, he says, "I won't talk unless they bring me a price." He gives them an answer on the spot.
4. Spell Out The Deal Before You Start: Your bargaining leverage is always greatest before you begin a job -- that's when you have something to offer that the other party wants. Warren Buffett learned this lesson the hard way as a kid, when his grandfather Ernest hired him and a friend to dig out the family grocery store after a blizzard. The boys spent five hours shoveling until they could barely straighten their frozen hands. Afterward, his grandfather gave the pair less than 90 cents to split. Warren Buffett was horrified that he performed such backbreaking work only to earn pennies an hour. Always nail down the specifics of a deal in advance -- even with your friends and relatives.
5. Watch Small Expenses: Warren Buffett invests in businesses run by managers who obsess over the tiniest costs. He one acquired a company whose owner counted the sheets in rolls of 500-sheet toilet paper to see if he was being cheated (he was). He also admired a friend who painted only on the side of his office building that faced the road. Exercising vigilance over every expense can make your profits -- and your paycheck -- go much further.
6. Limit What You Borrow: Living on credit cards and loans won't make you rich. Warren Buffett has never borrowed a significant amount -- not to invest, not for a mortgage. He has gotten many heart-rendering letters from people who thought their borrowing was manageable but became overwhelmed by debt. His advice: Negotiate with creditors to pay what you can. Then, when you're debt-free, work on saving some money that you can use to invest.
7. Be Persistent: With tenacity and ingenuity, you can win against a more established competitor. Warren Buffett acquired the Nebraska Furniture Mart in 1983 because he liked the way its founder, Rose Blumkin, did business. A Russian immigrant, she built the mart from a pawnshop into the largest furniture store in North America. Her strategy was to undersell the big shots, and she was a merciless negotiator. To Warren Buffett, Rose embodied the unwavering courage that makes a winner out of an underdog.
8. Know When To Quit: Once, when Warren Buffett was a teen, he went to the racetrack. He bet on a race and lost. To recoup his funds, he bet on another race. He lost again, leaving him with close to nothing. He felt sick -- he had squandered nearly a week's earnings. Warren Buffett never repeated that mistake. Know when to walk away from a loss, and don't let anxiety fool you into trying again.
9. Assess The Risk: In 1995, the employer of Warren Buffett's son, Howie, was accused by the FBI of price-fixing. Warren Buffett advised Howie to imagine the worst-and-bast-case scenarios if he stayed with the company. His son quickly realized that the risks of staying far outweighed any potential gains, and he quit the next day. Asking yourself "and then what?" can help you see all of the possible consequences when you're struggling to make a decision -- and can guide you to the smartest choice.
10. Know What Success Really Means: Despite his wealth, Warren Buffett does not measure success by dollars. In 2006, he pledged to give away almost his entire fortune to charities, primarily the Bill and Melinda Gates Foundation. He's adamant about not funding monuments to himself -- no Warren Buffett buildings or halls. "I know people who have a lot of money," he says, "and they get testimonial dinners and hospital wings named after them. But the truth is that nobody in the world loves them. When you get to my age, you'll measure your success in life by how many of the people you want to have love you actually do love you. That's the ultimate test of how you've lived your life."
2.Willing To Be Different: Don't base your decisions upon what everyone is saying or doing. When Warren Buffett began managing money in 1956 with $100,000 cobbled together from a handful of investors, he was dubbed an oddball. He worked in Omaha, not Wall Street, and he refused to tell his parents where he was putting their money. People predicted that he'd fail, but when he closed his partnership 14 years later, it was worth more than $100 million. Instead of following the crowd, he looked for undervalued investments and ended up vastly beating the market average every single year. To Warren Buffett, the average is just that -- what everybody else is doing. to be above average, you need to measure yourself by what he calls the Inner Scorecard, judging yourself by your own standards and not the world's.
3. Never Suck Your Thumb: Gather in advance any information you need to make a decision, and ask a friend or relative to make sure that you stick to a deadline. Warren Buffett prides himself on swiftly making up his mind and acting on it. He calls any unnecessary sitting and thinking "thumb sucking." When people offer him a business or an investment, he says, "I won't talk unless they bring me a price." He gives them an answer on the spot.
4. Spell Out The Deal Before You Start: Your bargaining leverage is always greatest before you begin a job -- that's when you have something to offer that the other party wants. Warren Buffett learned this lesson the hard way as a kid, when his grandfather Ernest hired him and a friend to dig out the family grocery store after a blizzard. The boys spent five hours shoveling until they could barely straighten their frozen hands. Afterward, his grandfather gave the pair less than 90 cents to split. Warren Buffett was horrified that he performed such backbreaking work only to earn pennies an hour. Always nail down the specifics of a deal in advance -- even with your friends and relatives.
5. Watch Small Expenses: Warren Buffett invests in businesses run by managers who obsess over the tiniest costs. He one acquired a company whose owner counted the sheets in rolls of 500-sheet toilet paper to see if he was being cheated (he was). He also admired a friend who painted only on the side of his office building that faced the road. Exercising vigilance over every expense can make your profits -- and your paycheck -- go much further.
6. Limit What You Borrow: Living on credit cards and loans won't make you rich. Warren Buffett has never borrowed a significant amount -- not to invest, not for a mortgage. He has gotten many heart-rendering letters from people who thought their borrowing was manageable but became overwhelmed by debt. His advice: Negotiate with creditors to pay what you can. Then, when you're debt-free, work on saving some money that you can use to invest.
7. Be Persistent: With tenacity and ingenuity, you can win against a more established competitor. Warren Buffett acquired the Nebraska Furniture Mart in 1983 because he liked the way its founder, Rose Blumkin, did business. A Russian immigrant, she built the mart from a pawnshop into the largest furniture store in North America. Her strategy was to undersell the big shots, and she was a merciless negotiator. To Warren Buffett, Rose embodied the unwavering courage that makes a winner out of an underdog.
8. Know When To Quit: Once, when Warren Buffett was a teen, he went to the racetrack. He bet on a race and lost. To recoup his funds, he bet on another race. He lost again, leaving him with close to nothing. He felt sick -- he had squandered nearly a week's earnings. Warren Buffett never repeated that mistake. Know when to walk away from a loss, and don't let anxiety fool you into trying again.
9. Assess The Risk: In 1995, the employer of Warren Buffett's son, Howie, was accused by the FBI of price-fixing. Warren Buffett advised Howie to imagine the worst-and-bast-case scenarios if he stayed with the company. His son quickly realized that the risks of staying far outweighed any potential gains, and he quit the next day. Asking yourself "and then what?" can help you see all of the possible consequences when you're struggling to make a decision -- and can guide you to the smartest choice.
10. Know What Success Really Means: Despite his wealth, Warren Buffett does not measure success by dollars. In 2006, he pledged to give away almost his entire fortune to charities, primarily the Bill and Melinda Gates Foundation. He's adamant about not funding monuments to himself -- no Warren Buffett buildings or halls. "I know people who have a lot of money," he says, "and they get testimonial dinners and hospital wings named after them. But the truth is that nobody in the world loves them. When you get to my age, you'll measure your success in life by how many of the people you want to have love you actually do love you. That's the ultimate test of how you've lived your life."
Importanat info
1. Reinvest :::: When you first make money, you may be tempted to spend it. Don't. Instead, reinvest the profits. Warren Buffett learned this early on. In high school, he and a pal bought a pinball machine to pun in a barbershop. With the money they earned, they bought more machines until they had eight in different shops. When the friends sold the venture, Warren Buffett used the proceeds to buy stocks and to start another small business. By age 26, he'd amassed $174,000 - $1.4 million in today's money. Even a small sum can turn into great wealth.
2.Willing To Be Different: Don't base your decisions upon what everyone is saying or doing. When Warren Buffett began managing money in 1956 with $100,000 cobbled together from a handful of investors, he was dubbed an oddball. He worked in Omaha, not Wall Street, and he refused to tell his parents where he was putting their money. People predicted that he'd fail, but when he closed his partnership 14 years later, it was worth more than $100 million. Instead of following the crowd, he looked for undervalued investments and ended up vastly beating the market average every single year. To Warren Buffett, the average is just that -- what everybody else is doing. to be above average, you need to measure yourself by what he calls the Inner Scorecard, judging yourself by your own standards and not the world's.
3. Never Suck Your Thumb: Gather in advance any information you need to make a decision, and ask a friend or relative to make sure that you stick to a deadline. Warren Buffett prides himself on swiftly making up his mind and acting on it. He calls any unnecessary sitting and thinking "thumb sucking." When people offer him a business or an investment, he says, "I won't talk unless they bring me a price." He gives them an answer on the spot.
4. Spell Out The Deal Before You Start: Your bargaining leverage is always greatest before you begin a job -- that's when you have something to offer that the other party wants. Warren Buffett learned this lesson the hard way as a kid, when his grandfather Ernest hired him and a friend to dig out the family grocery store after a blizzard. The boys spent five hours shoveling until they could barely straighten their frozen hands. Afterward, his grandfather gave the pair less than 90 cents to split. Warren Buffett was horrified that he performed such backbreaking work only to earn pennies an hour. Always nail down the specifics of a deal in advance -- even with your friends and relatives.
5. Watch Small Expenses: Warren Buffett invests in businesses run by managers who obsess over the tiniest costs. He one acquired a company whose owner counted the sheets in rolls of 500-sheet toilet paper to see if he was being cheated (he was). He also admired a friend who painted only on the side of his office building that faced the road. Exercising vigilance over every expense can make your profits -- and your paycheck -- go much further.
6. Limit What You Borrow: Living on credit cards and loans won't make you rich. Warren Buffett has never borrowed a significant amount -- not to invest, not for a mortgage. He has gotten many heart-rendering letters from people who thought their borrowing was manageable but became overwhelmed by debt. His advice: Negotiate with creditors to pay what you can. Then, when you're debt-free, work on saving some money that you can use to invest.
7. Be Persistent: With tenacity and ingenuity, you can win against a more established competitor. Warren Buffett acquired the Nebraska Furniture Mart in 1983 because he liked the way its founder, Rose Blumkin, did business. A Russian immigrant, she built the mart from a pawnshop into the largest furniture store in North America. Her strategy was to undersell the big shots, and she was a merciless negotiator. To Warren Buffett, Rose embodied the unwavering courage that makes a winner out of an underdog.
8. Know When To Quit: Once, when Warren Buffett was a teen, he went to the racetrack. He bet on a race and lost. To recoup his funds, he bet on another race. He lost again, leaving him with close to nothing. He felt sick -- he had squandered nearly a week's earnings. Warren Buffett never repeated that mistake. Know when to walk away from a loss, and don't let anxiety fool you into trying again.
9. Assess The Risk: In 1995, the employer of Warren Buffett's son, Howie, was accused by the FBI of price-fixing. Warren Buffett advised Howie to imagine the worst-and-bast-case scenarios if he stayed with the company. His son quickly realized that the risks of staying far outweighed any potential gains, and he quit the next day. Asking yourself "and then what?" can help you see all of the possible consequences when you're struggling to make a decision -- and can guide you to the smartest choice.
10. Know What Success Really Means: Despite his wealth, Warren Buffett does not measure success by dollars. In 2006, he pledged to give away almost his entire fortune to charities, primarily the Bill and Melinda Gates Foundation. He's adamant about not funding monuments to himself -- no Warren Buffett buildings or halls. "I know people who have a lot of money," he says, "and they get testimonial dinners and hospital wings named after them. But the truth is that nobody in the world loves them. When you get to my age, you'll measure your success in life by how many of the people you want to have love you actually do love you. That's the ultimate test of how you've lived your life."
2.Willing To Be Different: Don't base your decisions upon what everyone is saying or doing. When Warren Buffett began managing money in 1956 with $100,000 cobbled together from a handful of investors, he was dubbed an oddball. He worked in Omaha, not Wall Street, and he refused to tell his parents where he was putting their money. People predicted that he'd fail, but when he closed his partnership 14 years later, it was worth more than $100 million. Instead of following the crowd, he looked for undervalued investments and ended up vastly beating the market average every single year. To Warren Buffett, the average is just that -- what everybody else is doing. to be above average, you need to measure yourself by what he calls the Inner Scorecard, judging yourself by your own standards and not the world's.
3. Never Suck Your Thumb: Gather in advance any information you need to make a decision, and ask a friend or relative to make sure that you stick to a deadline. Warren Buffett prides himself on swiftly making up his mind and acting on it. He calls any unnecessary sitting and thinking "thumb sucking." When people offer him a business or an investment, he says, "I won't talk unless they bring me a price." He gives them an answer on the spot.
4. Spell Out The Deal Before You Start: Your bargaining leverage is always greatest before you begin a job -- that's when you have something to offer that the other party wants. Warren Buffett learned this lesson the hard way as a kid, when his grandfather Ernest hired him and a friend to dig out the family grocery store after a blizzard. The boys spent five hours shoveling until they could barely straighten their frozen hands. Afterward, his grandfather gave the pair less than 90 cents to split. Warren Buffett was horrified that he performed such backbreaking work only to earn pennies an hour. Always nail down the specifics of a deal in advance -- even with your friends and relatives.
5. Watch Small Expenses: Warren Buffett invests in businesses run by managers who obsess over the tiniest costs. He one acquired a company whose owner counted the sheets in rolls of 500-sheet toilet paper to see if he was being cheated (he was). He also admired a friend who painted only on the side of his office building that faced the road. Exercising vigilance over every expense can make your profits -- and your paycheck -- go much further.
6. Limit What You Borrow: Living on credit cards and loans won't make you rich. Warren Buffett has never borrowed a significant amount -- not to invest, not for a mortgage. He has gotten many heart-rendering letters from people who thought their borrowing was manageable but became overwhelmed by debt. His advice: Negotiate with creditors to pay what you can. Then, when you're debt-free, work on saving some money that you can use to invest.
7. Be Persistent: With tenacity and ingenuity, you can win against a more established competitor. Warren Buffett acquired the Nebraska Furniture Mart in 1983 because he liked the way its founder, Rose Blumkin, did business. A Russian immigrant, she built the mart from a pawnshop into the largest furniture store in North America. Her strategy was to undersell the big shots, and she was a merciless negotiator. To Warren Buffett, Rose embodied the unwavering courage that makes a winner out of an underdog.
8. Know When To Quit: Once, when Warren Buffett was a teen, he went to the racetrack. He bet on a race and lost. To recoup his funds, he bet on another race. He lost again, leaving him with close to nothing. He felt sick -- he had squandered nearly a week's earnings. Warren Buffett never repeated that mistake. Know when to walk away from a loss, and don't let anxiety fool you into trying again.
9. Assess The Risk: In 1995, the employer of Warren Buffett's son, Howie, was accused by the FBI of price-fixing. Warren Buffett advised Howie to imagine the worst-and-bast-case scenarios if he stayed with the company. His son quickly realized that the risks of staying far outweighed any potential gains, and he quit the next day. Asking yourself "and then what?" can help you see all of the possible consequences when you're struggling to make a decision -- and can guide you to the smartest choice.
10. Know What Success Really Means: Despite his wealth, Warren Buffett does not measure success by dollars. In 2006, he pledged to give away almost his entire fortune to charities, primarily the Bill and Melinda Gates Foundation. He's adamant about not funding monuments to himself -- no Warren Buffett buildings or halls. "I know people who have a lot of money," he says, "and they get testimonial dinners and hospital wings named after them. But the truth is that nobody in the world loves them. When you get to my age, you'll measure your success in life by how many of the people you want to have love you actually do love you. That's the ultimate test of how you've lived your life."
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