September 16, 2017

Items in italics are direct quotes from the articles below

Vikram Pandit, former CEO of Citigroup, says 30% of banking jobs could disappear within the next five years.  In an interview on Bloomberg Television, the 60-year-old Indian-American said threats from artificial intelligence and robots will “change the back office.”  “I see a banking world going from large financial institutions to one that’s a little bit more decentralized,” he told Bloomberg’s Haslinda Amin. Last year, Citigroup predicted 30% of job losses over a decade vs Pandit’s prediction of five years. A key component of this change is artificial intelligence taking away the back-office processes that are being handled by employees. As these processes become more and more automated, the employees that are willing to continue education, and train others that may have the opportunity to keep their jobs. Because we live in the Information Age, it’s important to have the skill of wisdom to be able to discern the useful information from just information. Many other former and current finance executives have voiced similar concerns about jobs being made redundant thanks to artificial intelligence. Last month, Axel Lehmann, COO of Swiss bank UBS, said AI would “fundamentally change the banking business.”  “I don’t want to get blindsided. It’s less the technology, as such, providing a transformative element in the banking industry,” he said in an interview with Business Insider. “It’s really alternative business models that has the potential to shake up everything and eat into our cake. In my opinion, the emerging blockchain technology will completely change the Banking industry. From my experience, banks are looking to constantly increase efficiency. One way is through having a smaller workforce handling multiple processes, and the other is through automation. For an interesting perspective, I recommend Bank Revolution –

In 1987, just five months after Rachel and Andy Berliner launched their small frozen organic food business out of their Petaluma, California ranch, they had to dismiss their entire staff–all five of them. The Berliners started Amy’s Kitchen with one product–a vegetable potpie, which Rachel would bake in their kitchen. After initial excitement, order volume petered. “We didn’t realize how seasonal the frozen food business was back then, and once summer hit, the orders stopped coming,” Andy said over the phone from the family ranch. Fortunately, the company could hire everyone back once the orders began to come back in. It was during this time that Andy began an association with Don Watts. At this point, Andy realized that his finances especially his bookkeeping was out of order. I can’t stress enough the importance of knowing your numbers. “You don’t need a little help, you need a lot of help,” Andy recalls Watts saying. Andy says many different employees were writing checks, and the company was not keeping good track of its payments and expenses. “Don laughed when we told him how we paid our bills,” says Andy. “But when he joined us full-time, he said he would help us become a $100 million company. Of course, we’d grow much bigger.” When Watts joined the company as its CFO it was under the condition that the company remained private. It was through his guidance that the company would get its first line of credit for $20,000. Only five months later, the company’s revenues would grow to $240,000, and the company would then increase that line to $100,000. “At every stage, he preached how we shouldn’t build up too much inventory and taught us how to study your margins and expand profits. He taught us how to not build up overhead and operate lean,” says Andy. “He helped us stay grounded and helped us transition from making potpies in our kitchen to making 14,000 a day.” Amy’s Kitchen pioneered the market for organic vegetarian frozen meals and today brings in an annual revenue of $500 million. Rachel and Andy’s intention was to not get rich, but to pass on a business to their children and possibly their children’s children. The most valuable advice, Andy says, was how Watts told them to never, ever sell. “Watts would remind us: ‘The day you decide to sell or go public is the day I walk out the door,’ Andy remembers, adding that although Watts is no longer alive, Amy’s still heeds the CFO’s advice and is committed to staying private. The important lessons from this article is to make sure if you have a business that is driven by accounts receivable and inventory is to keep your inventory manageable, and ensure you are monitoring your margins. Margins such as gross profit margin, cost of goods sold, and operating expenses. How quickly can you get you paid from your  customers? Does it take 30, 60, 90, or 120 days? How can you operate leaner? Why is it important to keep your company private? In the end, what is driving you when you create a business? What is your legacy?

If you are interested in creating a budget, then contact me for a financial checkup in the contact me section. Also, learn more about the self-lending principle in the mustard seed section.

This week, I’ve included THE WARRIOR MINDSET – MOTIVATIONAL VIDEOS – BEST MOTIVATION FOR 2017 from the Video Advice YouTube channel.

“If you think you know it all, you’re a fool for sure; real survivors learn wisdom from others.”

Proverbs 28:26 MSG


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: