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Recent Posts

April 14, 2018

 Your company is in business to make money. How do you know if you are? The typical answer is to look at accounting cost and profit models. 

The problem is, these models don't tell you all you need to know. They need help. They are one-dimensional analyses in a two...

August 31, 2017

 High maintenance clients.  Unprofitable clients.  Problem clients.  It's generally accepted you should eliminate these high maintenance, unprofitable clients.  That they don't pay for the costs incurred.  However, is getting rid of them r...

August 28, 2017

Every day, I read about a consultant, IT professional, Six-Sigma professional, or accountant who talks about how much money they've saved their clients.  99 times out of 100, this number is bogus.  It's not their fault and they're not trying to deceive - at least in mo...

August 20, 2017

Hello.  Welcome back.  What started as the latest blog post morphed into something much larger and cooler.

I've been known to suggest accounting data isn't all that relevant.  I've also been known to suggest profit may be misleading.

Many did not understand what I w...

June 22, 2017

Hello.  Welcome back!

Many folks have asked me to explain how I create effective cash flow profit models for clients; the ones that predict seemingly ridiculous things such as how increasing accounting profit can actually destroy cash profit.  I...

May 15, 2017

 Welcome back!

In my last blog post, I talked about how cost accounting can't and doesn't create a complete picture of your operating and financial environment, especially when the focus is on making money.  

Being blindsided is a common sports metaphor that also has bus...

May 1, 2017

The world exists in 3-D.  What would it look like in 2-D?

Welcome back!

I regularly point to the notion cost accounting is useless from a cash/making money perspective.  Over the weekend, this metaphor came up that offers one interesting example why.  Well, I think it's...

April 18, 2017

Welcome back.

I'm pro-cash.  Cash is money.  It's raw, unprocessed, clean, and unambiguous.  Cost accounting data are processed and have little, if anything, to do with money.  I often say cash is like tomatoes, garlic, basil and onions.  Cost accounting is like store b...

April 11, 2017

This morning, I read a report that longstanding Japanese company, Toshiba, may have to close its doors.  Why?  Not making money.  

Businesses must make money to exist.  The common proxy for assessing how much money a company has made is profit.  Question. "Is...

April 2, 2017

If you are about making money, don't look to accounting profit to tell you whether you are.  It doesn't work.  Why?  Two reasons.  First, the math is as questionable as a three dollar bill.  Second, making money is about cash, and profit does an extremely poor job mode...

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