The Warrior's Greatest Weapon is Patience

When we ask God for patience, does He magically make us more patient? Not from my experience. Rather, He gives us opportunities to stretch ourselves and, in a sense, exercise our “patience muscle”. Much like other muscles, there is always room for growth. I am currently experiencing such an opportunity…to grow my patience muscle.

The statement, "A warrior's greatest weapon is patience", is my inspiration for today’s post and is attributed to the legendary Japanese swordsman and warrior, Miyamoto Musashi. We can apply this mindset to our work of progressing through martial arts. It is a slow, tedious process where details must be mastered. There are no shortcuts or easy ways out. This concept also applies to leadership and personal development.

We find ourselves in a world where many of our experiences are tied to immediate gratification. I have worked with high-level VPs and C-Suite leaders who are so focused on current financial earnings or ensuring that shareholder value increases by the next quarter that they lose sight of the long-term implications of their decisions. There have been conversations where plans presented showed a cost-benefit analysis revealing significant gains for the company within the next 9 to 12 months, only to have line-of-business owners ask, “What’s in it for me, now?” The reality is that whether in leadership or just living everyday lives, we are all under a lot of real or perceived pressure to provide near-term results.

Patience takes resilience and carries profound wisdom for all of us. While it might seem like a virtue of the past, patience is still critical to leadership and team success. We are more effective as leaders when we strive to build long-term, real-life success. This requires that we rely on patience and perseverance, sometimes to the point of discomfort. To be clear, patience is not about passivity or inaction; it's about the ability to remain calm, focused, and strategic, even in the face of adversity and the “tyranny of the urgent”.

In leadership, patience can be displayed in various ways. It's the ability to listen deeply to team members, understanding their perspectives and challenges without immediately jumping to solutions. It's the wisdom to know when and how to allow individuals and teams the time they need to develop their skills and reach their full potential. It's the strength to resist the urge to micromanage. Enabling others to take ownership and learn from their experiences is how most people grow and develop. Patience recognizes that significant achievements rarely happen overnight. It requires a long-term vision, the perseverance to overcome obstacles, and the understanding that setbacks are often stepping stones to success.

One of the most challenging aspects of leadership is dealing with setbacks and failures. A patient leader understands that these are inevitable parts of the journey. Instead of reacting with anger or blame, I need to approach these situations with a calm and analytical mindset. I should work on framing failures as opportunities for learning and growth, both for myself and my teams. This approach fosters a culture of psychological safety, where individuals feel comfortable taking risks and innovating, knowing that they won't be punished for honest mistakes.

Exercising patience allows us to make more thoughtful and strategic decisions. In high-pressure situations, the instinct is to react quickly. This often leads to poor choices and inaccurate conclusions. If I am a patient leader, I take the time to gather as much of the necessary information as feasible, carefully weigh the options, and consider the potential consequences of each identified course of action. This deliberate approach minimizes the risk of knee-jerk reactions or impulsive decisions and increases the likelihood of achieving the desired outcome.

In situations that often celebrate speed and instant gratification, the wisdom of Miyamoto Musashi reminds us that patience is a powerful virtue. For leaders, it's not just a virtue; it's a strategic imperative. By cultivating patience, we can foster growth, build resilience, and achieve lasting success for ourselves and our teams.

Leadership Lessons from "Small Giants"

Since many who follow me are students of how to be a better leader, you have likely read Jim Collins' book "Good to Great". It has been a staple for many business leaders, exploring what it takes to transform companies into large, successful enterprises. Today, I highlight a book that is in contrast to what Jim Collins wrote. Bo Burlingham's "Small Giants" offers a different perspective, celebrating companies that choose to prioritize greatness over growth. These businesses often reject the conventional notion that "bigger is always better," and focus on building exceptional organizations with trust, a strong sense of purpose, deep relationships, and sustainable practices. In this book, Bo provides valuable insights for leaders who seek to create a lasting impact without sacrificing core values.

A key theme, which I appreciated, is that "Small Giants" presents the challenge of maintaining a "family" culture as a company grows. Burlingham quotes Fritz Maytag, founder of Anchor Brewing Company, who stated, "There is generally an inverse correlation between the number of people who work for a company and the strength of their emotional ties to it." Fritz fostered a strong sense of community and overall health of the company and the corporate culture over short-term profit demands prevalent in today’s business arena. This observation resonates deeply with me as I have witnessed firsthand how rapid expansion can dilute the trust, close-knit relationships, and shared sense of identity that define smaller organizations. The book delves into how several Small Giants navigate this challenge, emphasizing the importance of intentionality in preserving culture, even as the company scales. Leaders of these companies recognize that fostering strong emotional ties requires ongoing effort, investment in employee development, and a commitment to open communication.

Another thought-provoking aspect of "Small Giants" is its exploration of the potential pitfalls of setting priorities that are out of balance. A primary example is the idea of social responsibility at the expense of business fundamentals. Burlingham quotes Ari Weinzweig, CEO of Zingerman's, who states, "I have never encountered angrier and more cynical employees than those I've met in socially responsible companies that have been so focused on saving the world they neglect to do what was necessary to save themselves." This thought is a caution for leaders. While social responsibility is important, Weinzweig suggests that it cannot come at the cost of financial stability and employee well-being. Small Giants demonstrate that true sustainability requires a balanced and long-term thinking approach, where purpose and profit work in harmony.

"Small Giants" raises important questions about the long-term sustainability of exceptional companies. Burlingham asks, "Can companies maintain and preserve their mojo when the founder leaves, or dies? Can they even preserve their independence?" In today's business environment, mergers and acquisitions, and Private Equity firms are commonplace, and the pressure to maximize shareholder value often trumps other considerations. The book explores how several Small Giants grapple with these challenges, highlighting the importance of succession planning, values-based leadership, and a deep commitment to preserving the company's unique identity.

"Small Giants" is a refreshing and inspiring perspective on leadership. It’s a reminder that success can be defined in many ways, and that building a great company is not always about achieving massive scale. Bo illustrates that by prioritizing people, trust, purpose, and sustainable practices, leaders can create organizations that not only thrive but also make a positive impact on the world. The lessons from "Small Giants" are numerous and a valuable resource for any leader who seeks to cultivate a company culture that is both enduring and exceptional.

The Enduring Power of a Company's Origin Story

Have you ever worked for a company where you are deeply connected with its origin story? A story that was alive and well within the existing daily experience? A story that, decades after the company’s inception, still inspired admiration and shaped the company's identity? Even more impactful, have you had the rare opportunity to learn directly from the founders, those who breathed life into the organization's daily operations?

I've been fortunate enough to experience this, on a few occasions, and it's a powerful force.

There's something truly special about working for a company where the origin story isn't just a page in a corporate brochure. It's a foundational mythos that permeates the culture, guiding decisions, and inspiring employees. When a company's beginnings are rooted in a compelling vision, a genuine desire to solve a problem, or a commitment to certain values, it creates a unique sense of purpose. This purpose, in turn, instills a deep commitment to the mission and vision.

In companies like this, when you have the chance to learn directly from the founders, the impact is amplified. Getting to hear, firsthand, about the challenges they overcame, the sacrifices they made, and the unwavering belief that fueled their journey, it's impossible not to be moved. It creates a sense of connection to something larger than yourself. You understand that you're part of a story that's still being written, a legacy that you have a hand in shaping.

In my experience, this kind of environment fosters a powerful sense of ownership and accountability. It's not just about coming to work and collecting a paycheck. It's about contributing to something meaningful, about buying into and upholding the values upon which the company was built, and about striving to realize the founders' vision. There's a shared understanding that everyone has a role to play in the ongoing narrative.

Beyond the inspiration and the sense of purpose, there's another crucial element: TRUST. When a company's origin story is one of integrity, innovation, and genuine care for its customers, employees and/or its mission, this builds a deep well of trust, both internally and externally. Employees trust that the company is committed to doing the right thing, even when it's difficult. Customers trust that the company's products or services are delivered with the same level of passion and commitment that fueled its founding.

This connection to the origin story can be a powerful competitive advantage. In a world where employees are increasingly seeking purpose-driven work and customers are demanding greater transparency and authenticity, a company with a compelling and credible origin story has a significant edge.

The challenge, of course, is to preserve this connection as a company grows and evolves. How do you ensure that the origin story remains a living narrative, rather than fading into a distant memory? How do you keep the founders' passion alive in new generations of employees?

These are critical questions for any leader who seeks to build a truly enduring company. Next week’s post will be a review of a book titled “Small Giants”. It is a story of several companies with endearing origin stories and their desire to maintain a thriving company culture.

The Art of Influence: Leading While Delegating Ownership

Like many, I often remind myself that leadership is a continuous journey of growth. One challenge I frequently encounter is the tendency to want to solve every problem and fix every issue myself. This inclination stems from the traditional view of craftsmanship, which equates it with being a highly skilled, detail-oriented, and seasoned professional at the pinnacle of their field. Often, leaders rise to their positions because they were once master craftsmen, possessing elite-level expertise. However, to achieve greater significance for our teams and organizations, we must shift our focus. We need to hand the reins of craftsmanship over to those we lead, mentor, and coach. For me, and perhaps for many others, this is a crucial area for development: delegating ownership and empowering others to become master craftsmen.

Have you ever considered the fundamental shift that occurs when a leader truly understands that their team members operate from their unique blend of strengths, desires, and goals? We often find ourselves in leadership roles due to our experience and craftsmanship, a natural progression in our careers. However, to grow as leaders, we must adjust our focus and tactics. We need to concentrate on developing the leadership capabilities of others. Back in November 2019, I reviewed Marshall Goldsmith's book, "What Got You Here Won't Get You There," which highlights habits and tactics that leaders need to address as they advance in their careers. A key takeaway for me was the need to move away from the traditional, often misguided, notion that a leader's power lies in being the sole engine driving the team forward. I am no longer the hero who single-handedly solves clients' problems. While I still wield influence, and that influence is a powerful catalyst, I must remember that the real power, the true motivator for significant positive action and growth, resides within those I lead.

This new understanding of my role requires a delicate balance. As a leader, I am not relinquishing responsibility but rather redefining it. My role evolves into one of facilitation, guidance, teaching, and encouraging ownership and craftsmanship in others. I become the architect of an environment where individual strengths flourish, weaknesses are understood and supported, and each person's unique pace is accommodated. I call this "passing the baton." Supporting the professional development of those in my care demands focused awareness, careful observation, and a genuine commitment to understanding their unique needs, goals, and the balance they seek.

I must recognize that each person brings a different set of skills, experiences, and perspectives to the table. It is crucial to consider this amalgamation of personalities and strengths. Some may be quick starters, while others are more methodical; some may excel in collaborative settings, while others thrive in independent work. My effectiveness as a leader hinges on my ability to adapt my approach to these individual differences. I must provide my team with the platform and tools they need to thrive and, ultimately, surpass my skills and talents. This requires continuous learning: to listen deeply, communicate clearly, and provide support tailored to each person's unique needs. There is no one-size-fits-all approach to effective leadership. Each leader has their own style, and those they lead will respond differently to the pressures of performance.

Ultimately, leaders achieve the greatest success when they understand that their primary function is to cultivate an environment where everyone can leverage their strengths, receive support to address their weaknesses, and have the opportunity to take ownership of their work, thus becoming master craftsmen. In essence, leadership involves fostering a sense of value and individual contribution, where individuals feel they have the authority to make decisions, contribute their unique talents, and progress at a sustainable and challenging pace. By doing this, a leader unlocks the collective power of the team, achieving results far greater than the sum of its parts.

Breaking Habits That Hinder Your Leadership

I have come to realize that leadership is continuous growth and refinement. To be an impactful leader, I consistently strive to cultivate positive leadership traits. It's crucial to identify and eliminate the habits that detract from my effectiveness. These ingrained unconscious behaviors undermine my best intentions and hinder my ability to coach, lead, manage, motivate, and guide teams. Join me in exploring some common leadership pitfalls and offering strategies for breaking free.

The article linked below inspired today’s post.

https://geediting.com/dan-subtle-habits-that-are-quietly-destroying-your-ability-to-focus-according-to-psychology/

Identifying the Culprits: Common Leadership Habits to Ditch

• Micromanaging: We all understand that attention to detail is important. Many of us had a path to leadership, which included our level of expertise in our area of operational delivery. At one time, I believed those around me who would tell me how good I was. This led me to believe that my way of doing things was the best, and in some cases, the only way to get it done. I was quick to tell others how to do things, what sequence of operations, and many other aspects that I had in my toolkit. As I gained leadership experience, through reading new material and the “School of Hard Knocks”, I learned that excessive control stifles creativity, diminishes team ownership, stunts professional and intellectual growth, and breeds resentment. It signals a lack of trust and ultimately hinders productivity. Also, if I wanted to position myself for success in my leadership role, I had to trust those professionals whom I hired to do the job they are qualified to do.

• Avoiding Difficult Conversations: I do not know of a good leader who enjoys difficult conversations. Confrontation can be uncomfortable, but avoiding these discussions about performance, conflict, or difficult decisions only allows problems to fester and erode trust. It is critical to get ahead of situations with a caring, honest conversation to provide guidance and correction when necessary. I found that sometimes I cannot share details behind tough decisions, but I still need to have the conversations to help ensure wrong conclusions are not drawn. Another aspect of difficult conversations is that the team knows when you are allowing bad behavior. If I do not nip that in the bud, the team will start to perform at the level of the lowest acceptable behavior, motivation will wane quickly.

• Lack of Active Listening: I need to be clearly and intentionally listening to and understanding my subordinate's perspectives, which is essential for effective communication and building strong relationships. By being intentional about listening, confirming what I am hearing, and showing that I am understanding, I am building trust. Trust is arguably the most important aspect in strong leader/follower relationships. If I am only pretending to listen while formulating my response is a common trap that will quickly undermine the team’s trust and respect.

• Making Assumptions: There is a humorous line that I picked up, that says something to the effect that, “if I were not jumping to conclusions, I would not get any exercise at all”. Jumping to conclusions without gathering all the facts leads to miscommunication, poor decisions, and will damage any relationship you have. This will quickly break down trust and confidence among team members. A common theme among many leadership books, articles, and teachings is the need for trust. Another way to label this idea of building trust is the idea of “Leadership Capital”. The linked article will help us understand the ins and outs of Leadership Capital. When conversing or seeking clarification, always ask inquisitive questions, seek to understand motivations and conflicting priorities before making assumptions. There are often 2 sides to a story, and the truth lies somewhere between them. As a leader, I must seek the truth before drawing conclusions.

• Playing Favorites: Treating team members differently based on personal preferences creates a toxic environment of resentment and distrust. Everyone has their strengths, and it is my job as a leader to help weave those strengths together within the team. Fairness, balance, and impartiality are cornerstones of effective leadership.

• Resisting Feedback: I must receive feedback. When I have been unwilling to do so, it demonstrated a lack of self-awareness and hindered the team’s growth as well as their ability to thrive. Embrace feedback, even when it's difficult to hear, as an opportunity for learning and improvement. When we do this openly, we model an example for our teams. Consider how difficult it might be for someone to give you that feedback. They may feel as though their job is on the line if they are honest. Don’t let that be the case.

• Failing to Delegate Effectively: This runs parallel to the Micromanaging piece. A key responsibility I have is to help my subordinates grow. I need to be consistently mentoring my replacement. When I hoard tasks and refuse to delegate, not only am I overburdened, but it also prevents team members from developing new skills and taking ownership. Effective delegation empowers our team and frees us to focus on strategic priorities.

• Neglecting Recognition and Appreciation: Failing to specifically, promptly, and clearly acknowledge and appreciate your team's contributions can lead to demotivation, decreased morale, and even attrition. Be strategic and careful about this. Take a look at this article about “Variable-Ratio Scheduled Characteristics and Examples”; it may help you understand how to best show your appreciation. Some people like public recognition, while others are more private. Know your team. Regularly (but not in a predictable pattern), appropriately express gratitude and celebrate successes, both big and small.

• Communicating Poorly: A Commander's Intent in leadership involves explaining the "why" behind a task, empowering subordinates to act with initiative and adapt to changing circumstances, and ensuring alignment with the overall goal. It's a leadership principle that promotes clear communication and allows for decentralized decision-making within defined parameters. Vague, inconsistent, or passive-aggressive communication around policies, goals, direction, and targeted results creates confusion, distrust, and inefficiency. Strive for clear, concise, and transparent communication in all your interactions.

Breaking Free: Strategies for Change

• Self-Reflection: Regularly reflect on your own goals, growth, and leadership style. Identify areas where you can improve. Actively seek feedback from trusted colleagues, mentors, or even your team members. Pick up a good leadership book. I would be happy to make recommendations if you like, just email me at todd@toddrthomsen.com. Avoid emotional reactions as the primary influence when considering adjustments that could improve your leadership.

• Practice Active Listening: Focus fully on what the other person is saying, both verbally and nonverbally. Ask clarifying questions and summarize their points to ensure understanding. Avoid getting defensive.

• Conscious Awareness: Take time each day to be in quiet thoughts and ponderings. Pay attention to your behaviors. Identify the triggers that lead to your less effective habits. Is it a quickening of your heartbeat or a knot forming in your gut? Once you're aware of these triggers, you can develop strategies for managing and overcoming them.

• Accountability: Hold yourself accountable for your actions and be willing to admit your mistakes. Consider allowing a cohort or your direct leader to privately hold you accountable as well. This builds trust and demonstrates integrity.

• Develop New Habits: There is a Biblical principle that teaches us to put off our old self and replace it with something better. Just removing an old habit rarely works as desired. When we replace our negative habits with positive ones, we have a greater opportunity for success. For example, instead of micromanaging, focus on empowering your team through clear expectations and regular check-ins.

• Seek Support: It can be helpful to get outside help. Consider seeking support from a coach, mentor, or therapist. They are often more separated from the scenarios and often see more clearly. They can provide valuable insights and guidance as you work to break free from your less effective habits.

The Reward: More Effective Leadership

Many studies indicate that the most likely reason for team members to quit or leave is poor leadership. As a direct leader over your team, you have a bigger influence on the daily experience of your team than the Corporate Culture statement or the C-Suite ever will. Breaking these bad habits isn't easy, but the rewards are significant. By eliminating these common behaviors, you'll become a more effective leader, capable of inspiring your team, fostering a positive work environment, and helping the team achieve greater success. It's an unrelenting process, and the journey towards self-improvement is well worth the effort.

The Independent Leader: Building High-Performing Teams Through Empowerment

(Influenced by this article: https://fromthegreennotebook.com/2025/03/26/what-george-marshall-would-tell-todays-leaders/)

Great leadership isn't about being the sole problem-solver. It's about cultivating a team of capable individuals who can take initiative, make sound decisions, and drive results. This principle is powerfully illustrated in a quote attributed to Army Chief of Staff George Marshall, directed to Brigadier General Dwight Eisenhower: "Ike, the department is filled with able men who analyze their problems well but feel compelled always to bring them to me for the final solution. I must have assistants who will solve their own problems and tell me later what they have done." This simple yet profound statement encapsulates a critical element of effective leadership: promoting independence.

The Burden of Centralized Control

Many leaders fall into the trap of centralized control. They believe that every decision, no matter how small, must pass through them. This approach creates several problems:

• Bottlenecks: The leader becomes a bottleneck, slowing down progress and hindering agility.

• Overwhelm: The leader becomes overwhelmed with a constant influx of decisions, leading to burnout and decreased effectiveness.

• Stifled Development: Subordinates are prevented from developing their problem-solving skills and decision-making abilities.

• Reduced Morale: Team members feel disempowered and micromanaged, decreasing motivation and engagement.

Marshall's Vision of Empowered Leadership

George Marshall's message to Eisenhower highlights a different approach. He recognized that his role wasn't to be the ultimate decision-maker for every issue, but to develop and cultivate leaders who could operate autonomously. This vision of empowered leadership emphasizes:

• Trust: Leaders must trust their subordinates' abilities and judgment.

• Delegation: Leaders must effectively delegate responsibility and authority.

• Accountability: Leaders must hold subordinates accountable for their decisions and actions.

• Communication: Up-and-coming leaders must communicate about their decisions as they are taking action and working towards achieving the identified goals.

• Focus on Outcomes: Leaders should focus on the desired outcomes and allow their team members to determine the best path to achieve them.

Cultivating a Culture of Independence

Some ideas to promote a team of independent thinkers, leaders can implement these strategies:

• Clearly Define Roles and Responsibilities: Ensure that everyone understands their role, their scope of authority, and their decision-making boundaries.

• Provide Training and Development: Invest in training that enhances problem-solving skills, decision-making abilities, and leadership potential.

• Delegate Effectively: Assign tasks and projects that challenge subordinates, provide growth opportunities, and push their limits.

• Empower Decision-Making: Grant those in your care the authority to make decisions within their areas of responsibility.

• Offer Guidance and Support: Provide support and mentorship while avoiding micromanagement.

• Encourage Initiative: Foster a culture where team members feel comfortable taking initiative and proposing solutions.

• Celebrate Success and Learn from Failures: Acknowledge and reward successes, and view failures as learning opportunities.

The Benefits of Empowered Teams

Empowering direct reports to solve their problems and take ownership yields significant benefits:

• Increased Efficiency: Decisions are made more quickly, and progress is accelerated.

• Enhanced Innovation: Team members feel more comfortable taking risks and exploring new ideas.

• Improved Morale: Team members feel valued, trusted, and empowered, leading to increased motivation and engagement; they can take ownership.

• Development of Future Leaders: Subordinates are provided a means to develop the skills and confidence to take on greater responsibilities.

The wisdom in George Marshall's words to Eisenhower rings true today. Effective leaders don't seek to be the sole problem-solvers; they cultivate a culture of independence, prompting their teams to take ownership, make decisions, and drive results. By focusing on developing autonomous and capable individuals, leaders create stronger teams, achieve greater success, and build a lasting legacy of empowerment.

How Financial Intelligence Drives Leadership Impact

I have learned that to become a better leader, manager, or even a front-line contributor, understanding some basics on how Financials work for organizations will help with better decision making.  Financial Intelligence brilliantly illuminates why a solid grasp of financial principles is essential for every professional, especially those in leadership roles. In this book, Karen Berman and Joe Knight dismantle the intimidation factor associated with understanding corporate finance and reveal how financial intelligence influences individuals at all levels to make better decisions, ultimately contributing to an organization's health and success and our own ability to thrive and grow professionally.

If I may, I would like to explore key takeaways I picked up from Financial Intelligence and convey how these concepts translate into our ability to have a leadership impact every day.

1. The Front Line and the Bottom Line: Understanding Days Sales Outstanding (DSO)

One key is the emphasis that financial metrics aren't abstract numbers; they reflect real-world operational efficiency. One example is Days Sales Outstanding (DSO), which measures how quickly a company collects payment after a sale. While it might seem like a back-office concern, the authors highlight how front-line employees directly influence DSO.

• A sales team that diligently follows up on invoices, provides accurate documentation, and helps to manage customer expectations directly contributes to facilitating a better relationship, thus reducing the likelihood of DSO going beyond the contract terms.

• Similarly, clients will reward quality service. Client-facing team members who complete tasks thoroughly and resolve issues promptly and efficiently help prevent payment delays and encourage repeated engagement.

Financial Intelligence drives home the point that financial responsibility is shared. When front-line workers understand how their actions impact metrics like DSO, these team members elevate engagement and contribute more meaningfully to the company's financial health.

2. The Strategic Importance of Days Payable Outstanding (DPO)

Days Payable Outstanding (DPO) measures how long a company takes to pay its suppliers. The idea highlighted goes beyond the simple accounting equation to explore the strategic implications of DPO.

• While a high DPO can give the impression, on paper, that a company's short-term cash flow is strong, the book underscores that excessively delaying payables can damage vendor relationships.

• Damaged relationships will likely lead to less favorable terms, delayed deliveries, and often compromised quality of goods and services required to operate effectively.

• This, in turn, directly affects a company's ability to deliver quality products or services promptly, ultimately impacting Client Satisfaction (aka CSAT), thus having a direct negative influence on desired revenue growth.

Financially intelligent managers understand that DPO is another tool that is not just about maximizing cash but about strategically managing relationships for long-term success.

3. Financial Intelligence: The Cornerstone of Effective Management

Time and again, the authors argue persuasively that financial literacy is a critical skill for effective management. Managers who grasp specific aspects of financial statements and key metrics are better positioned to make informed decisions that drive business success.

• The book illustrates how financially intelligent managers can better assess the profitability of projects, understand the impact of their decisions on cash flow, and allocate resources to align effectively with the overall company strategies.

• These managers can also communicate more effectively with finance teams, understand the financial implications of operational issues, and better contribute to strategic planning.

By demystifying finance, Berman and Knight give managers tools to move beyond intuition and make data-driven decisions that contribute to the company's bottom line.

4. Cash Flow vs. Profit: Understanding the Lifeblood of a Business

One of the core concepts is the distinction between profit and cash flow. The book clearly explains why, while profit is important, cash flow is a more accurate indicator of a company's overall health.

• Profit reflects a company's performance, but it doesn't tell the whole story of its ability to generate and manage cash. Revenue is typically recognized once an invoice is sent. Revenue adds to the company’s reported profits, but that does not mean the invoice has been paid. Cash is not tracked for that invoice until the payment has been received.

• Cash flow reveals the actual movement of cash in and out of a business. DPO reflects the planned outbound cash flow, but since those outstanding payables have not been paid, the reporting shows those funds as part of the company’s current cash

• A company can be profitable on paper but still struggle with cash flow, which can lead to insolvency. There is a delicate balance, and it helps to understand how the financial professionals seek to navigate the Financials goals.

Financial Intelligence emphasizes that understanding cash flow is crucial for leaders to ensure the long-term viability and sustainability of the business.

5. The Power of the Cash Conversion Cycle

Another key the book introduces is the Cash Conversion Cycle (CCC) as a vital metric for assessing operational efficiency. The book highlights the importance of understanding how the components of the CCC interact:

• Cash Conversion Cycle = Days Sales Outstanding + Days in Inventory - Days Payables Outstanding

• By analyzing each component, businesses can identify areas for improvement.

• Reducing DSO accelerates cash inflow.

• Optimizing Days in Inventory minimizes tied-up capital.

• Strategically managing DPO (as discussed earlier) balances cash outflow with vendor relationships.

• The book emphasizes that a shorter CCC generally indicates better efficiency, as it means the company is quickly converting its investments in inventory and other resources into cash.

• Many financially intelligent leaders use the CCC to help to benchmark performance, identify bottlenecks, and implement strategies to improve cash flow and overall profitability.

Financial Intelligence by Karen Berman and Joe Knight is more than just a guide to financial statements; it's a roadmap to smarter and better leadership. By simplifying financial concepts and demonstrating their practical relevance, the book equips professionals at all levels to make more informed decisions that seek to drive business success.

My goal here is to show that for me, the key takeaways discussed here – understanding the impact of front-line actions on DSO, strategically managing DPO, the importance of cash flow, and the power of the Cash Conversion Cycle – are just a few examples of how financial intelligence translates into tangible leadership and management impact. By embracing the principles outlined in Financial Intelligence, leaders can foster a culture of financial responsibility, optimize operations, and ultimately contribute to the long-term health and prosperity.

I recommend this book for anyone seeking to enhance leadership effectiveness and drive meaningful results in today's complex business environment.

Leaders Need to Pause and Reflect

Many of us are under a lot of pressure. We are asked to accomplish more tasks, with fewer tools, and in a shorter timeline to keep up with the competitive landscape. As leaders, let’s not forget the importance of slowing down, reflecting, and catching our breath. It's not just about personal well-being. It may counter what you have may have learned: Slowing down is crucial for effective leadership and organizational success. In today’s post, I would like to share the value of slowing down. The article below helped inspire and inform my thoughts.

https://www.fastcompany.com/91271314/why-leaders-must-slow-down-to-speed-up-transformation

Benefits for Leaders to Slow Down:

• Improved Decision-Making: Reflection allows us to process information, analyze situations from different perspectives, learn lessons from our past, and make more thoughtful, strategic decisions. I have found that rushing from one task to the next usually leads to reactive, short-sighted choices.  

• Enhanced Self-Awareness: Taking time for introspection helps leaders understand their strengths, weaknesses, biases, and triggers. Being self-awareness is essential for personal growth and effective leadership. This allows us to recognize our impact on others and, if necessary, make room to adjust our behaviors accordingly.  

• Increased Creativity and Innovation: Quiet moments of reflection often spark new ideas and insights. Making distance for yourself, to step away from the constant barrage of information, allowing your mind to wander and make unexpected connections, leading to breakthroughs and innovative solutions.  This is, in part, why we can come up with great ideas while in the shower or as we are dozing off to a night of sleep.

• Reduced Stress and Burnout: Regular reflection can help leaders manage stress and prevent burnout. It provides us with an opportunity to process emotions, identify sources of stress, and develop coping mechanisms. The less stressed we are as leaders, the more effective we will be.  

• Stronger Emotional Intelligence: Reflection helps us develop our emotional intelligence, which includes self-awareness, self-regulation, empathy, and social skills. These qualities are imperative for building strong relationships, motivating teams, and navigating complex interpersonal dynamics.  

• Better Communication: Reflecting on past interactions and communication styles can help us identify our own areas for improvement. This will lead to clearer, more effective communication with our teams, stakeholders, and other cohorts.  

Benefits for Teams and Organizations:

• Improved Team Performance: When we prioritize reflection, self-care, and single-threaded task completion, it sets a positive example for our teams. Doing this creates a culture where taking appropriate breaks and prioritizing well-being is encouraged, often leading to increased team morale, productivity, and collaboration.

• Enhanced Organizational Culture: Demonstrating a reflective leadership style fosters a culture of learning, growth, and continuous improvement. When we do this, it encourages those in our care to think critically, challenge assumptions, and contribute their best ideas.  

• Increased Innovation: When we value reflection and create space for it, our teams are more likely to be innovative. When employees have time to think and reflect, they tend to generate new ideas and find new and creative solutions to challenges.

• Better Adaptability: In today's rapidly changing business environment, adaptability is crucial. Reflection helps us to better anticipate change, assess our strengths and weaknesses, and develop well-thought-out strategies to adapt effectively.  

Ideas on Incorporating Reflection:

• Schedule regular reflection time: Block out time in your calendar for reflection, just as you would for any other important meeting.  Protect these blocked times as if your job depends on it…because it does.

• Find a quiet space: Choose a place where you can be free from distractions and interruptions.

• Use journaling: Writing down your thoughts and feelings can be a powerful way to process experiences and gain insights.

• Practice mindfulness or meditation: These practices can help you quiet your mind and focus on the present moment.  For more on this, I suggest connecting with Brian Reich and subscribing to his blog, “Just Breathe, Mindful Moments”.

• Engage in conversations with trusted colleagues or mentors: Over the years, I have found that talking through your thoughts and challenges with someone you trust can provide valuable perspectives. For years, I had a mentor meet with me once a month over a cup of coffee. That help and insight was and still is invaluable.

• Take a walk in nature: It can be easy to forget that spending time in nature is a great way to clear your head and gain perspective. Listen to be wind blow, the birds sing, the waves on a shore, the babble of a brook, or whatever source of nature is easily accessible.

As leaders, when we prioritize reflection, we can enhance our own effectiveness, improve team performance, and create a more positive and productive work environment.

It's not a luxury; it's a necessity for thriving in today's demanding business landscape.

Thoughts on Unconventional Leadership

Embracing the Unconventional in Leadership

I strive to be more consistent with reading things that bring value to my life.  It is often easier to get lost in scrolling through social media, reading about culture, or looking for entertainment.  Earlier this week, I picked up a devotional collection titled, “The Valley of Vision”.  The opening devotion got me thinking and caused me to slow down, re-read, and start thinking more deeply about my role as a leader at work and home.  We often think of leadership in traditional terms: strength, authority, and unwavering confidence. But what if some of the tools for the most effective leadership lie in embracing concepts that seem contradictory on the surface? Read this stanza.  It speaks to this very idea, offering profound insights into the true nature of leadership…and perhaps life in general:

"Let me learn by paradox

that the way down is the way up,

that to be low is to be high,

that the broken heart is the healed heart,

that the contrite spirit is the rejoicing spirit,

that the repenting soul is the victorious soul,

that to have nothing is to possess all,

that to bear the cross is to wear the crown,

that to give is to receive,

that the valley is the place of vision."

This passage challenges our normal thoughts and understanding.  It invites us to explore the power of paradox in leadership. Perhaps this blog post can effectively unpack some of these concepts:

The Way Down Is the Way Up:

For leaders, this translates to the importance of humility. True leaders understand that they don't have all the answers. They're willing to "go down," listen to their team, acknowledge their mistakes, and seek feedback. This "lowering" of oneself paradoxically elevates the leader in the eyes of their team, fostering trust and respect.

To Be Low is to Be High:

This echoes the idea of servant leadership. The most effective leaders prioritize the needs of their team members. They empower others, provide support, and create an environment where everyone can thrive. By having some level of focus on serving others ("being low"), leaders may just achieve greater influence and impact ("being high").

The Broken Heart is the Healed Heart:

Leadership can often be filled with challenges. We often face setbacks, disappointments, and difficult decisions. A "broken heart" can represent the empathy and vulnerability that impactful leaders should possess. Leaders who allow themselves to feel and acknowledge these challenges are better equipped to connect with their team, build resilience, and ultimately find healing and growth.

The Contrite Spirit is the Rejoicing Spirit:

As leaders, when we can acknowledge our mistakes, take responsibility for our actions, and seek to learn and improve ("contrite spirit"), we are the ones who ultimately create a culture of growth and success ("rejoicing spirit").

That to Have Nothing is to Possess All:

This paradox speaks to the importance of detachment in leadership. As leaders, when we are overly focused on personal gain or power, we hinder our effectiveness. True leaders understand that our role is to serve a greater purpose. By "having nothing" in the sense of ego and self-interest, we can focus on the success of the team and the organization, which ultimately leads to greater fulfillment and a sense of "possessing all" that truly matters.

That to Bear the Cross is to Wear the Crown:

Effective leading often involves sacrifices, challenges, and difficult decisions – bearing the cross. When we lead to embrace these challenges, persevere through adversity, and remain committed to the vision, we can be the ones who lead our teams to achieve true success – wear the crown.

That to Give is to Receive:

The concept of giving is central to effective leadership. As leaders, when we give our time, energy, knowledge, and support to the team members, we have the opportunity to foster a culture of reciprocity and loyalty. By giving, leaders receive increased commitment, productivity, and discretionary effort from our team.

The Valley is the Place of Vision:

Valleys often represent challenging times or periods of difficulty. However, it is during these times that we often gain the clearest vision. It is in the valleys of our experiences where we are forced to learn, adapt, and grow. These challenging times provide the perspective and clarity needed to develop a strong vision for the future.

This stanza offers a powerful framework for understanding leadership…and life. By embracing these paradoxes, we can cultivate humility, empathy, resilience, and a focus on service, ultimately leading to greater effectiveness and lasting impact.

Cloud Security Realities: Intentionality and the Path to Resilience

Recent reports of security breaches in Oracle's SaaS solutions serve as a stark reminder of the ever-present challenges in today's digital landscape. While the cloud offers undeniable benefits – scalability, accessibility, and cost-efficiency – it also introduces new complexities in security and data management. These events underscore the importance of a concept I discussed earlier this year: cloud repatriation - why some businesses are bringing workloads back on-premises. 

This is not an uncommon discussion for most of us. However, in light of these recent events, I believe it's crucial to revisit the core idea: the need for intentionality in how we implement and utilize business systems.

To be clear, this isn't about casting fear around cloud hosting or SaaS-based solutions. It's about advocating for a balanced, strategic approach that prioritizes security, control, and business needs.

The Cloud Security Tightrope

Articles detailing the Oracle breaches highlight a critical tension:

• Cloud providers invest heavily in security, but no system is impenetrable.

• SaaS solutions, while convenient, can create a degree of separation between an organization and its data, potentially complicating incident response.

This doesn't mean the cloud is inherently insecure, but it necessitates a shift in mindset. Organizations must move beyond a "set it and forget it" approach and embrace a model of shared responsibility. Ultimately, ownership lies at the feet of the business owners as they are ones who are responsible for delivering goods and services.

Intentionality: The Antidote to Complacency

My February 11th, 2025 blog post on cloud repatriation touched on the idea that some businesses are choosing to move workloads back on-premises. This decision is often driven by a desire for greater control over data, security, and performance. Regardless of where a business chooses to host its data, the key takeaway is the value of being very intentional about how business systems are implemented and used.

Intentionality, in this context, means:

• Understanding Your Data: Knowing where your sensitive data resides, how it's accessed, and who has access to it.

• Security by Design: Building security considerations into every stage of system implementation, from architecture to configuration to user training. Statistically, user training on security protocols has the greatest impact on risk mitigation.

• Risk Assessment and Mitigation: Proactively identifying potential vulnerabilities and implementing robust security measures to mitigate those risks. "Grey hat" and "white hat" hackers are available for hire and can help find vulnerabilities in your configurations. It may be time to take advantage of their skills.

• Ensuring Availability and Recovery: Planning for both high availability (HA) to minimize disruptions and disaster recovery (DR) to restore operations after a major event.  The recent Oracle security breaches illustrate the need for both.

• Flexibility and Adaptability: Designing systems and processes that allow for adjustments in response to evolving security threats and business needs. Regular patching cycles for technologies like WebLogic, Java, IAM, and IIS are essential.

• Hybrid Approach: In some cases, this intentionality may lead to a hybrid approach, where certain systems or data remain on-premises while others reside in the cloud, allowing organizations to optimize for both security and agility.

Lessons Learned and Moving Forward

The Oracle security breaches, along with other similar events, provide valuable lessons:

• Complacency is a liability: Security requires constant vigilance and proactive measures.  Attention to detail is crucial.

• Control is a spectrum: Organizations must determine the level of control they need over their data and systems and choose their deployment model accordingly.

• Intentionality is paramount: Whether in the cloud, on-premises, or a hybrid environment, a deliberate and thoughtful approach to system design, implementation, and management is essential.

To be resilient in today's digital world requires moving beyond blindly embracing or rejecting any technology. It's about making informed decisions based on a clear understanding of your business needs, your risk tolerance, and the security landscape. By prioritizing intentionality in implementing security protocols, organizations can navigate the complexities of cloud computing and other technology deployments with greater confidence.