In his new book, How the Mighty Fall, Collins offers leaders the hope that they reverse their course when they are failing.  He says every institution, no matter how great, is vulnerable to decline. Any of them can fail and most eventually do. But some companies recover and become stronger.

Collins gives these stages of decline.

Stage 1.Complacency – know why specific things are a success and under what conditions they will no longer work. Good leaders realize that luck has played a role in their success and don’t become convinced that they personally were responsible for it.

Stage 2. Undisciplined pursuit of more. Do not neglect negative data and put a positive spin on ambiguous factors.

Stage 4. Grasping for salvation – lurching into a new area or product rather than getting back to the discipline that brought success in the first place.

Stage 5. Capitulation to irrelevance or death. The longer a company grasps for silver bullets, the more likely it is that it will continue the downward spiral.

To survive and thrive, companies need to listen to customers in an unemotional way. They should tune in to the customer experience. As long as they can avoid getting entirely knocked out of the game, hope remains.

How the Mighty Fall: And Why Some Companies Never Give In, by Jim Collins, published by Jim Collins, 240 pages,

Henry Ford is often looked up to as the father of mass production; doctors have their Hippocrates, and philosophers have Plato. But who is the father of accounting?For a long time, accountants did not recognize the name of Luca Pacioli although about the same time Columbus was discovering America, Luca was writing the directions for double-entry bookkeeping. Pacioli was the first person to describe double-entry accounting, also known as the Venetian method. This new system was then state of the art, it revolutionized economy and business.  Pacioli’s directions became the most widely read mathematical work in all of Italy, and his work was one of the first books published on the Gutenberg press.

The fact that his book “Summa de Arithmetic, Geometria, Proportioni et Proportionalita” was illustrated by Leonardo da Vinci, added needed credibility. (Where is Leonardo now when I am planning to write a book?)

* Income and expense. The most fundamental steps include deferring income and accelerating deductible expenses. If you can delay taxable income until January 1 and pay for invoices and expenses not usually handled until the following month or 2, you will save on your income tax.

* Contributions. Year-end planning also involves maximizing contributions to qualified retirement plans such as a 401(k). They must be made before the end of each year. (IRAs have a later date.)

* Portfolio. If you have planned to sell your losers, do it before January 1. Losses in excess of gains can be used to offset up to $3,000 in ordinary income, or $1,500 for a married couple filing separately.

One tax break available in 2008 through 2010: Couples with incomes of $65,000 or less ($32,000 for singles) are exempt from capital gains tax. Example: If you are single and after deductions and exemptions have $22,000 in income from wages and interest, you would pay no tax on up to $10,550 in capital gains, which would bring your income to the $32,550 limit.

This break is very helpful for investments that have been held for some years while their value has risen.

* Gifts. You can transfer $12,000 per person as gifts and reduce your income by that amount. A couple can reduce their income by $24,000. (The person who receives it doesn’t have to pay income tax on the money.)

* Learning credits. People with adjusted gross incomes between $7,000 and $57,000 may be able to claim a lifetime learning credit of up to $2,000 for qualified education expenses paid for all of their students who are enrolled in eligible educational institutions.

Norm Brodsky and Bo Burlingham, two of Inc. magazine’s popular columnists,  talked about their book “The Knack”.  Their advice mixes common sense, street smarts and pragmatism. Here are some points to remember:

• Life plan should be in sync with your business plan.  Be flexible enough to make changes if necessary.

• Have a set of long and short term goals for yourself and your business.

• Numbers run a business – get a handle on your finances.  Understand why gross margin matters.

• Keep in mind – sale does not occur until you collect the money.

• Short term assets should always exceed short term liabilities.

• No friends in business – make decisions that are best for your business.  Take emotion out of decision making process. This does not mean that you don’t care about the people you work with.

• Treat true competitors with respect.  You get nowhere by badmouthing them.

• Explain why you are better/different without putting your competitors down.

• Culture drives a company.  We don’t necessarily start out with a written statement that sets our company culture.

• CEO should take responsibility for your company culture,  otherwise you may end up having several different cultures.   Company culture  is company’s soul.

•  Don’t be wasteful.  Have enough cash on hand to get your company through hard times.

Ken Blanchard, author of the famous One Minute Manager, got support from Don Hutson and Ethan Willis to create his book, The One Minute Entrepreneur.

Most people who start a small business fail within 10 years, say the authors.  Readers find a simple map to success. Some advice is short and to-the-point, and some common sense advice they share you’ve heard before, but it still works.

The authors describe 20 key attributes of a successful entrepreneur. I find the following five they have included to be essential.

Resourceful – In my experience successful entrepreneurs find ways to get through difficult times, constantly learn new skills and improve their self-reliance.  They practice patience and come up with new ways to open doors that have been slammed shut in their face.

Visionary – Vision-inspired focused small business owners WILL find success. They don’t get discouraged by numbers and inspire people around them.

Optimistic – Future may not seem so bright for some small business owners right now, but they have to show up and motivate others.

Strategic -Clarity of direction will lead to smart decisions, learning to let go and working smart.

Team oriented – That’s how smart entrepreneurs earn the commitment of their people and the loyalty of their customers. Successful leaders always help other people grow.

The goal of writing this book must have been helping people discover their entrepreneurial strengths.  Entrepreneurs must learn to commit to success one step at a time.

The One Minute Entrepreneur: The Secret to Creating and Sustaining a Successful Business, Currency/Doubleday, 139 pages.

Energy costs. Because of high fuel prices, airline tickets cost more. Also add the cost of lost time, the hassles of going through airport security lines and late arrivals.

All of these situations are making air travel a less attractive choice. The days of flying cross country for a one-hour meeting are disappearing. Increasingly, virtual meetings are replacing travel. Researchers for Hewlett Packard and Cisco Systems, who studied body reactions, say that co-workers in different states and countries experience the same chemical responses to virtual meetings as to face-to-face meetings.

Travel by car for distances of 200 miles is less of a hassle than flying. But it takes more time than conference calls. And it costs more, 58.5 cents a mile.

It’s not just time and money. The frequent-flyer lifestyle can wreak havoc on a person’s health and family life. People who are involved in virtual meetings seem to be pleased with the reduction of air travel.

Here are some web-based options for webinars and online meetings:

GoTo Meeting

Webex

ConferenceCall.com

Skype

Consulting firm BDO Seidman, quoted in Business Week, says it’s not just about travel reduction, it’s also about increasing communication. They say meeting more frequently and in short bursts of time is more productive than flying off to long meetings.

Most companies are considering the green factor in all of their decisions. Flying and driving less will reduce a company’s carbon footprint.

1. Clean your mailing lists, make sure you have updated addresses for all recipients.

2. Find out how you can take advantage of United States Postal Service mailing options that benefit businesses, such as bulk mail and online  postage.

3. Postcard mailings are generally less expensive than letters.

4. Analyze your needs for packaging supplies, such as boxes, tubes, cartons, drums, strapping, shrink wrap, cushioning, edge protectors, bags, bubble wrap, tags, tape and other packaging products. Buy in bulk, it will save you money!

5. Send your monthly newsletter to your customers with monthly invoices.

6.  Switch to e-newsletters if this will save you money.

Six weeks after major surgery I finally started to train for my third upcoming Danskin triathlon in Seattle, Washington. While creating my training plan, It occurred to me that running a small business is like participating in a triathlon – you as a small business owner need to have some knowledge of all “events” – financial management, customer service and marketing, – or your business will not survive. You may not be good at all of them, but you have to build stamina to stay in competition and finish the race. All successful entrepreneurs I have ever known have had passion for their field. Just like triathletes, small business owners need passion to go out and compete no matter what the circumstances. Not all of us will win. Reaching the goals we have set for ourselves as small business owners, marketers or triathletes may bear bigger significance. Unfortunately I meet too many business owners each week who lack clear goals and desire to become better at what they do. At the same time, when we gain new insights, we become more confident at marketing our services.

“Everything can always be better. This game is fluid. It’s always changing, it’s always evolving. I could always hit the ball better, chip better, putt better, think better. You can get better tomorrow than you are today.”

-Tiger Woods

In addition, most successful individuals I know have created systems for every aspect of their lives. It may sound boring, but they stay on track without wasting energy on defeating chaos. They have streamlined their lives. I admire their productivity, therefore I am reading Getting Things Done by Dave Allen this week.

* Restrain yourself from topping off at the pump.

* Check and replace air filters.

* Keep your tires inflated.

* Maintain your car regularly.

* Use cruise control when you can.

* Don’t speed up and slow down frequently on highways.

* Drive at lower speeds when you can to increase fuel efficiency.

* Don’t let your car sit idle for long periods of time.

* Unless your car requires it – don’t buy high octane gas.

* Check your oil regularly.

Go to GasBuddy.com and find the best gas prices in the area. Good luck with squeezing your pennies!

* Homeowner’s insurance does not cover flood damage.

* Flooding can happen in almost any part of the country, including those that are not in flood zones. Floods recently occurred in Kansas, Missouri, and Oklahoma in areas that were far from rivers.

* In low-risk areas, it can cost as little as $112 a year. For a $250,000 house with $100,000 in contents coverage, the cost is about $30 a month. The average cost in the U.S. is $500 a year.

* A community has to be designated as a federal disaster area before any federal assistance is available.

* Homeowner insurance for basement contents includes only the washer and dryer, nothing else.