Tien Wong’s 2012 Predictions as Published in WashingtonExec

Happy New Year!  I’d like to say a special Thank You to JD Kathuria and my friends at WashingtonExec for publishing my look into the crystal ball for 2012.  Here is the Post:

Tien Wong’s 2012 Prediction: DC Startups Will Continue To Blossom

Written by Brynn Koeppen on January 3, 2012 in Execs to Know, Small Business

Tien Wong, Chairman and CEO of Opus8

2012 is here, and with it comes big changes for the Federal IT industry.  WashingtonExec gave local executives the opportunity to share their thoughts on where they see the government contracting industry headed.

Tien Wong, Chairman and CEO of Lore Systems and Opus8, gave WashingtonExec six factors that he believes will affect the 2012 Washington, D.C. entrepreneur and government contracting communities.

1.  IT SPENDING and THE ECONOMY – IT spending will increase both in commercial and government sectors, particularly in infrastructure, cloud, and mobility.  We have seen an uptick in business at Lore in the last quarter particularly from our commercial clients.  In conversations with many clients, I believe that overall confidence in the economy is improving a lot!

2.  PRESIDENTIAL ELECTION – Obama will be re-elected.  If the economy is improving, that favors Obama.

3.  STARTUPS – Startups in the DC region will continue to blossom.  The ecosystem is as active and sanguine as it has been in the past 10 years.  You are seeing groups like Startup America, Startup Maryland, Startup Virginia, FounderCorps, and established and new incubators take a keen interest in our region.  Angels are investing, and groups like Virginia’s CIT and Maryland’s DBED will be investing new allocations of seed money.

4.  CLOUD COMPUTING – Cloud adoption in the federal government will accelerate both internally via virtual private clouds, and via commercial providers with new FedRAMP guidelines and the award of commercial Infrastructure as a Service (IaaS) contracts (GSA’s IaaS and the Army’s APC2, for example).  The economic and performance benefits are far too great for cloud not to be aggressively adopted well into the future.

5.  DATACENTER CONSOLIDATION – Regarding the federal government’s datacenter consolidation efforts, the government will successfully close many datacenters.  However, I doubt they will hit their goals in 2012  because many individual application owners and datacenter operators are not as cooperative in providing information and complying.  Further, there’s a cost to consolidating and there are limited funds to achieve this, so you’ll likely see a lot of funding come out of O&M budgets.

6.  SMALL BUSINESS – Because of drastically reduced budgets, the government will rely on small business and entrepreneurs for creative ideas to cut costs, drive productivity, and improve performance. The DoD customer has been very open to the commercial best practices Lore is bringing to the table re: datacenter consolidation and application migration.  In addition, small business is more nimble and unencumbered by the fixed costs of the “Bigs,” so we can offer creative pricing structures, and ways for the government to buy from us.  We will see more firm fixed price offers, and shared-risk pricing, which inevitably will save the taxpayers money.

Please let me know what you think about these predictions. Thanks for reading, and please subscribe to my Blog!  All the best for an awesome 2012!

Featured image courtesy of Mike Licht, notionscapital.com, licensed via creative commons.

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Winning with Tim Ferriss’ The 4-Hour Workweek

When Tim Ferriss‘ book The 4-Four Hour Workweek originally hit the airport bookstores in 2007, I must admit I scoffed at the ridiculous title and thought the author and content would also be ridiculous. I was not alone in my opinion, as his methods and advice have been controversial.

After hearing so much about the book, I did finally buy and read it, and I was pleasantly surprised!  I just read it again on a recent trip to Rio (they do practice the 4 hour workweek in Brazil!) and thought I’d write a couple of Blog posts on the subject.  While there are a lot of contrarian and unusual ideas in the book, Ferriss DOES render some excellent advice on a variety of matters including how to create or design a lifestyle.  He does it in a very motivating “I did it so you can do it too” manner.

His basic themes are:

1.  You CAN enjoy the lifestyle you want, and you can do it now

2.  Simpify to create space and create attention (attention is more important than time because time without attention is useless) to apply to other things

3.  Focus on what’s important in your life and that which makes you happy and fulfilled.

4.  His 4-step “DEAL” formula: Defininition, Eliminate, Automate, and Liberate

Tim Ferris’ DEAL:

Definition – Define the life you want and how much it will cost for you to achieve it (in short, define your Goals)

Elimination – Eliminate stuff that’s not critical to your achieving your goals.  Practice the 80/20 rule and focus on what will get you closer to your ideal lifestyle.

Automation – Outsource noncritical and basic functions.  Find and build a business which generates maximum revenue with minimal time/attention.  The key is to minimize your own personal involvement to free yourself up to do the things YOU WANT.

Liberation – Free yourself from a particular geographic location.  The idea is to be able to travel, or work from anywhere.  Mobility is a hallmark of what Ferris refers to as the “NR,” or “New Rich.”

Tim’s “Muse,” an income machine:  Ferriss urges the reader to find his or her “muse” (a calling or business), and then go for it. Ferriss lays out a blueprint for starting your own business which can essentially run on autopilot.  Apparently, he had done this himself and built a business that generated cash flow to pay the living expenses, while requiring a fraction of the time and effort.  While I believe him, he makes it all sound too easy.

The Top 13 New Rich Mistakes

1.  Losing sight of dreams and falling into work for work’s sake (W4W)

2.  Micromanaging and e-mailing to fill time

3.  Handling problems your outsourcers or-co-workers can handle

4.  Helping outsourcers or co-workers with the same problem more than once, or with noncrisis problems

5.  Chasing customers, particularly unqualified or international prospects, when you have sufficient cash flow to finance your nonfinancial pursuits

6.  Answering e-mail that will not result in a sale or that can be answered by a FAQ or auto-responder

7.  Working where you live, sleep, or should relax

8.  Not performing a thorough 80/20 analysis every two to four weeks for your business and personal life

9.  Striving for endless perfection rather than great or simply good enough, whether in your personal or professional life

10.  Blowing minutiae and small problems out of proportion as an excuse to work

11.  Making non-time-sensitive issues urgent in order to justify work

12.  Viewing one product, job, or prospect as the end-all and be-all of your existence

13.  Ignoring the social rewards of life

In summary, I believe this is a book worth reading, as it contains a lot of useful and highly applicable tips and advice, while proffering some proven scenarios whereby you can unchain yourself from a job or mundane lifestyle, in order to design and pursue immediately a life of your dreams.

Featured image courtesy of benjyfeen licensed via creative commons.

More Business Advice from Warren Buffett

Two weeks ago, I had the good fortune of having my Blog post on Warren Buffett featured on WordPress.com’s home page.  Out of over 400,000 blog posts per day, WordPress features only 10 in its Freshly Pressed section.  I have no idea how my post was selected, but I bet it had to do with Mr Buffett’s popularity, especially in light of the recent turbulence in the stock market.

Needless to say, my Blog site was visited by thousands of Warren Buffett fans, so I thought I’d do another post on the Oracle of Omaha’s advice.  I found a nice article on about.com by Joshua Kennon, a private investor who authored The Complete Idiot’s Guide to Personal Investing, 3rd Edition.  The piece summarized some of Mr. Buffett’s best investment advice.  I chose seven of these nuggets, which I thought could also be very applicable to running and growing a business.

1.  Risk can be greatly reduced by concentrating on only a few holdings.  Business application: FOCUS!  Every company has limited human and capital resources, so concentrate your efforts on a few key areas rather than trying to “boil the ocean.”

2.  Stop trying to predict the direction of the stock market, the economy, interest rates, or elections.  Business application:  STAY THE COURSE.  Once you have made a business decision to go in a particular direction, stay focused on that direction and tune out the inappropriate noise.  If you are sure in your decision and it has been made rationally with good information, then eventually it will pay off.

3.  Be fearful when others are greedy and greedy only when others are fearful. Business application:  BE CONTRARIAN.  More money can be made in business by NOT following the “conventional wisdom.”  Trends move from one end of the pendulum to the other, so when the crowds are strongly of one opinion, then it could be time to make money by taking the opposing view.  For example, just 5 years ago, the “experts” thought the datacenter industry was stagnant.  There was a glut in capacity, and pessimism all around.  The smart contrarian entrepreneur who could see the tidal wave of virtualization and cloud computing was coming, made money by investing heavily in datacenters.

4.  The ability to say “no” is a tremendous advantage for an investor. Business application:  Concentrate, focus, and don’t get distracted.  The ability to say “no” is also a tremendous advantage for a business person.  Steve Jobs, for one, has always prided himself on saying “no” to things that did not fit his vision for Apple.  It is natural for opportunistic business people and entrepreneurs to want to look at EVERY opportunity, but by saying yes to too many projects, you dilute your resources and your company’s energy.

5.  An investor should act as though he had a lifetime decision card with just twenty punches on it.  Business application: BE SUPER SELECTIVE!  Imagine running your business knowing that you will only have 20 truly awesome ideas to bet on in your career!  That’s only one every two years.  Applying this advice means you must do your homework, be very diligent, and choose your projects very judiciously.

6.  Always invest for the long term.  Business application:  Your goal is to create long term shareholder value, so plan and operate your business in a way to achieve this goal. Note that Mr. Buffett uses the word “always,” which is a very strong word.  For me this is real wisdom.  I see far too many business leaders make short term and medium term decisions which appear to make sense, but really do not.  I agree with Mr. Buffett because, ultimately, all that really matters is the value created in the long term.

7.  It is not necessary to do extraordinary things to get extraordinary results. Business application:  You don’t always have to be the best.  You can win big even if you are a little better than your competition.  This is an excellent concept.  Too many companies spend too much time and money trying to be perfect, when all they really need is to stand above their competitors.  CyberRep operated in an industry with “C” players, and I always told our team that we would be successful if we were merely “B+” players.  It worked.

Thanks for reading.  Please comment below and let me know which concept resonates with you…and please sign up for my Blog too.  You can find the signup box in the right column of my Blog’s Home Page.

Featured image courtesy of trackrecord licensed via creative commons.

Warren Buffett’s Ten Rules for Winning

While enjoying a nice lunch with my Son at a Minneapolis Jimmy John’s sub shop this weekend, I saw this “WARREN BUFFETT’S TEN RULES” sign tacked to the wall.

Unfortunately, I wasn’t able to take a glare-free or hi-res photo, so let me list out these Rules below (with my comments in bold Italics):

No. 1:  REINVEST YOUR PROFITS – When you first make money, you may be tempted to spend it.  Don’t.  Instead, reinvest the profits.  Buffett learned this early on. In high school, he and a pal bought a pinball machine to put 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, Buffett used the proceeds to buy stocks and to start another business. No surprise that this is Rule #1.  He is the greatest investor of our time and one of the reasons is because he followed his own advice here.

No. 2:  BE WILLING TO BE DIFFERENT – Don’t base your decisions upon what everyone is saying or doing. When 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 on Wall Street, and he refused to tell his partners where he was putting their money. People predicted that he’d fall, but when he closed his partnership 14 years later, it was worth more than $100 million.  In short:  Don’t be afraid to be contrarian.  Time and time again, we see tremendously successful investors, businessmen, entrepreneurs take a contrarian approach.  Wasn’t it John D. Rockefeller who said the best time to buy is when there’s “blood in the streets”?

No. 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. Buffett prides himself on swiftly making up his mind and acting on it. He calls any unnecessary sitting and thinking “thumb-sucking.”  Buffett invested $5 Billion in Goldman Sachs during the worst moments of the 2008 financial crisis when Wall Street appeared to be melting down.  He committed this money in a 15 minute (no thumb sucking here) phone call with Goldman CEO Lloyd Blankfein.  Result?  A $10 Billion profit in 30 months.

No. 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. Buffett learned this lesson the hard way as a kid, when his grandfather Earnest 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 that 90 cents to split.  This advice holds not only for jobs, but also for any kind of negotiation, investments, partnerships, JVs, etc.

No. 5:  WATCH SMALL EXPENSES – Buffett invests in business run by managers who obsess over the tiniest costs. He once 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 the side of his office building that faced the road.  I think the lesson is also that the devil’s in the details, and that little things mean a lot. The best organizations have a handle on all of the nuances and details of their operations.

No. 6:  LIMIT WHAT YOU BORROW – Buffett has never borrowed a significant amount – not to invest, not for a mortgage. He has gotten many heartrending 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 invest.  If our country had followed this advice, we wouldn’t be in the financial pickle we’re in now, that’s for sure.  Seems like Buffett is not only saying to limit what you borrow, but also very simply to be disciplined, and that’s a key success driver

No. 7:  BE PERSISTENT – With tenacity and ingenuity, you can win against a more established competitor. 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.  This is my favorite of the Buffett Rules.

No. 8:  KNOW WHEN TO QUIT – Once, when 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. Buffett never repeated that mistake.  The only one making money at the racetrack is the owner.  I bet he’s happy he learned this lesson at a young age.

No. 9:  ASSESS THE RISKS – In 1995, the employer of Buffett’s son, Howie, was accused by the FBI of price-fixing. Buffett advised Howie to imagine the worst- and best-case scenarios if he stayed with the company. His son quickly realized the risks of staying far outweighed any potential gains, and he quit the next day.  Continually assess current and future risks and mitigate those you can to help shape and control your future.

No. 10:  KNOW WHAT SUCCESS REALLY MEANS – Despite his wealth, 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. “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 lived your life.”  What a great definition of “success.”  After all the effort, the blood, sweat and tears, and the battle scars from the business and investment world, the Master defines his success so simply and elegantly.

I can’t help but think that the world would be a better place, and the economy would be in much better shape if we all followed Warren Buffett’s Rules.

Hopefully, President Obama will continue to seek Mr. Buffett’s sage counsel and (I know this is a stretch) convince him to become our next Treasury Secretary when Tim Geithner (my Mandarin language TA at Dartmouth) retires.

Thanks for reading, and please leave a Comment below.  Which Buffett Rule is your favorite one? What kinds of things do you think Mr. Buffett would do if he were Treasury Secretary?

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