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Must Read Business Books, Best
Business Books, and Business Leadership Books |
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Free e-Books
from The Institute for
Advanced Leadership
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Resume
Design Instructions
Ten Steps to designing a Stellar Resume. Shopping for employment is a hybrid
of automated filter applications and "good old fashioned" human
interpretation. To be effective you need to design a Resume for all of
these areas. This ten step process is intended to provide useful
instruction for developing meaningful, accurate and compelling personal
profiles.
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Interview
for Excellence
Use position descriptions to create Job Requirements. Design a template to
track key skills and behavioral traits during the interview process so you can
compare results and hire the person best equipped to perform a specific role.
Are you getting the best talent for each position? How do you know?
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Standards
of Performance
Create Position Descriptions with Goals, Objectives, Responsibilities, Levels of
Authority and Performance Reports. Useful for tracking performance with
employees and management, conducting yearly performance appraisals, preparing
Job Descriptions for effective Interviews and New Hire Training.
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Communication
Skills
Based on the critically acclaimed seminars of specialist Mitch Simons of the
Simons Alliance, this presentation and companion guide were developed
specifically for trainers, coaches and consultants. Incredibly powerful
instructions for confronting the primal barriers to communication and to openly
share fierce conversations. Once the obstacles are identified and removed, open
and highly effective communication can occur.
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Active
Listening
Train yourself to hear and Understand Content and Feeling of the speaker's
message. Important skill for leaders, managers, sales, customer service and
working with colleagues. Course covers Listening Habits, Attending Skills,
Reflecting Skills, and Barriers to Effective Communication. Certificate of
Completion.
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Risk
Management
Are you prepared to handle an unexpected event? This insightful and practical
guide provides methodology, principal factors and helpful hints to manage risk,
Learn how to measure and calculate risk so you can determine when and which
controls to put in place. Louis Mehrmann has extensive first hand experience
from helping Fortune 500 companies identify, measure risk with quantitative
results, fundamental simplicity and usability. This research is available and
invaluable to business.
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Change
Management
The Art of Progress is to preserve order amid change and to preserve change amid
order. Review the rules to change, the challenge and the reaction cycle. Learn
how to introduce change, deal with resistance and plan for success. Are you
planning properly to cope with change?
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Security
is a Management Issue
This is a short tutorial with a very comprehensive workbook and
checklist for managing security, preparing for emergencies, hardware and
software integrity, and disaster response. Securing your valuable
company data includes preparation for hurricanes, theft, accidents and
vandalism. Protect confidential data of your customers and employees,
your financial records, and your strategic designs or presentations. Be
aware, be prepared, stay alert, take action and enjoy the benefits.
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Ownership
and Classification
Information Ownership and Classification - Protecting Vital
Information Assets. How high does your wall need to be? Practical
guidelines for classifying information for Internal Use Only,
Confidential information, Restricted information and Registered
Confidential Information. This guide reviews characteristics, ownership,
users management and responsibility in easy to apply summary steps. It
also contains implementation and review checklist. Lou Mehrmann draws
from years of industry experience and knowledge to provide insightful
business applications for protecting information assets.
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Essential
Elements for Effective Marketing
Build your brand or business message with simple and effective
checklist. Apply the FABIO Principle to define your products or
services. Powerful and easy to use, a necessary cycle for small business
owners, web commerce, and entrepreneurs. Are you getting the results
that you expected from your marketing dollars?
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Investing
in Customer Loyalty
"Customer Loyalty Sales" includes tools to identify current and target
markets, define your approach to key decision makers. You will learn the
importance of anxiety questions and building credibility, climb the
customer loyalty ladder, and understand the cost of customer loyalty by
customer type. Use customer information and coordinate your actions. Are
your current sales techniques right for your target customers? Do you
know the cost of your target markets?
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Creating
Corporate Ethics
Follow the step-by-step process to design an Ethics Statement that
represents your commitment to your customers, your employees, your
shareholders and builds trust. Develop Standards of Conduct to promote a
positive and ethical environment with guidelines for decisions and
actions. It is more than regulations and compliance, it defines your
company character.
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Harassment
& Discrimination
An effective Harassment & Discrimination course must encompass
harassment, discrimination and retaliation regarding sex, race,
religion, age, disabilities and national origin. The course must be
interactive, dealing with the issues, avoidance and response. This
course includes reference to actual cases, with thought provoking
questions and opportunities for discussion.
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Six
Sigma Process Improvement
Six Sigma Process Improvement removes the mystery from Six Sigma Quality
Circle techniques and provides a layman's introduction to begin using
the most common and effective techniques for effective process
improvement in a concise and easy to use reference manual.
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The Trusted Advocate: Accelerate Success with Authenticity
and Integrity
The
Fundamental Guide to Achieve Extraordinary Sales and Sustain Loyal Customers
By
John Mehrmann and Mitchell Simon
The
sales environment has been forever altered by e-commerce and
price-centered commodities. Competition has become stiffer, and
quotas have become higher. The demand for performance has
created brutal pressure in a lonely profession, and increasing
the number of cold calls is not enough to survive. Success
requires closing a higher percentage of opportunities and
growing existing business. But how can you achieve such lofty
goals?
The Trusted Advocate:
Accelerate Success with Authenticity and Integrity
is a revelation of fundamental principles that empower maximum
success through authenticity and integrity. John Mehrmann and
Mitchell Simon combine their experience in management and
leadership development to provide you with proven, cutting-edge
management techniques and leadership skills to unlock individual
potential and empower personal success. You'll learn how to:
* Increase
sales and retain loyal customers
* Train the
sales force, or train yourself
* Identify and
unleash your talents
* Turn
knowledge into power
* Build your
pipeline
* Create a
revolutionary process
* Earn a
reputation for being trustworthy
Designed to
revitalize sales professionals,
The Trusted Advocate: Accelerate Success with Authenticity
and Integrity
is perfect for managers, coaches, consultants, and trainers to
help rapidly accelerate individual or group performance. Use
your strengths as a competitive edge, enjoy your profession, and
advance your career!
>>
Look inside the book <<
>>
Order a copy from Amazon <<
>>
Read the testimonials! <<
Join
the Trusted Advocate Network on LinkedIn
http://www.linkedin.com/e/gis/83826/03792148A71A
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Playing the Right Cards: How to Successfully Market Your Small Business or
Professional Services
By Mike Coleman
At some point everyone who owns a small business or
provides professional services struggles with their marketing. This is usually a
result of not having a solid foundation in place that properly supports the
business. This book will provide you with a clear, concise overview of marketing
that will help you build that foundation. You will learn how to:
* Overcome both the internal and external barriers
to marketing your business *
Overcome both the internal and external barriers to marketing your business
* Clearly articulate what you do and who you serve
* Build strong, long lasting relationships
* Differentiate yourself and your services from the
competition * Put systems in
place to build a better business
* Create the proper mindset for running a business.
You will also be introduced to the CARDS System. This system contains the five
essential elements for building a successful business
About the Author:
Mike Coleman is a speaker, writer, and marketing
consultant. He helps small business owners and professional service providers
improve their marketing and build better business
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Servant Leadership : A Journey into the Nature of Legitimate Power and Greatness
By Robert K Greenleaf
The phrase “Servant Leadership” was coined by Robert
K. Greenleaf in The Servant as Leader, an essay that he first published
in 1970. In that essay, he said: "The servant-leader is servant first… It
begins with the natural feeling that one wants to serve, to serve first.
Then conscious choice brings one to aspire to lead. That person is sharply
different from one who is leader first, perhaps because of the need to
assuage an unusual power drive or to acquire material possessions…The
leader-first and the servant-first are two extreme types. Between them there are
shadings and blends that are part of the infinite variety of human nature."
"The difference manifests itself in the care taken
by the servant-first to make sure that other people’s highest priority needs are
being served. The best test, and difficult to administer, is: Do those served
grow as persons? Do they, while being served, become healthier, wiser,
freer, more autonomous, more likely themselves to become servants? And,
what is the effect on the least privileged in society? Will they benefit or at
least not be further deprived?" |
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The Breakthrough Company: How Everyday Companies Become Extraordinary Performers
By Keith R.
McFarland
The vast majority of small
businesses stay small—and not by choice. Only the most savvy and persistent—a
tiny one tenth of one percent—break through to annual sales above $250 million.
In The Breakthrough Company, Keith McFarland pinpoints how everyday
companies become extraordinary, showing that luck is a negligible factor.
Rather, breakthrough success turns out to be associated with a clearly
identifiable set of strategies and skills that anyone in any business can
emulate—from small startup to industry leader.
Encouraged by experts such as business legend Peter Drucker and Good to Great
author Jim Collins to identify the drivers that enable a company to push past
the entrepreneurial phase, McFarland spent five years building and analyzing the
world’s largest growth-company performance database and interviewing more than
1,500 growth-company executives on four continents. His goal was simple: to
identify the secrets of breakthrough.
The Breakthrough Company is the result. Winnowing a study pool of more
than 7,000 companies down to nine that have made the transition to major-player
status, McFarland highlights real-world tools and myth-busting insights that can
be used by anyone wanting his or her business to join this exclusive circle.
Among the book’s takeaways:
• Common wisdom holds that the founders and core entrepreneurial leaders of a
company must step aside for the business to reach the next level. Not true—as
long as founders “crown the company” instead of themselves.
• It’s not reckless to make ever-escalating bets on your company’s future, even
going nose to nose with competitors many times your size. In fact, it turns out
that the only safety comes in constantly upping the ante in exactly this way.
• A Business Bermuda Triangle does exist, gobbling up companies on the verge of
breakthrough. Presented here are three ways to navigate this potentially deadly
hazard successfully.
• However good you are—or think you are—you can’t do it alone. Learn how to
surround your company with networks of outside resources, aka “scaffolding,” and
how to enlist the aid of “insultants”—people who are willing to question a
firm’s existing assumptions and ways of doing business.
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Managing the Customer Experience: Turning customers into advocates
By Shaun Smith
How much more profit could you make
if you had customers who couldn't imagine doing business with anyone but you? In
your dreams! Tell that to Virgin Atlantic or Harley Davidson.
How great would life be if 40% of
your new business simply knocked on your door without you having spent a cent
advertising for it? Impossible! Tell that to First Direct.
The companies in this book have
managed to turn customers into advocates. Advocates who constantly refer their
friends and colleagues to those businesses. Why? Because those companies have
created a Branded Customer Experience. They have managed the relationship to the
point where customers can't imagine wanting to do business with anyone else.
How can you gain this unbeatable
competitive advantage? Managing the Customer Experience shows you how. It
takes you through the step-by-step process of creating Loyalty by Design. It
shows you how to re-think your business from the customer's point of view and
then design and deliver a customer experience that drives loyalty and
profitability.
Customer Satisfaction is no longer
enough. 80% of customers who switch suppliers express satisfaction with their
previous supplier. To lead the market companies need customers who are
enthusiastic 'advocates', customers who are highly loyal and drive new business
to the company. For example 38% of First Direct's business comes from customer
referrals. Advocacy comes from creating a customer experience that becomes
synonymous with the brand, what Forum calls a Branded Customer Experience.
Research for this book with
organizations like Amazon.com, Virgin, Pret A Manger, Krispy Kreme,
Harley-Davidson, Manchester United, and many others has identified the 'Uncommon
Practices' that help these organizations create a Branded Customer Experience.
Such an experience requires Marketing, Operations, and Human Resources to work
together to deliver the brand creating a common strategic agenda within the
organization.
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Made to Stick: Why Some Ideas Survive and Others Die
By Chip Heath
Mark Twain once observed, “ A lie
can get halfway around the world before the truth can even get its boots on.”
His observation rings true: Urban legends, conspiracy theories, and bogus
public-health scares circulate effortlessly. Meanwhile, people with important
ideas—businessmen, educators, politicians, journalists, and others—struggle to
make their ideas “stick.”
Why do some ideas thrive while
others die? And how do we improve the chances of worthy ideas? In Made to Stick,
accomplished educators and idea collectors Chip and Dan Heath tackle head-on
these vexing questions. Inside, the brothers Heath reveal the anatomy of ideas
that “stick” and explain sure-fire methods for making ideas stickier, such as
violating schemas, using the Velcro Theory of Memory, and creating “curiosity
gaps.”
In this indispensable guide, we
discover that “sticky” messages of all kinds—from the infamous “organ theft
ring” hoax to a coach’s lessons on sportsmanship to a product vision statement
from Sony—draw their power from the same six traits.
Made to Stick is a book that will
transform the way you communicate ideas. It’s a fast-paced tour of idea success
stories (and failures)—the Nobel Prize-winning scientist who drank a glass of
bacteria to prove a point about stomach ulcers; the charities who make use of
the Mother Teresa Effect; the elementary-school teacher’s simulation that
actually prevented prejudice . Provocative, eye-opening, and funny, Made to
Stick shows us the principles of successful ideas at work—and how we can apply
these rules to making our own messages “stick.”
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The Effective Executive
by Peter F.
Drucker
What makes an effective
executive?
The measure of the executive, Peter
F. Drucker reminds us, is the ability to "get the right things done." This
usually involves doing what other people have overlooked as well as avoiding
what is unproductive. Intelligence, imagination, and knowledge may all be wasted
in an executive job without the acquired habits of mind that mold them into
results.
Drucker identifies five practices
essential to business effectiveness that can, and must, be learned:
* Managing time
* Choosing what to contribute to
the organization
* Knowing where and how to
mobilize strength for best effect
* Setting the right priorities
* Knitting all of them together
with effective decision-making
Ranging widely through the annals of
business and government, Peter F. Drucker demonstrates the distinctive skill of
the executive and offers fresh insights into old and seemingly obvious business
situations.
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The 360 Degree Leader: Developing Your Influence from Anywhere in the
Organization
by John C.
Maxwell
In his nearly thirty years of
teaching leadership, John Maxwell has encountered this question again and again:
How do I apply leadership principles if I'm not the boss? It's a valid question
that Maxwell answers in The 360 Degree Leader. You don't have to be the
main leader, asserts Maxwell, to make significant impact in your
organization. Good leaders are not only capable of leading their followers but
are also adept at leading their superiors and their peers. Debunking myths and
shedding light on the challenges, John Maxwell offers specific principles for
Leading Down, Leading Up, and Leading Across. 360-Degree Leaders can lead
effectively, regardless of their position in an organization. By applying
Maxwell's principles, you will expand your influence and ultimately be a more
valuable team member.
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Never Eat Alone: And Other Secrets to Success, One Relationship at a Time
By Keith Ferrazzi
Do you want to get ahead in life? Climb the ladder
to personal success?
The secret, master networker Keith
Ferrazzi claims, is in reaching out to other people. As Ferrazzi discovered
early in life, what distinguishes highly successful people from everyone else is
the way they use the power of relationships—so that everyone wins.
In Never Eat Alone, Ferrazzi lays
out the specific steps—and inner mindset—he uses to reach out to connect with
the thousands of colleagues, friends, and associates on his Rolodex, people he
has helped and who have helped him.
The son of a small-town steelworker
and a cleaning lady, Ferrazzi first used his remarkable ability to connect with
others to pave the way to a scholarship at Yale, a Harvard MBA, and several top
executive posts. Not yet out of his thirties, he developed a network of
relationships that stretched from Washington’s corridors of power to Hollywood’s
A-list, leading to him being named one of Crain’s 40 Under 40 and one of Davos’
Global Leader for Tomorrow.
Ferrazzi's form of connecting to the
world around him is based on generosity, helping friends connect with other
friends. Ferrazzi distinguishes genuine relationship-building from the crude,
desperate glad-handling usually associated with “networking.” He then distills
his system of reaching out to people into practical, proven principles. Among
them:
* Don’t keep score: It’s never
simply about getting what you want. It’s about getting what you want and
making sure that the people who are important to you get what they want,
too.
* “Ping” constantly: The Ins and
Outs of reaching out to those in your circle of contacts all the time—not
just when you need something.
* Never eat alone: The dynamics of
status are the same whether you’re working at a corporation or attending a
society event— “invisibility” is a fate worse than failure.
In the course of the book, Ferrazzi
outlines the timeless strategies shared by the world’s most connected
individuals, from Katherine Graham to Bill Clinton, Vernon Jordan to the Dalai
Lama.
Chock full of specific advice on
handling rejection, getting past gatekeepers, becoming a “conference commando,”
and more, Never Eat Alone is destined to take its place alongside How to Win
Friends and Influence People as an inspirational classic.
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The Elephant and the Dragon: The Rise of India and China and What It Means for
All of Us
By Robyn Meredith
A compelling look at the major
changes in store as America faces increasing competition from two emerging Asian
giants.
In the streets of India, camels pull carts loaded with construction materials,
and monkeys race across roads, dodging cars. In China, men in Mao jackets pedal
bicycles along newly built highways, past skyscrapers sprouting like bamboo. Yet
exotic India is as near as the voice answering an 800 number for one dollar an
hour. Communist China is as close as the nearest Wal-Mart, its shelves full of
goods made in Chinese factories.
Not since the United States rose to prominence a century ago have we seen such
tectonic shifts in global power; but India and China are vastly different
nations, with opposing economic and political strategies—strategies we must
understand in order to survive in the new global economy. The Elephant and
the Dragon tells how these two Asian nations, each with more than a billion
people, have spurred a new “gold rush,” and what this will mean for the rest of
the world.
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The Speed of Trust: The One Thing That Changes Everything
By Stephen M. R.
Covey
According to Stephen M. R. Covey
(son of the bestselling author Stephen R. Covey), there is one thing that is
common to every individual, relationship, team, family, organization, nation,
economy, and civilization worldwide. It affects every effort in which humankind
is engaged, changing the quality of every present moment, and altering the
trajectory of every future moment, both personally and professionally. This one
thing, which changes everything, is trust—the foundation of the most powerful
governments, the most successful businesses, the most thriving economies, the
most influential leaders, the greatest friendships, or the deepest loves.
The Speed of Trust challenges the assumptions that trust is merely a soft
social virtue and articulates why it has become the key leadership competency of
the new global economy. Covey demonstrates how to quickly and permanently gain
the trust of clients, coworkers, partners, and constituents so as to make
organizations more profitable, people more promotable, and relationships more
energizing.
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Now, Discover Your Strengths
By Marcus
Buckingham and Donald O. Clifton
Unfortunately, most of us have
little sense of our talents and strengths, much less the ability to build our
lives around them. Instead, guided by our parents, by our teachers, by our
managers, and by psychology's fascination with pathology, we become experts in
our weaknesses and spend our lives trying to repair these flaws, while our
strengths lie dormant and neglected.
Marcus Buckingham, coauthor of the national bestseller First, Break All the
Rules, and Donald O. Clifton, Chair of the Gallup International Research &
Education Center, have created a revolutionary program to help readers identify
their talents, build them into strengths, and enjoy consistent, near-perfect
performance. At the heart of the book is the Internet-based StrengthsFinder®
Profile, the product of a 25-year, multimillion-dollar effort to identify the
most prevalent human strengths. The program introduces 34 dominant "themes" with
thousands of possible combinations, and reveals how they can best be translated
into personal and career success. In developing this program, Gallup has
conducted psychological profiles with more than two million individuals to help
readers learn how to focus and perfect these themes.
So how does it work? This book contains a unique identification number that
allows you access to the StrengthsFinder Profile on the Internet. This Web-based
interview analyzes your instinctive reactions and immediately presents you with
your five most powerful signature themes. Once you know which of the 34
themes—such as Achiever, Activator, Empathy, Futuristic, or Strategic—you lead
with, the book will show you how to leverage them for powerful results at three
levels: for your own development, for your success as a manager, and for the
success of your organization.
With accessible and profound insights on how to turn talents into strengths, and
with the immediate on-line feedback of Strengths Finder at its core, Now,
Discover Your Strengths is one of the most groundbreaking and useful
business books ever written.
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Good to Great: Why Some Companies Make the Leap... and Others Don't
By Jim Collins
The findings of the Good to Great
study will surprise many readers and shed light on virtually every area of
management strategy and practice. The findings include:
Level 5 Leaders: The research
team was shocked to discover the type of leadership required to achieve
greatness.
The Hedgehog Concept (Simplicity
within the Three Circles): To go from good to great requires transcending
the curse of competence.
A Culture of Discipline: When
you combine a culture of discipline with an ethic of entrepreneurship, you get
the magical alchemy of great results. Technology
Accelerators: Good-to-great
companies think differently about the role of technology.
The Flywheel and the Doom Loop: Those who launch radical change programs and
wrenching restructurings will almost certainly fail to make the leap.
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Who Moved My Cheese? An Amazing Way to Deal with Change
in Your Work and in Your Life
By Spencer
Johnson and Ken Blanchard
Change can be a blessing or a curse,
depending on your perspective. The message of Who Moved My Cheese? is
that all can come to see it as a blessing, if they understand the nature of
cheese and the role it plays in their lives. Who Moved My Cheese? is a
parable that takes place in a maze. Four beings live in that maze: Sniff and
Scurry are mice--non-analytical and nonjudgmental, they just want cheese and are
willing to do whatever it takes to get it. Hem and Haw are "little people,"
mouse-size humans who have an entirely different relationship with cheese. It's
not just sustenance to them; it's their self-image. Their lives and belief
systems are built around the cheese they've found. Most of us reading the story
will see the cheese as something related to our livelihoods--our jobs, our
career paths, the industries we work in--although it can stand for anything,
from health to relationships. The point of the story is that we have to be alert
to changes in the cheese, and be prepared to go running off in search of new
sources of cheese when the cheese we have runs out.
Dr. Johnson, coauthor of
The One Minute Manager and many other
books, presents this parable to business, church groups, schools, military
organizations--anyplace where you find people who may fear or resist change. And
although more analytical and skeptical readers may find the tale a little too
simplistic, its beauty is that it sums up all natural history in just 94 pages:
Things change. They always have changed and always will change. And while
there's no single way to deal with change, the consequence of pretending change
won't happen is always the same: The cheese runs out. --Lou Schuler
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The 4-Hour Workweek
By Timothy
Ferriss
What
The 4-Hour Workweek Is About:
First of all, I think the title of
this book is a bit of a misnomer and is useful for grabbing attention. What this
book actually is is the complete embodiment of the 80/20 principle into an
individual’s professional life. The 80/20 principle is the idea that 80% of your
productivity comes from 20% of your time, and the other 20% of your productivity
eats up 80% of your time.
Ferriss argues that by eliminating
that 20% of productivity that eats up most of your time, you can live in a much
more efficient fashion, and the entire book revolves around that concept in
various ways, hence the title
The 4-Hour Workweek. In some ways, the book itself reads like a blog,
as it’s broken down into lots of little pieces: some of them step-by-step
advice, some of them anecdotal, and some of them philosophical.
First and Foremost
Right off the bat, the book makes it clear that you should
pick and choose from the
material presented within, and that’s a vital caveat for any personal
productivity book - but especially this one. A personal productivity philosophy
created by someone else is designed around their own lives and the lives of the
people they associate with, but not necessarily your own. Thus, when you read a
book like this one, you need to be able to pull out the pieces that work for
you.
Why is that idea more true for this book than for others? Here,
the different pieces of
the book apply differently to different people. This is not like
Getting Things Done, where the pieces
can be applied in any life; many of these tips assume that you’re already wholly
into the information age and that your methods of earning money are, too (or at
least are comfortable enough with technology to easily move to that sort of
approach).
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The Tipping Point
By Malcolm
Gladwell
Amazon.com Editorial Review
"The best way to understand the dramatic transformation of unknown books into
bestsellers, or the rise of teenage smoking, or the phenomena of word of mouth
or any number of the other mysterious changes that mark everyday life," writes
Malcolm Gladwell, "is to think of them as epidemics. Ideas and products and
messages and behaviors spread just like viruses do." Although anyone familiar
with the theory of memetics will recognize this concept, Gladwell's The
Tipping Point has quite a few interesting twists on the subject.
For example, Paul Revere was able to
galvanize the forces of resistance so effectively in part because he was what
Gladwell calls a "Connector": he knew just about everybody, particularly the
revolutionary leaders in each of the towns that he rode through. But Revere
"wasn't just the man with the biggest Rolodex in colonial Boston," he was also a
"Maven" who gathered extensive information about the British. He knew what was
going on and he knew exactly whom to tell. The phenomenon continues to this
day--think of how often you've received information in an e-mail message that
had been forwarded at least half a dozen times before reaching you.
Gladwell develops these and other
concepts (such as the "stickiness" of ideas or the effect of population size on
information dispersal) through simple, clear explanations and entertainingly
illustrative anecdotes, such as comparing the pedagogical methods of Sesame
Street and Blue's Clues, or explaining why it would be even easier to
play Six Degrees of Kevin Bacon with the actor Rod Steiger. Although some
readers may find the transitional passages between chapters hold their hands a
little too tightly, and Gladwell's closing invocation of the possibilities of
social engineering sketchy, even chilling, The Tipping Point is one of
the most effective books on science for a general audience in ages. It seems
inevitable that "tipping point," like "future shock" or "chaos theory," will
soon become one of those ideas that everybody knows--or at least knows by name.
--Ron Hogan
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The China Price
By Alexandra Harney
An excerpt from The China Price: The True Cost of Chinese Competitive
Advantage
by Alexandra Harney ($26, Penguin Press, 2008).
Sam slides behind the wheel of his
new black Honda and noses the car into Friday morning traffic. It's a hot, sunny
June morning in Changsha, capital of central Hunan province, and everything
seems to be falling into place.
Beside him sits his wife Jasmine,
eight months pregnant and radiant in a yellow dress. High school sweethearts,
they married at 21. Now, at 23, they're about to start a family in a brand new
gated community. Sam, whose name, like those of other members of his family, has
been changed, is looking forward to making use of the development's two swimming
pools and basketball court. In a few years, they plan to build a house in the
mountains where they can entertain family and friends on the weekends.
The Honda heads out of town into the
verdant countryside toward Jasmine's father's towel factory. Towels, a key Hunan
export, have been the family's mainstay for nearly two decades. Sam married into
the job of overseeing the plant's $5 million in annual sales.
The road narrows and Sam slows to
accommodate farmers swaying on bicycles. On either side are rice paddies and
family farm plots. That's where the first sign of changes ahead appears. Trees.
Several years ago, farmers on the
outskirts of Changsha realized they could make good money growing trees. They
planted family plots in Hunan's fertile soil and hung signs on trees near the
road advertising their cellphone numbers. Soon enough, the farmers who worked at
Sam's factory were demanding higher wages, because they could make better money
from trees.
The factory, which relies mostly on
local labor, had no choice but to capitulate. "Salaries are going up and up,"
Sam sighs from behind the wheel. The labor market has tightened, too, as other
factories have opened in the area. The government is hiking the minimum wage in
Changsha. Sam figures he has three, maybe five more years before his factory
loses its competitive edge.
This is where the next boom in
Chinese manufacturing is supposed to take place. Conventional wisdom holds that
rising costs of everything from labor to land on the coasts are driving
factories in labor-intensive consumer industries deep into the country's
heartland, to provinces like Hunan, in pursuit of lower prices. But in China's
fast-forward economy, investors are finding things aren't as cheap or plentiful
as they used to be. And the workers aren't pushovers, either.
Thanks in part to Chinese government
policies, the country's labor-intensive export factories have for most of the
past decade operated almost in defiance of the rules of economics, enjoying
stagnant wages, ample coastal land near the ports, and a seemingly endless
supply of pliant labor. Government incentives, including subsidized electricity
and generous tax breaks, have helped keep the ordinary forces of a market
economy at bay. The low prices that this produced earned China the enviable
position of the world's dominant producer in a huge variety of products. But
this fortuitous situation couldn't last. "This is an advantage that expires,"
says Arthur Kroeber, managing director of Dragonomics, a research and advisory
group that specializes in the Chinese economy.
Jonathan Anderson, former head of
Asian economics at investment bank UBS, calls it "the end of China's supposed
absolute manufacturing domination." He argues that China will revert to a more
normal trading pattern, where it gains market share in some areas and loses it
in others. For any other country, this would be a natural assumption, devoid of
drama. For the world's emerging superpower and a world hooked on its cheap
products, it is anything but.
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