Entrepreneur’s Risk Management Strategies

Risk is as old as man and has been an old time acquaintance of businesses. There is no approach that will make risk to go extinct in business environment however; it can be controlled to an appreciable level. As an entrepreneur, you are duty bound to reduce your risk level to the barest minimum if you can continue to make profit. To this end, better risk management strategies are good inhibitors of business failures.

No matter what the sizes are, companies must have an approach to risk management since they can be easily managed when identified. To protect a business against risk, an entrepreneur needs to do the following:

1. Stop activities associated with risk: Activities that brings about risks to an organization need to be stopped. For instance, if a business fund is not separated from a personal fund, the temptation of using the company’s fund for personal expenses will always be there. Quick and unilateral decisions of top members of the management most times pose great risks to the company.

2. Spread the risk: there is no need for the risk to be concentrated on your desk. Spread the risks in form of contracting out some projects/services with a performance bond signed by the contracted firm can help. Sometimes, selling out products on credit to trusted customers can help to minimize the risk of obsolesce and high inventory cost.

3. Reducing risk through better management control: if the pros and cons of running an organization is properly spelt out for management staff, employee and customers etc, certain risks will be averted in the business. Proper management of the company’s data also helps to prevent risk. Hardcopy data can be digitalized and stored by reputable data managers for safety.

4. Insuring against risk if possible: a company need to insure against damage brought about by fire and natural disasters.

5. Apply improved technology: if risks will be averted, modern techniques will be applied in the operation and service provision of any company. This will enhance the business supply chain management hence making service provision to be excellent.

Managing some aspects of our businesses against risks takes automation. This will eliminated a lot of human errors associated with the risks. To be able to reduce risks in planning, monitoring and evaluation, software tools will be a veritable instrument.

After Decades of Conditioning, India Is Re-Aligning Itself With the Culture of Entrepreneurship

Globally, entrepreneurship has become a key engine for employment generation. As policy makers grapple with economic uncertainty and cultural changes, large corporations that traditionally created jobs are biting the dust. From 2003 to 2013, 712 corporations disappeared from the Fortune 1000. One can safely extrapolate that very few Fortune 1000 companies will be around in another 30 to 40 years. However a new breed of risk-takers and innovators in the form of entrepreneurs are beginning to line up on the horizon of business world. According to a report by the Kauffman Foundation, industrial era companies in the US dismissed more jobs than they created in contrast to high-growth startups that created the maximum number of new jobs between 2000 and 2010. Facebook has been credited with having created 4.5 million new jobs, directly and indirectly. This global trend makes a strong case for supporting Indian start-ups and entrepreneurs as a means to create future employment.

However, it is even more important to create a support system that ensures the survival of the start-ups beyond the first five years. In other words, once invested in a start-up, return on investment (ROI) can be assured only when the investment finds further sustenance. This is critical as 70 to 95 percent of start-ups fail or exit, resulting in disproportionately high job destruction. Studies have shown that 47 percent of the jobs created by start-ups are eliminated by exits in the first five years. It is the surviving 53 percent of businesses that witness rapid growth and bring about broad-based job creation.

This means that government policy must be attuned to the practical needs, while addressing the pain areas, of Indian entrepreneurs. The policy must address: funding to be more easily available to entrepreneurs; creating a large pool of experienced mentors and advisers who provide inputs around manpower and resource management, legal and marketing, partnerships and technology; and providing mechanisms to improve access to local and global markets.

It is evident that supporting entrepreneurship is a medium to long-term approach. The question that needs an answer is: what type of entrepreneurship should be prioritized for support so that success and subsequent job creation is assured? Today’s marketplace has become hyper competitive. Just take a look around. There are more choices available to consumers and enterprise buyers than ever before. There are new business models that don’t require buyers to own products or commit up front to long-term subscription of services. Delivery systems have changed, allowing businesses to reach customers in remote locations and new markets, bringing down geographical and political barriers. Entrepreneurs are innovating to give birth to entirely new asset-light business like Uber, Ola, Airbnb, Oyo Rooms, Zomato, Foodpanda, PayPal and Paytm. These businesses are re-shaping entire industries, forcing traditional players to re-think their strategies.

Igniting the spirit of entrepreneurship and sustaining it is also a long-term undertaking. Not everyone is blessed with the DNA of entrepreneurship. A culture of free enterprise needs to be nurtured. Today, one of the nations to have taken positive steps towards creating such a culture is the US where 1,600 colleges offer over 2,200 courses that ‘skill’ students in entrepreneurship. These courses build knowledge through academic studies, practical industry experience via apprenticeship programs, entrepreneurship clubs, boot camps and access to investor networks and support systems. Education, without doubt, is a way to ensure higher success rates for entrepreneurs. In India, we need to create cost-effective and scalable education models that help reach students using video and mobile technology on MOOC platforms that transform teaching into learning, thereby eliminating the need for massive armies of instructors and trainers.

Lastly, a substantial demographic in the form of Indian women remains untapped. Of the total number of entrepreneurs in the country, only 10 percent are women. However, even within these small numbers, women entrepreneurs from India-Kiran Mazumdar-Shaw, Sulajja Motwani and Ekta Kapoor to name a few-have been in the limelight. Significantly, a Dow Jones study has confirmed that start-ups with female executives have a higher chance of success. What they need to succeed is education, vocational training, access to funding and interaction with entrepreneurs and buyers across the world. According to The Organization for Economic Co-operation and Development (OECD), annual growth of the Indian economy could improve 2.4% if the country implements pro-gender policies.

Historically, Indian society and the education system have focused on creating doctors, lawyers, accountants, etc. These professionals are a necessity. But after decades of conditioning, the nation is re-aligning itself with the culture of entrepreneurship. We are at the cusp of entrepreneurial success. This opportunity must not be lost for the lack of policy and world-class support systems

Intercepting the Digital Divide

“Today, high-speed broadband is not a luxury, it’s a necessity.” – President Obama, January 14, 2015.

Let’s pause and reflect on what we have.

In some parts of the world we have GPS controlled drones and in the rest, we have around 3.6 billion people, who do not have regular access to the internet. These are the people who are terminally failing to get the benefit of the internet as an economic engine.

Digital divide is the gap in availability and access to information and communication technology (ICT) among individuals and communities. Numerically, this gap, i.e. people with no/limited access to computer or the internet, is three times the Indian population. The idea of digital revolution cannot be achieved when 50% of the world population is excluded. In other words, this population can’t compete on an equal footing in the labour market. The ‘optimistic path’ surmised by UN’s Sustainable Development Goal 9 and Agenda 2030 also envision avant-garde industrial revolution dubbed Industry 4.0. As this industrial breakthrough is heavily dependent on the adoption of technological innovation, the population disconnected from this technological grid will be less informed and under-represented in the capital and labour market.

The ability to access computers and the internet depends on many interwoven factors i.e., social, and economic dimensions. Nonetheless, the digital split can easily be bridged if these factors are broken down into specific action plans. Aside from these obvious barriers, the following would help narrow the gap:

Develop physical infrastructure: The Mason Analysis shows that the lack of proper infrastructure conducive to internet connection is more prevalent in the developing countries, especially in Africa. In this regard, key inputs such as development of terrestrial connectivity between the submarine cables, development of training centres and data module are perquisite to overcome the induction barriers of digital divide.

Promote investment and cooperation: The cardinal element to independent development of physical infrastructure is the liberalization of Public-Private Partnership (PPP) investment. Such a measure would boost investor confidence and could maximize the effectiveness of new investments conducive to financial and infrastructural resources. At this stage, policy remedy is required to lower licensing cost and high taxes on equipment and services. At the same time, integration of internet into the service delivery of government agencies and usage of communications infrastructure should also be highly prioritized.

Develop customized content: Developing physical infrastructure and providing training modules are not enough if local demand is not met. To welcome the next billion users, technologists need to deeply engage with local communities to understand their demands and ways to use this access. That way, internet and communications networks can be built to serve the demand. Responding to internet’s actual demand is equally important as devising new schemes.

Less dependency on social media: Excessive indulgence into social media cannot help uplift the internet penetration because of its limited use. People can disregard the real power of internet penetration and benefit of usage if they are confined into the 140 characters on Twitter or the square boxes of Facebook profile. The challenge to adopt and apply the divergent tools of internet can be overcome if internet platforms and its hosting devices are used in smarter ways.

With its ubiquitous and inclusive presence, internet is the key to next-gen technological access. Realizing it, companies such as Google and Facebook are assessing the form factors of attracting more people online. Individuals, government, and corporations are equally responsible in bringing the mass people into the internet bracket. At the same time, the government should also have smart policy interventions to combat the handicaps brought by the usability divides and any other forthcoming obstacles for digital divide.

Not Your Grandfather’s Factory: Modernizing Manufacturing to Attract Millennials

Why is engagement such a big deal in manufacturing and the skilled trades? Because according to a 2013 industry report, for every four trade positions that workers retire from, the industry is producing only one replacement. Worse yet, it’s predicted that in the next decade, that 2 million out of the 3.5 million manufacturing jobs available will go unfilled because of the lack of available talent.

Now you may be asking, how can that be? With millions of jobless Millennials, who happen to be facing an unemployment rate that is double the national rate, don’t we have enough people to fill those positions? Not until we change the image and perception of manufacturing – for both kids and their parents.

For the past two generations, young professionals haven’t exactly been leaping at the chance to work in manufacturing. Part of the problem is the stigma that manufacturing has – working in an unclean environment, with outdated thinking, and little room for growth. The other, bigger issues are the parents who have discouraged their kids from attending trade or technical school and instead promote the value of a four-year degree from a college or university. According to the National Association of Manufacturers and the Manufacturing Institute (NAM), only 3 in 10 parents would consider encouraging their child toward a manufacturing career. The perception has been that you go into the trades if you are not “college material.” And parents want their kids to be “college material.”

As the United States is now undergoing a “manufacturing renaissance” and looking to produce their goods on American soil again, there is an urgent and growing need for new talent.

So, how do you make manufacturing jobs more attractive and appealing to prospective employees? You can start by modernizing your brand. If your company is stuck in an old, calcified way of doing business, you’re going to have a hard time finding and keeping younger workers.

Today’s workers are digital natives. They are “wired” for technology in a way unlike any previous generations, and they expect to access it in the workplace. That’s why it’s critical for manufacturers to not only have cutting edge Industry 4.0 technology available, companies need to promote the technology used in their production process. Millennials will be pleased, if not surprised, so know that more than two-thirds of U.S. manufacturing companies are adopting 3D printing and more than half use robots.

Look for ways to better utilize mobile devices, videos and virtual reality in your hiring process as well as throughout the plant. Millennials are used to watching videos to learn about new things, so why not use YouTube or another video website to give potential hires a realistic view of “a day in the life” of a worker at your facility. Keep the videos to 2-3 minutes of less and capitalize on the “wow” factors of the job. Not sure what they are? Ask your current team members what they enjoy most about their job. You may even want to interview them and let them share their story in the video. In doing so, you’re letting job applicants know that this isn’t their grandfather’s factory!

One of the first places to start is your company website. Yes, it’s a great place to share what your company is all about, but it needs to be real – not a bunch of mumbo-jumbo “marketing speak.” Look for ways to share your company culture and mission. What is it like to work there? Demonstrate how your products and services serve a greater mission that simply making a profit. Take advantage of your online presence to show how your company makes a positive impact on society.

Next, check out your social media. (Now, if you’re saying “What’s that?” or “That’s just a fad,” you have your work cut out for you.

Figure out where your potential hires are hanging out. They may not be on Facebook, they may choose Instagram, Twitter, or LinkedIn instead. It’s important to make sure your channels are active and up-to-date. Give your employees opportunities to share what’s going on from their perspective. Post pictures from social events, charitable projects, and other fun occasions. Does your company look like a fun place to work from a social media standpoint? If not, look for ways to improve public perception. When done well, this can be a relatively quick fix – just start posting! When you have an active, engaging online social media presence, it builds credibility with potential hires from the younger generations.

Finally, keep in mind that Millennials are always connected. They look for one-on-one communication and immediate feedback. They consider their managers and leaders their peers and want to have access to them. If the only time you’re giving feedback is during the annual review process, you’re going to lose. There are lots of online tools, pulse-type surveys, and artificial intelligence programs that can help give feedback on demand. Communicating frequently and keeping employees in the loop will do wonders for engagement and performance development.

The digital nature of today’s manufacturing is opening up many opportunities for skilled positions, transforming the manual nature of a factory job to the high-tech environment it is today. According to Vicki Holt, President and CEO for Protolabs, “Digital manufacturing is revitalizing our industry and is igniting new opportunities. The skills gap presents a critical roadblock for all of us. But it’s encouraging to see a renewed optimism from a new generation of workers, and to hear that they understand this isn’t their grandparents’ manufacturing industry. Much work remains ahead of us, but this is a good start.”

Achieving "Plan B" Through Individualpreneurship – The Notion Of An Individual As An Enterprise

What is entrepreneurship?

Entrepreneurship is a competency (set of knowledge, skills, and activities) required to start, develop, and assume risk for an enterprise. An entrepreneur is an individual who organizes, operates, and assumes risk for an enterprise with the intention of transforming innovative ideas in products and/or services for a profit.

An enterprise is an undertaking for a prize or cause. It is a group of activities intended to produce income organized for:

  • Profit as a business of any size and type: unincorporated or incorporated; one or many entities, of which one is designated as the “holding entity” in a multi-entity structure; and such that one enterprise can incubate another
  • A not-for-profit association, such as a public charity or a private foundation
  • A government agency

When an enterprise is referred to as an entity, the reference is specifically to the holding entity, unless otherwise specified. The term “not-for-profit” is generic; the term “non-profit” means an entity that has been approved by a taxing authority as being exempt from income tax. “Not-for-profit” does not mean “not-for-revenue.”

As a discipline, a business delivers products and/or services to a customer for a profit. As an entity, a business can be:

  • Sole proprietorship (individual)
  • Partnership (pass-through to individuals): general, limited, or limited liability
  • Limited liability company (pass-through to one or more individuals as a partnership or as an equivalent to a “subchapter S” corporation)
  • Corporation: general with directors appointed by shareholder investors, and officers appointed by directors (“subchapter C”), pass-through to one or more shareholder investor individuals who may also be directors and officers (“subchapter S”), professional (pass-through to one or more individuals), or foreign

An upwardly mobile enterprise is a small-to-large enterprise focused on large market dominance (share being either industry-wide or in niches) with local-to-global aspiration in both traditional and non-traditional industries. It has growth potential from highly innovative people, processes, and products and/or services, and/or duplication of a business system. It is financed by founders and/or third-party investors (closely or widely-held) seeking capital appreciation, and potentially cash flow from dividends and/or interest, with medium to high risk. An upwardly mobile enterprise may be founded by one or more entrepreneurs, who either become part of a larger management team as new investors come on board, leave to form another venture as serial entrepreneurs, or retire.

Upwardly mobile enterprises are the heart of Wall Street.

A lifestyle business enterprise owner operates an enterprise in a local community, and may also be the founding entrepreneur:

  • Either as an active owner-manager, making a living from its activities for their own lifestyle
  • Or as a passive owner-manager, with an active management team in place

Lifestyle business enterprises are the heart of Main Street.

A lifestyle business enterprise owner can be a sole proprietor, partner, member (and usually also a manager) of a limited liability company, or a shareholder investor in a corporation (and usually also a director and an officer).

An employee is an individual who provides services in exchange for compensation under an explicit or implicit contract for hire, whereby the employer (hirer) has the right to control what work is performed and how. An independent contractor is self-employed; the hirer has the right to control only the result of the work, and not how it is performed.

What is individualpreneurship?

Individualpreneurship is a mindset for thinking about oneself as an enterprise, actively developing and managing multiple sources of income, and without being highly dependent upon any if possible.

Sources of an individualpreneur’s income include:

  • Employment
  • Entrepreneurship/business ownership
  • Investing

The individualprise represents the aggregation of all sources of an individual’s income. Gross income results from wages from employment, and from both revenues (commissions, dividends, fees, interest, rents, royalties, and sales) and from capital gains from both entrepreneurship/business ownership and investing activities. Net income (profit) results from gross income less the cost of revenue and the expenses required to generate it. The cash flow generated from net income generates wealth, which can be used for investing activities and supporting a personal lifestyle.

The broadest definition of wages includes all remuneration or compensation paid for services rendered by an employee, whether in cash or in other media including bonuses, commissions, and gratuities, based on piece, task, or time.

The need to develop and manage multiple sources of income arises from increasing uncertainty about economic, regulatory, and social trends.

For many individuals, the primary source of income is remuneration from employment, and the largest asset is their home. Employment is an active form of income – in effect employees exchange time for money. However, the best forms of income are those that are residual and passive.

Residual income results from an initial transaction at some time in the past for which an ongoing cash flow is received; passive income results from transactions where the individualpreneur is not actively involved.

Examples of residual income include enrolling members in systems where downstream commissions can be earned; selling items, such as subscriptions that are automatically renewable, or consumables where the ordering is processed by third-parties; and affiliate programs based upon referrals.

The rise and fall of employment opportunities

Prior to the industrial revolution, families were in effect enterprises. Augmenting farm work with other trades and crafts, families flourished in cottage industries working from home, effectively as a group of individualpreneurs. Merchants brought raw materials to homes and would take finished products to markets. Entrepreneurs would “put out” work to families, who were in effect their subcontractors.

As the industrial revolution progressed, work was transferred form homes to factories when the required machinery became too large or expensive. Initially, the “put in” system was used whereby workers in a factory were treated as subcontractors, and eventually became employees. Labor movements were founded to fight for workers’ rights, from which today’s employment and labor laws have evolved.

As the economy shifted from family to commercial and industrial enterprises, employment opportunities grew. Workers could expect long-term employment opportunities as manufacturing demand increased. Through improvements in manufacturing techniques, such as production lines and automation, the scale of units produced increased dramatically. Through improvements in energy, transportation, and telecommunications technologies, reach extended into new geographic markets for acquisition of materials and supplies, and delivery of end-products.

However, recent globalization trends have changed the cost structure of certain activities through outsourcing to providers who offer economy of scale, or to lower cost production markets. As a consequence of information and process control technologies, work has shifted from manufacturing to knowledge-based services. Technology can play a major role by creating jobs in new areas and eliminating them in others.

Enterprises have been impacted dramatically by these trends. For example, “big box” and online stores have had an impact on retailers on “Main Street” – but the savvy ones offer specialty products coupled with exceptional service. Even the local coffee shop is impacted by the price of green beans in global markets. Many manufacturers have downsized through strategic sourcing of components to scale providers, and in the construction industry, general contractors take advantage of prefabricated assemblies. As industries shift from manufacturing to knowledge-based, a major differentiator is marketing capability. Marketing capability requires understanding customer needs and wants, and responding with products and/or services designed for niche or mass markets, regardless of where the components are made.

The consequence is that job markets are dramatically changing, and that old assumptions for employment have become invalid. The notion of working for one employer for forty plus years is no longer possible because technology is changing the structure of industries and the nature of employment. Downsizing has become common, and it is a challenge for the education system to keep up with changing trends in the knowledge, skills, and technical requirements for jobs in emerging enterprises and industries.

The increase in consumer debt coupled with unstable employment opportunities has created stress for many individuals and their families, especially for those who are unemployed, face foreclosure on their homes, or even bankruptcy.

What is “Plan B?”

The term “Plan B” is used to describe an alternative course of action in case the preferred or primary “Plan A” fails. For many individuals, Plan A is a combination of a good education leading to a well-paying job. This form of Plan A stresses individual achievement through successes in education and employment – failures are usually downplayed. However, changing trends in employment put pressure on most individuals’ Plan A, who may face downsizing or even their employer going out of business.

For others, Plan A is a combination of entrepreneurship and business ownership. This form of Plan A can result in failure. However, ultimate success in entrepreneurship and business ownership is often achieved by learning from mistakes and failures over time, and by building teams. Plan A for entrepreneurs and business owners may change from time to time as their ventures change. Eventually, many entrepreneurs and business owners finally get it right as lessons from past failures lead to successes. Many entrepreneurs and business owners become investors in other enterprises with a sense of “wanting to put back,” and often with a higher tolerance for risk than those who have, in effect, earned income in exchange for time.

The uncertainty of the economy, regulation, and social trends as evidenced by downsizing, high consumer debt, government debt and unbalanced budgets, and high unemployment has created the need for all individuals to have a strong “Plan B.”

An effective Plan B begins with the notion of an individual behaving as an enterprise in their own right – the individualprise. Whereas Plan A may provide a primary source of income, developing a Plan B means understanding opportunities for earning multiple sources of income and allocating time efficiently by prioritizing on the best. Executing a Plan B may allow an individual to keep their primary form of employment, but work on other income producing activities, such as part-time employment, home-based businesses, or investing in real estate and/or securities.

The income statement of the individualprise is the tax return – after all, if the an individual has multiple strong streams of income, taxes are likely to be an important consideration.

The basis structure of the Individual Tax Return (IRS Form 1040) applicable to both Plan A and B activities includes:

  • Wages
  • Interest (Schedule B)
  • Dividends (Schedule B)
  • Business income from sole proprietorships (Schedule C)
  • Capital gains (Schedule D)
  • Supplemental income from rental real estate, royalties, partnerships, and subchapter S corporations (Schedule E)

The tax return offers clues as to opportunities for alternative sources of income; however, it is useful to separate the type of income from the forms of business, such as sole proprietorships, partnerships, limited liability companies, and corporations.

Types of income include:

  • Wages – all forms of compensation for full or part-time employment
  • Interest on investments
  • Dividends on investments
  • Capital gains on investments
  • Net income from active revenue generation such as commissions, fees, rents, royalties, and sales less expenses
  • Net income from passive revenue generation activities – primarily real estate rents and royalties less expenses

Types of business forms include:

  • Sole proprietorship and single member limited liability company – an individual that sells products and/or renders services, including as an independent contractor to hirers
  • Partnership or limited liability company – where an individual is a partner or member in an enterprise that shares profits, losses, and capital with others – the individual may be a general partner or member-manager, or a limited partner or member; a single member limited liability company is considered to be a disregarded entity
  • Subchapter S corporation – where an individual is a shareholder investor in a corporation that passes its profits and losses through to its shareholders – the individual also may be a director and/or an officer, and as such earns wages as an employee in addition to receiving dividends
  • Subchapter C corporation – where an individual is a shareholder investor in a corporation that is taxed separately from its shareholders, but may pay tax on the dividends received (thus is subject to double taxation) – the individual may also be an employee, and as such earns wages in addition to receiving dividends

Only individuals and corporations are legal entities, and as such, corporations have separate rights and privileges from their shareholder investors. Individuals are natural persons. However, a juristic person is a group of natural persons behaving as if they are a single group, such as in a partnership, a limited liability company, or an association. A company is a group of individuals that make up an enterprise regardless of business or legal form.

Entrepreneurs may start enterprises in any business form, but lenders and investors may require a specific form, and may place personal guarantees in individuals for contingent liabilities. Venture capital and investment firms may place specific requirements on business forms and management structure, such as being a Delaware subchapter C corporation. Thus a founding entrepreneur could become a shareholder investor in an enterprise that they are no longer in control of if an investor group brings in its own management team. Delaware is the preferred choice for incorporation for many investors because of its well established corporate laws.

Although self-employed individuals are treated as business owners through sole proprietorships, single member limited liability companies, and single shareholder corporations, they are unable to leverage their time unless they can delegate to trustworthy employees, or earn residual and/or passive income.

Individuals who are sole proprietors, partners, and members in limited liability companies are subject to self-employment taxes, and shareholder investors who are officers in subchapter S corporations are subject to employment taxes.

Achieving “Plan B”

There are many ways to develop and achieve a Plan B that has multiple income streams, and it is possible that one component may become the new Plan A eventually. Some opportunities result from converting a hobby into an income producing activity, whereas others result from leveraging professional qualifications and experience.

Examples of income producing activities include:

  • Part-time employment
  • Establishing a home-based business on a part-time basis, that has the potential to become full-time
  • Earning fees and commissions from referrals through affiliate marketing relationships
  • Earning royalties and fees through writing and speaking engagements
  • Investing in real estate for rental income and capital gains
  • Investing in securities for interest and dividend income and capital gains

Businesses that require separate physical premises, inventories, and employees should be avoided as a Plan B because of the high overhead of carrying costs, insurance, payroll, risk of theft, and governance. Whereas the notion of owning a restaurant can be a dream to many, all too often such an enterprise becomes nothing but a nightmare.

Home-based businesses can take many forms such as buying and selling products on the internet or providing professional services on a part-time basis. It is important to note that home-based businesses are subject to licensing and zoning laws and regulations, and may be subject to property, sales, and use taxes, in addition to income tax.

Any form of revenue generating activity requires business development and marketing capability to create awareness and build relationships. The degree of selling experience necessary is a function of the type of business. These activities can be routinized through duplicable, predictable, and measurable processes that can be learned over time.

Some investing activities may require active trading to ensure that capital gains can be properly realized in up markets, and to prevent losses in down markets.

The best form of income is both residual and passive, whereby ongoing cash flow results from activity that occurred in the past, and for which little or no management activities are required in the present.

An effective way to achieve a blend of residual and passive income is through a combination of sources from membership systems and investing activities as follows by:

  • Enrolling customers in membership systems where commissions are earned from ongoing sales of consumables, for which the ordering and distribution is handled by third-parties – this activity generates residual gross income
  • Investing the residual income in an investment portfolio that diversifies risk, and generates cash flow from interest and dividends – this activity generates residual gross income; the income is passive if the portfolio does not require active management through trading
  • Note: investing in real estate may generate residual income from rents; however active management may be required for finding tenants, negotiating leases, collecting rents, paying expenses such as utilities, and performing maintenance and repairs; investing in securities may require some trading to hedge from risk, and to take advantage of capital gains.

A shorter-term objective of Plan B is provide a hedge against Plan A as an alternative. A longer-term objective of Plan B is to gain financial independence – the state of having sufficient wealth to cover expenses required by a certain lifestyle. Wealth is achieved by having sufficient assets and income producing activities to generate a gross income that exceeds all professional, physical, and personal expenses required by that lifestyle. Wealth is a source of capital for future investment. It is usually advisable to eliminate debt in the quest to achieve financial independence.

Enterpriship

A key success factor in developing a Plan B is understanding those enterpriship (entrepreneurship, leadership, and management) competencies that are essential to income generation.

Is Your Company Ready For Industry 4.0 Transformation?

What is Industry 4.0?

Industry 4.0 is the 4th industrial revolution. To give a little history, industries used steam to make the machine work which increased production and reduced cost in the industrial revolution. The next phase of the revolution was the mass production with implementing electricity and assembly lines. The third revolution introduced automation and computers. We are now here in the fourth revolution through digitizing and networking where we can connect the digital world with the physical world.

With hassle free wireless networking you educate the machine. Earlier the intelligence lied with the humans and machines just helped with the physical work, but now we can educate the machine and the products itself, also get a virtual image. Using Internet of Things (IOT) you can connect all the physical machines with software, networks and censors and they would exchange data with each other making human life and production much more simpler.

How many hours have you spent to hire a mechanic because your machine stopped working and the mechanic failed to understand what went wrong with the machine? With Industry 4.0, the machine will tell you what part has been failed and what has to be replaced. With artificial intelligence, it also tells you which spare parts need to be fixed.

Why Transform to Industry 4.0?

The Cyber ​​Physical systems enable your product to communicate with your machine. Your product will instruct the machine as to the quantity and the type of product that needs to be produced, and the machine is then produces and labels the products. After detecting the product, you can never go wrong with packaging, also your quality check has been performed by the machine while packaging itself.

Industry 4.0 allows you to have a flexible manufacturing process that will better react to customer demands. This new manufacturing technology reduces your cost of production, cost of wastage, reduces errors, increases efficiency due to use of robotics, yields higher revenue, improves customer service and increases innovation. It also allows you to create a virtual image of the real world using 3D printers and help you test your product and know your contingencies beforehand which would allow you to change the process in order to avoid the contingency before you even start your production.

You don't need to manually check your stock. You can add a censor to your forklift and your products, and while stacking up your goods, you get the data of the quality, description, weights and dimension as well as the location of the product. This would immensely reduce errors and damages.

Feed your machines, knowledge of automated systems with this new manufacturing trend and let them communicate with each other while you see your profits rise up high and costs go low.

The Latest in Smartphone Technology

The smartphone field moves at a lightning pace, and keeping up isn't always always easy. Technology that was eye-popping a year ago, such as WVGA screens and eight-megapixel cameras, becomes outdated quickly. Here we will take a look at what the latest technology trends have been for smartphones in terms of both hardware and software.

Processors and screens have easily been the most rapidly advancing aspects of smartphone technology. Dual-core processors began to get included in devices at the beginning of 2011, and they are now standard in any top-tier smartphone. What's even more interesting is that quad-core processors are here, and are being included in the new Transformer Prime tablet. While the Prime is a tablet, it's only a matter of time before smartphones begin shipping with these quad-core chips. Meanwhile, in the screen department, HD screens have started to hit the latest premiere smartphones. The HTC Rezound is one such device that makes use of an HD screen to make using the device an absolute pleasure.

Another aspect of smartphone technology is literally just days old, and that's the latest version of Android. Nicknamed Ice Cream Sandwich, Android 4.0 was just released with the Galaxy Nexus smartphone on Verizon. The operating system brings several new features to advance the smartphone industry. One feature in particular is the incorporation of software buttons into the interface. While current Android smartphones include physical or touch-sensitive buttons to navigate through the interface, Ice Cream Sandwich does away with this. Expect smartphones in the next few months to be released that feature no buttons outside of the power button and volume rocker.

One final noteworthy advancement in smartphone technology in the last few months is speech recognition technology. With the launch of the iPhone 4S, Apple introduced the world to Siri. While Google already had incorporated its own voice command software into Android phones for over a year and a half, Apple made the idea mainstream and revolutionary. Now, Google is rumored to be working on a competitor to Siri that will also allow the user to interact with the phone through natural speech. Speech recognition definitely seems to be the next big thing in smartphone technology.

Between all of these recent leaps in smartphone technology, 2012 is already shaping up to be a very fascinating year. With such strong sales in the industry, manufacturers are all striving to gain and maintain market share. This is leading to some incredible devices and loads of innovations. Thanks to this perfect storm of competitive forces, consumers are benefiting greatly from what seems to be a limitless number of incredible devices.

5 Emerging Technologies Among Java Developers in 2018

1) Unit Testing:

In the event that you need to improve as an engineer in 2018, at that point you should take a shot at your unit testing aptitudes. What’s more, not simply unit testing, but rather robotized testing? This likewise incorporates combination testing. You can learn JUnit 5 and other propel unit testing libraries like Mockito, Power Mock, Cucumber, and Robot to take your unit testing expertise to next level. Mockito is extremely effective and enables you to compose a unit test for complex classes by taunting conditions and simply concentrating on the items under test. In the event that you an apprentice in unit testing and need to learn it in 2018, you should gear up and work harder to compete your rivals.

2) Big Data and Java EE 8:

Big data has been a very trendy and encouraging field in the Software industry for the last 3 years. Plenty of jobs wait for the one who is comfortable with Big Data. This has been among top 10 technologies for the java developers in 2018. Many new features come with Java EE 8. Servlet 4.0 with support of http://2, new and improved JSON building and processing, improved CDI and Restful web services, new JSF version, new Java EE Security API are some of the updated versions in the field. But majority of back-end developers tend to pick Spring as their technology for java in 2018.

3) Node JS:

Today, we are pleased to have a platform that is built on the Chrome’s Java Script runtime known as Node.js. This has helped a great deal for easy building of the fast and scalable network applications in the dynamic world today. The code has the property of being lightweight as Node.js is based on an event-driven, non-blocking I/O model. This has emerged as recent trends in the technologies employed by the java developers of 2018. It is very efficient and is perfect for data intensive and Real Time (RT) applications that may run across any number of the distributed devices.

4) Design Patterns and Readability of the Content:

No doubt, design patterns are neither are a technology nor a framework, yet they are the field of discussion among the java developers in 2018. Even in the present scenario, readable, clean and maintainable code is the goal of many java developers and it has to be this way only.

5) Angular and React:

If want to be known as a full-stack developer, it is mandatory that you have considerable knowledge in front-end technologies too. For building an attractive and eye catching presentation layer of the web-app, Angular and React offer the opportunity to do this in a more convenient and time efficient manner. Though React and Angular are not the only options available nowadays, but still their growth and popularity is evident from the positive reviews given by the end consumers.

Your Information Technology Career: Beware The Comfort Zone

I’ve seen it happen time and again to programmers, network engineers and administrators, and other IT personnel. They get a solid IT position, a good-paying job, and they get comfortable. They stop keeping up with the latest technologies, they stop studying, they no longer keep their CCNA, MCSE, and other industry certifications up-to-date…. and then one day, their comfortable job is gone.

Maybe they get laid off, maybe the company moves and they don’t want to move with it… but for one reason or another, they’re in the worst position possible. They have no job, and they have allowed their IT skills to deteriorate to the point where they are no longer employable.

If you’re in IT, you must be constantly learning. You must continually take the long view, and ask yourself three important questions. First, where do you want to be in three years? Second, what are you doing now in order to reach this goal? And finally, if you were laid off today, are your current skills sharp enough to quickly get another job?

That third question can be the hardest of all to answer honestly. I’m reminded of Microsoft announcing years ago that they would no longer be recognizing the MSCE 4.0 certification, since the network operating systems that certification was based upon would no longer be supported by MS. (Keep in mind that this change was announced months in advance, giving those holding the MCSE 4.0 plenty of time to earn the latest MS certification.)

Some MCSE 4.0s just went nuts. Microsoft’s certification magazine printed letter after letter from angry MCSEs saying that their company would always run NT 4.0, and that there was no reason for them to ever upgrade their certification.

This wasn’t just denial. This was career suicide. Let’s say that their network never moved from NT 4.0. Let’s also say that they got laid off yesterday. Would you want to go out into the current IT workplace and have your most recent network operating system experience be on NT 4.0 ? I sure wouldn’t.

The fact is that you’ve got to continue studying, continue growing, and continue learning new things if you want to have a successful long-term IT career. If you plan on studying only one topic, getting into IT, and then never cracking a book again, you’re entering the wrong field. And for those of us who have been in it for a while – again, ask yourself this question: “Am I prepared for what would happen if I were laid off today?” And if you’re not, do something about it!

How Is the Automotive Industry Handling the New Industrial Revolution?

Bill Gates is alleged to have once quipped that "If GM had kept up with technology like the computer industry has, we would all be driving $ 25 cars that got 1,000 MPG." Even though the authenticity of this quote is questionable, it has been circulated throughout the internet for years because there is something about the sentiment that rings true to us. It certainly does not seem that the automotive industry has kept up with advancing technology the way that the computer industry has.

This may be due in part to the manufacturing infrastructure that has evolved over the years. Making sweeping upgrades to equipment and / or processes seems a very expensive and risky proposition. & Nbsp; When you couple this with the fact that many automobile manufacturers today struggle to find enough demand for their current supply, it is easy to understand why keeping up with the latest technology isn't always a top priority.

The problem with this reluctance, though, is that automobiles are not inexpensive consumables that people buy casually. Customers expect vehicles to come with the highest standards of safety and efficiency. Customers expect the latest technology possible. How can manufacturers keep up with this demand for innovation without changing their processes?

It seems that some manufacturers are beginning to embrace the ways of the modern industrial world, and are finding ways to align their business models with the current wave of interconnectivity and streamlined automation.

Honda Manufacturing of Alabama

Honda's largest light truck production facility in the world – a 3.7 million square foot plant – was faced with a problem all too common to large manufacturing facilities. Over the years, a number of different automation systems were introduced to help streamline production. With operations including blanking, stamping, welding, painting, injection molding, and many other processes involved in producing up to 360,000 vehicles and engines per year, it is not surprising that they found themselves struggling to integrate PLCs from multiple manufacturers, multiple MES systems, analytic systems, and database software from different vendors.

Of course, on top of these legacy systems, Honda continued to layer an array of smart devices on the plant floor and embed IT devices in plant equipment. The complexity introduced by this array of automation systems turned out to be slowing down the operations they were intended to streamline.

After reorganizing their business structure to merge IT and plant floor operations into a single department, Honda proceeded to deploy a new automation software platform that enabled them to bring together PLC data with the data coming from MES and ERP systems into a common interface that allowed the entire enterprise to be managed through a single system. This also allowed Honda to manage and analyze much larger data sets that revealed new opportunities for further optimization. While this reorganization required a significant investment of resources, they were able to realize benefits immediately, and ultimately positioned themselves to maintain a competitive edge through the next decade or more.

Ford Motor Co.

Ford Motor Company operates a global network of manufacturing operations, and have had difficulty when trying to promote collaboration and share best practices between their various plants. They found a solution using technology based on the Google Earth infrastructure.

Ford was able to develop a cloud-based application that stores 2D and 3D representations of Ford's global manufacturing facilities, and allows users to navigate through these virtual environments, place pins, and upload video, images and documents to these pins that are shared throughout Ford's global operations. Engineers and operators can share information about current plant conditions and procedures, which can be accessed in real time from anywhere in the world. The accumulated data can be used for training or to update standard procedures. By creating a global collaborative tool, Ford has created a means of ensuring that each and every one of their employees has the latest, most accurate information on how to best perform a particular task or how to avoid a problem that was encountered elsewhere.

We will have to see in coming years whether or not these innovations will lead to improved market performance for either of these manufacturers, but in the meantime it is probably safe to expect other companies to follow suit. With the advances in manufacturing technologies and machine-to-machine communication, it is becoming very difficult to remain competitive without playing by the same rules as everyone else. Industrial technology has advanced to the point that we are experiencing what people refer to as a new industrial era – or Industry 4.0. Reluctance is no longer a viable option.