I Don't Know What I Don't Know...

Many years ago I manged a sales guy who regularly made the statement "I don't know what I don't know". He was a good natured guy with a reptuation for being a bit scattered, at times, so my typical response to him was "you don't even know what you know, much less what you don't know". As I said, he was a good natured guy and always took it in stride with a smile.

Fast forward to present day and I have become much more aware of the fact that "I don't know what I don't know", and my kids are a daily reminder of this. As their knowledge grows, they are able to educate me on all kinds of things that I was previously oblivious to. While much of what they share with me isn't exactly world-changing information, it serves a purpose none-the-less. It is a simple reminder to me that I don't "know-it-all".

Have you ever met someone who is widely perceived as a "know-it-all"? I am relatively certain that all of us have come across someone like this at some point and if you are anything like me, you may not hold a "know-it-all" in the highest regard. Let's face it, there is just no way that any one person can know everything and it should be easy for any rational individual to concede that.

The same principle is true in business... no one person can know everything. Of course we all have our areas of expertise and as a business owner, it is that expertise that our business is built on. However, there are many components to running a business and we cannot possibly know everything that there is to know about each one. If we are to be successful in running our business, it is imperative that we rely on our trusted advisors to help us in the areas that fall outside of our respective areas of expertise.

Whether our specific needs are related to technology, accounting and finance, or insurance and risk management... it is paramount to our success that we lean on the wisdom of others to guide us in the areas that we are weak. When we focus 100% of our efforts on the things that we do well and allow others to fill in the gaps within the areas that we don't, our efficiency and profitability will rapidly increase.

I encourage you to willingly state that "I don't know what I don't know", and turn it into a positive by seeking out trusted advisors to help you...

Are You Ignoring Corporate Formalities?

I ask this question knowing with a fair amount of certainty that most business owners would either answer with a definitive "Yes", or would simply respond with a blank stare confirming that they don't fully understand what Corporate Formalities are (much less why they are so important).

• I felt compelled to focus my latest blog post on this subject matter after a recent discussion with one of my trusted attorney contacts. The attorney was sharing with me yet another story of a business owner in crisis due to the piercing of his Corporate Veil . What made this story truly sad is that if the business owner had simply observed Corporate Formalities, the catastrophe that followed would most likely have been avoided. My attorney friend and I were in agreement that it is imperative that business owners understand what Corporate Formalities are and why they are so important.
• I have replayed that conversation muttiple times over the past few days which confirmed that I simply cannot focus enough on the education process surrounding these Corporate Formalities. I think most people understand that one of the most important reason to formalize your business entity is to create a protective layer between the business and personal assets of the shareholder, so it is perplexing to me that the idea of maintaining the integrity of that Corporate Shield is rarely given a second thought.
• The bottom line is this: observing Corporate Formalities is paramount in preserving the Corporate Veil and maintaining the layer of separation between your business and personal activities and assets. If you are unaware, or simply unwilling to take these steps, then the formation of your entity was a complete wast of your time and money.

If you are a typical business owner, I'm sure that you already have a full plate with overseeing the day to day operations of your business. However, I would encourage you to give some thought to Corporate Formalities and the role that they play in fully protecting your business. If you have been ignoring them, consider changing your practices. If you don't fully understand them in the first place, consider contacting me to learn more...