Playing Great Defense

Operational Insights into Defensive Spending Strategies

by
Charlie Smith
Operational Insights Inc.

In the book The Millionaire Next Door, authors Stanley and Danko instruct that in the game of personal wealth accumulation, your offense is the personal income that you bring in, while your defense is how you spend that income. While a high salary is playing great offense, spending that salary frivolously results in a losing score. These concepts are easily translated into what we do in the business world.

Your revenues are your offense, and the way you spend your revenues is your defense.

While having a great offense is obviously important to any company, many overlook the importance of having a great defense. A great defense can significantly increase your bottom line, while a bad defense can consume the revenues and possibly the entire company....more