Personal Improvement – Accountability to Yourself

This week I am going to discuss Accountability. I feel that understanding accountability is very important for succeeding in life. My grandfather told me that I have to be accountable for my actions and words when I was about 10 years old. I have tried to be true to that principle throughout my life.

After he passed away, a few years later, I figured out another lesson…that you should not rely on anyone else to guarantee your success.

The expectation was that we would all, (the grandchildren), continue in the family seafood business. I soon realized that I couldn’t depend on people’s promises to get ahead. That if I wanted something, I had to make it happen myself.

Because of my decision to take control of our future in the last few years, I started a journey of self-improvement. I have learned a good bit and implemented many of the things I have learned. Some things I was already doing, others were revelations. Below is a brief, non-exhaustive summary of what I have learned.

Be Accountable to Yourself!

Decide to Change

Nothing you want to change will change until you decide to change it. Griping and complaining about how bad a situation is will do nothing about it. Saying you will change or want to change will do nothing about it. Until. You. DECIDE. To. CHANGE.

Set Goals

Set goals you want to achieve. Things you want to accomplish. Places to visit. There are a couple of different ways to approach this. One is to take the bucket list approach. Detail everything you want to do. Tim Ferris suggests writing daily goals on a quarter-folded sheet of paper. This way, the list stays small and achievable. Whatever approach you take, remember this:

“Alice: Would you tell me, please, which way I ought to go from here?
The Cheshire Cat: That depends a good deal on where you want to get to.
Alice: I don't much care where.
The Cheshire Cat: Then it doesn't much matter which way you go.
Alice: ...So long as I get somewhere.
The Cheshire Cat: Oh, you're sure to do that, if only you walk long enough.”

Based on the above, unless you have a goal, you can’t really direct what you are doing. Which leads us to the next step…

Make a Plan

Once you have your goals in place, put together a plan on how to achieve them. Figure out what you will need to do, in the most efficient order you can think of. Try to mitigate risk by thinking of all the bad things that could happen along the way and have a plan for dealing with them.

Find an Accountability Partner

A lot of advice I have run across recommend having an accountability partner. Someone to express your goals to, review them on a regular basis, and help to keep you on track to succeed.

Grow! Achieve! Succeed!

All that is left to do now is to proceed…OK, it’s not that easy, but, the thing to remember is that you will run into setbacks. Things will go sideways every once in a while. Do not let that discourage you. Keep pushing forward and be the YOU you want to be. Like Mike Tyson said, “Everybody has a plan until they get punched in the face.” Learn to be resilient. Take responsibility and move forward, ever forward.

http://www.thatonerule.com/

And, as always, let me know what you think in the comments. Ask questions, tell your story.



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Personal Finance: Saving Money Versus Saving Money Versus Saving Money

Saving Money...Maybe you should think of it as Rescuing Your Money!

This week I am going to cover saving money. There are many differing thoughts about this topic these days, some of which have valid points. I will also lay out my thoughts on the idea.

Saving Money – Why Should You?

Why should you save money? You can save money for an emergency. You can save money for to buy something special. You can save money for a dream vacation. You can save money for retirement. Your reasons are valid for you.

Tim Ferriss advises that you set dreamlines…goals you want to achieve and figure out how much it will cost, both per month and one-time charges, so you can figure out how to get your retirement now rather than delaying and saving for “one day”. There is also this whole part about coming up with a muse, or business idea that will provide the extra income to cover the costs of achieving that mini-retirement. The other thing is that they should be frequent.

Robert Kiyosaki says “Savers are Losers!”. His reasoning is that no matter how you are saving money, be it in a bank, in a Certificate of Deposit (CD), or in a pickle jar buried in the back yard, you are losing money, at least at this point in time, because of monetary inflation.

“MonetaryInflation is an increase in the money supply which generally results in priceinflation.  This acts as a “hidden tax”on the consumers in that country and is the primary cause of price inflation.Monetary inflation is commonly referred to as the government “printingmoney” although the actual process is a bit more complex than just cranking upthe printing presses but the effects are essentially the same.As the money supply increases the currency loses its purchasing powerand the price of goods and services increases.”

Why under the mattress, In a savings account, or In a Certificate of Deposit Costs You Money

Currently the rate of inflation is approximately 2%. Based on the definition above, that means that your money loses 2% of its purchasing power. If your savings account is paying 0.25% interest rate, your money in that account is losing 1.75% with this rate of inflation. If your CD is paying 0.3%, you are losing 1.7%. And if you have it in a pickle jar, you are losing the full 2.0% of purchasing power by not doing anything with it.

Ultimately, as far as I am concerned, instead of just saving money, put your money to work in an investment that will earn you more than the rate of inflation. Historically, the S&P 500 has provided positive returns over the long term, but in some years, like 2008, it had a negative 37% yield.

Overall, accounting for inflation, the market seems to average about a 7% return, but you will be advised to leave your money in the market and let things work themselves out. We have money in the market in the form of traditional & Roth IRAs, regular managed investments, my 401k, and various individual stocks that I play with (not very much).

I, personally, don’t want to devote my time to attempt to master the market.

Why you should make your money work for you

We also are investing in real estate. So far, those investments are working out to about a 9% return. Real estate has many options from flipping, to buy and hold (rentals), to lending, to investing in notes (becoming the mortgage holder for other borrowers). As stated before, BiggerPockets is the best free education on real estate investing you can find.

Additionally, we invested in a high-end door manufacturing business. It is not currently providing a return on investment, but it is improving and still self-sustaining, in addition to providing me and my fellow investors with some of the best business management lessons we have ever run across.

The bottom line, make your money work. To paraphrase the old adage, if your money is not moving forward, it’s falling behind.

And, as always, let me know what you think in the comments. Ask questions, tell your story.

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Drilling Automation: Why Aren't We Further Along?

Current level of Drilling Automation

This week I am going to attempt to provide some answers to the question of “Why we aren’t further along with implementing Drilling Automation?”.

The thing that got me started thinking about this topic was an article in the Journal of Petroleum Technology discussing data accuracy, mainly a paper recently presented at the IADC/SPE Drilling Conference. The topic of that paper was An Algorithm to Automatically Zero Weight on Bit and DifferentialPressure and Resulting Improvements in Data Quality. 

Abstract: SPE189636-MS

The paper details a study by Pason, a company that collects, analyzes, and distributes real time and historical drilling data from rigs in North America. They conducted a study on the accuracy of Weight On Bit measurements and determined that the majority of the WOB data was incorrect due to drillers not properly zeroing the WOB indicator. They proceeded to develop an automated algorithm that zeroed the WOB and another key measurement, differential pressure. This improved the accuracy of the data collected immensely.

The thing in the JPT article that caught my eye was the question, paraphrased here, “What is keeping the industry, as a whole, from collecting more accurate data?” The main answer seems to be that collecting more accurate data is not free. Due to needing to utilize more accurate sensors and having, at minimum, personnel regularly recalibrate those sensors, to developing better sensors and systems, it all costs more money than the current standard provided.

This is a parallel to what we are seeing as a hindrance to progressing with Drilling Automation. Operators want the lowest price they can get to drill their wells, service & equipment providers want the highest price they can get for their equipment, products, & services, and in most cases, what you wind up getting is low-cost provider solution (read minimum quality for cheapest price).

In recent history, most operators have not wanted to help develop new technology and/or practices. While you do see companies like Statoil, Royal Dutch Shell, Apache, and others investing in drilling automation projects and sometimes partnering with service providers to do this, the majority do not.

I think part of the reason why we are not seeing large scale advancements with Drilling Automation is that there is not one entity in control of the entire operation. Factory automation is far easier for at least two reasons: Factories are usually controlled by a single entity and the tasks that are automated are simple, repeatable steps.

Drilling a well is not the same as operating a robotic factory. You can automate a lot of things that are repetitive and can be accomplished by robots. Drilling a well is not the case. There are exponentially more variables involved with drilling a well than welding pieces of a car together. Due to that expansive number of variables, changes in each multiply the contingencies and potential responses needed. To sum it up, it is not an easy task to accomplish. Not impossible, mind you, just not easy.

A lot of wells involve a minimum of three or four different companies working to drill the well. All with different goals and business models. That adds to the complexity. This can be somewhat caveated by Red or Blue rig models where a single service company provides most or all of the various services to the operator on the rig, OR the independent Operator model where they hire their own consultants and utilize third-party suppliers for equipment & products.

So, because of all this complexity, in addition to variations in the market (read: Current, hopefully over, crash in the industry), it makes it hard to make progress with drilling automation.

BUT, there are changes afoot! Industry conferences are starting to highlight Drilling Automation. More companies are becoming involved in the space. With the progress being seen in artificial intelligence, things that someone had to “feel” or “intuit” may soon be reduced to a routine validated by a computer algorithm.

We are starting to see progress. Interest from multiple players, large and small. Companies transferring their expertise from wetware to hardware and software. The singularity for Drilling Automation is not tomorrow. We may never get to a totally automated drilling process with no human involvement, but if we can get 95% there, that will be a huge reduction in cost and increase in efficiency!

And, as always, let me know what you think in the comments. Ask questions, tell your story.

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