Courses
The training required to become a Devil's Advocate Auditor is delivered over a live two-day session. Visit us here for dates and locations. Self-study options are also available.
We cover the following topics:
- On Becoming a Devil's Advocate Auditor
- Managing Meetings
- Intelligence Acquisition
- Business Model Validation
- Financial Model Validation
- Assessing People
- Insights into Business Strategy
- Decision Trap Detection
- Executive Decision Making
- Analytics
- Case Studies
A brief description of each of these various sessions is presented below.
On Becoming a Devil's Advocate Auditor
The program begins with a brief history of Devil's Advocates and the use of Devil's Advocates in a variety of historical and contemporary settings. The importance of conducting Devil's Advocate Audits is discussed. Insight is provided as to how Devil's Advocate Audits should be conducted as well as the perils of conducting such audits incorrectly. Guidance is given relative to who should —and who should not — conduct Devil's Advocate Audits.
Managing Meetings
Business leaders spend obscene amounts of time in meetings. Unfortunately, much of this is time is a waste. This session provides insight in how to better manage meetings as well as how to derive more intelligence from unavoidable meetings. Lessons are learned from Amgen, President Eisenhower, The Manhattan Project, former New York City Mayor Rudolf Giuliani, Intel, and the United States Supreme Court.
Approximate Time: 0.5 hours
Intelligence Acquisition
Before you make conclusions about the viability of a company's strategic plan, you must understand the underlying business proposition. To do this, you must collect, interpret and synthesize such information.
The genesis of such information will impact your interpretation of it. This session delves into best practices for gathering data, anecdotes and intelligence. The following are among the issues discussed:
- What are the pros and cons of gleaning market research from interviews? Surveys? Focus groups? Anthropology?
- Why is primary research critical?
- What should you do before you begin interviews?
- What are some signs that your interview questions lack punch?
- What are some of the most effective elicitation strategies for extracting information from sources?
- How can surrogate markers in scientific research distort reality?
- What are the benefits of "skip level meetings"?
- What is the "Mere-Measurement Effect"?
- What are the risks associated with making decisions based on anecdotes?
- What are the risks associated with over-relying on PowerPoint presentations when making decisions?
Institutions referenced during this session include Bank of America, the Central Intelligence Agency, Coca-Cola, Medtronic, Microsoft, and Starbucks.
Approximate Time: 1 hour
Business Model Validation
A dominant predictor of success of a business initiative is the intellectual integrity behind the business model. Devil's Advocate Auditors must be able to detect the vulnerabilities inherent in business plans.
The following are among the issues discussed during this session:
- How can the Icarus Paradox destroy a firm's revenue projections?
- Why must you avoid anything resembling the Las Vegas business model?
- How viable are business models based on the sharing economy?
- What are some limitations to monetizing a company's assets?
- How much precedential value should be attached to analogs and antilogs?
- How can you test business model portability?
- How can you ascertain the symmetry between a business model and the nature of the stakeholders?
- How can you project supply chain risks?
- What questions should you ask to determine the risk of technology overfitting?
- What are the risks associated with platform dependencies and platform transitions?
- When can transparency into business models be of irreducible importance and when can such transparency be deadly?
- What are the pros and cons of the freemium business model?
- What are the pros and cons of going to market through original equipment manufacturers?
During this session, lessons are learned from companies such as Airbnb, Amazon, Boston Markets, Build-a-Bear, Burlington Coat Factory. Chegg, Coursera, Dropbox, eLance, Groupon, KFC Corporation (Africa), Pandora Media, Realology, Segway, SodaStream, and StubHub.
Approximate Time: 2 hours
Financial Model Validation
Whoever said "numbers don't lie" was a liar.
True, there are a variety of legitimate means for reporting the same financial results. Nevertheless, some finance professionals take tremendous liberties in their reporting of financial performance. Going forward projections are even more susceptible to creative and wishful thinking.
This session focuses on how to spot aggressive financial projections as well as how to detect accounting chicanery.
- How can you use the teachings of Enrico Fermi to approximate the size of addressable markets?
- Where do dangers lie in terms of confusing the degree of competition with market potential?
- Why is it that not all revenue is equal?
- Why should you be concerned about revenue merry-go-rounds?
- How can you avoid becoming sucker-punched by positive revenue performance?
- What are some early warning signs of possible accounting fraud?
- How can you inventory contingent liabilities?
- What are some early warning signs of channel stuffing?
- Why should you be concerned about related party transactions?
- How can resale guarantees, last dollar rebates and market development funds distort a company's earnings?
- What are some of the risks associated with mergers and acquisitions? How should these issues impact your financial modeling?
- How can you quickly perform a common size analysis?
Companies referenced during this session include Advanced Micro Devices, Akamai, Arthur Anderson, Autonomy, Boeing, Cabela's, Crocs, Enron, Groupon, Halliburton, Hewlett Packard, Krispy Kreme, Sunbeam, and Tesla Motors.
Approximate Time: 1.5 hours
Assessing People
Devil's Advocate Auditors must make judgments about people, whether those people be employees, partners, clients, suppliers, directors, and investors.
This session discusses how to increase your chances of hiring the best candidates and affiliating with the best business partners. Insight is provided relative to the interview process, questions posed by some of the most successful companies during their interviews, and best practices for checking references. Ideas are shared regarding managing, monitoring and motivating people.
The following are among the issues discussed:
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Ideas for assessing, managing and motivating people are provided by reviewing practices embraced by companies such as Berkshire Hathaway, Expedia, Goldman Sachs, Google, Johnson & Johnson, Microsoft, Nordstrom, School of Rock, Valeant Pharmaceuticals and Whole Foods.
Approximate Time: 1 hour
Insights into Business Strategy
To discern the merits of a strategic plan, you must be able to challenge such plans against strategic paradigms. Utilizing a variety of models enables Devil's Advocate Auditors to scrutinize contemplated business initiatives from a variety of perspectives.
This session provides insight into applying the following managerial tools when vetting business strategies:
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The above strategic models are illustrated with examples from Apple Computer, Caterpillar, Chock Full O'Nuts, Facebook, Harley Davidson, Infosys, Microsoft, Pfizer, Walmart, and Whole Foods.
Approximate Time: 2 hours
Decision Trap Detection
Warren Buffett wisely said, "It is easier to stay out of trouble than to get out of trouble." Thus, business leaders stand to reap great value from understanding where decision making traps lie. Armed with this knowledge you will be able to avoid decision errors such as:
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Among the many examples discussed are those relating to Berkshire Hathaway, Fiji Water, Honda, Donald Trump and the Yom Kippur War.
Approximate Time: 2 hours
Executive Decision Making
Via negativa. That describes the lessons learned in the session entitled "Decision Trap Detection". Now, it is time to learn how you can inoculate yourself from common errors in decision making such as the anchoring bias and groupthink.
A host of tools designed to enhance your decision making will be presented. Specific decision making strategies and tactics discussed include:
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Related lessons are gleaned from the likes of CVS, Enron, Google, Kleiner Perkins, Pete's Wicked Ale, Southwest Airlines, Staples, and Xerox.
Approximate Time: 2 hours
Analytics
When should you make gut decisions? Under which circumstances are decisions based on analytics more likely to yield superior results? How much weight should be placed on numbers? How can you draw conclusions from the numbers presented to you? How can you inoculate yourself from being manipulated by numbers?
When are anecdotes essential? When are they deadly? When is derivative data crucial? When are decisions emanating from derivative data dangerous?
This session addresses such issues. During this part of the program we distill truth from numbers through an understanding of issues such as:
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Approximate Time: 1.5 hours
Case Studies
The above training modules are punctuated with a variety of brain teasers and case studies that challenge the attendees to resolve real-world business conundrums. Selected case studies will be deliberated in group discussions.
Approximate Time: 1.0 hours
About the Course Leader: David Wanetick, Managing Director, IncreMental Advantage
David developed the Devil's Advocate Auditor curriculum.
For more than 20 years, David has sparred with over 5,000 CEOs, CFOs, Board members and other senior executives on issues ranging from product launches to acquisition strategies; from international expansion to pricing schemes; from financing maneuvers to joint-ventures; from intellectual property valuation issues to investment decisions; and, from personnel decisions to cross-selling initiatives.
David also runs the Business Model Validation practice at IncreMental Advantage. His clients include start-ups; Fortune 500 companies; technology transfer offices; incubators; hedge funds; private equity funds; and, government enterprises. He is the author of three books that have achieved world-wide acclaim, including the only two books that unveil Industry Analysis.
David has been a guest on CNBC, Bloomberg and CNNfn and has been quoted in the Wall Street Journal, Barron's, Investor's Business Daily, Directors & Boards, and many other newspapers, blogs and magazines throughout the world. He lectures all over the United States as well in Canada, the United Kingdom, the Netherlands, Belgium, Germany, Denmark, Singapore, Kuwait, Malaysia, China, Hong Kong, India, Columbia and Israel.