Assess the impact of something quickly

The ability to assess the impact of a change in internal or external factors quickly can help assess materiality.

Learn 10-20 rules of thumb in your industry that shape your organization: for example, think of global supply and demand, pricing and exchange rates impacts, possible increases in throughput, transport mode/mix, capacity constraints stepped costs, etc...

This should include a high-level understanding of the cost and capital landscape and weighting that contributes to those elements.

You will then use these to ensure you are directionally right, before investing time on something that might not materially move the dial. This will also give you the ability to assess scenarios quickly and/or identify areas where risk mitigation strategies should/could be put in place if you want to reduce volatility. #ruleofthumb #pareto