Book Review: Stats and Curiosities: From Harvard Business Review

If you ever took a college course on stats you are likely to recall counting ceiling tiles as more exciting. However, stats can provide all types of useful and interesting information that can spark the imagination. Within the book Stats and Curiosities you will learn about the human brain, business behavior, health, gender relations, and the economy. It provides tid bits of knowledge and insight into some of the most common things we do but have no idea were doing them. 

Did you know that 19% of high status people believe that others smile at them more? It may not actually be true but how people view themselves has an impact on what they see in the environment. Even more interesting powerful people actually believe they are 6 inches taller.  None of it may be true but it seems to pay psychologically to think yourself high status and powerful.

Of course some statistics have large implications for business. Thirty percent of financial professionals feel pressure to either violate ethics or break the law. That coincides with self-reported ethical people earning 3.4% less than their peers who do not report following high ethical standards. When money is the only goal there is natural pressure and punishment to earn more at all costs. Ethical people are internally driven to resist environmental urges.

What is so special about interacting with others? Social participation gives the same mental boost as a big raise helping employees feel positive. Despite the nearly free employee satisfaction push many organizations have not adjusted their environment to maximize the social benefits that develop a sense of community and positive interaction that raises workplace productivity.

Some of the statistics could help improve your sales and customer satisfaction. Helping consumers feel special also helps them make more purchases. By telling someone they were randomly selected to receive a discount they are 3X more likely to buy the product. The way in which our customer service and sales strategies align help in improving sales revenue.

Statistics are a natural part of our lives and scientists take great pains to ensure that their statistics are actually measuring what they say they are measuring. Despite their tedious nature statistics can provide some great insight into human behavior. The book doesn’t talk about how statistics work or the methodology behind such statistics but does provide a lot of interesting trivia information that can be useful for your life and your business.

O’connell, A. (2013). Stats and Curiosities: From Harvard Business Review. Boston, MA: Harvard Business School Publishing 978-1-4221-9631-1

Book Review: Buffett: the making of an American Capitalist

Rarely do we get a glimpse of the life of the successful and famous.  To many in the business world Warren Buffett is more like a god than a man. In his book Buffett: the making of an American Capitalist you won’t be receiving insider investment tips but you will come to know a little of the man that has been an inspiration to business students and investment gurus for a number of decades. You will learn what made him the man he is today. Sometimes, it is those little things in life that put on us on unique paths.

Of particular interest is the information about Buffett’s life and his formation as a leading investor. He started as an odd but liked child who seemed more like a fish out of water than the confident billionaire he is today. A little socially awkward people came to accept him as he was. He watched the stocks while other boys made modeled airplanes. A boy who loved to play sports, talk of financial success, and attract other boys to him. 

He loved to read and apply those concepts to his paper route, pinball business, and future enterprises with passion. Warren was always learning and applying and made a life out of this process. With a few good mentors he became the investor magnet he is today. It was a long process of learning, adapting, and applying that seemed to meet with the right personality. Something business students should consider as they learn new knowledge and have a chance to use it.

When Warren met the professor Benjamin Graham he was able to use his native talents in a systematic way based upon the principles and philosophies of his mentor. The philosophy, “For stock speculation is largely a matter of A trying to decide what B,C, and D are likely to think-with B,C and D trying to do the same” seemed to stick. The precocious student learned quickly and developed his own methodologies. 

Much of the rest of the book talks of Warren Buffett’s life, loves, and business successes. It is more than a story of an emerging wealthy person but the way of thinking of the boy who grew to be a man that made it all possible. It is a story of financial strategy and pure diligence of a person that became known as the Oracle of Omaha. 

Warren’s story doesn’t end with this book. It is only a snap shot into his process of development and growth that led to great fortune. As recently as March of 2014 Warren is encouraging groups to become more engage in social causes that help those in need. It is these philanthropic adventures that help others to remember that wealth is not a source of happiness in and of itself. Wealth is a tool that places greater responsibilities on the owner to use money to enhance life. 

Lowenstein, R. (2008). Buffett: the making of an American Capitalist. NY: Random House

Book Review: A Small Management Tips Book with a Big Punch

Management Tips by Harvard Business Review offers some important advice for managers. The book is small but gives strong advice and explanations on how to become a better manager. It is something that you put on the shelf and refer to the key principles of management when needed. It is broken into managing yourself, managing your team and managing your business. You can zoom through the book in a few hours. 

You may be interested in a few tips:

Listen: Listening is a skill that is learned over time. Truly listening means to try and understand what another person is saying and why they are saying it. You can determine a lot about the person, their goals, their motivations, and their personalities simply by listening. The book encourages readers to think about the conversation and try and understand where it is headed. 

Be Confident-But Not Really Sure: Having a strong opinion is a sign of confidence but being so sure about that opinion is mental weakness. The point is that opinions should be adjusted and changed depending on the information that is available and the feedback you get from others to make them more accurate. Ignorance is based upon opinions that are unyielding to the realities of the environment. 

Battle Change Resistance:  People are naturally resistant to change if only because it is not the way in which they view the problem and often don’t want to put forward the effort to make change. Ensure that you are using the facts/research, know their arguments, and provide them with the big picture. This helps others see the need for change and to have some ability to formalize the possibilities. 

Management is not easy but if you haven’t thought about how much of management is working with others and guiding them to higher levels of performance you are missing the big picture yourself. Management requires learning the proper skills and developing them in the context of others. Managers are influencers and should ensure that they have developed the right social, strategic, and personality resources to make things happen. 

Management Tips by Harvard Business Review.  (2011). Boston, MA: Harvard Business Review Press ISBN: 978-1-4221-5878

Book Review: Alan Greenspan’s The Map and the Territory

Alan Greenspan’s book The Map and the Territory-Risk, Human Nature, and the Future of Forecasting delves into the intricate nature of the economy and his life lessons on economic management. He discusses the nature of human decision-making as animal spirits, how uncertainty impacts choice, productivity as a measure of performance, and the advent of globalization. The book provides a general overview of the nature of the economic systems and the knowledge he has accumulated from it.

For those who are in higher education they will appreciate the section on Education’s Gini. In the old days, professors worked with a few hundred students but online education is about to make the super professor. These are the professors that reach out and touch thousands of students at one time. The industry is in the process of making its way into the mainstream and developing new technology.

Of course, the age old problem of variability in human behavior has not been resolved. Alan Greenspan is amazed at how these animal spirits have been defined by regression analysis and human actions are very much closer to being refined for economic analysis. If we were to develop better economic models that include the animal spirits along with economic modeling we will have better projections for development.

In particular his call for the restructuring of American’s infrastructure makes sense in light of recent changes. Our excessive debt has damaged short-term spending and long-term productivity while not leaving enough to fix our antiquated system.  Roads have not kept up with the cars and the ecological efficiency of potential technology has not been fully exploited.  We are patch working an older system without embracing the new.

He further goes on to discuss the nature of macro-forecasting and how it has grown in influence.  In the distant past the process of forecasting was a private affair among business people trying to reduce risk. The age of big data is coming on us and those who can master this data are more likely to be successful. The end of WWII and Keynesian economic explanations helped solidify this trend.  Today’s data makes it a reality.

The book is interesting in a number of ways and there is much to gather out of it. Like Alan Greenspan, I agree that the time when an overhaul of our economic system is likely. With rising income disparity, technology development, and big data analysis the need to tie people to the system is even more important for international competitiveness. A time may soon come when government becomes more transparent with data, investment risk is reduced through better information, and people are tied to the system through innovative entrepreneurship both in their own and within other’s companies.  Education will need to change to help ensure that the high technological skills, innovative spirit and developed analytic skills will be available. Infrastructure will need to tie people together in ways not seen at any time in history in order to create a better pipeline of transformational products and services.

Greenspan, A. (2013). Map and the Territory-Risk, Human Nature, and the Future of Forecasting.  NY: Penguin Press.