Monthly Bookmarks –
144th Edition – May 15, 2022
Numbers are cold and unfeeling.
Tom and David Chivers, How to Read Numbers
1. Turnarounds
Every business and financial leader should read at least one book on turnarounds by an expert in this field. My top pick is Reversing the Slide by Jim Shein.
I used to believe that any CFO could be a turnaround expert. After reading this book more than once, I’m convinced more than ever that CEOs are probably the best in these situations.
The book is full of examples, financial analysis, and various strategies to turn around a business on the brink of bankruptcy. My favorite big ideas in the book:
- The five phases of decline
- The thirteen-week cash flow forecast
- Cash vs. GAAP reporting
- Skills of a Chief Restructuring Officer
- The role of insiders and outsiders in a family business
- Strategy, Operations, or Finance (which comes first?)
The first four chapters are especially strong in building our business acumen from a turnaround expert’s perspective.
2. Analogies In The Legal System
Can those of us in corporate finance learn a thing or two from the legal system in its use of analogies to decide on court decisions?
In Adams v. New Jersey Steamboat Company (1896), the court ruled that a steamboat is more like a hotel than a train stemming from theft on a steamboat. Thanks to a simple, yet powerful analogy, the defendant won.
Want to get better at using and analyzing analogies? My recommendation is John Pollack’s, Shortcut who also presented this material at a TEDx event several years ago.
3. Physical Books
Do you prefer digital books or physical versions? While I read the majority of my books on the Kindle app, I still keep one physical book nearby that I’m reading at all times. Those versions can take from two weeks to about six to finish.
Currently, I’m reading the hardback How To Read Numbers by Tom and David Chivers. The book is very similar to the stats classic, How to Lie With Statistics by Darrell Huff.
Similar to Huff’s book, How To Read Numbers is about spotting the bad ones in the media:
In this book, we’re going to talk a lot about numbers: about how they’re used in the media, and about how they can go wrong – and give misleading impressions.
4. Revisiting Personal Finance Books
Periodically, a CEO will ask about my favorite personal finance books. I never know if they are asking for themselves or family members. I don’t read many, but three stand out with the emphasis on mindset:
- How To Be Rich by J. Paul Getty
- The Millionaire Next Door by Danko and Stanley
- The Psychology of Money by Morgan Housel
What’s your favorite title and why? If you let me know, I’ll share it in next month’s newsletter.
5. Books That Are Easy on the Brain
When I finish a long audiobook, I immediately follow up with something light, entertaining, and a topic where I don’t have to think. I badly needed such a title after wrapping up Titan a couple of weeks ago.
My go-to titles typically revolve around the autobiographies and biographies of celebrities. In this case, I gave Michael Munn’s book entitled Jimmy Stewart: The Truth Behind the Legend five stars. And yes, count me as a big fan.
If you have an interest in such titles, here are five that I rank high in this genre (ratings are Audible numbers):
- Stories I Only Tell My Friends by Rob Lowe (4.6 on 12k reviews)
- The Boys by Ron and Clint Howard (4.8 on 2k reviews)
- Total Recall by Arnold Schwarzenegger (4.7 on 8k reviews)
- Born a Crime by Trevor Noah (4.9 on 197k reviews)
- Who Is Michael Ovitz? (4.7 on 1k reviews)
The Ovitz book is hard to stop, and it’s a strategy and negotiation book disguised as a book by an A-list Hollywood agent.
Recent Bookmarks – 143 | 142 | 141
Recent CFO Bookshelf Podcast Playlist:
Outcome-Based OKRs
Ram Charan on Finding, Getting, and Developing Talent
A New Way to Think with Roger Martin
The Power of Analogy
Thank You For Reading. Thank you for making this a successful newsletter.
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Always be learning and growing.
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