Monthly Bookmarks –
150th Edition – November 27th, 2022
The objective of the enterprise is to make money and have fun doing so.Bill Gore, Founder of W. L. Gore & Associates
1. The Significance of 150
This is the 150th edition of the CFO Bookmarks newsletter. I was curious if there was any significance attached to this number.
There is, and I bet you already knew about Dunbar’s number which states we can maintain roughly 150 social relationships due to cognitive and time limitations. For more insights, you can watch this short video explanation by Robin Dunbar who is also the author of Friends: Understanding the Power of our Most Important Relationships.
Are there examples of this theory being applied in the workplace? In Gary Hamel’s, The Future of Management …
With few exceptions, no facility or manufacturing site is allowed to grow to more than 200 people. Bill Gore (the founder) believed that as the number of people in a business increased, associates inevitably felt less connected with one another and with the ultimate product. Moreover, the bigger the unit, the smaller the stake people would have in key decisions.The Future of Management, page 92
2. The Search for Corporate Governance
FTX was once worth $32 billion. Not anymore.
The new CEO of FTX has been quoted as saying, “Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here.” That’s coming from the same guy who oversaw the liquidation of Enron in 2001.
If you are not familiar with the story, FTX filed for bankruptcy earlier this month leaving some one million customers and other investors facing losses well into the billions of dollars. Recent WSJ articles have revealed serious allegations of mismanagement at the highest levels of leadership including its founder.
I find this story perplexing due to the types of investors involved with FTX (Sequoia is one of them). Where was corporate governance? How did controls become so lax, or was this philosophy in place at the beginning?
There is nothing complicated about corporate governance. It’s a way of thinking and behaving on a consistent basis as decided upon at the Board and leadership levels of the organization. There’s no reason to read a book on this topic. Instead, take a look at Amazon’s concise corporate governance statement. I especially like the line after the focus on cash:
We will … work hard to spend wisely and maintain our lean culture. We understand the importance of continually reinforcing a cost-conscious culture.
3. Bill Gates Shares Five of His Favorite Books
Bill Gates recently shared five of his favorite books, and I bet you have read at least one of them.
His favorite book on Lincoln is Team of Rivals—great pick. My first book on Lincoln is still my favorite, Lincoln the Unknown by Dale Carnegie. This was recommended reading at my Dale Carnegie training early in my financial career.
Bill’s favorite book on the periodic table is Mendeleyev’s Dream: The Quest for the Elements. Do you mean there are more titles in this category? Sorry, I don’t have a favorite in this narrow genre. Does Surely You’re Joking, Mr. Feynman count?
4. Not Better, Think Different
I’m not looking for a job or a career change. Yet, I loved chapter ten in the easy-to-read, Play Bigger. The book could easily replace any text on strategic planning that is about how businesses become category kings. The included examples make the concepts tangible and easy to follow.
The last chapter is dedicated to applying category design thinking in our careers. The authors who each have deep marketing backgrounds suggest that we start a category and make ourselves its king by finding a problem, concisely defining it, and making sure others see it as we see it.
And when thinking about your personal category strategy, always remember different versus better. When you seek different, you aren’t climbing someone else’s ladder–you’re building your own ladder and putting yourself on the top rung.Play Bigger, page 220
5. Books I’ve Purchased This Month
Surprise, I get asked regularly, “What are you reading?” How about I answer this with what I’ve purchased lately?
Lyndsey Weber is one of the most talented business and financial modelers I have encountered in years. During a recent interview, she told me she was enjoying Seize the Daylight, a book about daylight savings time. Hook, line, and sinker. I bought it and have already completed it.
David Preau’s book reminds me a little of Longitude by Dava Sobel, but the latter is a bit more story-driven whereas the book on daylight savings time is more of a fact-driven narrative.
Earlier in the year, I made the decision to reread some of my favorite books from the past thirty years. Accordingly, I just finished The Boys in the Boat a week ago. The second time around was as good as the first. I also bought a hardback version for one of my kids who is a corporate controller. That’s because this book is for every leader. It’s a book about teams and humanity – everyone rowing with one mission at the right cadence, at the right speed, and guided by a coach who knows every nuance, strength, and weakness of the rower.
I recently told Chris Miller on Twitter that I’m looking forward to reading Chip War. The book already has 300-plus ratings at 4.7. Not bad for a book that was released only a few weeks ago. In this short video, Chris provides a synopsis of the book:
Recent CFO Bookshelf Podcast Playlist:
On Becoming a Category Champ
Outcomes Over Output
An Expert Financial Modeler Explains Her Pivot to PreSales
Does Accounting Have to be Boring?
What is Financial Transparency?
Thank You For Reading. Thank you for making this a successful newsletter.
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Always be learning and growing.