Category Archives: Financial
Moneyball: The Art of Winning an Unfair Game
I listened to the (abridged) audio CD version which is narrated by the author. It is a good story, though somewhat long winded at times. The story is about the Oakland A’s and how they have used statistics to select a winning team for significantly less money than the rest of baseball. (An analogous situation for LM would be hiring of new employees – has anyone ever studied what characteristics identified during interviews correlate to success at MFC-Dallas?) The moral of the story is there is a great advantage when you can exploit market inefficiencies using the scientific method. You will have to read the book to find out more. It will really make you think about the value of conventional wisdom.
Theory of Constraints and Its Implications for Management Accounting (Eric W. Noreen, Debra A. Smith, James T. MacKey)
Not the best book out there on the Theory of Constraints. Part of TOC is the principle that the accounting which is done for GAAP and the IRS, for example, should not be used to make business decisions. This isn’t a new concept to accountants. Many an MBA has glossed over this fine print though. Several case studies are given where using TOC accounting to make business decisions provides significantly superior profits, capital expenditure plans, offshore trades, etc.