Fast forward to 2017 when British politician Diane Abbott nervously spluttered on radio as she tried to explain her plan for an additional 10,000 police officers… only she couldn't do the simple costing on air.  She started with £300,000 before changing to £80m. That gives a range of between £30 and £8 000 per police offer per year.  Bargains both. 

South Africa's President Jacob Zuma famously got tongue-tied in parliament and couldn't pronounce a number in the billions.  He just couldn't get the words out.

Stage fright and stress do weird things to people's mental abilities.  Research has proven a strong correlation between emotions and cognitive functioning.

Best we all take a chill-pill around our numbers.  Seriously relaxed is the way to go. 

Peter. ​

Marchionne did things differently, and knew what numbers to pay attention to.  

He spent money on the seemingly little things like bathrooms.  "How can you build nice cars when the employees' bathrooms are unfit for the workers?"  

While he said, "Please don’t buy our electric version of the cute Fiat 500."  He knew they lost $20 000 on each one.

But he saw the profits in Ferrari, which he spun off to be a separate company from parent Fiat Chrysler Automobiles. 

In the end, his results measured up.  After rescuing Chrysler from liquidation in the crash of 2008, he turned the company he bought for $2bn into an asset worth $84bn. 

Farewell to you Mr Marchionne.  You were fast driving even as you left your marque. 

Peter. ​

​Me & the Bees is creating a buzz.  Mikaila Ulmer turned her great-grandma’s lemonade recipe into an $11M Whole Foods deal.  From which part of the profits go to honeybee causes.

Honey lemonade is sweet, but sweeter still is the story: Mikaila is just 13 years old and started the business at the age of four.

​The lemonade’s winning ingredient may well be the honey, but it’s also business acumen. At the age of four, while most kids bring their teddy bears to show and tell, Mikaila had a lemonade stand at a children’s business fair.

Lemonade stands are an almost mythical  entrepreneurial platform for children. And yet here is this young lady from Texas creating a very real business from her sidewalk venture. 

The delightfully articulate Mikaila appeared on Shark Tank and talked to NBCabout how she got (literally) stung when she was starting out.  Methinks with her business savvy, and no-doubt presence of behind-the-scenes advisors, this social entrepreneur won't get stung in business too often.

Wishing you a sweet week,

Peter

Investors use a company’s profit this year as a starting point for predicting next year’s.  The prognoses drive the company’s share price. 

When making those predictions, it can be reasonable and make sense to adjust the reported profit figure so that it better foretells the future.  But that’s where the trouble begins. ​

It is a truth universally acknowledged that a business seeking better returns must be in want of women.  (Sorry, Jane Austen) 

You see, research has shown that businesses - and particularly investment managers - perform better with a balance of men and women in the workplace. ​

Too much testosterone can wreak havoc on financial behaviour. So here’s the conundrum: why are there not more women in executive leadership roles? 

“Women and minorities manage only 1% of the asset management industry’s $71 trillion in assets and only 15% of global mutual fund managers are women” says  Girls Who Invest.  It’s an organization that’s done the sums and exists to change them. 

Girls Who Invest selects about a hundred female students each year after a hard-fought application process. It then puts them through three-week summer camps at Wharton and the University of Notre Dame.  The women emerge prepped and inspired for a career in finance. 

Each year, after teaching the Color Accounting module at the camps, we leave uplifted.  The bright minds of the savvy up-and-comers, from widely diverse backgrounds, give us great cause for optimism.  

Clearly, balance shouldn’t only happen on balance sheets. 

Peter

​Albert Einstein, the greatest scientific genius of his time, changed the very way we understand the universe.  

He discovered the truths that led to the equation E=MC2 and the theory of relativity by conducting visual thought experiments. Famously, he imagined riding alongside a beam of light. 

Einstein had been unhappy at school in Germany where, in the late 1800s, schooling was rigid and all about rote learning. So he moved to German-speaking Switzerland and sought out a school in Aarau which followed the principles of Johann Pestalozzi, an educational reformer.  Those principles made all the difference and set him on the path to his breakthroughs.
 
Pestalozzi’s motto was “Learning by head, hand and heart”.  He wrote that “Visual understanding is the essential and only true means of teaching how to judge things correctly.”  The learning of numbers must be subordinated to first understanding concepts, he believed.
 
On so many levels, our worldwide community of Color Accounting educators are proud to call ourselves “Pestalozzians”.  Belief in the individual. Use of hands in the learning process. The power of the visual BaSIS Framework we use.  And even the priority of words over numbers as one learns to make sense of financial statements.  
 
200 years later we are unreservedly happy to take our hats off to you, Johann Heinrich Pestalozzi, with a deference you wouldn’t demand from us.

Peter