A Note From The President

Avil Beckford, President

This issue took longer to complete because I struggled so much with Innumeracy, the book I reviewed this month. I am a numerate person and I couldn't relate to a lot of the book. I believe that as an author it is your responsibility to provide practical information that the reader can apply. I don't understand why the author thought that I would be interested in knowing what the volume of all human blood in the world is. This is one of the many off the wall examples provided in the book. I believe that literacy and numeracy are very important, and that we should take action now to improve levels, but Innumeracy is not the book to do it. The survey results this month show how an increase in literacy can impact a country's economy.

I am going to change gears and talk about something that will put a smile on your face. Did you know that Sunday, May 1 is World Laughter Day? I discovered that World Laughter Day is always celebrated on the first Sunday of May.

In an article in the Halifax Herald titled "The best medicine: We laugh because it's good for us; mirth is a kind of social glue," reported that "Young children are estimated to laugh over 300 times a day - a reason why they seem to have more obvious fun than adults who average 20 times daily… On average, men and women produced the same number of laughs, but men tended to laugh a "bit longer" than women." Get out and get laughing and Happy World Laughter Day to you.

Book Review

Innumeracy: Mathematical Illiteracy And Its Consequence by John Allen Paulos

About three years ago, a colleague recommended Innumeracy: Mathematical Illiteracy And Its Consequence by John Allen Paulos because she believed that it would be useful for a financial literacy project that I was working on. I bought the book and found it extremely dry and boring to read so I put it down for a later date. Six weeks ago, I picked up Innumeracy with the hope of reviewing it for the April issue of Ambeck Edge. I have read six other books during that time and I am now scrambling a week before the newsletter is due to read it and write the review.

Innumeracy, which is simply mathematical illiteracy, is defined by the author as "an inability to deal comfortably with the fundamental notions of numbers and chance."

Paulos provides many examples of how we misunderstand risk and misinterpret data. He offers insights and analysis of stock market scams, lotteries, and gambling schemes designed to capitalize on innumeracy. The author attributes the roots of innumeracy to three elements - poor education, psychological blocks, and romantic misconceptions about the nature of mathematics. He proceeds to severely criticize the American education system for its misunderstanding of proper math education. He offers one interesting solution to repair the ailing education system, and that is to certify retired engineers and other science professionals to teach mathematics.

Paulos' stated goal for writing this book is to "appeal to the educated but innumerate - at least to those whose fear of mathematics is not so great that (num)(ber) is automatically read as (numb)(er)." I do not think that Mr. Paulos accomplished his goal because innumerate people wouldn't read this book, and if they attempted to do so, they would give up in frustration because the book gets bogged down in complicated descriptions of problem solving methods. The book also uses terminology that will certainly throw off most of his innumerate readers.

I didn't enjoy reading this book, but I am glad that I forced myself to read it. Some of the concepts in the book reminded me of long forgotten mathematical concepts that I haven't used since I left high school. One thing I really enjoyed about the book, which was consistent throughout, is Paulos' emphasis on being more discriminating about information that's presented to you to build a case for a certain point of view. In my consulting practice, I use various independent information sources and different methodologies for a more balanced presentation of information. It's very important that we never take things at face value.

I do not recommend this book, but I would suggest that we take time to work on word and logic problems to give our brains a workout.

April's Book List

This month I would like you to go to your favourite bookstore, browse the Fun & Games section and buy a book to make you laugh and one to give your brain a workout.

Survey Results

Study: Literacy Scores, Human Capital and Growth

• On average, a country that achieves literacy scores 1% higher than the average, ends up in a steady state with labour productivity 2.5% higher than other countries, and GDP per capita 1.5% higher
• 1% gain in the average literacy/numeracy skill level in Canada would create a permanent increase of $18.4 billion per year, in the country's GDP
• Investments in human capital, such as education and skills training, produce three times more economic growth than do investments in physical capital
• Basic skills development drives economic growth - it is not simply a by-product of economic growth
• There is a correlation between literacy and wage levels in Canada. A recent study indicates that each additional year of education a person receives is worth 8.3 per cent on their paycheque.

Adult Literacy Survey (IALS) obtained for 14 Organisation for Economic Co-operation and Development (OECD) countries between 1960-1995

Literacy, Numeracy and Labour Market Outcomes in Canada, Statistics Canada, 2001

http://www.statcan.ca/Daily/English/040622/d040622d.htm
http://www.statcan.ca/Daily/English/010319/d010319a.htm

How Did They Do That?

David Chilton, author of "The Wealthy Barber"

Challenge: I approached the Shopping Channel in 1997 to have two sisters, Janet & Greta Podleski, promote their "Looneyspoons" cookbook. The Shopping Channel was somewhat skeptical about dealing with books because the price point wasn't high enough. Also, how would the brick and mortar stores such as Costco, Chapters and Indigo react?

Resolution: To eliminate the low price point problem with The Shopping Channel we offered them a two-for-one deal that they would pass on to the consumer. That way their volumes would reflect the great value proposition that the consumer was receiving. Therefore, their total revenue would be more than acceptable. This would have an unintended consequence because The Shopping Channel would be getting a better deal than the brick and mortar booksellers who bought a larger quantity of the cookbooks. To alleviate their concerns, I offered a personal guarantee that after one appearance on the Shopping Channel, if sales of the cookbook didn't increase in the stores, I would no longer use that marketing strategy. I personally believed that most viewers wouldn't call the Shopping Channel to purchase the cookbook. Instead, they would actually purchase the cookbook when they were in the store. However, for the 30-minute appearance on the Shopping Channel we had no idea what a tremendous impact it would have on sales. The Shopping Channel opened up several new accounts and the brick and mortar stores saw sales double and even triple after the sisters' appearance on the Shopping Channel.

Lessons Learned:

• There is a creative response to every problem.
• You always have to think, "How can the other parties benefit?"

What Can Ambeck Do For You:

Ambeck Enterprise provides diverse business research and analysis services to senior level executives, through the relevant distillation of diverse facts and data.

Formula For Success

David Chilton

I do not know if there is a formula for success, because if it were that simple, everybody would be doing it. To become successful, it takes a lot of hard work. Every business is different. Execution is very underrated and too much emphasis is placed on ideas. You must pay attention to detail. You must look for ways to help others - you have to help people achieve their objectives. Success also requires great flexibility, you have to see things as they are and not the way you would like them to be. You must accept reality and deal with it.

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