I am sitting on a pile of rocks

I am sitting on a pile of rocks.

That makes me the greatest architect and engineer of all time.

Unfortunately not. The fact that I am sitting on a pile of rocks obviously does not make me a great architect, or an architect at all. The Pharao Cheops had a clear vision, bought (or enslaved?) the skills he needed and then transformed a pile of rock into one of the most impressive monuments in mankind history.

This simple thinking does not seem to apply to the modern world.

Many of the companies and AI guru I met claim: “I am sitting on a gold chest”; that chest would be the data they gathered and think they own. And then they continue: “we need to hire a data scientist and make money”. Just missing: passion, idea, business sense, vision.

Unless you have a clear vision on what to do with your data, which market need you want to address, unless you are sure that there is market traction and someone would pay for your “intelligence”. Just do not do it .

If you want to change the world or simply make money, you need the vision, the will, the skills and probably deep pockets. Or just the passion.

A data scientist, no matter how much you pay him/her, won't help at all

If you are interested in discussing simple, disruptive ideas in this field, just contact me.

If you are not, here is an article (re)published on linkedin on the topic

https://www.linkedin.com/search/results/content/?keywords=This%20skill%20is%20now%20worth%20millions&origin=SWITCH_SEARCH_VERTICAL

Why I do love finance

Finance people are the number crunchers….

Finance is the place where you can get the numbers….

We do the business, the finance will take care of the rest….

Finance is dry….

While discussing finance with many counterparts I hear very often similar statements. If one was to believe any of those interpretations of the role, finance would be a very sad place to be.

I love finance and I believe that is one of the most exciting functions in a company. Why is that?

Because finance is the place you need to go first if you want to understand the business, what happened to it, what is happening now and what could happen if you do certain things. Finance is a reflection of the beginning and the end of all company’s activities.

As a finance person you have to own the future, the present and the past (yes, also the past). This means that you have to take responsibility and tell the management or the owner what is working and what is not, regardless of the consequences. And you have to stand upright also for the past and for the things you might be not responsible for: if there is some mess created in the past to be sorted out, you still sit with it and will need to fix it, no matter who created it. The willingness to own the past, the present and the future determines the quality of your finance people.

That is why I love it.

I like to think of finance as a big bathtub with one faucet pouring water in (revenues) and several holes draining it (expenses and investments). The art of managing the water flow is the reflection and the catalyst of the company’s strategy.

What you want to have is a constant level of water and a pleasant temperature. If you have too much water pouring in (allowing for example revenue enhancing discounts), the tub will spill and you will waste the water; eventually you will need to dry the floor. If you draining holes are extracting too much water, the tub will be empty at some point.

How do you know what is the right way of managing the flow?

My own philosophy in understanding the appropriate “water” level resides in understanding the difference between creating value and extracting value.

You will create value if you keep a pleasant level of water, at the right temperature, so that you can bath (or drink; in this case you are taking the dividends) as long as you want.

Extracting value can happen through reducing expenses and investments by closing the drains and opening the faucet too much. The joy of watching so much water filling the tub will soon be replaced by the sadness of drying the floor and paying for the floor repairs.

Dear salesmen, strategists, marketing people, IT people: next time you pass by the minimalistically furnished finance offices, with poor light and worn down floor, think about the bath tub. You too will love finance.

I love bathing. I love finance.