In Malcolm Gladwell’s latest book, Outliers, he poses the question, do we really understand why we are successful? Counter-intuitive propositions are often the hallmark of truly insightful observations. Take his example from Canadian hockey. Many of the most successful 18 year old Canadian ice hockey players were not only very skillful, they were really big nine and ten year olds. Because the age cut off for boys ice hockey is Jan 1st, then any kid with a birthday in January to March has a huge advantage to look good or at least dominate physically.

They are then selected for the rep squad, they get more games, better coaching etc etc. By the time they are 18 they have lived and breathed ice hockey their whole life! Same goes for baseball with a July 31st cut off. Other fascinating examples include the Beatles and Bill Gates.

The Beatles were an amazing band but it did them no harm that between 1960 and 1962 they played Hamburg gigs, off and on for 270 nights. By the time they had a burst of success in 1964 they had played an estimated 1200 times!

Bill Gates is a genius but Lakeside School where he attended as an eighth grader had a computer club with access to a mainframe computer in downtown Seattle. This was 1968 and for the next 5 years Gates racked up an extraordinary amount of time on the terminal!

We must be careful when analysing our successes. Do leadership teams really understand what makes their business tick? Are our accounts departments really generating all the real time key performance indicators we need.

Remember this, there are only two reasons that a financial number moves. Only two. Volume and yield. As you try to understand the stories behind your business, the reasons for failure and success – make sure you start with the obvious big volume and yield reasons or you might jump to the wrong conclusions!

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