Reviews (3)

Very poorly written
I found Arditti's writing to be simply attrocious. What the marketplace needs is a clear, concise guide to instrument structure and valuation, and Mr. Arditti writes in circles. As an example, his chapter on option pricing refers to "using the methods used previously in this chapter" without referring to how to apply these to the method just introduced. The method just introduced was explained using numbers that were presumably fabricated, but lord only knows, because the author can't be bothered to specify how his example was structured.

In trying to explain things simply, the author fails to explain anything clearly. "Derivatives" is an extreme disappointment. As a reference, this book may have some use, but if you're looking to learn something from it, stear clear.

He knows how to design derivatives and make them work
I am completely satisfied with this book. He knows how to design derivatives and make them work. This book does a remarkable job of explaining the theory and practice of derivative securities.

EXCELLENT AND IN PATCHES OUTSTANDING
This book is an excellent resource for beginning and intermediate level fund managers who want to understand the derivatives to be able to use them in risk hedging and income maximization.

The book is excellently organized in four sections and each section is self sufficient. Each of the sections begin with basics, illustrates the concepts with example, introduces the mathematics of pricing and methodology of hedginag of risks

Every section has also a nice subsection on terminology and definitions.

The book is an excellent attempt to explain a highly technical and complex subject.The section on Interest Rate swaps is outstanding. A must read for all corporate money managers and a must addition to all financial libraries. ... Read more

Book Description

Two of the most innovative thinkers in the field present a workthat represents the single best resource for understanding andimplementing activity-based cost management.Kaplan and Cooper revealthat most companies don't know how to measure accurately, influence, orunderstand the fundamental cost drivers in their businesses.They thenprovide a detailed and comprehensive blueprint that will enablemanagers to make better decisions and to promote organizationallearning and improvement.

Cost and Effect takes the management,finance, and accounting fields to an entirely new level, as the authorsdemonstrate how the principles of activity-based costing and otheradvanced cost management techniques, such as target and kaizen costing,can drive business performance.Using lively examples from a varietyof leading companies worldwide--including Siemens, Hewlett-Packard,AT&T, the Swedish wire manufacturer Kanthal, Kirin Beer, and Procter &Gamble--they show how to create integrated, knowledge-based systemsthat provide meaningful information on current and pastperformance.

The innovation systems described in Cost and Effectwill help you: Determine where improvements in quality, efficiency,and productivity will have the highest payoffs. Assist front-lineemployees in their learning and improvement activities. Make betterproduct mix and capital investment decisions. Negotiate moreeffectively on price, product features, quality, delivery, and serviceto promote win-win relationships with your customers. Choose low-costsuppliers who are truly low cost, not just low price. Design productsand services that meet customers' expectations--and that can beproduced and delivered at a profit. Integrate your activity-basedcost system into reporting and budgeting processes to reveal thesources of excess capacity.

Everyone involved in running abusiness--from general managers and strategic planners to financialexecutives, IT professionals, and operations managers--must read thisbook to learn how innovative cost and performance measurement systemscan enhance their organizational profitability and performance. ... Read more

Reviews (7)

BEST ANALYSIS OF ACTIVITY BASED COSTING AND HOW TO GUIDE
Kaplan and Cooper have put together an outstanding guidebook for managers to follow in order to reap the most significant benefits from activity based costing and other cost management techniques. The great merit of this book is that it does not preach to the reader the latest management fad, but rather goes through a thorough analysis of budgeting processes, highlighting benefits and drawbacks of each. They do not claim ABC is the best approach, and even praise some simpler methods that are more adequate for certain companies. Instead, they point to the circumstances in which ABC can provide outstanding results to companies.

The book structured first with an analysis of the most often used systems of managerial cost accounting. It highlights the shortcomings of these, proceeding then to present certain productivity improvements that could contribute to performance. These are mostly related to the quality movements (TQM, 6 Sigma, etc), which are presented in a very understandable way. These are complements to the existing usual cost management systems. These improvements can be made even without implementing ABC systems.

Then the authors proceed to describe activity based costing and its benefits in terms of choosing customers, suppliers, and product breadth. They present many examples that would be very relevant to any practitioner, in industry or service. There is a specific section focusing on services, which makes the appropriate adaptations to the systems for the peculiarities of it.

Overall, an outstanding work, to help anyone involved in cost management, whether they are interested in activity based costing or more traditional standard costing methods.

The very best book on activity-based management.
I have read this book cover to cover and have re-read chapters. Kaplan ensures that you grasp the fundamental concepts by keeping things simple. He illustrates the concepts with easy to understand examples. I gained very little knowledge from the first 3 ABM books I read, but after reading "Cost and Effect," I felt that I had a good enough grasp of the fundamentals to actually implement a costing system.

Cooper and Kaplan: my heroes
After reading several academic papers concerning activity based costing I still wasn't convinced about the usefullness of the methodology. After reading Cost & Effect I revised my opinion on Cost Management. This book gives all the answers to effective Cost Management. It takes you from the ABC Age to the Activity Based Management Age and clearly helps you to understand what costs are alle about. Once you really understand the topics of this book you will be able to face and manage costs in whatever business you are in. Read it!

Evolving Toward Better Financial Information and Actions!
Cost & Effect will most appeal to those who have had extended experience with Activity-Based Costing (ABC) or operate in manufacturing industries.

If you are interested in learning more about Activity-Based Costing, this book is not the best choice for you. Professor Kaplan has co-authored books that explore this subject in much greater detail.

Most people set as their initial priority the need to have accurate financial reporting for the entire enterprise. Falling below that level of effectiveness is Stage I in the terms of this book. Once you have that financial reporting done accurately, you are at Stage II. But you know almost nothing about how to manage your costs better. In order to do that, you will need to establish ad hoc financial reporting processes designed to help your organization learn from its experience and identify opportunities for improvement, built around Activity-Based Costing (ABC). ABC is simply a way of more accurately applying overhead costs back to activities and then processes that permits accurately understanding more about which combinations of products and services and customers are profitable and which are not. Then, within each activity, you can also see the inefficiencies in what you are doing that present opportunities for improvement. The book also has a nice discussion of Kaizen costing that is widely used in Japanese companies looking for on-going cost improvements, based on Professor Cooper's research. There are a few case histories to illustrate the principles, but most will find these insufficient to guide them through the process. In other books, Professor Kaplan has pointed out that there is a lot of acquired art in the subject and you probably need help to get it right. I concur. Once you have ABC operating in stand-alone systems, you are at Stage III.

At this point, you will have a financial reporting system that is separate from the ABC system. How do you put them together? That the subject of chapter 14, which is the key value-added part of this book. You will see what the systems architecture and process flow needs to be in order to combine ABC with Enterprise-Wide Systems (EWS) of the sort that many large companies have invested in during recent years. Putting the two together will greatly improve planning, budgeting, design of new products and services, and operational improvements. Chapter 15 expands into the area of how to apply the combined system to budgeting and transfer pricing. Combing ABC and EWS puts you at Stage IV, a level rarely reached today.

The book's main message is that it's a mistake to try to go from Stage II directly to Stage IV. There's a lot of experimentation and mistakes that you can benefit from in an extended Stage III. I agree again, based on my experience with ABC.

The one caution you should have about ABC in this context is that if you are going to radically change your business model every 2-5 years as many companies are, Stage IV is probably unattainable and undesirable. You can't hold back business model innovation for better cost systems. The next business model innovation will probably give you better costs than tweaking the current business model with ABC will.

Seek out the fastest route to progress, and do more of it!

The book I use every day!
I would like to have it in German and French languages in order to recommend it to my colleagues. ... Read more

Book Description

Since its initial publication in 1987, Revelance Lost has gone through nine printings, won two major awards from the accounting profession, and had a profound impact on how management accounting systems operate in the 1990s. It has become a manifesto for managers in accounting and control. By exploring the evolution of management accounting in American business from the early textile mills to present-day computer-automated manufacturers, Johnson and Kaplan reveal why modern corporations must make major changes in the way they measure and manage costs. In a world of rapid technological change, vigorous global and domestic competition, and enormous information-processing capabilities, it is critical that managers receive information that is timely, accurate, and relevant. ... Read more

Reviews (5)

this is a book that revolutionized management accounting
Relevance lost of a book about the history of management accounting. The book is very well documented in that in times they were able to deduce different conclusions made by others. They start from the very beginning exploring as far back as the 18th century. They start out by discussing how textile mills started recording in their books accounting information. They begin from the very beginnings of accounting. Accounting emerged as a discipline in the early 18th century, but their underlying purpose in not for internal uses but it was created so that stakeholders can gauge the value of their investment in the firms that put out these financial statements. In the book there are a number of firms they highlight that made important contributions to management accounting. The first company they highlight is DuPont corporation in the nineteenth century. There is a theme to the development of management accounting. DuPont first staterted out as a manufacturer of gunpowder but went on to become bigger. The first companies that innovated their way of internal controls in management accounting grew out of a necessity. DuPont first came out with a measure of their business which was the return on investment measure. Because Dupont was becoming bigger and it needed to measure return on investment to measure the profitability of individual business units. It was a measuring rod to asses the different business activities of it business units. With this measure the managers of DuPont could make decisions such us which business units to invest on and do away with units that are performing poorly.
In the 1920's at General Motors they have been experimenting with using variances to measure how well they are doing in their manufacturing. In to the picture is a man named Alfred Sloan, he is one of the most brilliant thinkers in management. With implementing variances GM was able to have a uniform way to impose standards to its managers. With this system, GM's growth became remunerative.
Then there came a period as the authors put it when relevance was lost. Financial accounting accounted for the bulk of the innovations in accounting leaving behind management accounting. This is like the "dark ages" of cost accounting when companies and academics did not innovate methods and processes to advance management accounting. There were a number of reasons for this, first is the requirement imposed in companies to generate financial statements for the stakeholders of the companies. Second, the cost of putting together the necessary information was prohibitive. Technology has not yet grown mature enough to allow managers to go through the trouble of compiling the information needed to make the decisions.
The beauty of this book is that it traces beginnings of topics that are familiar to us now. Topics like variances, discounted cash flow analysis, return on investment, sunk cost, and even just-in-time inventory systems. The next evolution of management accounting is to be led by academicians according to the authors. In this stage of the life of management accounting arose discounted cash flow analysis. This is a step ahead of the return on investment method. This is also a time when economist started to innovate management accounting further. The concept of sunk cost is introduced by economist in the London School of Economics. Innovations also arose by way of the field of operations research. Operations research deals primarily of mathematics. And about this time management accounting was taking hold as a discipline of its own. Along with discounted cash flow analysis, opportunity cost is introduces as well as agency theory and residual income. Residual income is interesting in that it was a step backward in the innovations of theories. Even though, GM started using this instead of the return-on-investment measure. The driving force of this period of the growth of management accounting is the need to have better decision making. This is why economics along with operations research contributed to the growth of management accounting.
Next up, management accounting in its evolved form before 1980 falls short. Management accountants make a couple of theoretical mistakes. They are no longer providing managers of the critical information needed to make decisions. Management accounting has become obsolete in a sense. The next development is what happened after 1980. Because of bitter and growing competition because of global forces and deregulation there needed to be more changes. In this period arose what is now called total quality management, and its progeny just-in-time systems. Manufacturers needed to control their work-in-process inventory. Meaning the Japanese where beating Americans by having zero inventory. This led to changes in management accounting systems throughout the United States.

Historical backgrounds of BSC, ABC & EVA
If you want to understand everything about the historical backgrounds of such now well-known management instruments like the balanced scorecard, activity based costing and EVA, there is no better book to read than this book. This book started off a transformation of management accounting and of organizational performance management. Essential reading for controllers, students of management and management consultants.

Broad History of Mgmt Accounting
Good in-depth survey of the history and purpose of Management Accounting. Classic book. You see Kaplan's thought processes as he develops the basis of his later works on new forms of accounting such as the Balanced Scorecard and EVA.

If you are a management accountant this book will put your work into perspective as well as caution you about the pitfalls of doing things the way theu have always been done.

A good read for discouraged management accountants.
For those management accountants who feel less than totally appreciated (the real ones will know this to be a common feeling) then this book shows how financial accounting usurped management accounting when the bean counters went looking for shareholders and needed to tell less than the truth about what was going on inside their firms.

If auditors are just hookers with a degree, then financial accountants are then just politicians without a cause - you cannot run a business on late and averaged data from the financial perspective.

This book reminds us that knowing what things cost to make and cost to sell is what keeps a firm on the black ink side of the ledger.

Worth a read.

Excellent treatment of subject
This is a small book which puts forward the idea that we must return to a better use of product cost data to make decisions. The authors review the literature going back to the first industries in the 1700's that used cost data in a managerial way. The work quotes heavily A. Chandler, J.M. Clark and Vatter for their contributions. It then reformulates their idea's and other historical data to come to the author's conclusion. In summary, it is well done for those interested in the subject and have an appreciation for business history ... Read more

Book Description

The 2002 edition of The Harvard Business School Guide to Careers in Finance is an indispensable resource for anyone considering a job search in finance or investment banking. This all-in-one guide details the trends in finance, describes the industry's vast and varying career opportunities, and provides guidance on the recruiting process. Included in this new edition are profiles of leading investment banks, commercial banks, and Fortune 500 companies that hire MBAs; a selected bibliography; and a useful glossary of finance terms.

The Harvard Business School Guide to Careers in Finance Includes:
*Is a Career in Finance Right for You?
*Company Profiles
*Recruiting Contacts
*Career Resources
*Career Paths in Finance
*Investment & Commercial Banking
*Financial Services
*Corporate Finance
*Glossary of Financial Terms ... Read more

Reviews (5)

superficial book
This book is extremely superficial and unimaginative, giving only scant information and profiles from a number of companies of a few finance careers.

good, but the Vault guides are better
In my opinion there is more and better objective information on Finance and investment banking careers in the Vault Career Guide to Investment Banking and in the Vault Guide to Finance Interviews, which have the added benefit of being able to be purchased on vault.com and downloaded immediately. Good luck.

better information in the Vault guides
In my opinion there is more and better objective information on Finance and investment banking careers in the Vault Career Guide to Investment Banking and in the Vault Guide to Finance Interviews, which have the added benefit of being able to be purchased on vault.com and downloaded immediately. Good luck.

fair
This book was fair, but in my opinion the Vault Guide to the Top Finance Firms is a superior guide to careers in finance. Also try the Vault.com Guide to Finance Interviews. Good luck.

Good Book for Finance Review
This was just as good as their 1999 edition. ... Read more

Book Description

When the economy was booming and dot-coms were flying high, venture capitalists were admired as impresarios of innovation. Then the market tanked, start-ups fizzled, and those same deal-makers were rebuked as predators out for a quick score. So which portrayal is accurate? Where is this much-hyped industry heading? And what will it mean for the future of innovation in the global economy?

In this definitive book, industry experts Paul Gompers and Josh Lerner provide the first cool-headed explanation of the venture capital industry and the role it plays in our economy. They underscore that, regardless of the economic conditions, innovation is incredibly difficult to finance, take to market, and translate into value. While venture capital has evolved to address these problems-the industry has fueled innovation, economic growth, and wealth creation for decades-features of the venture industry have left it vulnerable to boom-and-bust cycles. In the near future, say the authors, the industry must transform dramatically, with important implications for industry players and the entrepreneurs and organizations they serve.

Drawing from compelling research and industry "war stories," Gompers and Lerner present a series of practical frameworks for understanding the relationships among venture capital, innovation, and entrepreneurial success. They demystify how the venture capital world operates, and outline the opportunities and obstacles faced by all players in this evolving arena.They explore:

· The problems entrepreneurs encounter in securing financing, and how the venture capital model can help innovators to resolve them

· How venture capitalists can effectively pursue promising opportunities while building a sustainable franchise

· How corporations, nonprofits, and government institutions can harness the power-and avoid the pitfalls-of the venture capital model when applying it in their own sectors

Whether the industry is enjoying an incredible growth spurt or weathering an economic slowdown, readers will find this book an immensely practical guide to leveraging the venture capital model to turn innovation into value.

... Read more

Reviews (2)

Authoritative and Well Written
Gompers and Lerner have written the best book on venture capital thus far. The authors have done a great service to entrepreneurs, VCs, and the entire business community with this work.

It is written, organized, and executed at perfect pitch and should be read by anyone considering taking the plunge into entrepreneurship, pursuing a career as a VC, or simply wanting to know more about the complexities and true nature of venture capital.

As venture capital gradually becomes more plentiful in the next 24 months, reviewing this work should be required of serious-minded professionals.

Absolutely Phenomenal Book
I can't say enough good things about this book! Gompers and Lerner provide a crystal clear explaination of the role venture capital plays in the economy and offers an insightful view of how venture capital will change in the future.

Anyone who is launching a new venture should bypass the "How To Write A Business Plan" books and pick up a copy. ... Read more

Book Description

About 75 percent of active investors consistently deliver returns below those of passive index funds. Why? In part, it's because proven methods for valuing assets are too complex to apply-causing investors to rely on commonly used benchmarks such as current earnings and price-earnings multiples that simply don't reflect how the market prices stocks.

Now, leading valuation experts Alfred Rappaport and Michael J. Mauboussin argue that the secret to beating the market stands in plain sight. Embedded in the stock price-the most accessible piece of information in the investment arena-lies all investors need to know about how the market expects a company to perform. By correctly decoding that information, say the authors, investors are on the way to anticipating changes in a company's competitive position that the current stock price doesn't reflect-and making informed buy, hold, or sell decisions before the rest of the crowd. This proven approach, expectations investing, holds the potential to change the rules and improve the odds of the stock selection game forever.

The beauty of expectations investing is that it harnesses the power of the market's own tried-and-true pricing model-discounted cash flow-without requiring difficult and often dubious long-term forecasting. Highly practical, the book provides a strategic framework and corresponding tools for using price-implied expectations (PIE) to:

Interpret current prices and anticipate revisions in expectations.
Monitor signals from managerial actions such as mergers and acquisitions and share buybacks and estimate their impact on shareholder value.
Devise, adjust, and communicate management strategy in light of shareholder expectations.

In addition, a unique expectations infrastructure helps track value creation from the initial triggers that shape performance to the resulting impact on sales, operating profit margins, and investment efficiency.

Universally applicable to public companies across the economic landscape, Expectations Investing will enable professional investors, analysts, and executives to translate heightened uncertainty into lucrative opportunity.

... Read more

Reviews (20)

Must Reading
In an investment world filled with tinsel and glitter, Rappaport and Mauboussin have given us substance and common sense. Using the invaluable information imbedded in the price of a stock to establish the market's expectations,the authors present a (fairly) simple methodology for assessing the valididity of those expectations, and to invest accordingly, It is, as Peter Bernstein says in his brilliant foreword (an absolute must- read before you plunge into the text), "a logical path to the heart of value."
I'm pleased to have give the book an earlier endorsement, because I hope that mutual fund managers will learn from "Expectations Investing" that there are far better ways to manage money--ways to focus on "value" whether their style is value or growth--than the costly, high-turnover, momentum-driven strategies that are rife in the industry today.
More than ever after the 35% fall in the stock market since March 2000, investors need wisdom. They'll find it here.

A must have book for today's investor.
This book should be required reading for every active investor today. Too often pundits throw out terms like market leader,growth stock, value stock, recession resistant as reasons to buy a stock, and try to predict where the "market" will go for the next six months. Expectations Investing will help you learn to throw away these lazy investor labels and instead provides a framework for evaluating a particular stock in terms of what the current price is saying about how good or bad the future for the company may be and whether it merits your purchase or sale. You will learn that every stock, market leader or not, has a whole set of assumptions embedded in the current valuation- this book will help you learn to think in these terms and evaluate whether those assumptions embedded in the current price are reasonable. The book debunks some popular myths and provides highly illustrative examples that make some technical issues easy to understand. For the pro, coverage of executive compensation, option analysis as well as key chapters on competitive strategy and other operating issues will definitely stimulate the thought process. At the same time the basics of valuation are covered in an easy to read fashion. Finally, the Notes section itself can lead the intellectually curious to a "pot of gold" of information. Turn off the business TV and put your popular financial magazine on the coffee table and read this book instead !

A Different Approach
Stock market investing books usually come in two flavors.

The first group of authors tell you to look for certain price and volume patterns; that the stock price depends on those patterns because those patterns are a reflection on human behavior.

The second group of authors tell you to look for certain ratios in the financial statements; that the stock price depends on those ratios.

Then there's this book, which tells you that the price could depend on a lot of things, like mergers and acquisitions and the synergy they generate, executive compensation, competitive strategies, stock buybacks, etc. But they don't tell you how to calculate those factors into the stock price. The book is a good book which certainly provokes thought. And it's probably good for finding stocks for the long term investor. But for me, it's a little too impractical. And a little too academic intellectual guru voodoo. When I have money at risk, and I have to make quick decisions (which can affect my net worth), I like to keep things simple and easily measurable which technical and fundamental analysis allows me to do.

Recommended by Enron!
I haven't read the book but I saw an unintentionally funny quote on the book jacket. Amongst other people praising the book and urging you to buy it, there is a quote from one Jeffrey Skilling from the Enron Corporation:

"Expectations Investing reinvents today's investment market architecture. . . . A valuable tool for the innovative investor." -Jeff Skilling, CEO, Enron Corp.

You too can become as "innovative" as Enron! Wonder if they'll remove that recommendation in reprints...

Expectations Investing: Reading Stock Prices for Better Retu
I used to always wonder how do investment analysts evaluate stocks.Buffett never beleived in P/E nor P/S or P/CF. Mind you [local store] never traded under P/E of 24, neither DELL nor msft.
So how do you pick these great stocks?

If a investor is reading this book, he has crossed over from Amateur investor stage to become a semi professional. Evaluate your stocks as you evaluate a business. When you buy business, you are basically looking at how much cash can I take home very month.

This is a great book. ... Read more

Reviews (1)

great book to understand financial functions
I read the Japanese version of this book. This is one of the best finalce books I've ever read. This book helped me to understand much better the future of financial businesses. It is especially good in explaining: what is the rationale for financial intermediaries to exist, how capital markets evolved, why corporations hedge by themselves, and how asymmetric information affects financial instruments. ... Read more

Amazon.com

Psychology rules the stock market, according to Hersh Shefrin. In Beyond Greed and Fear, Shefrin shows how bias, perception, and other aspects of psychology often rattle investors and move stocks. From the individual who keeps losers too long to overconfident money managers who mistakenly think they can predict financial trends, human nature foils investment returns. "Behavioral finance is everywhere that people make financial decisions. Psychology is hard to escape; it touches every corner of the financial landscape, and it's important. Financial practitioners need to understand the impact that psychology has on them and those around them. Practitioners ignore psychology at their peril," writes Shefrin, a finance professor at Santa Clara University. An academic volume geared toward financial professionals, the book details an emerging field known as behavioral finance, in which psychology is believed to be at least as important as market fundamentals, such as earnings and balance sheets. Shefrin describes how investors are motivated by fear, hope, overconfidence, and the need for short-term gratification. The book gives plenty of examples of investment mistakes, and analyzes them from a behavioral-finance perspective. While Beyond Greed and Fear targets professionals, individual investors will benefit from this look at an important mover of markets. --Dan Ring ... Read more

Reviews (10)

A slow waltz through the psychology of investing
This book has a good heart, but I can't recommend it so highly. The author takes several classical cognitive mistakes that humans make (some will recognize the classic names of Kahnemann and Tversky; they are one of the substrates of this book). The author applies such mistakes to a wide range of investment problems - holding on to losing stocks too long, anthropomorphizing stock decisions, and so on. The sort of psychology that makes you think that a coin that has flipped tails three times now has a 95% chance of flipping heads on the next toss. Most intelligent readers (the sort that buy Harvard Press books) could get the same points in a much briefer format, like a book chapter or a 10-page article. For example, people tend not to save enough for retirement because the future seems a long time away and they think they'll catch up and it will work out. Well, yes. Next?

A great book about Behavioral Finance
This book builds on the current literature in Behavioral Finance and reviews the most relevant academic articles. It is interesting for the researcher in empirical finance and the best book to understand the behavior of individual investors.

Another fascinating and recent publication in this field is by Andrei Shleifer: "Inefficient Market"

A very good book, but quite academic
I had mixed feeling about this book. Content wise, it's incredible. It's full of real life stories, data, analyses, propositions of many so called market anomalies. However, I really find some of the chapters too long, especially those after chapter 5. The author had copied his style of thesis writing and actually many of his own theses (he's a renowed professor after all) into a book which has a big audience group of investors or traders who want quick fix or certain level of entertainment and personal improvement. In these respects, the "Psychology of Finance by Lars Tvede" and the "Devil take the hindmost by Edward Chancellor" are "easier" but not definitely better alternatives.

Anway, this is one of the very few "serious" books about behavioural finance that is relatively practical. If you are abound of time, go for it. Otherwise, you may try the two books I mentioned above.

p.s. I like the following the most: In April 1997 Financial Timesran a contest suggested by economist Richard Thaler. Readers were told to choose a whole number between 0 and 100. The winning entry would be the one closest to two thirds of the average entry. The winning choice is 13. The real point of this game is that playing sensibly requires you to have a sense of the magnitude of the other players' errors. Hope you got it right.

You won't be overconfident when you've read this!
Behavioural finance is an important topic and this book provides a very enjoyable and insightful read for the layman. It will stimulate interest in the topic by being accessible, which is what it set out to do, so four stars from me. It gives you some good 'dinner party anecdotes' (!) when colleagues or friends tell you about 'how markets work'. It is not a textbook on the subject by any means, rather a book for the airport that you will read again and recommend to others. Don't expect to see any matrix algebra or stochastic differential equations in this one!

A good Overview of the Subject
Mr. Sherfin has written an entertaining, yet scholarly overview of the subject. It is pitched at the practitioner rather than the layman, so anyone wanting detailed financial planning advice or quick fire trading ideas is going to be disappointed. What you do get however is a fascinating insight into the reasons that long-term stock market anomalies continue to exist, and the forms that they take. This should finally bury the idea that markets are efficient.

A couple of beefs though; firstly, as Sherfin points out several times "investors learn slowly" in yet most of the time series he quotes seem to be 3 to 10 years - statistically pretty insignificant in making generalizations about market behavior. Secondly, while he is rightly cynical about he money management industry (and does a good job at exposing some of its less creditable tricks), he at once dismisses active money management - "a combination of private interests and behavioral phenomena provide the basis for the existence of this active segment" - and then goes on to document the success of Fuller & Thaler Asset Management in producing considerable excess return. So which is it Mr.Sherfin? ... Read more

Reviews (1)

Why Japan Inc doesn't let accountants rule marketing
The book is fascinating for its insights on target costing in addition to the better known Japanese working concepts of target quality and time to market in developing next generation products. It is suggested that everyone in the business team should vision what mix of quality features, price, and in-market date will be competitive, and then target these aims relentlessly. Processes must be tailored to fit them, and innovation priorities are defined by these goals. So target costing, for example, becomes the whole development team's job. Meanwhile accounting (and other performance) measures are seen as a distraction - open a separate book on them as a formality if necessary - but don't let them get in the way of the lean marketing learning organisation. The one disappointment of this book is that the twenty or so case studies of Japanese companies on which it is based are not included in it. For the full story, you will have to buy each Harvard case study. If you would like to discuss this book or how it impacts western measurement notions, eg te Balanced Scorecard, e-mail Chris Macrae at wcbn007@easynet.co.uk ... Read more

Book Description

As organizations become more complex and more decentralized, the demand for relevant management accounting information increases. Accounting and Management explores the problems faced by companies as they attempt to modernize their management accounting systems. The book consists of thirteen essays, by leading scholars, on the actual needs and applications of accounting information in modern businesses. It examines how companies such as Weyerhaeuser, Johnson and Johnson, and Hewlett-Packard have designed new control systems and provided new directions for measuring product costs and managerial performance. ... Read more

Reviews (1)

Accounting hype!!!
The authors research the claims of the accounting profession about the importance of knowing the "accounting language" to make it in business. But find it not to be so. The information mosaic a manager truly uses is (1) close to where the action is in the different functional units of the organization and (2) tied to primary units of activity and not the monetary units used in the mainstream accounting practice. ... Read more

Book Description

Set firmly within the larger context of American business history, Accounting for Success traces the evolution of the century-old, distinguished accounting firm of Price Waterhouse (PW). Allen and McDermott divide Price Waterhouse's history into three distinct periods. The first (1890 to the mid- 1920s) covers the establishment of the American outpost of a British parent and the Americanization of its practice. The second (the next forty years) highlights PW's rise to unrivaled professional leadership and the important role played by the audit. The third (the 1970s on) focuses on PW's response to the challenges brought about by the globalization of the economy, heightened competition among firms, and the growth of nonaudit services. The authors also address six central themes that recur throughout PW's history: the importance of the partner; the significant role played by the law in shaping the accounting profession's rights and responsibilities; the changing nature of accounting services; the continuously evolving and complex business environment; the highly visible role played by PW's leadership; and PW's worldwide approach to its business. ... Read more

Book Description

On Wall Street, the pressure to perform and the ethical dilemmas that accompany it did not fade away with the 1980s. As recent headlines attest, criminal proceedings, regulatory complaints, and customer litigation continue to affect the public's perception of the banking and securities industries. Street Smarts is a forceful call to action for Wall Street leaders to restore the industry's reputation for high professional standards. The authors examine corporate and individual conduct in financial institutions and markets to identify the major ethical issues confronting the securities industry, including market rigging, insider trading, whistle-blowing, and conflicts of interests. Based on their years of experience on Wall Street, Smith and Walter urge firms not to rely on regulatory or compliance commissions but to create an environment in which each firm defines appropriate actions and individual managers take responsibility for shaping and upholding the standards through employee development. Nothing less than the future of the industry is at stake. Street Smarts will help bankers, securities analysts, traders, and investors understand what needs to be done now to invest in an open, responsible culture that creates long-term value and higher returns. ... Read more

Book Description

There is a revolution going on in the world of accounting and control. Managers have begun to realize that most current accounting systems are not keeping up with the dramatic changes occurring in manufacturing. Just-in-time manufacturing and distribution processes, computer-aided design, and flexible manufacturing systems are now commonplace in the modern workplace, but antiquated accounting systems are unable to accurately monitor their operations, making them a liability for today's managers. In Measures for Manufacturing Excellence, leading academics from around the world describe how some of the most forward-thinking companies are using operations and accounting measures to win the battle for manufacturing excellence. Issues discussed include measuring organizational improvement, facilitating organizational learning, motivating product design improvements and evaluating production planning. ... Read more

Book Description

Information is power-and in financial markets that power has long belonged to intermediaries responsible for managing the exchange of information among clients. But now, technology has made information simultaneously and easily accessible to all through a simple Internet connection. Moreover, technology has codified many practices that once relied solely on human relationships and judgment, transforming the control of industry know-how and intellectual property, the structure of the financial markets, and ultimately, the makeup of the entire marketplace for information.

In the midst of the so-called new economy, the evolution of financial markets provides a time-tested guide to how and why intermediaries and the information they work with are evolving along with technology. It also convincingly proves that these information intermediaries-or infomediaries,-will not soon be replaced. In Information Markets, finance industry experts William J. Wilhelm Jr. and Joseph D. Downing systematically explore the interplay between human capital and information technology in financial markets, and distill critical lessons for strategists in other information-rich businesses, including health care, law, entertainment, and publishing.

The authors explain that technological advances have upset the delicate balance between an innovator's incentives for discovery (profiting from ideas) and the interests of society at large (information "wants to be free"). They provide a durable framework for understanding the tensions that arise in information-intensive markets, and how organizations adapt to these tensions in the face of continuous technological change.

The authors also describe how intermediaries resolve coordination problems according to long-established economic rules and experience, explain how the evolution of the intermediary function will affect the enforcement of intellectual property rights, and identify new opportunities organizations can exploit to create value and fuel innovation.

For any business dependent on information exchange, this timely book explains the vital role of the intermediary in today's global marketplace.

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Reviews (2)

Great insight into human capital and knowledge management
As co-founder of Human Capital Technology Inc. and active in the area of Knowledge Management, this book provides an essential history of information and knowledge management. By providing an historical perspective, the book clearly and simply explains the relationships between those who have information and those who want information and how that relationship has and continues change.

While the authors use the Investment Banking industry to make their point, the information is applicable to all areas of business. A must read for those who are concerned with the acquisition of information and the management of corporate knowledge.

Insightful, provocative view of the securities industry
Excellent book that describes the fundamental structure of the securities industry then overlays practical (and readily observable) elements of intellectual property/capital. One of the few intellectual capital books I have ever read that includes detailed analysis on J.P. Morgan, one of the all-time titans of capital.

Do not be turned off by the greek (mathematical) equations in the chapter about IPO allocations.

The authors have a very strong framework that holds up well in the real world, even in the post internet bubble world.

I especially enjoyed the chapter about the Goldman Sachs IPO and ECNs. ... Read more

Reviews (3)

Good background material but not at all actionable
I'm familiar with this book as it was an assigned textbook for a graduate level accounting course I taught. Where is succeeds is in pointing out the flaws of traditional accounting as a management tool and traditional cost reduction efforts as a response. Their material on finding and retaining profitable products and finding and retaining profitable customers are especially good. However, there isn't much in here on implementing the ideas and some ideas, especially managing with the real numbers, may be difficult to impossible to implement.

So, what's here is a good to great source of ideas in financial aspects of general management. There's just not much on how to take action on the ideas.

distills to one book many on subject
Although the critic that complains of lack of originality is perhaps correct, this book is of great use to the small business owner. Through this book one may convey the writtings of Porter, Kaplan, Drucker, Copeland, Urich and many others to the layman employee that neither has the interest, time, nor perhaps even the capacity to to inculcate the writtings of the aforementioned authors. It delivers the spirit and meaning of value adding/non-value adding activity and its relavance for every business.

Heavy on Cases Light on Content
Apply the cost of this book to the purchase of Robert S. Kaplan's "The Balanced Scorecard" and, perhaps, "Cost & Effect." (I'm assuming that almost every reader already has a copy of Michael Hammer's and James Champy's "Reengineering the Corporation.") The author's tend to quote the leading authorities in activity based costing, balanced scorecards, and process reengineering liberally and follow each quote with an endless stream of supporting cases. Outside of these celebrity quotes and the mind-numbing quantity of cases, there is a surprising lack of content -- I'm almost tempted to write the authors to request a refund.

(Believe me, this two-star rating is extremely generous!!!) ... Read more