#269: Monday Memo: The Bell Curve Fallacy and the Importance of the Long-Tail
What’s one of the biggest fallacies in business & finance and which is holding our performance back?
It’s that performance & results of both staff and enterprises follows a normal bell-curve distribution! It simply doesn’t! Intuitively we know this because 50% of newly registered businesses will fail in 5 years following an exponential Paretian power curve, 5 companies make up 18% of the stock market value in the US, and on sports teams most of the money goes to those who generate the most value with most of us earning below the average. In any endeavor there are those who smash performance out of the park and then the rest of us, or as some call the long tail.
In this bite-sized episode I explain why so many of us continue to use the normal distribution fallacy and a more appropriate way of looking at this.
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Om Podcasten
The #SITN Show (www.sitnshow.com) is a popular accounting & finance podcast listened to in over 150+ countries around the world.
Getting an accounting qualification or finance certification is one of the best things to do to make a difference in our society. It potentially gives us a position from which we can help businesses make better decisions for the good of their customers, suppliers, communities, colleagues and yes owners and other financiers too. We can help increase the opportunity for all. So #SITN was established to leverage the value of mentoring:
1. To elevate the influence, impact, value, and difference we make for our organisations; and
2. To have more fun, rewarding, and meaningful careers in accounting & finance.
In this way we make it more accessible to everyone in our profession, regardless or geography, professional affiliations, status, gender, etc…
The fundamental premise of #SITN is that despite for all the challenges our profession is facing into, the seemingly accelerating rate of change, the new digital technologies and business models, we still have the ability to share with each other practical advice & experiences on what works well and what doesn’t, so that we can all plot better paths forward.
Every Thursday we release a professionally produced podcast with a 30- to 40-minute interview that has been recorded with a guest mentor relevant to the finance & accounting profession. These guest mentors share their real success stories and hard-won lessons which are not found in any textbooks or on LinkedIn profiles. Together with the interviewer they deconstruct their experiences into the key strengths, qualities and practical ‘baby’ steps that others can also follow. On Mondays there is the popular #SITN Monday Memo which is a 5-minute debrief on a topical issue or useful piece of practical advice in accounting & finance.
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