(#1) The Story behind the Numbers Newsletter: Connecting the story: a mix of 2 worlds thought behavioral economics

Hello,

I’ve been always fascinated about numbers.

I remember myself before going to school with a notebook. In that notebook I was calculating and writing numbers.

I don’t remember too much about the calculation, most likely some basic things that I saw in my elder brother’s notebook or books. But the numbers were there. What was more fascinating besides the numbers, was the story behind the numbers. And that’s when I found during school topics like physics, chemistry, or geometry. I could now see the numbers from a different perspective. And that made me think more about the story behind the numbers.

Eventually, I joined an economic high school were my Economic teacher, the late Professor Vasile Boieru, when preparing for a student Economic contest, gave me a book. It was “Economics. The rules of the game” by Michel Didier [1]. I was fascinated. Presented in an easy and accessible way, I couldn’t stop reading it. More than that, it started what will be my companion, which is analyzing, reflecting, and researching. I started thinking, connecting trends, and having my own opinions. Of course, they were basic principles for a student and basic for practical matters, but for me was the beginning of the path that I will follow.

I've been studying economics for the last 24 years. It started in an economic high school, continued at the The Bucharest University of Economic Studies for the bachelor, master and PhD program. Soon after starting my PhD in 2008, I've also began my teaching career. Research has been part of what I did in the last 15 years as being part of the Department of Financial Analysis and Valuation. During this time I had the chance to have teaching and research activities at Dauphine University in Paris, University of Alicante and Vienna University of Economic Studies. I earned my PhD in 2011 with a research on performance analysis through value creation.

Teaching and research always gave me that sense of exploring, curiosity and focus. Since 2008, I started also joining consulting projects and had the chance to meet a new world: the business world. Through working in different projects, and since 2018 working with Qualians on various organisational development projects, I started combining my passion for numbers & financial analysis with what I saw in different organisations. I call this "The Story behind the Numbers".

My work on productivity, personal & organisational development has a final result that I am fortunate to see in analysing numbers.

Businesses focus on reaching the target numbers each year. And we can see the performance in quarterly reports, annual reports or different industry statistics.

It's like looking at the back cover of a book. You can see the summary of the book and some key ideas. This is how I see the financial statements. They show the summary of a period (year, or quarter). In financial analysis, we take those financial statements and go back and track & analyze the trends, performance and evolution.

I started learning psychology in a bachelor program. One of the reasons was that I started connecting the dots between numbers and behavior (seen in different projects). I'm still learning, but it is connected to behavioral economics, as described in the definition below.

"Behavioral economics combines elements of economics and psychology to understand how and why people behave the way they do in the real world. It differs from neoclassical economics, which assumes that most people have well-defined preferences and make well-informed, self-interested decisions based on those preferences."[2]

I wrote 3 books on Financial analysis (Performance analysis though value creation, 12 ingredients for productivity & Real Estate Market and investor behavior) and co-authored 4 more, and worked on more than 30 scientific articles on the matter. Moreover, I had the chance to work with Prof. Hermann Simon for the translation and adaptation in Romanian of "Confessions of The Pricing Man). All of these, connected more and more my interest in Behavioral Economics.

Last year, I started 2 newsletters on Linkedin, one on Productivity and one on Motivation. The interest was high and more than 3500 professionals subscribed. But, for me, the 2 newsletters seemed really disconnected from what I want to actually share.

I don't think motivation is disconnected from productivity and neither disconnected from numbers. In the end we see the financial results as they are: results of what is happening during a year in an organisation or a team.

The financial numbers are the results of:

• strategy, great business model and innovation
• company culture, a vision and mission
• tactical implementation of strategy and great leadership
• sales & pricing strategy with continuous product development
• productivity at the team level
• clear change management & strategy execution
• great communication, collaboration and interpersonal relations
• productivity at the personal level and self-management

As shown in this image above, the target should always be to reach the end story, the actual root cause that drives the final financial numbers.

That's why, I'm launching the Linkedin Newsletter "The Story Behind The Numbers". It will include my views from connecting the story between 2 worlds: the financial numbers one and the behavioral one.

Each week, I will share some insights from finance connected with the actual patterns that I see related to the effect on those numbers. I will also start a new podcast named as this newsletter in which I will invite: C level executives, entrepreneurs and professionals to share their story behind the numbers.

So, I invite you to subscribe and looking forward to start this journey with this Linkedin Newsletter. You can opt to receive an email (from Linkedin) with new editions of this newsletter or just get a notification in the Linkedin platform.

Regards,

Costin Ciora, PhD.

References:

[1] Michel Didier - L'Economie: regles du jeu?(1984),?Economia: regulile jocului, Humanitas,1999

[2] What is behavioral economics by Max Witynski, University of Chicago News, https://news.uchicago.edu/explainer/what-is-behavioral-economics