Sam Savage's latest offering Flaw of Averages is a useful book and set of thought tools he calls mindles. If you have a PhD in statistics or mathematics, your job or role rarely begins and ends with you. Often your models will need to be explained to people. More importantly, the places where the models could or would go wrong need to get explained.
The Flaw of Averages provides a great read and introduction to basic concepts in probability and real life situations where things behave in unintended ways, such as the hidden stories in the "average".
The book's core strength is the author's fun and helpful voice. He is the stats teacher you wish you or your kids had.
Sam Savage has spent a long time in industry explaining and teaching how statistics and models work across sectors. His chief skill is as a creator of simple stories and mental models that let managers and regular people understand the value of statistics applied. Dr. Savage sells powerful "light bulb goes on in the head moments" for a living and sells the tools that let people have those light bulb moments in their own respective domains.
If you want a way to understand something from a new angle or some interesting new thought tools, take a look at the Flaw of Averages. Quite a few useful examples and free simulations are available at his website.
Topics covered include:
- Flaw of averages in finance and real estate
- Flaw of averages in supply chain management
- Examples of more successful product launches
- Petroleum (peak oil is hinted at)
- Many other real world applications and examples that would allow managers to share powerful concepts. If you can't afford a $2k/day stats manager to assess some of your business issues, try a few hours of reading this book.
Disclosure: 10 years ago, I bought one of Sam's modeling tools for excel and over the course of 4 years proceeded to lose it somewhere between living in Dubai, Denmark and Brussels. I called Sam up, explained the situation and he let me pick up an upgrade for minimal cost. He is not only a great teacher/practitioner but a nice fellow as well.