Now, I know that not every person in the world is good with math. I am good friends with people who aren’t. However, it stands to reason, that if your job encompasses some level of mathematics, that at least with that aspect you would be fairly decent with.
Enter Client X.
Client X asked me to design a report for him. This report involved a bunch of totalling and summarizing that he is going to use to support sales. This man is also responsible for setting all the standards for sales, and the price breaks, markups, and discounts. In his job he does a lot of number crunching, and he’s held this job, and others like it, for twenty years.
On this report, he wanted to see not only the base price and company standard markup, but several levels of markups and discounts, so he could easily see profit margins and work with his customers to get them the best deal to secure business without hurting his own company. A 5% discount, and markups of 5%, 10%, 15%, and 20%. When I wrote this report, I used standard math principles: to get, for example, a 10% increase on a price you multiple the original amount by 1.10. This is a derived number, as follows:
X + (X * 10%)
10% is equal to 10/100 which reduces to 1/10 which is 0.10
X + (X * 0.10)
pull the X out
X * (1 + 0.10)
or
X * 1.10
This man argued with me, stating that multiplying by 1.10 was exactly the same as dividing by 0.90. He even tried to explain it with math… something like “dividing by the reciprocal is the same as multiplication”. Of course, 9/10 is not the reciprocal of 1/10, but that didn’t stop him. We went around and around until he finally brought in his boss who agreed that dividing by 0.90 was the same, and instructed me to use that method since it was their company standard. So I did.
A couple of weeks later, Client X calls to explain to me that my report is all wrong. “Our sales people are having to fudge the numbers to make them work,” he says. “The markups and discounts aren’t coming out right,” he continues. I wonder why that is? Client X now starts telling me my math must be wrong, he goes over how to do a 10% markup by dividing by 0.90, and I confirm that’s what the report is doing. “But then why are the numbers wrong?” he asks, puzzled. “Hmm, well, on your 10% numbers, are you off by about 1% or $1 every hundred?” “Yeah,” he says, “how did you know?”
How did I know?
100 * 1.10 = 110
100 / 0.90 = 111.111111111111…
I wonder…
Let me tell ya, there is just nothing sweeter than having someone force you to do something wrong only to be able to throw it in their faces later.