Being the Boss: The 3 Imperatives for Becoming a Great Leader
|Authors:||Linda A. Hill and Kent Lineback|
|Publication:||Harvard Business Press, 2011|
You never dreamed being the boss would be so hard. You're caught in a web of conflicting expectations from subordinates, your supervisor, peers, and customers. You're constantly fighting fires. You're mired in office politics. You end each day exhausted and discouraged, wondering what, if anything, you've accomplished. You're not alone. As Linda Hill and Kent Lineback reveal in Being the Boss, becoming an effective manager is a painful, difficult journey. It's trial and error, endless effort, and slowly acquired personal insight. Many managers never complete the journey. At best, they just learn to get by. At worst, they become terrible bosses. This new book explains how to avoid that fate by mastering three imperatives: 1) Manage yourself: Learn that management isn't about getting things done yourself. It's about accomplishing things through others; 2) Manage a network: Understand how power and influence work in your organization and build a network of mutually beneficial relationships to navigate your company's complex political environment; and 3) Manage a team: Forge a high-performing "we" out of all the "I"s who report to you. Packed with compelling stories and practical guidance, Being the Boss is an indispensable guide for not only first-time managers but all managers seeking to master the most daunting challenges of leadership.
Building World Class Universities in Asia
|Author:||D. Quinn Mills|
After discussing higher education's potential contribution to Asia's economic progress and the characteristics (and limitations) of a leading university, Professor Emeritus Daniel Quinn Mills lays out his recommendations for building a world-class university in Asia, including how to hire faculty, build a curriculum, attract and retain students, and achieve top-quality research.
The Fund Industry: How Your Money Is Managed
|Authors:||Robert Pozen and Theresa Hamacher|
|Publication:||John Wiley & Sons, forthcoming|
The Fund Industry explains to students and investors how to evaluate mutual funds and other collective investment vehicles. It discusses how different types of funds are managed, marketed, and regulated. It also reviews how funds invest and gather assets in countries across the globe.
Thinking Too Little to Thinking Too Much: A Continuum of Decision Making
|Authors:||Dan Ariely and Michael I. Norton|
|Publication:||Wiley Interdisciplinary Reviews: Cognitive Science 2 (January-February 2011)|
Due to the sheer number and variety of decisions that people make in their everyday lives—from choosing yogurts to choosing religions to choosing spouses—research in judgment and decision making has taken many forms. We suggest, however, that much of this research has been conducted under two broad rubrics: the study of thinking too little (as with the literature on heuristics and biases), and the study of thinking too much (as with the literature on decision analysis). In this review, we focus on the different types of decision errors that result from both modes of thought. For thinking too little, we discuss research exploring the ways in which habits can lead people to make suboptimal decisions; for thinking too much, we discuss research documenting the ways in which careful consideration of attributes, and careful consideration of options, can do the same. We end by suggesting that decision makers may do well, when making any decision, to consider whether they are facing a "thinking too much" or "thinking too little" problem and adjust accordingly.
Download the paper: http://onlinelibrary.wiley.com/doi/10.1002/wcs.90/abstract
How to Design a Winning Business Model
|Authors:||Ramon Casadesus-Masanell and Joan E. Ricart|
|Publication:||Harvard Business Review 89|
Most executives believe that competing through business models is critical for success, but few have come to grips with how best to do so. One common mistake, the authors' studies show, is enterprises' unwavering focus on creating innovative models and evaluating their efficacy in standalone fashion—just as engineers test new technologies or products. However, the success or failure of a company's business model depends largely on how it interacts with those of the other players in the industry. (Almost any business model will perform brilliantly if a company is lucky enough to be the only one in a market.) Because companies build them without thinking about the competition, they routinely deploy doomed business models. Moreover, many companies ignore the dynamic elements of business models and fail to realize that they can design business models to generate winner-take-all effects similar to the network externalities that high-tech companies such as Microsoft, eBay, and Facebook often create. A good business model creates virtuous cycles that, over time, result in competitive advantage. Smart companies know how to strengthen their virtuous cycles, undermine those of rivals, and even use them to turn competitors' strengths into weaknesses.
Read the article: http://hbr.org/2011/01/how-to-design-a-winning-business-model/ar/1#
Share Issuance and Factor Timing
|Authors:||Robin Greenwood and Samuel Gregory Hanson|
|Publication:||Journal of Finance (forthcoming)|
We show that characteristics of stock issuers can be used to forecast important common factors in stocks' returns such as those associated with book-to-market, size, and industry. Specifically, we use differences between the attributes of stock issuers and repurchasers to forecast characteristic-related factor returns. For example, we show that large firms underperform following years when issuing firms are large relative to repurchasing firms. While our strongest results are for portfolios based on book-to-market, size (i.e., we forecast the HML and SMB factors), and industry, our approach is also useful for forecasting factor returns associated with distress, payout policy, and profitability.
Read the paper: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1572174
Are You a Good Boss—Or a Great One?
|Authors:||Linda A. Hill and Kent Lineback|
|Publication:||Harvard Business Review 89|
Private moments of doubt and fear come even to managers who have spent years on the job. Any number of events can trigger them: an initiative is going poorly; you get a lukewarm performance review; your new assignment is daunting. HBS professor Linda Hill and executive Kent Lineback have long studied the question of how managers grow and advance. Their experience brings them to a simple but troubling observation: Most bosses reach a certain level of proficiency and stay there—short of what they could and should be. Why? Because they stop working on themselves. The authors offer what they call the three imperatives for every manager who seeks to avoid this stagnation: Manage yourself. Who you are as a person, the beliefs and values that drive your actions, and especially how you connect with others all matter to the people you must influence. Manage your network. Effective managers know they cannot avoid conflict and competition among organizational groups; they build and nurture ongoing relationships. Manage your team. Team members need to know what's required of them collectively and individually and what the team's values, norms, and standards are. The authors include a useful assessment tool to help readers get started.
Read the article: http://hbr.org/2011/01/are-you-a-good-boss-or-a-great-one/ar/1#
The Emerging Capital Market for Nonprofits
|Authors:||Robert S. Kaplan and Allen S. Grossman|
|Publication:||,em>Harvard Business Review 88|
Many of our largest and most successful companies today did not exist 50 years ago. During this same time interval, companies that ranked among top in the 1960s have disappeared, been merged out of existence, or become much smaller presences in the U.S. industrial scene. These shifts in fortunes are vivid examples of the private sector's cycle of Schumpeterian creative destruction. In contrast, the list of the largest nonprofit organizations has remained stable over decades. Large nonprofits do not disappear and few new ones—Habitat for Humanity and Teach for America are among the exceptions—scale to national size. Schumpeter's cycle apparently does not operate in the social sector. This paper proposes that the disparity arises from the nonprofit sector's historically immature infrastructure and poor mechanisms for channeling funds from donors and foundations to the most effective nonprofits and away from underperforming ones. We illustrate how innovative information and financial intermediaries, using new measurement approaches tailored for the nonprofit sector, have recently arisen to help direct funds to the most effective nonprofits. These innovations have the potential to enable the sector to become far more responsive, effective, and efficient in creating positive social impact at a national scale.
Read the article: http://hbr.org/2010/10/the-emerging-capital-market-for-nonprofits/ar/1
Stop Holding Yourself Back
|Authors:||Anne Morriss, Robin J. Ely, and Frances X. Frei|
|Publication:||Harvard Business Review 89|
After working with hundreds of leaders in a wide variety of organizations and in countries all over the globe, the authors found one very clear pattern: when it comes to meeting their leadership potential, many people unintentionally get in their own way. Five barriers in particular tend to keep promising managers from becoming exceptional leaders: people overemphasize personal goals, protect their public image, turn their competitors into two-dimensional enemies, go it alone instead of soliciting support and advice, and wait for permission to lead. Troy, a customer service manager, endangered his job and his company's reputation by focusing on protecting his position, not helping his team; when a trusted friend advised him to change his behavior, the results were striking. Anita's insistence on sticking to the tough persona she'd created for herself caused her to ignore the more intuitive part of the leadership equation, with disastrous results—until she let go of the need to appear invulnerable and reached out to another manager. Jon, a personal trainer who had virtually no experience with either youth development programs or urban life, opened a highly successful gym for inner-city kids at risk; he refused to be daunted by his lack of expertise and decided to simply "go for it." As these and other examples from the authors' research demonstrate, being a leader means making an active decision to lead. Only then will the workforce—and society—benefit from the enormous amount of talent currently sitting on the bench.
Read the article: http://hbr.org/2011/01/managing-yourself-stop-holding-yourself-back/ar/1
Creating Shared Value
|Authors:||Michael E. Porter and Mark R. Kramer|
|Publication:||Harvard Business Review 89|
The capitalist system is under siege. In recent years business has been criticized as a major cause of social, environmental, and economic problems. Companies are widely thought to be prospering at the expense of their communities. Trust in business has fallen to new lows, leading government officials to set policies that undermine competitiveness and sap economic growth. Business is caught in a vicious circle. A big part of the problem lies with companies themselves, which remain trapped in an outdated, narrow approach to value creation. Focused on optimizing short-term financial performance, they overlook the greatest unmet needs in the market as well as broader influences on their long-term success. Why else would companies ignore the well-being of their customers, the depletion of natural resources vital to their businesses, the viability of suppliers, and the economic distress of the communities in which they produce and sell? It doesn't have to be this way, say Porter, of Harvard Business School, and Kramer, the managing director of the social impact advisory firm FSG. Companies could bring business and society back together if they redefined their purpose as creating "shared value"-generating economic value in a way that also produces value for society by addressing its challenges. A shared value approach reconnects company success with social progress. Firms can do this in three distinct ways: by reconceiving products and markets, redefining productivity in the value chain, and building supportive industry clusters at the company's locations. A number of companies known for their hard-nosed approach to business—including GE, Wal-Mart, Nestlé, Johnson & Johnson, and Unilever—have already embarked on important initiatives in these areas. Nestlé, for example, redesigned its coffee procurement processes, working intensively with small farmers in impoverished areas who were trapped in a cycle of low productivity, poor quality, and environmental degradation. Nestlé provided advice on farming practices; helped growers secure plant stock, fertilizers, and pesticides; and began directly paying them a premium for better beans. Higher yields and quality increased the growers' incomes, the environmental impact of farms shrank, and Nestlé's reliable supply of good coffee grew significantly. Shared value was created. Shared value could reshape capitalism and its relationship to society. It could also drive the next wave of innovation and productivity growth in the global economy as it opens managers' eyes to immense human needs that must be met, large new markets to be served, and the internal costs of social deficits—as well as the competitive advantages available from addressing them. But our understanding of shared value is still in its genesis. Attaining it will require managers to develop new skills and knowledge and governments to learn how to regulate in ways that enable shared value, rather than work against it.
Read the article: http://hbr.org/2011/01/the-big-idea-creating-shared-value/ar/1
Minimal Settlement Assets in Economies with Interconnected Financial Obligations
|Author:||Julio J. Rotemberg|
|Publication:||Journal of Money, Credit and Banking (forthcoming)|
A model is developed where firms belonging to a group are obliged to make payments to one another by using a liquid asset. The paper studies the exogenous endowments of this asset that are necessary to assure that all obligations are met. Conditions are presented under which the degree to which firms are interconnected (so that each creditor has more debtors and each debtor has more creditors) increases the number of firms that must be endowed with the liquid asset. Interconnectedness then makes payment defaults more likely. By acquiring too many payment obligations, firms may also become too interconnected.
Peronist Beliefs and Interventionist Policies
|Authors:||Rafael Di Tella and Juan Dubra|
We study the logic of Peronist interventionist polices and the beliefs that support them. Instead of a comprehensive approach, we focus on three elements. First, we study beliefs and values about the economic system present in Peron's speeches during the period 1943-1955. Second, we study survey data for the 1990s on the beliefs of Peronist and non- Peronist voters in Argentina and Democrat and Republican voters in the U.S. While income and education suggest that Peronists (in relative terms) look like the American Democrats, their beliefs and values suggest that Peronists are the Argentine equivalent of the Republicans. Third, given that these beliefs are non-standard (for economists) we present a model formalizing some of their key aspects (for example, the idea that there is something more than a material exchange in labor relations).
Download the paper: http://papers.nber.org/papers/w16621
Conveniently Upset: Avoiding Altruism by Distorting Beliefs about Others
|Authors:||Rafael Di Tella and Ricardo Pérez-Truglia|
In this paper we present the results from a "corruption game" (a dictator game modified so that the second player can accept a side payment that reduces the overall size of the pie). Dictators (silently) treated to have the possibility of taking a larger proportion of the recipient's tokens, take more of them. They were also more likely to report believing that the recipient would accept a low price in exchange for a side payment and selected larger numbers as their best guess of the likely proportion of recipients acting "unfairly." The results favor the hypothesis that people avoid altruistic actions by distorting beliefs about others.
Download the paper: http://papers.nber.org/papers/w16645
Preference Heterogeneity and Optimal Capital Income Taxation
|Authors:||Mikhail Golosov, Maxim Troshkin, Aleh Tsyvinski, and Matthew Weinzierl|
We examine a prominent justification for capital income taxation: goods preferred by those with high ability ought to be taxed. In an environment where commodity taxes are allowed to be nonlinear functions of income and consumption, we derive an analytical expression that reveals the forces determining optimal commodity taxation. We then calibrate the model to evidence on the relationship between skills and preferences and extensively examine the quantitative case for taxes on future consumption (saving). In our baseline case of a unit intertemporal elasticity, optimal capital income tax rates are 2% on average and 4.5% on high earners. We find that the intertemporal elasticity of substitution has a substantial effect on optimal capital taxation. If the intertemporal elasticity is one-third, optimal capital income tax rates rise to 15% on average and 23% on high earners; if the intertemporal elasticity is two, optimal rates fall to 0.6% on average and 1.6% on high earners. Nevertheless, in all cases that we consider, the welfare gains of using optimal capital taxes are small.
Download the paper: http://www.nber.org/papers/w16619
A Behavioral Model of Demandable Deposits and Its Implications for Financial Regulation
|Author:||Julio J. Rotemberg|
A model is developed that rationalizes contracts that give depositors the right to obtain funds on demand even when depositors intend to use these funds for consumption in the future. This is explained by depositor overoptimism regarding their own ability to collect funds in a run. Capitalized institutions serving depositors with such beliefs emerge in equilibrium even if depositors and bank owners have the same preferences and the same investment opportunities. Various government regulations of these institutions, including minimum capital levels, requirements concerning the assets they may hold, deposit insurance, and compulsory clawbacks in bankruptcy, can raise the average ex post welfare of depositors.
Download the paper: http://www.nber.org/papers/w16620
What We Know: Turning Organizational Knowledge into Team Performance
|Authors:||Bradley R. Staats, Melissa A. Valentine, and Amy C. Edmondson|
This paper examines how teams draw on knowledge resources in the firm in the production of novel output. We theorize positive effects of team use of an organizational knowledge repository on two measures of team performance (quality and efficiency) and argue that these effects will be greater when teams face structural characteristics (team geographic dispersion and task change) that intensify the challenge of knowledge integration. Drawing on information processing theory, we distinguish between a team's knowledge repository use and concentration of use (the extent to which use is limited to a few members versus more evenly distributed within the team). Using objective data from several hundred software development projects in an Indian software services firm, we find that knowledge repository use has a positive effect on project efficiency but not on project quality. Concentration of repository use, a form of within-team specialization, is negatively associated with project efficiency and positively related to project quality. Finally, as predicted, we find that in some cases the effects of both repository use and concentration of repository use are greater when teams are dispersed geographically or encounter changing tasks. Our findings offer insight for theory and practice into how organizational knowledge resources can improve knowledge workers' productivity and help build organizational capability.
Download the paper: http://www.hbs.edu/research/pdf/11-031.pdf