In a series of studies, Francesca Gino and Dan Ariely found that inherently creative people tend to cheat more than noncreative people. Furthermore, they showed that inducing creative behavior tends to induce unethical behavior. It's a sobering thought in a corporate culture that champions out-of-the-box thinking.
Summing Up Readers of Jim Heskett's column this month offer guidelines for when to think fast and when to think slow, from author Daniel Kahneman's book, Thinking, Fast and Slow.
Economists have been paying increasing attention to the role that culture plays in a firm's overall performance. This paper focuses on how trust—a key cultural factor—affects firms' decision-making process, size, and productivity. Research was conducted by Nicholas Bloom of Stanford University, Rafaella Sadun of the Harvard Business School, and John Van Reenen of the London School of Economics.
Sum-up Nontraditional performance measures, as highlighted in the movie 'Moneyball', will become an increasingly important part of the young manager's toolkit, Jim Heskett's readers say.
Forum Closed Summing Up: Is experience really the best teacher? Sure—when not much is on the line, according to readers commenting on Professor Jim Heskett's column on common sense.
"Show me a company or nonprofit or government in trouble, and I will almost invariably show you a set of leaders who are asking absolutely the wrong questions," says professor Robert Steven Kaplan. He discusses his new book, What to Ask the Person in the Mirror. Plus: book excerpt.
Summing Up Managers like to think they act ethically, but at the end of the day ethical action is subjective, readers tell Jim Heskett. Reaction to the new book Blind Spots.
Economists love menus, which can be used to help understand people's choices. For example, do we prefer more choices (larger menu) or fewer (shorter menu)? But the menu itself has to be pre-selected. Research by David Goldreich (Rotman School of Management, University of Toronto) and Hanna Halaburda (Harvard Business School) focuses on the menu setter's decisions about what to include, and how large a menu to construct in the context of 401(k) plan choices.
Even when we think we are making principled decisions, recent research reveals we are not as ethical as we would like to believe. Professor Max H. Bazerman discusses his new book, Blind Spots: Why We Fail to Do What's Right and What to Do about It. Plus: Book excerpt.
In the management literature, some theories hold that corporate actions and strategic choices can be partially predicted by knowing the functional background of executives. The authors provide evidence on how CEOs and CFOs who were former investment bankers, auditors, and private equity/venture capital executives managed decisions around goodwill impairments (essentially goodwill charge-offs)—a complex accounting choice involving a high degree of managerial discretion. Research by HBS professor Francois Brochet and doctoral candidate Kyle Welch.
A common business (and life) practice involves delaying a decision in order to avoid immediate commitment. James J. Anton (Fuqua School of Business) and Dennis A. Yao (HBS) discuss ways in which delaying or, alternatively, speeding up commitment can be a valuable tactic, how these tactics influence the actions of other decision makers, and ways in which such actions affect other decisions. Changing the speed at which a decision is made affects how others allocate resources to influence how that and other decisions will eventually be made. The researchers identify two tactics associated with changing decision speed: "pinning" and "focusing."
If time is money, as the old adage goes, then a CEO's schedule is especially important to a firm's financial success. This raises a fair question: What do CEOs do all day? To that end, researchers followed the activities of 94 CEOs in Italy over the course of a pre-specified week, enlisting the CEOs' personal assistants to track their bosses' activities with time-use diaries. Research was conducted by Raffaella Sadun of Harvard Business School, Luigi Guiso of the European University Institute, and Oriana Bandiera and Andrea Prat of the London School of Economics.
In the course of making a decision, managers often err in one of two directions—either overanalyzing a situation or forgoing all the relevant information and simply going with their gut. HBS marketing professor Michael I. Norton discusses the potential pitfalls of thinking too much or thinking too little.
Leading a doomed company can often help a career by providing experience, insight, and contacts that lead to new opportunities, says professor Shikhar Ghosh.
In business and in life, it's important to strike a smart balance between naïveté and cynicism. Act too naïvely, and someone is bound to take advantage of you. Skew cynical, and you may miss out on new opportunities with good people. This paper discusses the decision errors inherent in leaning too far in either direction. Research was conducted by Chia-Jung Tsay, Lisa. L. Shu, and Max H. Bazerman of Harvard Business School.
Published in 2010
Summing Up Is choice an art or science? Jim Heskett's readers wonder whether the question is the right one to ask. (Online forum has closed; next forum opens January 6.)
Successful business strategy lies not in having all the right answers, but rather in asking the right questions, says Harvard Business School professor Robert Simons. In an excerpt from his new book, Seven Strategy Questions, Simons explains how posing these questions can help managers make smart choices.
Executives at public companies are always under pressure to "meet the numbers" each quarter, often so much so that they sacrifice long-term investments in order to make everything look rosy in the short term. In this paper, Harvard Business School professor Rebecca M. Henderson and Sloan School of Management professor Nelson P. Repenning set out to reconcile the apparently contradictory strategies of short-term results and long-term investments.
At what point in the corporate food chain are big decisions made? It depends on technology, according to new research, which finds that information-based software will help to push decisions further down the corporate ladder, whereas communication technologies will push decisions up to the top. Research was conducted by Nicholas Bloom of Stanford University; Assistant Professor Raffaella Sadun of Harvard Business School; and Luis Garicano and John Van Reenen of the London School of Economics.
Even the best leaders can be in denial—about trouble inside the organization, about onrushing competitors, about changing consumer behavior. Harvard Business School professor Richard S. Tedlow looks at history and discusses how executives can acknowledge and deal with reality. Plus: Book excerpt.
