Harvard Business Review October 2016

Daniel Kahneman is surely one of the world’s nimblest thinkers. In 2002 he shared the Nobel Prize in Economic Sciences, a neat trick for a psychologist who claims he never so much as sat in on an economics course. He has also made valuable contributions to the field of management, and I suspect he didn’t do a lot of classwork in that area either. Kahneman has cowritten a couple of articles for Harvard Business Review— on how teams can make better decisions by identifying and reducing the biases that inevitably pop up in their thinking, and on how delusional optimism can lead executives to choose the wrong strategic path. This month he’s back with another compelling piece, coauthored with Andrew M. Rosenfield, Linnea Gandhi, and Tom Blaser, all of TGG Group,…

As a young officer in the Israel Defense Forces, Daniel Kahneman developed a protocol for evaluating recruits that was designed to ensure that interviewers were consistent. Sixty years later, the Nobel laureate has returned to the study of “noise” in judgment. As he and his coauthors document on page 38, inconsistent decision making is an invisible tax on the bottom line of many organizations. “Where there is judgment, there is noise—and usually more of it than you think,” they write. Christoph Loch, a professor at and the director of Cambridge University’s Judge School of Business, explores the factors that make technological innovations catch on. After working for five years on a variety of innovation projects, he came to understand the critical role business models play in linking technology changes to market…

We have been self-managed for five years and implemented holacracy one and a half years ago, because we wanted clarity about who was doing what, and the team wanted more goal-oriented work. Holacracy achieves both aims, and our company gets through the build-measurelearn cycle much faster. Mark Vletter, founder, Voys and Devhouse Spindle When Tony Hsieh was inspired by Brian Robertson to implement holacracy at Zappos, a number of employees resigned either for economic reasons or because they were not connected with this kind of organizational structure. Holacracy is a culture thing, and not every organization is suited to it. In such cases it’s good to review holacracy and cherry-pick certain parts to implement in the traditional organizational structure. Arie Blokland, independent retail banking and mortgage consultant The authors cite Frederick Taylor’s early-1900s contribution…

Alexander Pepper spent 27 years at a large accounting firm helping client companies devise ways to compensate CEOs and other senior executives. Starting in the early 1990s, pay packages have typically included long-term equity incentive plans aimed at aligning managers’ and shareholders’ interests. But over time Pepper grew disillusioned. “I began to realize that the people we were putting the packages in place for didn’t necessarily like them very much, and the plans didn’t do what they were intended to,” he says. In the early 2000s Pepper went back to school, eventually earning a DBA; he teaches at the London School of Economics. Today he researches why payfor-performance plans don’t work. “I was part of the system that I’ve subsequently come to say is not very effective,” he says. Since 2013…

The research: Chenkai Wu, a PhD student in public health at Oregon State University, teamed up with OSU professors Robert Stawski and Michelle Odden and Colorado State’s Gwenith Fisher to examine data from the Health and Retirement Study, a longitudinal survey of Americans age 50 and over. When they looked at the sample of 2,956 people who had begun participating in the study in 1992 and retired by 2010, the researchers found that the majority had retired around age 65. But a statistical analysis showed that when people retired at age 66 instead, their mortality rates dropped by 11%. The challenge: Does work benefit us in unexpected ways? Is delayed retirement the secret to a longer life? Mr. Wu, defend your research. Wu: That’s the conclusion we are leaning toward. What’s interesting…

The Idea Behind the Popeyes turnaround was a conscious decision to treat leadership as stewardship—and to put the interests of franchisees above those of every other stakeholder group. My first official day as CEO of Popeyes Louisiana Kitchen was November 1, 2007, but the company was holding a big franchisee meeting in Orlando a few days earlier. I wasn’t technically an employee yet, but I decided to attend and make a presentation. My hope was to inspire the entrepreneurs who own and operate Popeyes restaurants about the bright future of the brand. In retrospect, I was naive and overly optimistic. The company had gone through four CEOs in seven years, and sales had been choppy throughout that period. The meeting made it crystal clear that the relationship between Popeyes and its franchisees was…