MIT Sloan Management Review Winter 2023

REORGANIZE. REVOLUTIONIZE. Reform. Rethink. Today’s organizational leaders have a mandate to make change happen: to diversify or innovate before a line of business is disrupted, to fix an unhealthy culture that is driving out talent, and to adapt to new trends or technologies. While the times may call for transformational leaders, focusing on how to effect change in other people, processes, and structures isn’t enough. In order to truly rise to complex challenges posed by the great economic, social, environmental, and political uncertainty the world currently faces, you must also be a transforming leader — continually learning, evolving, and maturing as a manager and a human being. A great source of inspiration for personal growth that can help you responsibly and effectively wield the authority you have been given is the research…

What if your company’s health insurance plan (or your hiring and training practices, or your policy on guns in the workplace) violates a new state law? And what if your efforts to comply with fast-changing laws and regulations are met with condemnations from employees, customers, and investors? These were not questions that business leaders were asking themselves even a few years ago. Now they must. Worse, such questions are certain to increase in both quantity and importance. You need a political strategy — one that supports and complements your business strategy. One clear cause is the U.S. Supreme Court term that concluded in June 2022, which both revealed and reopened ugly scars in the social fabric of American society. Decisions on climate regulation, reproductive rights, and gun control, to pick just three, sparked…

Neuromarketing. Neuromanagement. Neurofinance. Attempts to inject brain science into the business world have been nothing short of comprehensive — and, quite possibly, oversold. Proponents of neuroscience in commercial settings argue that it can provide key insights that help explain consumer and employee behavior — insights that can ultimately be used to develop more appealing products and services. While that may be true to a certain extent, managers considering such applications aren’t served by broad claims that gloss over important caveats concerning the practical application of brain science. This article aims to help managers critically evaluate vendor offerings based in neuroscience. In particular, there are three very significant issues that business leaders must understand if they hope to make informed decisions regarding investments in such products. Issue 1: Proxies One high-profile example of neuromarketing involves…

Driven by customers, activist investors, governments, and their own values, companies are increasingly looking to make a more positive impact on the environment by adopting a sustainability focus. An important arena for those activities is the emerging bioeconomy, which focuses on using biological (nonfossil) resources, waste streams, and manufacturing byproducts, often combined with a circular, whole-life-cycle product perspective. This movement is enabled by new materials technologies and processes that replace fossil-based ingredients with biobased alternatives from the agriculture, forestry, and marine industries. Circularity comes in with strategies aimed at extending the useful life of products for as long as possible and then reusing their materials and components in some way. Multiple materials and technologies can replace fossil-based ingredients and components, such as packaging made from bamboo and mushrooms, cosmetics and pharmaceuticals made…

Decision makers often want to escape the psychological discomfort of ambivalence by making choices as quickly as possible. This is true even for choices that have an ethical component, including those that can involve potential harm or violations of social norms. Decisions that have moral consequences are often dense and require reconciliation of the conflicting interests of multiple stakeholders, as well as more sustained and systematic consideration. Studies have shown that individuals experiencing ambivalence don’t always correctly identify what is causing that conflicting feeling of positive and negative emotions. This is a missed opportunity. Being conscious of this state, called identified ambivalence, can lead to more effective decision-making, because recognizing uncomfortable mixed reactions allows decision makers to suspend initial judgments and try to understand what is truly causing their cognitive discomfort.…

The COVID-19 pandemic, the war in Ukraine, and the ongoing climate crisis have put a spotlight on the central role businesses can play in tackling global challenges. We need companies to step up and help — for the sake of the economy as well as people and the planet. Yet one of the drivers of corporate citizenship — investor influence — is limited by existing approaches for assessing a company’s social and environmental performance. The predominant frameworks are too narrow and fail to fully address key stakeholder concerns. Environmental, social, and governance (ESG) assessments focus on internal operational matters, such as labor relations and supply chain sustainability, but don’t fully consider the impact that a company’s products or services can have on outside stakeholders. Frameworks focused on external impact in turn…