A manual advocates a return to a more classic mode of thinking about business.
In this book, the authors direct concerted criticism at the drastic increase in short-term thinking in the business and management world in the last two decades. They cite the boom in things like investment hedge funds that stress short-term gains and hence short-term thinking, pointing out that this phenomenon goes hand in hand with larger changes in corporate culture. The tenure of most executives is shorter now, they explain, noting the obvious result: “CEOs tend to focus on shorter-term objectives.” Carey (Talent Wins, 2018, etc.), Dumaine (The Plot to Save the Planet, 2008), Useem (The Leader’s Checklist, 2011, etc.), and debut author Zemmel have aimed their arguments at executives, directors, and investors, laying out the values of long-term thinking and highlighting both its risks and rewards. “One of the toughest challenges any CEO faces is staying focused on a long-term strategy while having to deal with short-term distractions,” they write. They provide several prominent examples of major corporate executives who risked short-term consequences for long-term gain: the decision of Ivan Seidenberg, when he served as Verizon’s CEO, to redouble his investment in the growth of his companies in the face of investors calling for selling off assets; the willingness of CVS Health CEO Larry Merlo to incur a short-term $2 billion loss in getting his chain out of the business of selling cigarettes; and the readiness of 3M CEO Sir George Buckley to restructure his company’s finances to increase its investment in its own future. The authors deftly use these and other cases to emphasize that long-term thinking and long-game investing and strategizing are not only more responsible, but also more profitable if they are done with daring and determination. The narrative tactic of grounding all this in real-world examples from business headlines pays off, and each chapter in the book’s first section ends with a useful “executive summary” outlining the key lessons to be learned from the individual cases. Considering the enormous harm that short-term investing has done not only to companies, but to countries as well, this book should be required reading in boardrooms everywhere.
A concise, powerful call for responsible, long-term business practices.Pub Date: May 8, 2018
ISBN: 978-1-61363-088-4
Page Count: 140
Publisher: Wharton Digital Press
Review Posted Online: July 30, 2018
Kirkus Reviews Issue: Sept. 15, 2018
Review Program: Kirkus Indie
Categories: BUSINESS | LEADERSHIP, MANAGEMENT & COMMUNICATION | GENERAL BUSINESS
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“Quality of life means more than just consumption”: Two MIT economists urge that a smarter, more politically aware economics be brought to bear on social issues.
It’s no secret, write Banerjee and Duflo (co-authors: Poor Economics: A Radical Rethinking of the Way To Fight Global Poverty, 2011), that “we seem to have fallen on hard times.” Immigration, trade, inequality, and taxation problems present themselves daily, and they seem to be intractable. Economics can be put to use in figuring out these big-issue questions. Data can be adduced, for example, to answer the question of whether immigration tends to suppress wages. The answer: “There is no evidence low-skilled migration to rich countries drives wage and employment down for the natives.” In fact, it opens up opportunities for those natives by freeing them to look for better work. The problem becomes thornier when it comes to the matter of free trade; as the authors observe, “left-behind people live in left-behind places,” which explains why regional poverty descended on Appalachia when so many manufacturing jobs left for China in the age of globalism, leaving behind not just left-behind people but also people ripe for exploitation by nationalist politicians. The authors add, interestingly, that the same thing occurred in parts of Germany, Spain, and Norway that fell victim to the “China shock.” In what they call a “slightly technical aside,” they build a case for addressing trade issues not with trade wars but with consumption taxes: “It makes no sense to ask agricultural workers to lose their jobs just so steelworkers can keep theirs, which is what tariffs accomplish.” Policymakers might want to consider such counsel, especially when it is coupled with the observation that free trade benefits workers in poor countries but punishes workers in rich ones.
Occasionally wonky but overall a good case for how the dismal science can make the world less—well, dismal.Pub Date: Nov. 12, 2019
ISBN: 978-1-61039-950-0
Page Count: 432
Publisher: PublicAffairs
Review Posted Online: Aug. 28, 2019
Kirkus Reviews Issue: Sept. 15, 2019
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SEEN & HEARD
A psychologist and Nobel Prize winner summarizes and synthesizes the recent decades of research on intuition and systematic thinking.
The author of several scholarly texts, Kahneman (Emeritus Psychology and Public Affairs/Princeton Univ.) now offers general readers not just the findings of psychological research but also a better understanding of how research questions arise and how scholars systematically frame and answer them. He begins with the distinction between System 1 and System 2 mental operations, the former referring to quick, automatic thought, the latter to more effortful, overt thinking. We rely heavily, writes, on System 1, resorting to the higher-energy System 2 only when we need or want to. Kahneman continually refers to System 2 as “lazy”: We don’t want to think rigorously about something. The author then explores the nuances of our two-system minds, showing how they perform in various situations. Psychological experiments have repeatedly revealed that our intuitions are generally wrong, that our assessments are based on biases and that our System 1 hates doubt and despises ambiguity. Kahneman largely avoids jargon; when he does use some (“heuristics,” for example), he argues that such terms really ought to join our everyday vocabulary. He reviews many fundamental concepts in psychology and statistics (regression to the mean, the narrative fallacy, the optimistic bias), showing how they relate to his overall concerns about how we think and why we make the decisions that we do. Some of the later chapters (dealing with risk-taking and statistics and probabilities) are denser than others (some readers may resent such demands on System 2!), but the passages that deal with the economic and political implications of the research are gripping.
Striking research showing the immense complexity of ordinary thought and revealing the identities of the gatekeepers in our minds.Pub Date: Nov. 1, 2011
ISBN: 978-0-374-27563-1
Page Count: 512
Publisher: Farrar, Straus and Giroux
Review Posted Online: Sept. 3, 2011
Kirkus Reviews Issue: Sept. 15, 2011
Categories: BUSINESS | LEADERSHIP, MANAGEMENT & COMMUNICATION | PSYCHOLOGY
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