Consumers have a hunger for a clear message about the determinants of success and failure in business, and they need stories that offer a sense of understanding, however illusory.

Daniel Kahneman
Daniel Kahneman

An Israeli-American psychologist and economist notable for his work on the psychology of judgment and decision-making, as well as behavioural economics, for which he was awarded the 2002 Nobel Memorial Prize in Economic Sciences.

In his penetrating book The Halo Effect, Philip Rosenzweig, a business school professor based in Switzerland, shows how the demand for illusory certainty is met in two popular genres of business writing: histories of the rise (usually) and fall (occasionally) of particular individuals and companies, and analyses of differences between successful and less successful firms.

He concludes that stories of success and failure consistently exaggerate the impact of leadership style and management practices on firm outcomes, and thus their message is rarely useful.

We humans constantly fool ourselves by constructing flimsy accounts of the past and believing they are true.

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The text above was taken and slightly edited from the following sources.

The Halo Effect: ... and the Eight Other Business Delusions That Deceive Managers

The Halo Effect: ... and the Eight Other Business Delusions That Deceive Managers (Book) by Phil Rosenzweig

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  • Entrepreneurship
  • Other
  • History
  • Illusion of Reality
  • Inspiration
  • Perception
  • Storytelling
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