Hard Facts, Dangerous Half-Truths And Total Nonsense: Profiting From Evidence-Based Management |...

Hard Facts, Dangerous Half-Truths And Total Nonsense: Profiting From Evidence-Based Management | Jeffrey Pfeffer, Robert I. Sutton | An excellent book for reality-based business management

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Hard Facts, Danger...

	Hard Facts, Dangerous Half-Truths And Total Nonsense: Profiting From Evidence-Based Management Jeffrey Pfeffer, Robert I. Sutton Harvard Business School Press, 2006 - 276 pages average customer review:based on 37 reviews view larger image
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highly recommended

How to avoid the "doing-knowing gap"

In my opinion, the most valuable business books are those which pose and then respond to an especially important question. For example, before Pfeffer and Sutton wrote their previously published book, The Knowing Doing-Gap, they asked: Why is it that managers who know so much about organizational performance, say so many smart things about how to achieve performance, and work so hard are nonetheless trapped in firms that do so many things they know will undermine performance? Their research indicated that a substantial majority of the executives they studied demonstrated a significant gap: They knew what to do and how to do it but seldom took effective action based on that knowledge.

In this book, Pfeffer and Sutton examine what they call "the doing-knowing gap": doing without knowing, or at least without knowing enough. "People kept telling us about the wonderful things they were doing to implement knowledge - but those things clashed with, and at times were the opposite of, what we knew about organizations and people. Upon probing, we soon discovered that many managers had been prompted by a seminar, book, or consultants to do things that were at odds with the best evidence about what works." Pfeffer and Sutton identify some of the barriers to what they call "evidence-based management" and recommend specific steps that leaders can take to overcome those barriers. Of special interest to me is what they have to say about "half-truths that bedevil organizations."

These are among the specific questions to which Pfeffer and Sutton respond and they do so brilliantly:

1. What exactly is "evidence-based management"?
2. Evidence of what? And how to verify it?
3. Why do all organizations need evidence-based management?
4. What are the most damaging half-truths about managing people and organizations?
5. When attempting to implement evidence-based management, what are the most formidable barriers to overcome?
6. How best to overcome each?
7. Which incentives are most important to individual performance?
8. To organizational performance?
9. What are the most valuable potential benefits of evidence-based management?
10. Which specific principles can guide and inform the collaborative efforts of those who are committed to doing whatever it takes to achieve such benefits?

As I read this book, I thought about what Pfeffer and Sutton had said about "the knowing-doing gap" in their previous book bearing that title. Whereas that gap indicated that people could possess sufficient skills and knowledge but are unable to take effective action, "the doing-knowing gap" suggests problems of a quite different nature. Perhaps Pfeffer and Sutton share my own concern that many of those who read their book will then exclaim "Aha! That's it! Now I understand!" In fact, some of them will "get it" but most won't...at least not immediately. I agree with Pfeffer and Sutton's suggestion that each organization be viewed as an "unfinished prototype." Readers would be well-advised to consider Pfeffer and Sutton's ideas with the same perspective.

In my opinion, hard facts are not enough. They must also be the right facts and there must be enough of them. Although I fully appreciate the importance of faith, trust, hope, empathy, and decency, the fact remains that what cannot be verified cannot be managed.

What about half-truths? I suggest that they be treated like cockroaches: Turn on bright lights and refuse to let them hide or escape. One of my favorite techniques, "fishboning," involves saying "Why?" to each response until neither you nor anyone else can bear to continue. When subjected to such rigorous scrutiny, half-truths don't have a chance. Fishboning worked well for Socrates and it will also work well for us.

With regard to "total nonsense," it is amazing how durable it can be. The fact remains that some people are convinced that wet highways cause rain...and that's that. For whatever reasons, it is very important to them to cling to such beliefs despite all evidence to the contrary. It seems a fool's errand to waste time and energy trying to convince them of the merits of evidence-based management...or of anything else.

One final point: What Pfeffer and Sutton recommend can - and should - be implemented at all levels throughout any organization, regardless of size or nature. The leadership which evidence-based management requires has nothing to do with title or tenure but everything to do with being resourceful, empirical, and pragmatic, skeptical and suspicious but not cynical or manipulative. And the initiatives to achieve and then sustain effective evidence-based management must be collaborative and continuous .

Those who share my high regard for this book are urged to check out Pfeffer and Sutton's earlier book, The Knowing-Doing Gap: How Smart Companies Turn Knowledge into Action as well as Robert Mittelstaedt's Will Your Next Mistake Be Fatal: Avoiding the Chain of Mistakes Which Can Destroy Your Company, Michael Levine's Broken Windows, Broken Business: How the Smallest Remedies Reap the Biggest Rewards, George S. Day and Paul J.H. Schoemaker's Periferal Vision: Detecting the Weak Signals That Will Make or Break Your Company, and Sydney Finkelstein's Why Smart Executives Fail and What You Can Learn from Their Mistakes.

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An excellent book for reality-based business management

This was one of the best business books to pass my desk in a long time. Then, I'm biased. Doing research bores me, but _applying_ research is my great love. It's a love unrequited after decades in the business world. Not for lack of trying; more for lack of good research. Most business books, buzzwords, and brilliance are pretty much bull-pucky. Not "Hard Facts." Pfeffer and Sutton have a simple premise: Companies run better by using business principles based or high-quality research, instead of by jumping on the pithily-promoted trend-of-the-day. They support their premis with *gasp* facts and research. The book follows its own advice. It is heavily footnoted with sources and studies, enough to make the most obsessive librarian happy for months.

Other reviews have mentioned the Big Half-Truths the authors explore: should we leave our lives at the door when we go to work? do the best organizations have the best people? does pay drive performance? is strategy destiny? They explore all these questions and often conclude the conventional wisdom is wrong. But their evidence isn't a cute little mouse looking for his cheese; it's decades of research, data, and examples. Their swiss cheese has far fewer holes in the logic.

The Big Half-Truths weren't the big takeaways for me. The offhand examples are what changed my world:
Oh, by the way, holding back students who fail causes them to do worse than letting them advance anyway.
Oh, by the way, do you like to ask winners why they succeeded? Research shows self-reports of losers who _think_ they're winners are the same as self-reports of winners. Hmm...
Oh, by the way, talent isn't innate. Believing you can (or can't) develop talent becomes a self-fulling prophecy.
Oh, by the way, even a super-competent CEO will get better results by yielding control.
Oh, by the way, merit-based pay for teachers doesn't produce better learning in schools.

All were, of course, properly footnoted. Without actually converting to Librarianism, I'll likely spend the next few months happily chasing down the supporting research to find out what else I think I know that just isn't so.

The Big Half-Truths were the main point of each chapter, of course, with the Little Half Truths as the supporting evidence. The authors don't just debunk; they go one step further and tell you what to do differently, if you've bought in to the Halfs.

Along the way, Sutton and Pfeffer also utter a word rarely heard in business: Wisdom. They believe Wisdom is more important than knowledge or IQ. They define it precisely, and the definition will surprise you. You may or may not agree with it, but if you don't meet the definition yourself, you'll likely dismiss it as absurdity. And of such self-fulfilling prophecy will your fate be wrought.

Sadly, the consulting market thrives on new fads, delivered in pithy books, easily extensible(*) to keep the consultant in Beamers for years. So we aren't likely to see any sudden groundswell desire for competent advice that isn't attached to new-and-different-sounding buzzwords. But here's my advice:

Are you a manager? Buy this book and follow its advice. You'll fail, of course. The book itself explains that your dysfunctional corporate culture will easily swat down your wave-making desire for fact-based management. So then you can hire a consultant to help.

Are you a consultant? Buy this book and read it. Then get that manager's phone number and sell him/her your latest buzzword, but actually *deliver* evidence-based management.

"Hard Facts" and evidence-based management isn't new; it's the premise behind business school, for goodness' sake. But this book will give you a lot of fact-based insight you're unlikely to get any other way.

(*) The "Cheese" brand alone lends itself to a decade of sequels. Organizational change: Who Moved my Cheese? Mergers and acquisition: Who Bought my Cheese? Competitive strategy: Who Grilled my Cheese? Layoffs and divestitures: Who Cut my Cheese?

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So sensible that it hurts.

Read this book before you work another week, it will change your views for ever. While most people would say they are logical and fact based, we are not. We make guesses into supposed analysis, we turn anecdotes into facts, we prefer opinions of agreeable staff over those that disagree with us - we do some many things that bring unreliability to our business that it's no wonder that some many good things just fail.

Numerical based people will find this book easier to see the through line, but everyone should read and head the message.

If our doctor told us that we needed to take a medicine, we would as a matter of course ask questions about proof; yet we make decisions based on no (or worse contrary) evidence and wonder why the idea dies. Evidence based thinking works in science, superior outcomes can also come from transfering this into every day decision making. This book is worth twice the price.

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Back to management based on evidence

Jeffrey Pfeffer is Professor of Organizational Behavior and Robert I. Sutton is Professor of Management Science and Engineering at Stanford's Graduate School of Business. They are the author of business bestseller `The Knowing-Doing Gap' (2000). This book was published in 2006 and consists of 9 chapters.

In the preface the authors explain the result of their exercise: "[This book] is a call for evidence-based management, a case for its potential impact, and a guide on how to use it." They also immediately warn readers: "There are no simple, easy answers, but there are answers." Part I - Setting the Stage - consists of two chapters, whereby the first chapter serves as an introduction into evidence-based management. "Evidence-based management proceeds from the premise that using better, deeper logic and employing facts to the extent possible permits leaders to do their jobs better." And although most managers try to act on the best evidence there is little rigorous use or serious appreciation of evidence-based management. In the second chapter the authors consider key impediments to implementing evidence-based management and how to overcome them. They also offer guidelines and ways of thinking to help organizations turn these ideas into action.

The main body of the book is contained within Part II - Dangerous Half-Truths About Managing People and Organizations - and consists of six chapters. Chapter 2 shows simple but powerful standards for judging which advice and practices advocated in the vast marketplace for business ideas are sound, which are suspect, and which are total nonsense. This is followed by an examination of perhaps the most basic half-truth - "work is fundamentally different from the rest of life and should be." This half-truth is fundamental because so much else follows from it. The organizational practices are quite different than we observe - or at least aspire to - in our personal life. Chapter 4 discusses the half-truth that "the best organizations have the best people", which was embraced during the dot-com boom and still lives on in the "war for talent" imagery. The next chapter examines one of the most deeply held half-truths in the business world, that "financial incentives drive company performance." However the authors' best evidence shows that using them to solve many problems leads organizations to stray from their goals and undermines performance.

The remaining three half-truths move up to the organizational level of analysis, focusing on the challenges of managing the enterprise. For instance, chapter 6 questions whether and when "strategy is destiny". Peffer and Sutton make an evidence-based case that excessive faith in strategic decision making is hazardous to an organization's health. This is followed by an examination of the faulty evidence and logic behind the mantra "change or die". The final chapter of this part considers what leaders are expected to do versus what they actually can and should do. The authors focus on these half-truths because they believe that "leaders who understand why each belief is flawed, and who think hard about the evidence for and against each, can develop more effective and sophisticated approaches to running their organizations."

In the final chapter the authors explain that managers can find and use evidence so their companies can avoid such dreadful journeys. They identify and discuss 9 implementation principles to help people and organizations to commit themselves to profit from evidence-based management. None of these principles will surprise anyone and most are in fact predictable. However, most of us do not always stick to them for a variety of reasons. "The question remains: Who will have the courage and wisdom to do it?"

Yes, I do like this book. Although it does not fundamentally bring any new principles to table, it will help most of us re-focus onto the extremely important task of managing based on evidence, data and facts. Pfeffer and Sutton effectively break down dangerous half-truths and make a compelling case for finding and using evidence to succeed not just in management/business but also in the rest of life. Just one criticism, there could be some more details on methods for gathering data and translating this into evidence.

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Good but...

Pfeffer and Sutton's book Hard Facts takes 276 pages (including index) to make one simple point - business leaders cling to miracle cures and don't do the work or homework necessary to become evidence based managers. This is a good insight, but hardly new (try Richard Pascale's Managing on the Edge, 1990, or any Dilbert cartoon). It also treads a similar path to Sydney Finkelstein's earlier book "Why Smart Executives Fail" (2003) and both have similar tables of contents, observations and conclusions. Personally I'd recommend Finkelstein, especially for Chaper 10.

The cover asks "Are you making the right decisions" and leaves the reader to wonder if they are. The first 214 pages illustrate through anecdotal evidence, and some limited analysis, that:
- organizations would perform better if leaders applied evidence better
- implementing evidence based management is difficult
- integrating work and rest of life is good (is this really central to the book?)
- wise people are better than intelligent ones and they must be nurtured
- strategy is something senior people aspire to, without fully appreciating how difficult it is to formulate or implement it
- there are advantages to getting change done quickly
- leadership is difficult and bad leadership is dangerous

At times it's difficult to see the coherence of these diverse ideas, maybe they are nothing more than a list of ideas. I agree with most of the ideas, but they're not new nor original. The test of an idea is in the action, so my expectation was that this book would deliver in Part 3 "From Evidence to Action".

Part 3 is a big disappointment. It's brief, and says:
- treat your organization as an unfinished prototype
- no brag, just facts
- master the obvious and mundane
- see yourself and organization...etc
By the time I got to page 225 I'm pretty frustrated. I plough on the last page, and feel disappointed. I've just spent a lot of time reading stuff I already know, and the practical advice is a mirage.

Evidence based leadership is difficult for key reasons that these authors overlook. Leaders are seldom in a position to control their organizations because they do not have the evidence in their hands to decide, direct, or even influence on the basis of anything other than luck and guesswork. How to get leaders into a position to lead? Well that's a practical question that this book didn't answer, but I sure wish it had

Suggested reading:
- Managing with Power (ISBN: 0875844405 )
- Marketing and the Bottom Line (ISBN: 0273661949)
- Marketing Payback (ISBN: 0273688847)

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reviews: 1, 2, 3, 4, 5, page 6, 7, 8

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