Brilliant: The Science of Smart

We Should Follow Those Who Finish Second, Not First

Success in business can actually be a poor indicator of skill.

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The success story is a staple of business books and magazines: the faces of top investors and executives smile at us from the covers, and inside their words invite us to emulate their actions. But research suggests we should be cautious in modeling ourselves after extraordinary performers or adopting their much-praised methods; these paragons may offer less wisdom than they promise. Greater value can be found, studies show, in less sexy but more substantial theories, and in the practices of those who are second best in the field.

In an article published last month in the Proceedings of the National Academies of Science, Jerker Denrell of the University of Oxford and Chengwei Liu of the University of Warwick reported on experiments that modeled the results of a game played in many rounds. Over time, the most skilled players came to inhabit a second tier of reliable competence. Those who succeeded spectacularly — who took their places in the first tier — were often not the most skilled, but rather were those who got some lucky breaks early on or took big risks that happened to pay off. Emulating these top performers would probably lead to disappointment, since imitators would be unlikely to replicate their good fortune. Because luck and risk play a dominant role in extraordinary outcomes, Denrell and Liu write, “extreme success or failure are, at best, only weak signals of skill,” and top performers “should not be imitated or praised.” Better, they advise, to learn from individuals “with high, but not exceptional, performance” — those whose success can be attributed to solid skill and not to a rare lightning strike.

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Focusing on “the best” can even lead entire industries astray. In an article in The American Journal of Sociology, researchers David Strang and Michael Macy contend that “the centrality of the ‘success story’” helps generate business-world fads, in which innovations are rapidly adopted and just as quickly discarded (think “total quality management,” “matrix management,” “quality circles”). The problem is that while we’re told frequently and at great length about successes, we hear almost nothing about failures — a bias that skews our judgment about what’s likely to work. For example, the authors note, during the seven years when quality circles (a practice that American companies borrowed from Japanese industry) were most popular, there were plenty of articles published in the business media about the increases in savings and employee satisfaction they produced — but no stories about quality circle failures. Companies had to discover through their own experiences that quality circles just didn’t work. In order to make balanced decisions about which practices to adopt, Strang and Macy advise people to look “not only among the Intels and Microsofts, but also among the Wangs and Digitals.”

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Tellingly, the most genuinely useful innovations tend to emerge from companies’ on-the-ground responses to economic and social challenges — not from business advice books. So concluded researchers Danny Miller and Jon Hartwick in an article in the Harvard Business Review, for which they tracked the coverage of business trends in academic, professional, business and trade publications over a 17-year period. Evanescent fads, they found, are usually simple, one-size-fits-all solutions promoted by charismatic “gurus.” Approaches with real staying power are more complex and multifaceted, and demand deep organizational changes.

By analyzing the characteristics of theories currently in fashion, we may even be able to tell in advance which ones will turn out to be permanently useful additions, and which ones are here-today-gone-tomorrow trends. A paper published earlier this year in the journal Information and Organization applied just such an analysis, and concluded that “service-oriented architecture” — a buzzword in the information systems industry right now — is destined to be no more than a fad. Armed with critical thinking skills and a healthy dose of skepticism, we can learn to distinguish leaders and theories with the shiny look of success from those that offer the real thing.

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