January 15, 2008

Book Review - The Halo Effect

The Halo Effect ... and the Eight Other Business Delusions that Deceive Managers
Phil Rosenzweig
HD 30.19 .R67 2007

This book is meant as a wake-up call and cautionary tale for businesses and organizations. His primary point is to caution managers about the halo effect. Essentially, when business is going well and the company is successful, managers conclude that they have a winning strategy. When business declines, they immediately conclude that the strategy must change. This overarching cautionary tale includes several others: that nearly all events have multiple, often interrelated causes or explanations, that not all research data is valid, and that a company's performance is not absolute, but is dependent on several often uncontrollable factors. Managers may not like this book because it is intended to be critical of their thinking, but it can help them to avoid these traps and to better understand the complex causes and effects that affect their business or organizational environment.