Brainstorming appears in many strategy, entrepreneurship, and leadership texts, often mentioned in passing with the implication that it’s a great tool for group decision-making. But the research literature suggests a more circumspect attitude. Indeed, this week’s New Yorker features an interesting and informative essay on some of the latest results:

The underlying assumption of brainstorming is that if people are scared of saying the wrong thing, they’ll end up saying nothing at all. The appeal of this idea is obvious: it’s always nice to be saturated in positive feedback. Typically, participants leave a brainstorming session proud of their contribution. The whiteboard has been filled with free associations. Brainstorming seems like an ideal technique, a feel-good way to boost productivity. But there is a problem with brainstorming. It doesn’t work.

Writer Jonah Lehrer goes on to quote Keith Sawyer: “Decades of research have consistently shown that brainstorming groups think of far fewer ideas than the same number of people who work alone and later pool their ideas.” Lots more at the source.

O&M co-founder Nicolai Foss will give the 2012 Sherlock Hibbs Distinguished Lecture in Business and Economics Tuesday, 6 March 2012, 10:00-11:30am, in 205 Cornell Hall on the University of Missouri campus. The title is “Open Entrepreneurship: The Role of External Knowledge Sources for the Entrepreneurial Value Chain.” The lecture is sponsored by the Hibbs Professors of the University of Missouri’s Trulaske College of Business and the University of Missouri’s McQuinn Center for Entrepreneurial Leadership (which I direct).

The full announcement (with Nicolai’s impressive bio) is below the fold. The lecture is free and open to the public, so all are welcome!

The Hibbs Professors of the University of Missouri’s Trulaske College of Business and the University of Missouri’s McQuinn Center for Entrepreneurial Leadership invite you to the 2012 Sherlock Hibbs Distinguished Lecture in Business and Economics:

Open Entrepreneurship: The Role of External Knowledge Sources for the Entrepreneurial Value Chain

Nicolai J. Foss
Copenhagen Business School and Norwegian School of Economics and Business

Tuesday, March 6, 2012
205 Cornell Hall
10:00 – 11:30am

Sponsored by the Hibbs Professors of the University of Missouri’s Trulaske College of Business and the University of Missouri’s McQuinn Center for Entrepreneurial Leadership, the lecture is free and open to the public.

Nicolai J. Foss is a Professor of Strategy and Organization at the Copenhagen Business School, a part-time Professor of Knowledge-based Value Creation at the Norwegian School of Economics and Business Administration, and the Head of Department of the Department of Strategic Management and Globalization at CBS. He also holds part-time and visiting professorships at the Lund University, Luiss Guido Carli-Roma, and Agder University. He founded the Center (now Department) of Strategic Management and Globalization at the Copenhagen Business School in 2005, building it from a center with 5 faculty members to a full department with 17 faculty members along with postdocs and PhD students.

He is author or editor of 22 books, 136 journal articles, and 81 book chapters. His work has appeared in the Academy of Management Review, Academy of Management Journal, Organization Science, Strategic Management Journal, Journal of International Business Studies, Journal of Management Studies, Strategic Organization, Strategic Entrepreneurship Journal, Industrial and Corporate Change, Organization Studies, and other leading academic journals. His articles and books have been translated into Chinese, Russian, and Spanish. His newest book, Organizing Entrepreneurial Judgment: A New Approach to the Firm (with Peter G. Klein), is forthcoming from Cambridge University Press.

Foss was a founder of the Danish Research Unit for Industrial Dynamics and a co-founder of the industry-funded Center for Policy Studies, the most influential privately funded Danish think tank. Since 2000 he has raised over €2 million in external funding as research leader and has participated in many additional funded research projects. He is a panel member of the European Research Council and serves as a member of the three-person management group of the Norwegian Center for Service Innovation at the Norwegian School of Economics and Business Administration, which is supported by a €20 million, 8-year grant.

Educated as an economist from the Copenhagen University (1989), Foss his received his PhD from the Copenhagen Business School in 1993, where he has been Assistant, Associate and Full Professor.

Apropos Lasse’s post, check out Scott Armstrong’s “Illusions in Regression Analysis,” via Craig Newmark, who highlights passages like this:

This illusion [that correlation implies causality] has led people to make poor decisions about such things as what to eat (e.g., coffee, once bad,is now good for health), what medical procedures to use (e.g., the frequently recommended PSA test for prostate cancer has now been shown to be harmful), and what economic policies the government should adopt in recessions (e.g., trusting the government to be more efficient than the market).

And this:

Do not use regression to search for causal relationships. And do not try to predict by using variables that were not specified in the a priori analysis. Thus, avoid data mining, stepwise regression, and related methods.

It is not yet online, but the University of Paris-Sorbonne is looking for a Full Professor in the Economics of Organization (see the ad text below). Importantly, proficiency in French is not a requirement … “upfront,” at least.

Very apropos (if I may) the Department of Strategic Management and Globalization will be hiring one assistant professor and three associate professors in ”strategic and international management” over the next few months. Proficiency in French, or Danish for that matter, is not required at all. The job ads are here. Or, contact me directly on njf.smg@cbs.dk

Economics of Organization/ Public economics

The University of Paris (Pantheon-Sorbonne) has an opening for full professorship in economics of organization/public economics. Priority will be given to candidates with substantial publications in international journals, mainly in the field of organization theory, including public organizations, with a special interest for the embeddedness of organizations in their institutional environment. Candidates with acknowledged expertise in the economics of infrastructures will also receive particular attention. The selected candidate will benefit from an  exceptional research environment (he/she will be affiliated to the Centre d’Economie de la Sorbonne -CES), from a pool of potential Ph D students of very high quality, and from substantial research opportunities. (S)he will also benefit from the exceptional position of Paris at the international research crossroad. Speaking French is not compulsory upfront although some rudiments would help. However, the candidate is expected to develop French proficiency in the future so as to be able to teach at the advanced undergraduate level. The deadline is not yet known, but should be posted soon on the following site: http://centredeconomiesorbonne.univparis1. fr/bandeau-haut/recrutement/. Seminars will be organized with selected candidates in the first months of 2012, with a final decision expected in April. For detailed information, contact Claude Ménard (menard@univparis1.fr).

Über-guru Jim Collins has taken more than his share of hits here at O&M, mainly for lack of attention to experimental design (1, 2, 3). It appears that his new book,  Great by Choice: Uncertainty, Chaos, and Luck: Why Some Thrive Despite Them All (Harper, 2011), finally tries to address this issue with an attempt at causal identification. If the dust-jacket blurb is to be believed, Great by Choice introduces to the Collins project the concept of treatment and control:

With a team of more than twenty researchers, Collins and Hansen studied companies that rose to greatness — beating their industry indexes by a minimum of ten times over fifteen years — in environments characterized by big forces and rapid shifts that leaders could not predict or control. The research team then contrasted these “10X companies” to a carefully selected set of comparison companies that failed to achieve greatness in similarly extreme environments.

This looks like a step in the right direction, but Collins is still selecting on the dependent variable — in a quasi-experimental design one normally chooses the treatment and control groups based on behaviors, not outcomes. (You don’t compare 100 healthy people to 100 sick people, you compare 100 smokers to 100 otherwise similar nonsmokers or 100 people on a medication to 100 similar people on a placebo to see which get healthy or sick.

For more, see Collins in the NYT or this interview from Knowledge@Wharton. I don’t have the actual book but I tried searching keywords from the Amazon “Look Inside,” and didn’t get any hits for “Knight,” “Schumpeter,” “dynamic capabilities,” or other appropriate key words, so I’m not expecting much theory here.

Rich Bettis makes an important point in a forthcoming issue of SMJ. Bettis points out how two unfortunate practices interact with each other to create a very serious and fundamental problem for knowledge accumulation in (strategic) management.

One is the widespread practice of running numerous regressions on a given dataset and subsequently adapting (or in milder cases “tuning”) hypotheses or theory to fit the data. By itself this practice is quite unfortunate, since data patterns can and will occur by chance, and the more regression models one tries the more likely that one will “find” something. We obviously do not want such random patterns to influence either theory building or our catalog of empirical findings. However, this problem would be a great deal less serious if replication studies were common and we gladly published non-findings. Random correlations in the data would not survive replication tests, and would be eliminated fairly quickly.

As we all know, in management, replication studies cannot get published and are basically just not done. To make matters worse, we don’t publish non-findings either. This is the second unfortunate practice. Taken together these two practices may in the worst case indicate that much of what we think we know in management are just random data patterns, discovered through data mining, and protected by our lack of replication studies and refusal to publish non-findings. This is a sobering thought. As Bettis points out, we should all be very thankful that replication studies are more common in medical research than in management.

What is the solution? Well, a first step might be to launch the Journal of Managerial Replication Studies and give it the prestige it deserves. Either SMS or AOM should see the launch of such a journal as a crucial responsibility. I mean, we really don’t want to be quacks, do we?

HT: Helge Thorbjørnsen

Mike Ryall writes about the 2011 HBS strategy conference:

Of the empirical papers, almost half incorporated some method aimed at causal identification. My sense is that such identification strategies will soon become a fairly standard requirement for publication in a top management journal (“soon” being measured in academic time, of course).

We’ve discussed this issue several times, including a 2008 post on the potential tradeoffs between choosing problems that are well-identified and choosing problems that are important. I agree with Mike that the management and entrepreneurship literatures — at least the quantitative empirical part of those literatures — are catching up the economists here. But consider the advantages of backwardness: can management research learn to take identification seriously without falling into the Freakonomics trap? (Please, no Freakostrategy or Super-Freakopreneurship!)

Of course, management and entrepreneurship researchers, unlike most economists, tend to sympathize with (or at least tolerate) qualitative methods, and one legitimate means of generating causal inference is careful, detailed, historical investigation, case work, ethnography, analytical narrative, and so on. I suspect, though, that the trend Mike describes will tend to push these approaches to the side as well.

O&M friend Brent Ross sends along this CFP for a track session of the 2012 Wageningen International Conference on Chain and Network Management. The session, “Managing Wicked Problems: The Role of Multi-Stakeholder Engagements for Resource and Value Creation,” is linked to a special issue of the International Food and Agribusiness Management Review. Info below the fold:

Management scholars and practitioners recognize that engagement with stakeholders is crucial for a firm to gain the necessary resources and capabilities to innovate, compete and create shared value (Teece and Pisano 1997; Freeman 2005; Kramer and Porter 2006). Furthermore, multi-stakeholder engagements have become a common means in the agri-food sector to address the increasingly presence of “wicked problems” such as sustainability (Batie 2008, Peterson 2009). “Wicked problems” cannot be framed and solved in any traditional way because they have no closed-form definition, deal with complex systems in which cause and effect relationships are either unknown or highly uncertain, and have multiple stakeholders with strongly-held, diverse, and conflicting values related to the problem. From the point of view of the firm, managing “wicked problems” requires the engagement of multiple stakeholders (De Wit and Meyer 2010, Peterson 2011) such as supply chain partners, universities, government agencies, NGOs and civil society.

Managing interactions and undertaking initiatives simultaneously with multiple stakeholders can represent an effective strategy for organizations in the agri-food sector to tackle “wicked problems”, share and co-create the resources and capabilities, and to create shared value. In practice, however, managing multi-stakeholder engagements present numerous challenges. Organizations need adequate initial resources and capabilities to start interacting with multiple stakeholders; the process of sharing and co-creating resources and learning from multiple stakeholders has to be efficient and effective; the expected outcomes of sharing and co-creating resources have to be identified and measured; the risk of possible negative outcomes of multi-stakeholder interactions has to be managed.  Alternative governance mechanisms are often used to address these important multi-stakeholder issues.

Given the nature and the importance of “wicked problems”, this call for papers aims to deepen management scholars’ and practitioners’ understanding of how an organization can effectively undertake multi-stakeholder interactions to develop resources and capabilities and ultimately create shared value. Therefore, we encourage submissions of papers that tackle a broad range of questions, including (but not limited to) the following:

·  What is the impact of multi-stakeholder engagements on the sharing and co-creation of resources and capabilities, and value creation?  Can value be created for both private firms and their stakeholders in the presence of “wicked problems”? What is the relationship between reaching commonly agreed sustainability objectives and creating value for the firm?

·  Which resources and capabilities are necessary and/or sufficient to create shared value in the context of “wicked problems” such as sustainability?  Which stakeholders can provide them and under which conditions? In turn, what are the initial resources and capabilities needed to effectively engage with multiple stakeholders? Is there a critical mass of stakeholders and/or resources and capabilities that is required to initiate and sustain engagement? How does the process of multiple stakeholders sharing and co-creating resources and capabilities take place?

·  Are reputation and legitimacy resources co-created or shared in multi-stakeholder engagements? Does the member composition of the multi-stakeholder engagement matter? Which member inclusion/exclusion mechanisms are effective to enhance stakeholders’ reputation and legitimacy? What is the impact of a stakeholder drop-out on the reputation and legitimacy of the multi-stakeholder engagement? What is the relationship between stakeholder heterogeneity or representativeness, on legitimacy and reputation of the multi-stakeholder engagement?

·   Which organizational structures and governance mechanisms are most effective to allow multiple stakeholders to share and co-create resources and capabilities and create value? In particular, what is the effect of managing a formal multi-stakeholder alliance versus an informal network of multi-stakeholder interactions?

·  How do multi-stakeholder engagements evolve over time? What are the causes and effects of change and the implications for stakeholders? What are the challenges and implications of downscaling global multi-stakeholder initiatives to a local level? What are the challenges and implications of up-scaling local multi-stakeholder initiatives to an international level?

Both empirical and conceptual papers are welcome and we strongly encourage multi-disciplinary submissions from scholars in areas such as management, law and economics, public administration and policy, marketing, organizational behavior, communication, education, development, sociology, and psychology among others. In addition to the track session, submissions will be subject to a double-blind review process and will be considered for publication in a special issue of the International Food and Agribusiness Management Review on managing multi-stakeholder engagements.

To insure full consideration for the track session and for the special issue of the IFAMR, please submit/upload your full papers using the IFAMR submission process found at www.ifama.org. You should submit/upload your paper under the folder WICKED no later than January 5th, 2011.  Papers should follow the manuscript guidelines posted for IFAMR.

References

Batie, S. (2008). “Wicked Problems and Applied Economics.” American Journal of Agricultural Economics 90 (5), 1176–1191.

De Wit, B. and Meyer, R. (20100. Strategy Synthesis: Resolving Strategy Paradoxes to Create Competitive Advantage. 2^nd Edition, Cengage Learning.

Freeman, R.E., J. S. Harrison, A. C. Wicks, B.L. Parmar, S. de Colle (2010). Stakeholder Theory: The State of the Art. Cambridge University Press.

Peterson, C. (2009). “Transformational supply chains and the ‘wicked problem’ of sustainability: aligning knowledge, innovation, entrepreneurship, and leadership.” Journal of Chain and Network Science  9(2): 71-82.

Peterson, C. (2011). An Epistemology for Agribusiness: Peers, Methods, and Engagement in the Agri-food-bio System. Forthcoming on the International Food and Agribusiness Management Review.

Porter, M.E. and Kramer, M.R. (2006). “Strategy & Society: The Link Between Competitive Advantage and Corporate Social Responsibility.” Harvard Business Review (12/2006), 1-16.

Teece, D. and Pisano, G. (1997). “The Dynamic Capabilities of Firms: an Introduction.” Industrial and Corporate Change 3 (3), 537-556.

Deadline for WICANEM Full Paper Submission: January 5th, 2012.

Deadline for IFAMR Full Paper Submission: January 5th, 2012.

Timeline for IFAMR double-blind review only (additional information soon on www.ifama.org):

Deadline for IFAMR Full Paper Submission:              January 5th, 2012.

Notification of Acceptance/Revision/Rejection:       March 30th, 2012.

Deadline to Revise Accepted Papers:                    June 10th, 2012.

Final Notification of Acceptance/Rejection:            September 15th, 2012.

Interesting new monograph from the IEA (Institute of Economic Affairs) in the UK on: Self Employment, Small Firms and Enterprise. A pdf is available for free here. And here is the executive summary.

Summary 

• Self-employment is a form of contractual relationship which, in certain circumstances, will have greater benefits to the parties involved than an employer–employee relationship. Government intervention, however, may make selfemployment artificially more attractive by raising the costs of employment relationships.
• Certain ethnic minority groups, older people and those without English as a first language tend to be overrepresented among the self-employed. This is partly because of the flexibility the arrangement provides but also because self-employment offers a ‘safety valve’ for those who find it difficult to find employment in the formal labour market.
• It is vital that businesses are not impeded from moving from a situation where the owner is self-employed without employees to a situation where the business has employees. There is evidence that businesses are impeded in this way. In just nine years to 2009, the proportion of micro-businesses with employees fell by almost one fifth. At the same time the proportion of self-employed with no employees rose rapidly.
• Women, individuals from certain ethnic groups, those with young dependants, those with low or no qualifications, those for whom English is not a first language and those who have recently experienced unemployment make up a much greater proportion of the workforce of small firms. For example, whereas 11 per cent of employees of small firms had no qualifications, only 4 per cent of employees of large firms had no qualifications.
• Some workers will prefer to work for small firms because of the greater flexibility they offer in their working practices. In many cases, however, small firms will employ people who are talented but who are not able to negotiate the more formal recruitment processes of larger firms. Micro-businesses therefore perform an important economic and social function – employing people who might be overlooked by larger employers.
• Genuine entrepreneurial insight and discovery tends to come from small firms. Entrepreneurship is crucial for economic growth. The nature of entrepreneurial insight is such, however, that we have no idea where it will come from – not even in the most general terms. Probably only one in every thousand ‘start-up’ firms will become one of the large businesses of the future.
• Policies to promote entrepreneurship must come in the form of removing impediments to business and should not involve the promotion of particular business activities. It is simply not possible for government intervention to pick this tiny number of winners. All government can do is create a climate in which entrepreneurship can thrive.
• The smallest firms are a key driver of job creation. Businesses do not start big. One quarter of employees working in firms that were established ten years earlier are working for firms that started from a position of employing only one person.
• The cost of regulation has grown enormously over the last fifteen years. This particularly affects small firms with employees because regulatory costs act like a ‘poll tax’. Wide ranging exemptions from employment regulation and the minimum wage would be appropriate for small firms. Such exemptions would have the additional advantage of allowing the government to ‘experiment’ with deregulation. Standard terms and conditions of employment could be drawn up which would ensure that employees clearly understood the exemptions. Radical reforms of the tax system would also assist small firms which experience much greater compliance costs than large firms.
• Moves by the government to promote entrepreneurship through the state education system or provide specific tax exemptions and reliefs for particular forms of business activity are wasteful or counterproductive.

At O&M we’ve long prided ourselves on being one of the top academic group strategy blogs. We believed this with great confidence, mainly because we were the only academic group strategy blog. Other blogs deal with strategic issues — Dick Rumelt’s blog, Knowledge Problem, Managerial Econ, Digitopoly, and of course the Good Twin, among others — but the Herfindahl index for academic group strategy blogs has been pretty close to 1.0.

We’re happy now to introduce a new entrant, strategyprofs.net, brainchild of Freek Vermeulen, Karim Lakhani, Mike Ryall, Russ Coff, Steve Postrel, and Teppo Felin. The first posts are already up, and the discussion is extremely interesting. Welcome to the blogosphere, Strategy Profs!