Robert I. Sutton: Making a Case for Evidence-Based Management

Robert I. Sutton, professor of management science and engineering at the Stanford Engineering School, has tried several times to complete a book about wisdom and management. After two stalled attempts to write a book with the prospective title The Attitude of Wisdom, he and Jeffrey Pfeffer, coauthor with Sutton of The Knowing-Doing Gap: How Smart Companies Turn Knowledge into Action (Harvard Business School Press, 2000), set out to write the forthcoming Hard Facts, Dangerous Half-Truths, and Total Nonsense: Profiting from Evidence-Based Management (HBS Press, March 2006). When they finished it, says Sutton, “Jeff turned to me and said, ‘We finally wrote the book on wisdom when we wrote this book.’ “

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Why is it so hard to find good evidence?

It’s hard to tell what’s right and what’s wrong, and anybody can bea management expert. It’s a signal-to-noise ratio kind of problem: There’s just too much stuff out there. And what sells best is by no means the best way to actually practice management.

People are attracted to brand-new ideas and things. The way most knowledge is developed is that people build on one idea, or on nothing at all. A consequence is that the same new things get discovered every six or seven years, and just relabeled. Think of business process reengineering, which is built on a whole lot of earlier ideas.

One of my colleagues in the School of Education here describes our country as the United States of Amnesia. We keep pretending the same old ideas are brand-new, and we never learn from what’s already happened. Consider the idea of incentive-based pay for teachers. Once again, it’s the rage throughout the U.S. Yet this idea actually gets debunked about every eight years, going back almost a hundred years.

Yet there is good evidence for business decisions, right?

Yes, but it’s just amazing to me how many companies refuse to accept even the strongest evidence. The two strongest bits of evidence that I can think of in business that are routinely ignored are the evidence of the dangers of ERP implementations and the evidence on the failure of most mergers. Everybody who considers a merger either pretends they don’t believe the evidence, or they say it can’t happen to them.

Next page: Are Mergers a Good Idea?

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