HBS Article-Evidence Based Management

October 22, 2009

What jumps out at me from reading this article is the fact that so few companies have tried or are trying an evidence based approach to management. I really found that to be amazing. I realize that it is easier to take pre-existing theories and ideas and simply try to wedge them into the management situation at hand, but to me, the problems inherent in such an approach are readily apparent.

Every company is different. They have different products, different employees, and different goals. So, with that in mind, how do you not sit down and try to figure out how—and more importantly if—a particular strategy will work for your company? I suppose if you asked these managers they would tell you that taking something that works elsewhere and applying it to their company promotes efficiency. Why reinvent the wheel, right? But it seems crazy not to spend some time figuring out (1) why the strategy you want to adopt worked at the originating company, (2) what is different about your company, and (3) how could those differences create problems for the strategy you want to adopt.

I suppose there is a certain fear/peer pressure element at work here. If company A is using a hot new management approach and other companies begin to emulate it and show some success with that approach, if you are a CEO, you do not want to be running the lone company that is not using that approach, especially if your company is—or already was—struggling in comparison to these other companies. So you go with the flow and use the new approach, regardless of how it fits within the dynamics of your company. If it works out, great, and if not, you were applying a tried strategy, so at least you have that to hang your hat on when you go to face the board of directors.

I guess another problem with adopting this approach is the experimentation aspect. If you are going to come up with a new approach to doing things, it requires trial and error—in other words, experimentation. Experimentation, however, does not always lead to profit. If you try a bunch of things and, through trial and error, you come up with the next great marketing approach you are a genius. But, if you run through these processes and nothing works, you have wasted a bunch of time and have nothing to show for your efforts. And, if you are the person in charge, you may well find yourself fired. So, I can see why a manager may want to avoid experimentation and stick with a tried and tested theory that has worked elsewhere.

But, I think focusing on the possible drawbacks to evidence based management misses the big picture. Yes, if you use an evidence based approach you may occasionally wind up with a series of unsuccessful experiences, but you also may wind up being the person or company that came up with the next big thing everyone wants to copy. But, you have the advantage, because you developed this strategy with your team or product in mind, something those who will later try to copy your strategy will not have. In the long run, for both managers and companies, it seems like the benefits of this approach outweigh any possible negatives.

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