Philip M. Rosenzweig (2007)

The Halo Effect: And the Eight Other Business Delusions That Deceive Managers

Cognitive biases are a fascinating topic. In The Halo Effect, Rosenzweig explores their effect on decision-making in business, as well as how our perception of such decisions gets warped once their consequences become obvious. Turns out, the exact same management choice, say “increasing customer centricity”, can either be seen as the salvation of a company (“Doubling down on customer service protected their core market!") or as a hallmark of it’s demise (“Their narrow focus on existing customers stifled growth and innovation!"), solely depending on what effect the decision ultimately had.

Rosenzweig clearly takes great pleasure in dissecting how much of the advice given in the revered business literature of his day (including “In Search of Excellence” and “Built to Last”) has been victim of such fallacies. While the examples showcased in the book, including the rise and fall of Cisco and ABB, are a bit dated, there’s still a lot to be learned from them. Even if it’s only to take lessons learned from other companies’ successes or failures always with a grain of salt.