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Why Managers Are So Bad at Recognizing Good Ideas, by Adam Grant's former student Justin M Berg

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Managers like to make safe bets and don't fear invisible losses.

There are two basic modes of judgment: criticism and praise. The former consists of identifying a subject’s flaws; the latter of noting its merits.

In most settings, criticism tends to dominate. For any idea or book or movie or what have you, the question that people discuss is what’s wrong with it, why it didn’t live up to expectations. Often, one gets the feeling that the criticism isn’t dispensed in an effort to engage with the work but as a demonstration of the critic’s smarts, the implicit argument being that he or she is sharper and more discerning than the work’s creator.

Often, the greater intellectual challenge—as a reader, as a viewer, and as a manager—is to recognize when something is truly great.

Managers in particular seem to have a hard time with this, said the Wharton professor and author of Originals: How Nonconformists Move the World Adam Grant, in a lecture at the Aspen Ideas Festival, co-hosted by the Aspen Institute and ​The Atlantic. Grant points to the work of his former student Justin M. Berg, who is now a professor of organizational behavior at Stanford. While at Wharton, Berg studied circus performers who were trying to make it into Cirque du Soleil. Berg asked the performers to submit videos of their work and then asked the artists themselves, circus managers, and regular audience members to evaluate them. He wanted to know, between the performers and the managers, who could predict which acts would most resonate with the audience members.

What Berg found is that the artists themselves were terrible judges of their own work. “On average,” Grant explained, “when they looked at 10 videos, they ranked their own video two spots too high.” The reason, he said, is that “they’ve fallen in love with their own work.”

The circus managers, however, also didn’t fare well, but failed in the opposite direction. “They are too negative on novel ideas,” Grant said, “and they commit a ton of false-negatives, rejecting really promising ideas.”

So why is this? Why do managers tend to find flaws, not reasons for praise? To answer that, Grant turns to the example of Seinfeld, which was rejected by executive after executive at NBC before Rick Ludwin, who didn’t work in sitcoms, to say, as Grant paraphrased it, “you know, I realize that this show makes no sense and it’s really about nothing, the plotlines never get resolved, and you can’t identify with any one of the characters. But it made me laugh and that’s what a sitcom is supposed to do.” The managers, by contrast, were too focused on whether Seinfeld looked like what had succeeded in the past to recognize its novel brilliance. Years of experience had trained them to believe that a certain type of show would be successful, and biased them against something that broke that mold.

But Grant says it wasn’t just experience that prevented those managers from appreciating Seinfeld. It was also that they had bad incentives. As he explained, “If you are a manager, if you commit a false positive, you are going to embarrass yourself, and potentially ruin your career.” Managers, he says, are terrified of committing false positives, meaning saying something will be a hit when in fact it will flop.

False negatives, by contrast, present little costs. “If you reject a great idea,” Grant said, “most of the time, no one will ever know.” (One exception to this: Pity the editors who rejected Harry Potter.) Managers like to make safe bets and don’t mind the invisible losses.

Solution: Get managers to think like peers.

The question then, for Grant, is whether it’s possible to train managers to be more receptive to new ideas. To answer that, he asked, who out there is good at this?

Berg’s work was again illuminating. Berg found that there was one group whose instincts did line up well with what would actually be successful with audiences: other circus artists. “They were the best forecasters by far,” said Grant. “Unlike the artists themselves, the peers could take a step back” and see a work’s flaws. But, unlike managers, the peers “were also really invested in the creative process,” which enabled them to recognize when something was novel and worth the risk.

One conclusion from this would be to eliminate managers from certain decision-making processes. But since that’s not typically possible, perhaps instead managers can be taught to think like peers, and Berg found that that can be done—and relatively easily. “All he did,” Grant explained, “was he asked managers to spend five minutes brainstorming about their own ideas before they judged other people’s ideas.” That, Grant said, “was enough to open their minds. Because when they came in to select ideas, they were looking for reasons to say no. Get them into a brainstorming mindset first, and now they’re not thinking evaluatively, they’re thinking creatively.”

And that, Grant says, means “they’re much more likely to say, ‘What are the reasons that I should consider this idea?’ as opposed to, ‘Why should I walk away from it?’”

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