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Misunderstanding The Nature Of Company Performance : The Halo Effect And Other Business Delusions

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Week 1 Assignment 2
Shelby D. Williams

Mid America Christian University

MGMT 3213

Professor Annette Gunter

28 Jan 2017 Abstract
This paper will be based on the California Review Management study called "Misunderstanding the Nature of Company Performance: The Halo Effect and Other Business Delusions" by Phil Rosenzweig. The research processes that have been completed on business performances over the years, and the strengths and weaknesses of the types of data used will be discussed. The Halo Effect will be evaluated, and examples from my career will be given to help with understanding the topic at hand. I will give thoughts, ideas, and solutions I plan to adapt and work on in my career to help avoid the Halo Effect in my daily life…show more content…
For this research, the companies researched were chosen based on the independent variable of outcome---success. When researching how operations and other factors affect a company 's success, the testing needs to include companies with different success levels. If the data are based only on successful companies, there is not any comparison to show what they were doing differently to make them successful. For example, all of the successful companies have an owner, but that is not what makes them successful. All companies successful or not are owned by someone. The other studies that Rosenzweig explains are "1994---Built to Last: Successful Habits of Visionary Companies" and "2001---Good to Great: Why Some Companies Make the Leap...and Other Don 't." These studies are considered more accurate on the basis of successful companies being compared to less successful companies, but Rosenzweig points out a separate fault within. The latter cases did extensive research, but the majority of the data came from publications and articles published by journalists. Rosenzweig uses these to introduce the Halo Effect. He explains that these studies, though they are more thorough with the samples, the data are based on highly on biased information, instead of getting the raw data from the companies.
The Halo Effect
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