In theory: The halo effect

Emma De Vita's weekly look at management-speak.

It's been hailed as one of the most important management books of 2007 and praised for debunking some of the many myths that surrounds this pseudo-science, but what really appeals to business managers about The Halo Effect ... and the Eight Other Business Delusions That Deceive Managers is its irreverence. You are also made aware that you too might have been a sucker for some of the delusions that the book's author, Phil Rosenzweig, skilfully pulls apart. For once, this is a business book for the sceptical mind, free of the type of jargon beloved of David Brent in the BBC sitcom The Office.

So what does management professor Rosenzweig have to say, and what can you, as a charity manager, learn from it?

He explains his most important delusion, 'the halo effect', as the phenomenon that occurs when an organisation's financial performance is particularly good - be it profits, sales or fundraising totals. People within the charity - and big cheeses are especially prone to this - will probably conclude that the manager responsible for this glittering success is a visionary leader who has deployed a brilliant strategy and created the kind of working environment where every bright young charity worker wants to be.

Yet when the figures take a turn for the worse, the same people inevitably conclude that the manager's strategy was wrong and that their employees are lazy. Rosenzweig says these bosses were wrong to equate the financial performance of the organisation with the manager's performance in the first place; the fact that you have met your toughest targets can be the result of fluke circumstances as much as of managerial brilliance.

This conclusion will not come as a shock to some managers, but luck can't be relied on all of the time. Rosenzweig argues that the best kind of managers are the sort who can finely balance tenacity and risk-taking to make the most of the chances that they are handed. His words of wisdom for the despairing manager? "For the most part, long-term success is a delusion."

- Emma De Vita is a senior section editor on Management Today.

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