HBR's 10 must reads 2019 the definitive management ideas of the year from Harvard Business Review

MANAGEMENT US$24.95

hbr.org

2019

Stay informed. Join the discussion.

Visit hbr.org

Follow @HarvardBiz on Twitter

Find us on Facebook and LinkedIn

The definitive

management ideas

of the year from

Harvard Business Review.

2019 year from The definitive management ideas of the Harvard Business Review.

2019

We’ve reviewed the ideas, insights, and best practices from

the past year of Harvard Business Review to keep you up-to￾date on the most cutting-edge, influential thinking driving

business today. With authors from Thomas H. Davenport to

Michael E. Porter and company examples from Facebook

to DHL, this volume brings the most current and important

management conversations right to your fingertips.

This book will inspire you to: • Make stronger connections and build greater trust among

people who work on multiple teams

• Engage customers and employees alike with the help of

artificial intelligence

• Channel your outrage about sexual harassment in the

workplace into effective action

• Consider how CEO activism can generate goodwill for your

company—and weigh its risks

• Pair data with qualitative research to increase diversity in

your organization

• Remain competitive in a hub economy by using your

company’s assets and capabilities differently

A year’s worth of management wisdom,

all in one place.

HBR Guide Series

Looking for smart answers to your most

pressing work challenges? Try these and

other titles in the practical HBR Guide

series:

HBR Guide to Being More Productive

HBR Guide to Better Business Writing

HBR Guide to Building Your Business Case

HBR Guide to Buying a Small Business

HBR Guide to Changing Your Career

HBR Guide to Coaching Employees

HBR Guide to Data Analytics Basics for

Managers

HBR Guide to Dealing with Conflict

HBR Guide to Delivering Effective Feedback

HBR Guide to Emotional Intelligence

HBR Guide to Finance Basics for Managers

HBR Guide to Getting the Right Work Done

HBR Guide to Making Every Meeting Matter

HBR Guide to Negotiating

HBR Guide to Office Politics

HBR Guide to Performance Management

HBR Guide to Persuasive Presentations

HBR Guide to Project Management

Classic ideas, enduring

advice, the best thinkers—

all in one place

HBR’s 10 Must Reads series is the

definitive collection of ideas and best

practices for aspiring and experienced

leaders alike. These books offer essential

reading selected from the pages of

Harvard Business Review on topics

critical to the success of every manager.

Each book is packed with advice and

inspiration from leading experts such

as Clayton Christensen, Peter Drucker,

Rosabeth Moss Kanter, John Kotter,

Michael Porter, Daniel Goleman,

Theodore Levitt, and Rita Gunther

McGrath.

Titles in this bestselling series include: • HBR’s 10 Must Reads: The Essentials • HBR’s 10 Must Reads for New Managers • HBR’s 10 Must Reads on Change Management • HBR’s 10 Must Reads on Communication • HBR’s 10 Must Reads on Emotional Intelligence • HBR’s 10 Must Reads on Entrepreneurship and

Startups

• HBR’s 10 Must Reads on Leadership • HBR’s 10 Must Reads on Leadership Lessons

from Sports

• HBR’s 10 Must Reads on Managing People • HBR’s 10 Must Reads on Managing Yourself • HBR’s 10 Must Reads on Mental Toughness • HBR’s 10 Must Reads on Sales • HBR’s 10 Must Reads on Strategic Marketing • HBR’s 10 Must Reads on Strategy • HBR’s 10 Must Reads on Teams

BONUS ARTICLE

“Now What?”

Managing #MeToo

By Joan C. Williams and

Suzanne Lebsock

ISBN-13: 978-1-63369-642-6

9

7

8

1

6

3

3

6

9

6

4

2

6

9

0

0

0

0

HBR’S

10

MUST

READS

The defi nitive

management ideas

of the year from

Harvard Business Review.

2019

HBR’s 10 Must Reads series is the defi nitive collection of ideas

and best practices for aspiring and experienced leaders alike.

These books off er essential reading selected from the pages

of Harvard Business Review on topics critical to the success of

every manager.

Titles include:

HBR’s 10 Must Reads 2015

HBR’s 10 Must Reads 2016

HBR’s 10 Must Reads 2017

HBR’s 10 Must Reads 2018

HBR’s 10 Must Reads 2019

HBR’s 10 Must Reads for New Managers

HBR’s 10 Must Reads on Change Management

HBR’s 10 Must Reads on Collaboration

HBR’s 10 Must Reads on Communication

HBR’s 10 Must Reads on Emotional Intelligence

HBR’s 10 Must Reads on Entrepreneurship and Startups

HBR’s 10 Must Reads on Innovation

HBR’s 10 Must Reads on Leadership

HBR’s 10 Must Reads on Leadership for Healthcare

HBR’s 10 Must Reads on Leadership Lessons from Sports

HBR’s 10 Must Reads on Making Smart Decisions

HBR’s 10 Must Reads on Managing Across Cultures

HBR’s 10 Must Reads on Managing People

HBR’s 10 Must Reads on Managing Yourself

HBR’s 10 Must Reads on Mental Toughness

HBR’s 10 Must Reads on Sales

HBR’s 10 Must Reads on Strategic Marketing

HBR’s 10 Must Reads on Strategy

HBR’s 10 Must Reads on Strategy for Healthcare

HBR’s 10 Must Reads on Teams

HBR’s 10 Must Reads: The Essentials

HBR’S

10

MUST

READS

The defi nitive

management ideas

of the year from

Harvard Business Review.

2019

HARVARD BUSINESS REVIEW PRESS

Boston, Massachusetts

HBR Press Quantity Sales Discounts

Harvard Business Review Press titles are available at signifi cant quantity

discounts when purchased in bulk for client gifts, sales promotions, and

premiums. Special editions, including books with corporate logos, cus￾tomized covers, and letters from the company or CEO printed in the front

matter, as well as excerpts of existing books, can also be created in large

quantities for special needs.

For details and discount information for both print and

ebook formats, contact [email protected],

tel. 800-988-0886, or www.hbr.org/bulksales.

Copyright 2019 Harvard Business School Publishing Corporation

All rights reserved

No part of this publication may be reproduced, stored in or introduced into

a retrieval system, or transmitted, in any form, or by any means (electronic,

mechanical, photocopying, recording, or otherwise), without the prior

permission of the publisher. Requests for permission should be directed to

[email protected], or mailed to Permissions, Harvard Business

School Publishing, 60 Harvard Way, Boston, Massachusetts 02163.

The web addresses referenced in this book were live and correct at the time of

the book’s publication but may be subject to change.

Library of Congress cataloging- in- publication data is forthcoming.

eISBN: 9781633696433

Editors’ Note vii

The Overcommitted Organization 1

by Mark Mortensen and Heidi K. Gardner

Why Do We Undervalue Competent Management? 19

by Raff aella Sadun, Nicholas Bloom, and John Van Reenen

“Numbers Take Us Only So Far” 37

by Maxine Williams

The New CEO Activists 47

by Aaron K. Chatterji and Michael W. Toff el

Artifi cial Intelligence for the Real World 67

by Thomas H. Davenport and Rajeev Ronanki

Why Every Organization Needs an Augmented Reality Strategy 85

by Michael E. Porter and James E. Heppelmann

Thriving in the Gig Economy 109

by Gianpiero Petriglieri, Susan Ashford, and Amy Wrzesniewski

Managing Our Hub Economy 117

by Marco Iansiti and Karim R. Lakhani

The Leader’s Guide to Corporate Culture 133

by Boris Groysberg, Jeremiah Lee, Jesse Price, and J. Yo- Jud Cheng

The Error at the Heart of Corporate Leadership 165

by Joseph L. Bower and Lynn S. Paine

Now What? 207

by Joan C. Williams and Suzanne Lebsock

About the Contributors 239

Index 243

Contents

vii           

It’s never easy to whittle down a year’s worth of Harvard Business

Review ’s research, ideas, and advice to the few articles gathered in

this volume, but this past year was particularly tough. In addition

to staple HBR topics such as leadership and strategy, the complex

and difficult issues we were turning over in our minds and dis￾cussing in boardrooms and on social media also filled the pages

of HBR. Recurring themes included machine learning, the place of

business in society, and the implications of intersectionality— where

harassment and discrimination can aff ect any one of the multiple

layers of our identity. The standout articles of the year covered an

array of topics, from integrating cognitive technology with human

work to speaking up— whether as a CEO activist or as a manager

amid the #MeToo movement. Our authors gave you new lenses

through which to view the evolving context in which we work. This

collection of articles showcases these and other critical themes from

the past year of Harvard Business Review .

We’ve all been working in teams for years. The challenge today

is how to manage work and communication when you and every￾one you work with are all on a half- dozen other teams too. “The

Overcommitted Organization” affi rms that some standard advice

for working on teams still applies while also providing new strate￾gies for managing this growing modern- day dilemma, from map￾ping overlap to sharing insights across projects to helping teams

maintain progress when key members are yanked for “all hands on

deck” emergencies. Authors Mark Mortensen and Heidi K. Gardner

conduct research, teach, and consult on collaboration and leader￾ship issues. They have identifi ed several ways in which both team

and organizational leaders can reduce the negative aspects of over￾lap and take advantage of the benefi ts, including skill sharing across

teams, better time management, and opportunities to learn.

MBA students are taught that companies can’t expect to compete

on the basis of management competencies— they’re too easy for

rivals to copy, so they won’t sustain competitive advantage over time.

However, a decade- long research project undertaken by authors

Raff aella Sadun, Nicholas Bloom, and John Van Reenen reveals that

the conventional wisdom is fl awed, raising the question “Why Do

Editors’ Note

EDITORS’ NOTE

viii

We Undervalue Competent Management?” In their study of 12,000

organizations the authors found vast diff erences in how companies

execute 18 core management practices, including such basic ones as

setting targets, running operations, and grooming talent. Those dif￾ferences matter: Companies with strong managerial processes do sig￾nifi cantly better on high- level metrics such as profi tability, growth,

and productivity. The authors identify the main challenges hindering

the adoption of essential management practices, suggest solutions,

and make the case that senior leaders should focus on operational

excellence as a crucial complement to strategy.

To overcome organizational bias, leaders are relying on people

analytics to make data- driven decisions and to hire and promote

fairly. But some leaders who take this approach say they can’t

counteract or reverse bias with data: They can’t “apply analytics to

the challenges of underrepresented groups at work” because “the

relevant data sets don’t include enough people to produce reliable

insights— the sample size, the n , is too small.” In “‘Numbers Take

Us Only So Far,’” Facebook’s global director of diversity, Maxine

Williams, explains why data must be paired with qualitative research

to give leaders the insights they need to increase diversity at all lev￾els of their organizations. By drawing on industry or sector data,

learning what other companies are doing, and deeply examining the

experiences of their own employees, companies can advance their

goals of improving diversity and inclusion.

CEOs have always lobbied publicly for political or social issues that

are good for their business. But this year we saw a signifi cant phenom￾enon emerge: “The New CEO Activists.” Taking stands on issues that

are not directly related to their business model and their success can

hurt sales (or help them) when consumers respond with their wallets.

So why take the risk? Duke’s Aaron K. Chatterji and Harvard Business

School’s Michael W. Toff el off er a guide leaders can use in assessing

whether to speak out and how, choosing which issues to weigh in on,

and balancing the likelihood of having a positive eff ect with the possi￾bility of a backlash.

Artificial intelligence and machine learning have generated

lots of hype, but what do they mean for you and your business?

In “Artifi cial Intelligence for the Real World,” Thomas H. Davenport

ix           

EDITORS’ NOTE

and Rajeev Ronanki encourage readers to look at AI “through the

lens of business capabilities rather than technologies.” Instead of

a transformative approach, the authors advise, companies should

take an incremental approach to developing and implementing AI

and focus on augmenting rather than replacing human capabilities.

They assert that AI can support three important business needs:

automating business processes, gaining insight through data anal￾ysis, and engaging with customers and employees. Their four- step

framework for integrating AI technologies, along with the real- case

examples they provide, will allow companies to explore how they

might best use cognitive technologies.

For those who work outside the technology realm, the acronyms

AI and AR can sound a bit like alphabet soup. We found value in

reading the previous piece and “Why Every Organization Needs an

Augmented Reality Strategy” together, because that can help defi ne

what those acronyms are and how they’re used. AR— technologies

that superimpose digital data and images on physical objects— has

familiar entertainment applications, such as Snapchat and Pokémon

Go. But AR is now being used in business in far more consequen￾tial ways; Michael E. Porter and James E. Heppelmann assert that

it will become the new interface between humans and machines.

They defi ne AR, describe its evolving technology and applications,

and discuss its importance. The authors provide both a primer for

Luddites and an expansive review of the opportunities AR presents,

from expected applications such as logistics and design to sur￾prising ones such as allowing HR to tailor training according to an

employee’s experience or repeated errors.

Whether we’re freelancers who have lost access to the security

and support of traditional employers or corporate employees log￾ging in from home offi ces, the way we work has changed. In “Thriv￾ing in the Gig Economy,” the organizational behavior professors

Gianpiero Petriglieri, Susan Ashford, and Amy Wrzesniewski report

on their study of freelance workers to understand what it takes to be

successful in independent work. They found that the most eff ective

independent workers “cultivate four types of connections— to place,

routines, purpose, and people — that help them endure the emotional

ups and downs of their work and gain energy and inspiration from

EDITORS’ NOTE

x

their freedom.” Addressing these core areas can help you stay moti￾vated, boost your productivity and focus, and ward off feelings of

rootlessness and isolation.

As individuals, we’re working in new ways, but the con￾text in which we work and our organizations grow— or fail— has

changed too. “Managing Our Hub Economy” off ers a fascinating,

forward- looking, and sometimes chilling examination of the place

of business in society. Hub fi rms such as Alibaba, Apple, and Ama￾zon create real value for users but also concentrate data and power

in the hands of a few companies that employ a tiny fraction of the

workforce. Harvard Business School professors Marco Iansiti and

Karim R. Lakhani argue that the hub economy will continue to

spread across additional industries, concentrating power even more.

“To remain competitive, companies will need to use their assets and

capabilities diff erently, transform their core businesses, develop

new revenue opportunities, and identify areas that can be defended

from encroaching hub fi rms and others rushing in from previously

disconnected economic sectors.”

Another new perspective on an old issue is found in “The

Leader’s Guide to Corporate Culture.” The conventional wisdom

has it that leaders are expected to create and change strategy, but

culture is ingrained, unchangeable, and “anchored in unspoken

behaviors, mindsets, and social patterns.” Not so, say Harvard Busi￾ness School professor Boris Groysberg and his coauthors. They argue

that it is possible to change your company’s culture, but fi rst you

must understand how it works. By integrating fi ndings from more

than 100 of the most commonly used social and behavioral models,

the authors created a framework that will allow you to model the

impact of culture on your business and assess its alignment with

your strategy. When properly managed, culture can help leaders

achieve change and build organizations that will thrive in even the

most trying times.

Most CEOs and boards are hyperfocused on creating wealth

for their shareholders. But managing for the good of the stock is

not always the same as managing for the good of the company—

especially when it leads to a focus on the short term. In “The

Error at the Heart of Corporate Leadership,” Joseph L. Bower and

xi           

EDITORS’ NOTE

Lynn S. Paine examine the foundations and fl aws of agency the￾ory, which views shareholders as the “owners” of a company and is

behind the current widespread idea that corporate managers should

make shareholder value their primary concern. The authors off er

eight propositions to provide a company- centered model that would

have at its core the health of the enterprise instead. Their model

would return companies’ attention to innovation, strategic renewal,

and investment in the future.

Where do we go from here? The #MeToo movement and countless

reports of sexual harassment in the workplace are transforming how

we manage relationships at work. In “Now What?” the legal scholar

Joan C. Williams and the feminist historian Suzanne Lebsock explore

whether this is really the end of a harassment culture. Companies

are moving away from quiet settlements with victims and toward

fi ring abusers. But employers must still follow due process and eval￾uate the credibility of reports. They need clear policies and fair pro￾cedures for handling harassment. The authors surprised themselves

with their closing advice: “If you are being sexually harassed, report

it. We’re not sure if we would have advised that, in such a blanket

and unnuanced way, even a year ago.”

The most important ideas of the year are at your fi ngertips in

this volume. From ideas on managing your team, to issues for your

board and senior executives, to harnessing artificial intelligence

and augmented reality, to addressing meaty personnel issues such

as diversity and harassment, the articles here will help you address

the situations you’re facing today and prepare for what lies on the

horizon.

—The Editors

The defi nitive

management ideas

of the year from

Harvard Business Review.

2019

HBR’S

10

MUST

READS