How learning occurs

29 Mar

The stars have aligned. So have the planets. And it is good.

I’m currently taking two MBA courses, Statistics for Decision Making and Management and Organizational Science. And there is nothing more joyous when there is randomly occurring synergy between the two. Or perhaps it’s not random?

This week, we began hypothesis testing in Statistics. We are formulating our hypotheses, then testing to see if we should accept or reject the null. And what are we reading in Management this week? Good to Great, or Just Good?, an article by Bruce Niendorf and Kristine Beck. Their article uses this very same statistical methodology to examine if there is any evidence that the five management principles identified by Jim Collins in the mega-bestselling business book Good to Great actually produced stellar results.

According to Niendorf and Beck, Collins’ “evidence” doesn’t hold up on multiple levels. First, he used data mining incorrectly. Collins found patterns in the data, but he failed to test his patterns once he found them. Second, he identified an association between the “great” firms and his five principles, but he failed to establish causation. When debunking medical myths on his radio show, the great Dr. Dean Edell explains causation to laypeople as follows: People eat carrots, and people get in car accidents, but that doesn’t mean carrots cause car accidents.

Collins developed the five traits AFTER he examined the companies, rather than developing the traits first and exploring if the companies matched. From that perspective, couldn’t he write the traits any way he wanted to make them “work” for his selected companies?

Niendorf and Beck used the same methodology I used to solve six Statistics homework problems last night: They identified a theory, set up hypotheses, and then sampled, tested and drew conclusions. Learning in action!

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