31 Posts found for Author: Roger L. Martin

In football, there is a rigid separation of the real market — the games played on Sundays — from the expectations market, or the betting that takes place prior to the game. No participant in the real market is permitted to participate in any way in the expectations market. If they do, they risk a lifetime ban for even one infraction. There is an even … [ Read more ]

Content: Quotation | Author: Roger L. Martin | Subjects: Compensation, Corporate Governance, Economics, Finance

American capitalism is in dire straits, caught in a perilous pattern of increasing volatility, decreasing investor returns, and ongoing bad behavior by executives. And it’s getting worse. Since the turn of the twenty-first century, we’ve seen two massive value-destroying market meltdowns and a string of ethics breaches, including accounting scandals, options-backdating schemes, and the subprime mortgage debacle.

Just what is going on here? Is it the … [ Read more ]

Content: Book | Author: Roger L. Martin | Subjects: Corporate Governance, Economics, Management

Agency theory, derived from neoclassical economics, together with the gospel of shareholder value, has led to managers being compensated for doing the wrong things. Stock-based compensation, for example, focuses executives on expectations markets rather than real markets, where customer value is created. It is this focus on maximizing what should be an ancillary goal that has led to the marginalizing of customers as “marks” to … [ Read more ]

Content: Quotation | Authors: David K. Hurst, Roger L. Martin | Source: strategy+business | Subjects: Corporate Governance, Economics

Really smart people have the hardest time learning. They are so very smart that they are also very “brittle.” When something goes wrong, rather than reflect on what they might have done to contribute to the error, they look entirely outside themselves for the causes and blame outside forces — irrational clients, impossible time pressure, lack of adequate resources, shifts beyond their control. Rather than … [ Read more ]

Content: Quotation | Authors: Chris Argyris, Roger L. Martin | Source: Harvard Business Review | Subjects: Learning, Organizational Behavior, Personal Development, Personality / Behavior

Neither inside nor outside directors can adequately represent shareholder interests.

Content: Article | Author: Roger L. Martin | Source: The Conference Board Review | Subject: Corporate Governance

Because of the structure of their compensation, CEOs are rewarded for share price volatility not performance. So the volatility of the past four years has served them very well indeed. To understand how, let’s model stock-based compensation in two possible worlds: A CEO whose stock has followed the S&P more or less exactly and a CEO whose stock has remained steady over the same period. … [ Read more ]

Content: Article | Author: Roger L. Martin | Source: Harvard Business Review | Subject: Corporate Governance

The role of big companies is to turn great people into mediocre organizations.

Content: Quotation | Author: Roger L. Martin | Source: ChangeThis | Subjects: Bureaucracy, Organizational Behavior

The chief proponent of “integrative thinking” argues that business schools need to teach fewer absolutes and more critical thinking skills.

Content: Prospective MBA Content | Author: Roger L. Martin | Source: BusinessWeek | Subject: About the MBA Degree

There is little evidence that the ability of today’s organizations to accurately understand the world and predict the future has increased one iota. Massive spending on these [information] systems has not prevented corporations from wandering off the beaten strategic path, or being ambushed by new competitors and changing markets, and I would argue that the reason for this is a natural tension between the pursuits … [ Read more ]

Content: Quotation | Author: Roger L. Martin | Source: Rotman Magazine | Subjects: Management, Organizational Behavior

This content is restricted to site members. Please log in or register

It’s a delicate balance: Can companies provide good returns to shareholders while being socially responsible? The “virtue matrix,” developed by Rotman School of Management’s Dean Roger L. Martin, lays out some guidelines in this excerpt from the Harvard Business Review.

Content: Article | Author: Roger L. Martin | Source: Harvard Business School (HBS) Working Knowledge | Subject: Social Responsibility (ESG)