Corporate Ethics Pays Off

That is the conclusion of a recent McKinsey & Company study. Register at the site and you read the article.

In short, the article says that challenging times make it particularly necessary for strategists to think clearly and soundly. But as Charles Roxburgh notes in "Hidden flaws in strategy," those qualities may be a lot rarer than we think. Drawing on insights developed by behavioral scientists, this article helps explain why so many smart people develop and execute bad strategies. Hardwired into our brains, it seems, are biases and shortcuts that were once essential to our survival as a species but can now inspire strategies that are doomed even before launch. Often, for example, we overestimate our ability to make "reasonable" assumptions, so strategies based on them fail when they prove false. We succumb to fuzzy "mental accounting" that leads us to make illogical decisions. We take comfort in following the herd even though "me-too" strategies usually produce merely mediocre results.