Bookshelf | September / October 2105

A collection of reviewed books from the September / October 2015 print issue.

BEYOND MEASURE

“Culture has become the secret sauce of organi­zations: the thing that makes the difference but for which no one has the recipe,” writes entre­preneur Margaret Heffernan. So how can orga­nizations create “just cultures,” where everyone feels safe to speak up, offer ideas, and learn from failures? Readers might be familiar with some of Heffernan’s solutions, such as encouraging creative conflict, promoting diversity, and finding ways to build social capital. But she supplements these suggestions with useful examples of how actual companies have achieved them. For instance, the Torres wine vineyard keeps a Black Book where every employ­ee who makes a mistake writes it up; new employees read the book so they know how to avoid similar errors. A thoughtful and empowering read. (TED Books/Simon & Schuster, US$16.99)

MYTHS & MORTALS

Many business leaders, from the owner of the corner grocery store to chewing gum magnate William Wrigley, hope their children will want to head the family business. But sometimes their heirs aren’t prepared to run the enterprise like their parents did—which could be a good thing. Andrew Keyt, executive director of Loyola University Chicago’s Family Business Center, explores how successors must differentiate themselves from their ancestors to create their own visions for the companies they’ve inher­ited. Keyt makes his points with a combination of research, psychology, and interviews with famous heirs such as Christie Hefner and Massimo Ferragamo. He concludes that succes­sors must “become strong leaders in their own right, demysti­fying the idealized version of their predecessors, recognizing their shortcomings as well as honoring their successes.” (Wiley, US$40)

EFFICIENTLY INEFFICIENT

For decades, finance experts have tried to define how the markets work and why. Lasse Heje Pedersen of New York University and Copen­hagen School of Business doesn’t accept the two most common positions. If the market is efficient, he says, there’s no point in trying to beat it because all information is already avail­able; if it’s inefficient, it should be easy to beat. But hedge fund managers and market professionals build lucrative careers on occasionally outperforming the market, and Pedersen thinks it’s because markets are “efficiently inefficient.” He writes, “Competition among professional investors makes markets almost efficient, but the market remains so inefficient that they are compensated for their costs and risks.” His ultimate point? “If hedge fund returns are not just about magic, then the main hedge fund strategies can be learned and understood.” He spends the rest of the book breaking down and exploring those strategies. (Princeton University Press, US$45)

THE REMIX STRATEGY

In today’s complex business world, it’s not just one business competing against another, but alliances of businesses competing against other alliances. But with the high failure rate of mergers and acquisitions, how can execu­tives make sure they get value out of a business partnership? Benjamin Gomes-Casseres offers the three laws of business combinations: The businesses must create more value together than they do separately; they must be managed in a way that realizes that value; and they must each earn a return that justifies the investment. Gomes-Casseres, a Brandeis professor, deconstructs both successful alliances (Pixar and Disney) and unsuccessful ones (Daimler and Chrysler) with the goal of helping any business leader increase the chances of making a partner­ship work. (Harvard Business Review Press, US$30)

COMPLIANCE MANAGEMENT

One of the most complicated parts of run­ning a business is doing it the right way—not just keeping up with changing governmen­tal regulations, but also operating in an ethical, responsible manner. Nitish Singh and Thomas Bussen, both of Saint Louis University, have compiled a comprehensive handbook that explains key pieces of legislation, the his­tory behind them, and the practical reasons it is essential to comply. For instance, they point out that companies found guilty of wrongdoing tend to incur lesser penalties if they have solid ethics and compliance programs already in place. But such programs don’t just win over judges; they resonate with employees, who are 60 percent less likely to feel pressured to break the rules than workers in companies without such programs. The authors reference historical precedent and recent scandals as they discuss topics from risk management to data privacy and every­thing in between. (Praeger, US$37)

WHAT YOU REALLY NEED TO LEAD

Industry observers frequently call for more and better leadership, notes Harvard’s Rob­ert Steven Kaplan, but these observers can’t agree on a clear definition of what "better leadership" is. Kaplan hopes to change that by providing a framework for identifying and building leaders. He writes, “I will make the argument that leadership starts with an ownership mind-set. That is, do you think as if you are in the shoes of a de­cision maker and act in a manner that takes ownership of the consequences of your actions? Do you focus on adding value to others?” He believes anybody can—and everybody should—step forward when the opportunity arises. As he points out, “Leadership doesn’t require a written invita­tion.” (Harvard Business Review Press, US$27)