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Well, according to statistics (see Kahneman) CEO 'performance' has very low correlation with perceived CEO performance. Also, past success has low correlation w

Well, according to statistics (see Kahneman) CEO 'performance' has very low correlation with perceived CEO performance. Also, past success has low correlation with future success. In other words, there isn't really a 'CEO skill', or a 'successful manager' skill. In other words, company success is not repeatable given the same set of people. In other words, yes, luck is extremely important. There is no moral of the story other than: failure does not mean that you didn't do well.

HNJohnC 13y ago
Yes, we (should) all know that but somehow we are still deluged with books and blog posts from these lucky few telling the rest of us how to do it. Worse yet too many are taking it as gospel when they really should just do it their own way.
- TDL 13y ago
  We are deluged by these narratives because they are easy to understand. Same thing with a lot of money is synonymous with success; money is easy to quantify. When we start talking about randomness and luck, my sense is, that people begin to feel uncomfortable because it makes the world a much more less understandable place.
jfb 13y ago
"There is no moral of the story other than: failure does not mean that you didn't do well." While this lesson is pretty well internalized, I think there's some difficulty with the converse: just because you succeeded, doesn't mean what you were doing was right. Life is contingent.
- sz4kerto 13y ago
  Oh yes, that might be even more important. See the Superinvestors of America: http://www.tilsonfunds.com/superinvestors.html http://www.tilsonfunds.com/superinvestors.html
- baddox 13y ago
  This is really just semantic. You can play around with definitions and construct all sorts of truisms: Just because your company ran out of money and ceased to exists doesn't mean you failed. Just because your company grew very quickly, IPO'd at a high price, and had consistently large profits for many years, doesn't mean you succeeded.
agilord 13y ago
Care to provide pointers on the correlations (research paper, whatever)?
- Narretz 13y ago
  I can't tell you the exact study, but you can find it in Kahnemann's Thinking Fast and Slow.
dasil003 13y ago
Are those statistics for startups or Fortune 500s? Because the way I see it, at a small scale you are much more in control of your own destiny simply due to high agility and low communication overhead.

HNJohnC 13y ago

Yes, we (should) all know that but somehow we are still deluged with books and blog posts from these lucky few telling the rest of us how to do it. Worse yet too many are taking it as gospel when they really should just do it their own way.

TDL 13y ago
We are deluged by these narratives because they are easy to understand. Same thing with a lot of money is synonymous with success; money is easy to quantify. When we start talking about randomness and luck, my sense is, that people begin to feel uncomfortable because it makes the world a much more less understandable place.

jfb 13y ago

"There is no moral of the story other than: failure does not mean that you didn't do well." While this lesson is pretty well internalized, I think there's some difficulty with the converse: just because you succeeded, doesn't mean what you were doing was right. Life is contingent.

sz4kerto 13y ago
Oh yes, that might be even more important. See the Superinvestors of America: http://www.tilsonfunds.com/superinvestors.html http://www.tilsonfunds.com/superinvestors.html
baddox 13y ago
This is really just semantic. You can play around with definitions and construct all sorts of truisms: Just because your company ran out of money and ceased to exists doesn't mean you failed. Just because your company grew very quickly, IPO'd at a high price, and had consistently large profits for many years, doesn't mean you succeeded.

agilord 13y ago

Care to provide pointers on the correlations (research paper, whatever)?

Narretz 13y ago
I can't tell you the exact study, but you can find it in Kahnemann's Thinking Fast and Slow.

dasil003 13y ago

Are those statistics for startups or Fortune 500s? Because the way I see it, at a small scale you are much more in control of your own destiny simply due to high agility and low communication overhead.