“The Persistence Project” – an ambitious new research project led by two Deloitte Consulting veterans, consultant Mumtaz Ahmed and noted author Michael Raynor – seeks to advance the art of “success study.”. This paper aims to investigate this issue.
Starting in 2007, Mumtaz Ahmed and Michael Raynor worked on developing a rigorous statistical method for identifying exceptional performers with Professor Andrew D. Henderson of the University of Texas at Austin. The paper looks at the method by way of an interview.
The paper finds that their preliminary efforts so far have revealed that the benchmarks for greatness are much higher than generally perceived.
There are a number of critical elements of research design that set this study apart. First, the authors have taken a unique approach to identifying companies that have achieved exceptional results. Typically, research of this type sets benchmarks – e.g., 3× the market for 15 years – and claims that firms that exceed such a mark are good enough to merit closer study. This study first characterizes the nature of the larger system within which all firms operate, controls for key confounding variables such as year and industry effects, and then assesses which firms, conditional on their life spans, have actually delivered results so unlikely that firm specific effects, such as uniquely skilled management, are plausible contributors to their performance. It is this aspect of the work that won a Best Paper award at the Academy of Management this year, and will also be published in the Annals of Applied Statistics.
The authors have built into their study design the opportunity to predict outcomes, and so depending on the results of those predictions, their theories will be validated, or not.
The research is attempting to gain useful insight into the causes of sustained, truly superior corporate performance.
Sterling, J. and Randall, R.M. (2010), "The Persistence Project: seeking to advance the art of “success study”", Strategy & Leadership, Vol. 38 No. 1, pp. 5-10. https://doi.org/10.1108/10878571011009822Download as .RIS
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