Evolutionary theory predicts that if there is an advantage in cheating a system then, cheating will happen. This experiment shows how that might have implications for real world managers.
...when we measure everything by rate of return on investment and profit, we're going to be measuring the capability of managers to cheat the system.
In other words they don't cheat, they are simply gaming the system.
The answer is in having carefully thought out tests. For example an anatomy course aims to teach students the name of every bone in the body. How to test? Ask each each student to name 4 bones pointed out at random by the examiner. The only way to pass this exam is to know the names of every bone in the body. Knowing the exam format will not help and there is no need for obscurity to ensure the exam process is fair.
Some might argue that such behaviour makes corporate executives no different to criminals.
Tuesday, 19 August 2008
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