By Daniel Butcher
As generative AI’s usage continues to grow rapidly, critics point out that OpenAI’s ChatGPT fabricates sources, including citations, journal names, and articles, that sound legitimate and scholarly, but are often made up. Sometimes, it doesn’t attribute direct quotes to the person who said or wrote them. Other generative AI platforms have been accused of plagiarism or failing to properly cite sources or even producing “hallucinations” that fill information gaps with inaccurate statements or outputs. Still, these may be more growing pains rather than chronic illnesses.
That’s according to Academy of Management Scholar Herman Aguinis of the George Washington University School of Business, who said that every new technology presents ethical challenges in producing and using it. Problems arose in the early days of the Internet, too. He noted that generative AI platforms such as ChatGPT have largely corrected the issue of hallucinations.
“You can Google something and copy and paste something from the search results, but plagiarism has been around for a long time…you could grab a paper book from the library and copy a whole paragraph from it,” Aguinis said. “AI is making these possibilities and the potential for cheating in these ways much easier and more straightforward.
“ChatGPT 3.0 was doing that, but the GPT-4o version not only gives you the right source name but also a quote or sentence from the source—it is absolutely incredible, and that’s going to get even better,” he said.
As for using generative AI in the workplace, Aguinis believes that leaders have to create sensible policies.
“One sensible general blanket policy that applies across industries, jobs, and tasks is to openly and honestly describe exactly how you use AI for your specific task, essentially, user beware,” Aguinis said. “It’s really important to offer an explanation, qualification, or warning of how you used AI.
“Second, the issue of AI output verification is absolutely key—you should verify the accuracy and appropriateness of the information that you received through ChatGPT,” he said. “Those are the guardrails, and while this is evolving, and we’re immersed in it, people shouldn’t be too scared about it, because every time we lived through those technological advancements, there were all these alarms going off that there’s going to be all kinds of problems.
“Every technology can be used, abused, and misused, so there’s nothing new about AI—we need to think about verifying the information and being open and honest about how we use it.”
-
Daniel Butcher is a writer and the Managing Editor of AOM Today at the Academy of Management (AOM). Previously, he was a writer and the Finance Editor for Strategic Finance magazine and Management Accounting Quarterly, a scholarly journal, at the Institute of Management Accountants (IMA). Prior to that, he worked as a writer/editor at The Financial Times, including daily FT sister publications Ignites and FundFire, Crain Communications’s InvestmentNews and Crain’s Wealth, eFinancialCareers, and Arizent’s Financial Planning, Re:Invent|Wealth, On Wall Street, Bank Investment Consultant, and Money Management Executive. He earned his bachelor’s degree from the University of Colorado Boulder and his master’s degree from New York University. You can reach him at dbutcher@aom.org or via LinkedIn.
View all posts
Up next....
Two Creators Working Together Are Better Than One
By Daniel Butcher
There are many examples of creative and productive partners, including John Lennon and Paul McCartney, the Coen brothers, Warren Buffett and Charlie Munger, Steve Jobs and Steve Wozniak, William Procter and James Gamble, Bill Hewlett and Dave Packard; the list goes on and on.
Academy of Management Scholar Bess Rouse of Boston College said that people who create together engage in intimate creative interactions that lead to a shared interpersonal boundary—“I created it” becomes “We created it.” This shared interpersonal boundary influences creativity by forming a closed, safe space in which duos can explore divergent ideas and navigate creative blocks.
“We know a lot about team creativity, and we know a lot about individual creativity, and one of the things I was really interested in exploring is this idea of two people working together and the balance that happens in that space,” Rouse said. “You look at a lot of successful, creative people in the world, and they’re often working in pairs, and it’s either a very explicit pair or a well-known person who works with a shadow person.
“It might be a husband and wife, or it might be a more dominant person and a secondary person who are working together,” she said. “That creative space is really special, because you can challenge that person and they’re trusted, and it’s in this bounded space where you develop the sense of a shared interpersonal boundary, where you feel very connected to this other person, and so they’re able to challenge each other and get some of the benefits of having an outsider voice.
“Yet the trust and the support are built into the relationship as well, and that seems to be a really powerful dynamic for developing really high-quality creativity and sustaining it over time.”
An example that Rouse cited in an Academy of Management Review article is from Michael Lewis’s book, The Undoing Project: A Friendship That Changed Our Minds, on social psychologists Daniel Kahneman and Amos Tversky.
“They were social psychologists very well known for doing their work together, and Lewis does a really good job of fleshing out the sorts of tensions in that kind of relationship, but they’re also a very powerful example of two people collaborating and working together successfully and bringing out the best in each other over time,” Rouse said.
-
Daniel Butcher is a writer and the Managing Editor of AOM Today at the Academy of Management (AOM). Previously, he was a writer and the Finance Editor for Strategic Finance magazine and Management Accounting Quarterly, a scholarly journal, at the Institute of Management Accountants (IMA). Prior to that, he worked as a writer/editor at The Financial Times, including daily FT sister publications Ignites and FundFire, Crain Communications’s InvestmentNews and Crain’s Wealth, eFinancialCareers, and Arizent’s Financial Planning, Re:Invent|Wealth, On Wall Street, Bank Investment Consultant, and Money Management Executive. He earned his bachelor’s degree from the University of Colorado Boulder and his master’s degree from New York University. You can reach him at dbutcher@aom.org or via LinkedIn.
View all posts
Up next....
The “Lone Genius” Myth Overshadows One of the Partners
By Daniel Butcher
Professional creative partners—such as Lennon and McCartney, Rodgers and Hammerstein, the Coen brothers, and Jerry Seinfeld and Larry David provide evidence that the pair is the primary creative unit. But countless examples show when one of a pair gets more credit than the other—think Duke Ellington and Billy Strayhorn, Dave Chappelle and Neil Brennan, Simon and Garfunkel, as well as whoever was the wind beneath Bette Midler’s wings.
Academy of Management Scholar Bess Rouse of Boston College said that many organizational stories feature duos who create together:
• Steve Jobs and Steve Wozniak propelled the personal computer revolution.
• Sergey Brin and Larry Page provided new ways to find information through Google.
• Ben Cohen and Jerry Greenfield shifted our expectations about ice cream with flavors such as Cherry Garcia and Phish Food.
Such creative pairs often start their own companies, but when they work within organizations, they change them.
“We have this very this myth of the lone genius—this is woven through the creativity literature where we really want to assign credit to one person,” Rouse said. “This idea can be very rupturing to a creative dyad, if somebody’s trying to assign more credit to one than the other or saying, ‘This is really that one person’s idea—that other person didn’t do very much.’
“Our societal and organizational incentives—both financial rewards and recognition—are generally not aligned well with this idea that we actually do creativity as a very social process,” she said. “It isn’t just in entertainment and business; also in medical fields, an important question is, ‘Who came up with what discovery?’ and we’ve gotten a little looser on attribution of credit, being able to say, ‘This team of people came up with this discovery,’ but often you will hear people still continue to pick apart who did what and say, ‘That was really this one person’s idea, and this other person was just helpful.’
“I don’t think we’ve figured out a very good way of rewarding or acknowledging the power that happens in a group or particularly in a dyad around creativity—we still really want to assign ownership or credit to one person.”
In some cases, different personality types determine which half of a duo is more celebrated by the media.
“You definitely see these examples where there’s one person in a duo who becomes a media darling, and sometimes this is by choice, when one person likes being in the spotlight more than another person, and they’re willing to fly under the radar, like Steve Jobs and Steve Wozniak,” Rouse said.
“You can think about social dynamics there, and in some situations, one person loves being in front of the camera and getting those kinds of accolades, and another person would prefer to be in the background,” she said.
“But sometimes it isn’t an individual choice—that is, there are other factors that come into play that shape who we pay attention to.”
-
Daniel Butcher is a writer and the Managing Editor of AOM Today at the Academy of Management (AOM). Previously, he was a writer and the Finance Editor for Strategic Finance magazine and Management Accounting Quarterly, a scholarly journal, at the Institute of Management Accountants (IMA). Prior to that, he worked as a writer/editor at The Financial Times, including daily FT sister publications Ignites and FundFire, Crain Communications’s InvestmentNews and Crain’s Wealth, eFinancialCareers, and Arizent’s Financial Planning, Re:Invent|Wealth, On Wall Street, Bank Investment Consultant, and Money Management Executive. He earned his bachelor’s degree from the University of Colorado Boulder and his master’s degree from New York University. You can reach him at dbutcher@aom.org or via LinkedIn.
View all posts
Up next....
Taming Toxic Workplaces
By Daniel Butcher
If you work for a bad boss at a dysfunctional or toxic organization, you can either find a new job or learn to cope with stressful conditions. But if you can get middle managers on your side, then you might even be able to start changing the toxic culture.
Academy of Management Scholar Bess Rouse of Boston College, who coauthored an Academy of Management Journal article with William Kahn of Boston University on this topic, said that toxicity appears in organizations as intolerance, bullying, narcissism, and other forms of destructiveness that demoralize employees and undermine organizational success. Senior leaders often perpetrate toxicity or fail to stem destructive behaviors.
“How do the people working underneath these intolerant, narcissistic, or destructive leaders respond in these toxic situations?” Rouse said. “It isn’t uncommon for me to talk to somebody who feels like they have one of these toxic leaders that they’re working under, but they don’t always have an idea of how to handle it.
“One option is to just leave, but we don’t always have that option to just leave, so then we think about, ‘How do we want to be? What kind of middle manager, if we’re in that position, do we want to be?” she said. “Do we want to be somebody who protects ourselves and has that toxicity cascade down the organization, or do we want to be somebody who buffers our employees and makes them feel protected?
“There are different ways of thinking about coping with a toxic workplace; we talk about this as workarounds for how you think about responding to those toxic leaders.”
Toxic organizations drain workers’ personal agency, undermining their capacity to act independently and make choices.
“Leaders’ toxic behaviors such as intolerance, bullying, narcissism, and destructiveness are all red flags, and we can be good leaders without having those behaviors,” Rouse said. “What we saw in that study was that these weren’t bad people—they were driven by anxiety about a lot of external challenges that were happening in the organization, and they just managed that anxiety by belittling other people and diminishing them.
“Obviously it wasn’t the most effective way, but that was their way of dealing with that pressure, and then we also found that that stayed in place because the senior team colluded around that, essentially, and no one stepped up and said, ‘We can’t keep behaving this way,’” she said. “It was actually the middle managers, those people who were better at shifting from absorption to differentiating among team members, which ended up challenging that structure in that type of toxic organization.
“Especially when that that top leadership team has become very insular and supporting of one another in a way that there are no new voices coming into that senior team, then the middle managers are left to have to do that that work of changing the toxic organizational culture.”
-
Daniel Butcher is a writer and the Managing Editor of AOM Today at the Academy of Management (AOM). Previously, he was a writer and the Finance Editor for Strategic Finance magazine and Management Accounting Quarterly, a scholarly journal, at the Institute of Management Accountants (IMA). Prior to that, he worked as a writer/editor at The Financial Times, including daily FT sister publications Ignites and FundFire, Crain Communications’s InvestmentNews and Crain’s Wealth, eFinancialCareers, and Arizent’s Financial Planning, Re:Invent|Wealth, On Wall Street, Bank Investment Consultant, and Money Management Executive. He earned his bachelor’s degree from the University of Colorado Boulder and his master’s degree from New York University. You can reach him at dbutcher@aom.org or via LinkedIn.
View all posts
Up next....
How Teams Achieve the Coveted State of “Group Flow”
By Daniel Butcher
Too often, teams in sports, music, and business fail to gel for many reasons. Sometimes, though, teams achieve “group flow,” when interactions seem effortless, and team members contribute ideas and complete tasks in synchrony to reach peak levels of collaborative performance.
Academy of Management Scholar Bess Rouse of Boston College said that team members contributing swiftly and additively—extending a prior contribution, is crucial for creating a sense of momentum. Increasing momentum, in turn, influences changes in emotions, thought processes, and behavior that result in group flow.
“The delicacy of group flow makes it very hard to maintain,” Rouse said. “When we’re theorizing about it, we’re really careful about this idea of coming in and out of group flow, and that it is very hard to sustain over time.
“When you’re thinking about it in the context of a group at work, in particular, it’s helpful to think about things like, ‘How do we focus our attention on each other and keep that momentum going?’—so you could imagine that a lot of interruptions are problematic in that sense,” she said.
“If somebody is interrupting you, or you don’t have dedicated space, it’s going to be very hard to get into that sense of group flow.”
Rouse and her research colleagues theorize that a lot of the factors that contribute to good group functioning, such as feeling comfortable in the workplace and feeling trust from senior management and colleagues, help get individuals and, by extension, teams in that flow.
“When we think about this state of flow at the group level versus the individual level, the idea that this is something like improv is instructive—responding to a team member by saying ‘yes, and…’ contributes to the idea that you’re building on each other,” Rouse said. “You actually want to be there for that purpose, and you want to build on other team members’ ideas.
“And this can be difficult in the context of organizations, because we have political motivations; we have our own agendas,” she said. “We have different things we’re doing at work that hopefully are related to the work assignments or objectives but may be actually getting in the way of you feeling that necessary trust and willingness to build on other people’s ideas.”
-
Daniel Butcher is a writer and the Managing Editor of AOM Today at the Academy of Management (AOM). Previously, he was a writer and the Finance Editor for Strategic Finance magazine and Management Accounting Quarterly, a scholarly journal, at the Institute of Management Accountants (IMA). Prior to that, he worked as a writer/editor at The Financial Times, including daily FT sister publications Ignites and FundFire, Crain Communications’s InvestmentNews and Crain’s Wealth, eFinancialCareers, and Arizent’s Financial Planning, Re:Invent|Wealth, On Wall Street, Bank Investment Consultant, and Money Management Executive. He earned his bachelor’s degree from the University of Colorado Boulder and his master’s degree from New York University. You can reach him at dbutcher@aom.org or via LinkedIn.
View all posts
Up next....
Why Some People with Mental Disorders Thrive as Entrepreneurs
By Daniel Butcher
Symptoms and traits associated with certain mental disorders, including attention deficit/hyperactivity disorder (ADHD), bipolar disorder, dyslexia, and autism, may help entrepreneurs and other businesspeople succeed, noted Academy of Management Scholar Dean Shepherd of the University of Notre Dame.
Shepherd said that conditions that might be seen as a negative, particularly in employment, can sometimes be an advantage in entrepreneurship.
“Some mental disorders are perceived to negatively impact reliability in traditional nine-to-five employment but can actually be an asset in entrepreneurship,” Shepherd said. “Research has found that people with dyslexia tend to have weaker aspects in their left hemisphere of their brain, but their right hemisphere is stronger, and so therefore they can enter entrepreneurship and be successful in it.
“We have the statistics to say that the people with dyslexia are more likely to become entrepreneurs than the general population—in fact, it’s true for many groups who feel like they’re constrained in being promoted in corporate employment turned to self-employment or entrepreneurship,” he said.
“That includes minorities, marginalized groups, and people with all sorts of disabilities, for example, women and immigrants, because they feel like they have constraints or face discrimination in the workplace and that they don’t have those as much in entrepreneurship.”
Research has found that people with ADHD are more likely to become entrepreneurs.
“People with ADHD are more prepared to engage in risk taking, they’re more proactive, and they’re more innovative, and we also found that people with autism are actually getting used by companies engaging in software testing, because they have some advantages in being able to test software,” Shepherd said.
“Entrepreneurship may cause some mental disorders through high stress or loss when a business fails, which can be an important point to consider when deciding on your career path, but people with disorders are also drawn to entrepreneurship,” he said.
-
Daniel Butcher is a writer and the Managing Editor of AOM Today at the Academy of Management (AOM). Previously, he was a writer and the Finance Editor for Strategic Finance magazine and Management Accounting Quarterly, a scholarly journal, at the Institute of Management Accountants (IMA). Prior to that, he worked as a writer/editor at The Financial Times, including daily FT sister publications Ignites and FundFire, Crain Communications’s InvestmentNews and Crain’s Wealth, eFinancialCareers, and Arizent’s Financial Planning, Re:Invent|Wealth, On Wall Street, Bank Investment Consultant, and Money Management Executive. He earned his bachelor’s degree from the University of Colorado Boulder and his master’s degree from New York University. You can reach him at dbutcher@aom.org or via LinkedIn.
View all posts
Up next....
Entrepreneurs’ Taboo F-Word
By Daniel Butcher
There’s an F-word that used to be taboo among entrepreneurs and researchers who study them: failure.
Academy of Management Scholar Dean Shepherd of the University of Notre Dame said that when he was a doctoral student at Bond University in Australia teaching entrepreneurship to undergraduates and MBAs, the assigned texts on entrepreneurship rarely mentioned failure.
“On the one instance that one of them did, the textbook said, ‘Entrepreneurs don’t fail—businesses do, but entrepreneurs are just motivated to try again,’” Shepherd said. “Then one day, I got a phone call from my father, and the family business that he’d created and run as long as I’d been alive was failing badly, and I said, ‘You have to close it down,’ and that caused him and me great distress and anxiety.
“And so it felt funny going back into the classroom and trying to encourage everyone to become an entrepreneur and not be able to say, ‘There is a chance that it’ll fail,’ and also not give them the tools to say that, if you do fail, this is how you cope with it,” he said. “I waited for quite a few years before I wrote a paper about it, and I went into the psychology literature on bereavement and grief, because there, psychologists had tools to help people overcome grief.
“And I thought, ‘My dad’s reaction wasn’t as bad as losing a loved one, but in some ways, it’s still grief, where grief is the negative emotional reaction to the loss of something important.”
Some entrepreneurs even call the business they start—or help launch—their baby. Their ventures are entwined with their own identities.
“When people ask them, ‘What do you do?’ they say, ‘I’m an entrepreneur,’” Shepherd said. “Are you still an entrepreneur once your business fails?
“And so the psychology literature really gave us some good tools to say that maybe you do a bit of grief work; you talk it through with someone, and as you come up with a story for why it failed, then it makes it a little less painful,” he said. “The negative emotional reaction can diminish.”
-
Daniel Butcher is a writer and the Managing Editor of AOM Today at the Academy of Management (AOM). Previously, he was a writer and the Finance Editor for Strategic Finance magazine and Management Accounting Quarterly, a scholarly journal, at the Institute of Management Accountants (IMA). Prior to that, he worked as a writer/editor at The Financial Times, including daily FT sister publications Ignites and FundFire, Crain Communications’s InvestmentNews and Crain’s Wealth, eFinancialCareers, and Arizent’s Financial Planning, Re:Invent|Wealth, On Wall Street, Bank Investment Consultant, and Money Management Executive. He earned his bachelor’s degree from the University of Colorado Boulder and his master’s degree from New York University. You can reach him at dbutcher@aom.org or via LinkedIn.
View all posts
Up next....
Resilient Entrepreneurs Don’t Shy Away from Failure
By Daniel Butcher
Some of the most common mistakes that entrepreneurs make are focusing too much on past successes, pretending that hard work always results in success, and not learning from failure, according to Academy of Management Scholar Dean Shepherd of the University of Notre Dame.
Shepherd said that the shocking closure of his own father’s business was what inspired him to study the effects of entrepreneurial failures. He described loss orientation as communicating about the disappointing or traumatic event and restoration orientation as thinking about other things, including next steps.
“It was a family business in residential construction formed around 1965—I am not sure how large it was, but [it built] maybe 100 houses per year, and there were no full-time employees; my father used a lot of sub-contractors,” Shepherd said. “It started to experience some difficulties approximately one year before he closed it down.
“He was very much a restoration-orientation person, so he refused to talk about it, just like a typical Australian male, and he and I never discussed it,” he said. “He never engaged in loss orientation, [grieving the] loss of his business; he never oscillated between loss orientation and restoration orientation, and so he suffered for a long time as a result of that.
“I did research on scientists working in Germany, and when their projects failed, those that were able to oscillate between the two, loss orientation and restoration orientation, were the ones who were most successful at processing the setback or loss, bouncing back, and moving forward.”
Shepherd cited the work of Eric Ries, an entrepreneur and author of The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses, as emblematic of a strain of entrepreneurship that doesn’t shy away from failure but actually highlights the need for it to inform the organization’s plans, budgeting, and initiatives.
“A lot of entrepreneurs now, including the author of The Lean Startup, are trying to think about different projects like real options, so they’re probes into an uncertain environment, and if we have many of them, then we gain information, and as we get that information, we can kill some projects and redeploy the resources to the ones that show promise,” Shepherd said. “That’s a way to try and manage the uncertainty, and it really has failure as part of the process, because we must terminate those initiatives that don’t show promise in order for this strategy to work.
“If we have an anti-failure bias and we choose not to terminate them, or we take longer to make the decision to discontinue them, then the downside losses actually start to increase,” he said. “The best examples are my dad, who struggled to process failure, and the studies of the German scientists, some of whom were able to deal with failure in a productive way.”
-
Daniel Butcher is a writer and the Managing Editor of AOM Today at the Academy of Management (AOM). Previously, he was a writer and the Finance Editor for Strategic Finance magazine and Management Accounting Quarterly, a scholarly journal, at the Institute of Management Accountants (IMA). Prior to that, he worked as a writer/editor at The Financial Times, including daily FT sister publications Ignites and FundFire, Crain Communications’s InvestmentNews and Crain’s Wealth, eFinancialCareers, and Arizent’s Financial Planning, Re:Invent|Wealth, On Wall Street, Bank Investment Consultant, and Money Management Executive. He earned his bachelor’s degree from the University of Colorado Boulder and his master’s degree from New York University. You can reach him at dbutcher@aom.org or via LinkedIn.
View all posts
Up next....
Successful Entrepreneurs Leverage Knowledge and Motivation
By Daniel Butcher
Successful entrepreneurs focus on what they know best and care most about when brainstorming and evaluating business ideas, according to Academy of Management Scholar Dean Shepherd of the University of Notre Dame.
“Entrepreneurs often say, ‘Where do I look for an opportunity?’ Now, I always try and say, ‘We’ll look internally first at your own history,’” Shepherd said. “‘What is unique about you? What unique knowledge do you have?’
“My path is unique, just like every person’s path is unique, and it’s given me knowledge that other people don’t have,” he said. “If I can think about things from that perspective, then I’m more likely to come up with an opportunity that other people haven’t thought of in the past.
“In thinking about it that way, I’m more likely to see opportunities related to my motivation, something that I’m passionate about, and so opportunities are often identified at the intersection of my knowledge and my motivation.”
People who are knowledgeable in a particular field are better equipped to spot signals of potential opportunities in that area. Experienced entrepreneurs can also gauge the chances of success of a particular idea, even if it’s just a rough estimate, to decide whether it’s worth pursuing.
“If I’m highly motivated by certain things, then I’m more likely to see signals in the environment that relate to that motivation, and so it’s the combination of those two that allows me to identify opportunities,” Shepherd said. “I also evaluate opportunities in a similar way.
“I say to myself, ‘Do I have the knowledge, the skills, and the ability to be able to execute this opportunity? Is it feasible?’” he said. “And I also asked myself, ‘Is it desirable? Is it something that I want to do? If I do it and exploit this opportunity, does it give me the things that I want to have?
“And so it’s really that intersection of knowledge and motivation that is the how do we identify opportunities, and also whether we want to exploit those opportunities or not and what would be required to do so.”
-
Daniel Butcher is a writer and the Managing Editor of AOM Today at the Academy of Management (AOM). Previously, he was a writer and the Finance Editor for Strategic Finance magazine and Management Accounting Quarterly, a scholarly journal, at the Institute of Management Accountants (IMA). Prior to that, he worked as a writer/editor at The Financial Times, including daily FT sister publications Ignites and FundFire, Crain Communications’s InvestmentNews and Crain’s Wealth, eFinancialCareers, and Arizent’s Financial Planning, Re:Invent|Wealth, On Wall Street, Bank Investment Consultant, and Money Management Executive. He earned his bachelor’s degree from the University of Colorado Boulder and his master’s degree from New York University. You can reach him at dbutcher@aom.org or via LinkedIn.
View all posts
Up next....
When Entrepreneurs Can’t Acknowledge Failure, Disaster Strikes
By Daniel Butcher
Elizabeth Holmes, who was convicted of fraud for lying about the effectiveness of the blood-testing product of her biotechnology company, Theranos, is a cautionary tale illustrating a potential downside of entrepreneurship. Unable to deal with the failure of her company’s blood-testing methods, she just plowed ahead, refusing to acknowledge the disappointing results or telling any of the investors—or anyone else—that the tests weren’t working. She pretended like everything was okay, continued to collect investor money, and built up the biotech startup to a $9 billion valuation.
Academy of Management Scholar Dean Shepherd of the University of Notre Dame said that it’s common for entrepreneurs to deal with failure poorly, but investors failed to effectively scrutinize Theranos.
“A lot of the stakeholders there were maybe willfully ignorant—they wanted to believe her,” Shepherd said. “They didn’t ask probing questions; they ignored the negative signals, which is what we call a confirmation device.
“They look for information that confirms their opinions, and they discount or ignore information that disconfirms them, and so in many ways, she was negligent, but they were also negligent,” he said.
Sometimes entrepreneurs can’t even acknowledge failure to themselves, much less publicly, because their entire identity is wrapped up in success. One major failure could crack that self-image.
Shepherd said that job loss—or the failure of one’s business—can devastate a person’s sense of identity. He wrote about his research findings related to such phenomena in Hitting Rock Bottom After Job Loss: Bouncing Back to Create a New Positive Work Identity.
“Failure can have a huge impact on you psychologically, because your identity is quite often highly related to the things that you do for work, and when you lose that identity, you go into a crisis or a freefall, because you don’t know who you are anymore,” Shepherd said. “And if you don’t know who you are, you don’t know how to socially act, and it can be a very dangerous situation.”
-
Daniel Butcher is a writer and the Managing Editor of AOM Today at the Academy of Management (AOM). Previously, he was a writer and the Finance Editor for Strategic Finance magazine and Management Accounting Quarterly, a scholarly journal, at the Institute of Management Accountants (IMA). Prior to that, he worked as a writer/editor at The Financial Times, including daily FT sister publications Ignites and FundFire, Crain Communications’s InvestmentNews and Crain’s Wealth, eFinancialCareers, and Arizent’s Financial Planning, Re:Invent|Wealth, On Wall Street, Bank Investment Consultant, and Money Management Executive. He earned his bachelor’s degree from the University of Colorado Boulder and his master’s degree from New York University. You can reach him at dbutcher@aom.org or via LinkedIn.
View all posts
Up next....
Crowdfunding Reshaped the Global Economy
By Daniel Butcher
Crowdfunding platforms such as GoFundMe, through which hundreds of millions of people have donated more than $30 billion for mostly charitable causes since it launched in 2010, also provide nonfinancial support via social media. For example, in 2024 alone, GoFundMe users drove support for causes they care about through 55 million-plus shares across various social-media channels and via email.
Academy of Management Scholar Dean Shepherd of the University of Notre Dame said that crowdfunding has opened the world to a new way of doing good. This form of support for micro-entrepreneurs’ mini-projects affects the global economy.
“In some ways, it’s like the economy itself has these little probes into an uncertain environment, and some are going to fail, and some are going to gain traction,” Shepherd said. “And all of that’s a good thing, because it creates innovation, so we’re really just pitching out a whole lot of different potential opportunities; some are going to fail, and that’s perfectly fine, but some are going to be successful, and those successful ones may actually lead to something very interesting.
“Crowdfunding was quite an innovation,” he said. “It came from a change in regulation that actually freed up a lot of little bits of money for little entrepreneurs who may actually become highly successful entrepreneurs.
“It could be one of the greatest innovations to allow for more everyday entrepreneurship, and future superstars may actually even come from some of those smaller programs and initiatives that get off the ground thanks to crowdfunding.”
-
Daniel Butcher is a writer and the Managing Editor of AOM Today at the Academy of Management (AOM). Previously, he was a writer and the Finance Editor for Strategic Finance magazine and Management Accounting Quarterly, a scholarly journal, at the Institute of Management Accountants (IMA). Prior to that, he worked as a writer/editor at The Financial Times, including daily FT sister publications Ignites and FundFire, Crain Communications’s InvestmentNews and Crain’s Wealth, eFinancialCareers, and Arizent’s Financial Planning, Re:Invent|Wealth, On Wall Street, Bank Investment Consultant, and Money Management Executive. He earned his bachelor’s degree from the University of Colorado Boulder and his master’s degree from New York University. You can reach him at dbutcher@aom.org or via LinkedIn.
View all posts