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No decision-making system is going to guarantee corporate success. The strategic decisions that corporations have to make are of mind-numbing complexity. But we know that the more power you give a single individual in the face of complexity and uncertainty, the more likely it is that bad decisions will get made.

James Surowiecki

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James Surowiecki
Age: 57
Born: 1967
Born: April 30
Journalist
Writer
Meriden
Connecticut
James Michael Surowiecki
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System
Guarantees
Giving
Decision
Complexity
Going
Face
Uncertainty
Made
Faces
Corporations
Mind
Success
Corporate
Make
Making
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Individual
Decisions
Strategic
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More quotes by James Surowiecki

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On Wall Street, fraudulent schemes tend to thrive during economic booms, and to blow up when times turn tough.
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Groups are only smart when there is a balance between the information that everyone in the group shares and the information that each of the members of the group holds privately. It's the combination of all those pieces of independent information, some of them right, some of the wrong, that keeps the group wise.
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Being out of a job can erode people's confidence and their sense of possibility and employers, often unfairly, tend to take long-term unemployment as a signal that something is wrong.
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In the heart of the Great Depression, millions of American workers did something they'd never done before: they joined a union. Emboldened by the passage of the Wagner Act, which made collective bargaining easier, unions organized industries across the country, remaking the economy.
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In the days when corporate downsizing was all the rage, Wall Street took a lot of flak for judging companies too harshly and setting the bar for corporate performance so high that executives felt their only option was to slash payrolls.
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From a social point of view, it's beneficial that homeownership encourages commitment to a given town or city. But, from an economic point of view, it's good for people to be able to leave places where there's less work and move to places where there's more.
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If companies tell us more, insider trading will be worth less.
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But, if recent history has taught us anything, it’s that self-regulation doesn’t work in finance, and that worries about reputation are a weak deterrent to corporate malfeasance.
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The fundamental problem with banks is what it's always been: they're in the business of banking, and banking, whether plain vanilla or incredibly sophisticated, is inherently risky.
James Surowiecki
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I think people don't understand compound interest because typically no one ever explains it to them and the level of financial literacy in the US is very low.
James Surowiecki
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If being the biggest company was a guarantee of success, we'd all be using IBM computers and driving GM cars.
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One of the problems that exacerbates procrastination is the feeling that you have lots of different things to do and no clear sense of which matter more, when they should be done, etc.
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Politically speaking, it's always easier to shell out money for a disaster that has already happened, with clearly identifiable victims, than to invest money in protecting against something that may or may not happen in the future.
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In a world where companies increasingly know about their business in real time, it makes no sense that public reporting mostly follows the old quarterly schedule. Companies sit on vital information until reporting day, at which point the market goes crazy.
James Surowiecki
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The smartest groups, then, are made up of people with diverse perspectives who are able to stay independent of each other. Independence doesn't imply rationality or impartiality, though. You can be biased and irrational, but as long as you're independent, you won't make the group any dumber.
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If private-equity firms are as good at remaking companies as they claim, they don't need tax loopholes to make money.
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If small groups are included in the decision-making process, then they should be allowed to make decisions. If an organization sets up teams and then uses them for purely advisory purposes, it loses the true advantage that a team has: namely, collective wisdom.
James Surowiecki
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Life insurance became popular only when insurance companies stopped emphasizing it as a good investment and sold it instead as a symbolic commitment by fathers to the future well-being of their families.
James Surowiecki
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Workers who come to the U.S. see their wages and their standard of living boosted sharply simply by crossing the border. That's a good thing, and one of the best arguments for immigration reform, even if you'll rarely hear a politician make it.
James Surowiecki
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A general principle of good taxation is that similar jobs, and similar kinds of compensation, should be taxed the same way: otherwise, the government is effectively subsidizing some jobs over others.
James Surowiecki