I just spent a few hours over a recent spring break trip rereading Phil Rosenzweig's wonderful book: “The Halo Effect – and the Eight Other Business Delusions That Deceive Managers.” Halo is definitely the best business book I've read in the past five years. It should be required reading for anyone involved in evaluating business performance, looking for the proverbial “keys to success.”

The halo effect is a psychological bias in which evaluations of some traits of persons or objects are generalized to other traits as well, even if they're unrelated. An example might be judging attractive people as intelligent. The bias was named by psychologist Edward Thorndike for his 1920's studies in which he found high correlations between the evaluations of different personality traits of soldiers by their commanding officers. Those evaluated positively tended to have high ratings on all traits. Negative assessments showed the same consistency.

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