Based on research by Vikas Mittal

When a fast-casual restaurant chain started to see stagnating sales, the company’s CEO came up with a solution: adding new, higher-quality menu items. 

To validate his thinking, he informally interviewed a few dozen diners at different locations, asking them how they would feel about more and higher-quality menu items. After getting enthusiastic responses from several customers, he went ahead with his plan. Sales fell further.

So what went wrong? Systematic surveys showed that what created the most value for customers was a fast dining experience with a short wait time, a simple menu with a few items, ample parking and a bill under $12 per meal. Higher quality and an expanded menu did not correlate at all with customer value. Where the company’s CEO went wrong was by relying on salience instead of importance. 

Salience refers to factors that are top-of-mind and easy to recall, which become prominent and are then incorrectly prioritized. A classic example is a 1979 study that surveyed people about their perceived risk of dying from causes like drowning, murder or cancer. The study’s authors found that people thought they were more likely to die from causes that were mentioned more often in their local news, such as murder, when in fact they were at much greater risk of dying from common but less prominent causes such as cancer. 

The CEO made food quality and expanded offerings salient to himself by talking about them to a small group of customers. It was an easy way for him to feel good about his efforts. But, like many executives, he relied on salience. 

Salience is easy and convenient, but it’s also the curse of decision-making. It simply reinforces executives’ prior beliefs rather than diagnosing the true cause-and-effect relationship. Imagine if a doctor saw a patient with stomach pain and recommended an appendectomy because a patient she’d seen the day before needed one. Or if the doctor asked the patient to recommend the treatment himself. Patient outcomes would likely falter and the doctor would go out of business (and perhaps lose her medical license).

Thankfully, doctors don’t operate this way. They rely on the statistically measurable relationship between critical inputs and outputs for decision-making. So should senior executives and CEOs.

Informal customer conversations draw primarily on gut feelings, hunches and top-of-mind ideas, and as such, aren’t reliable indicators of true customer value. Like all of us, customers often tailor their responses to the audience they’re addressing. So a company’s vice president of service might speak with a customer who says they love the service, while the same customer might tell an HR executive they love the employees and then go on to tell the VP of sales that they would like lower prices. These on-the-spot responses typically have no significant impact on or statistical correlation with customer value, which ultimately drives sales and profits.

To craft a successful strategy, executives need to use a systematic, statistical process that starts with choosing a clear outcome or output, such as customer value or employee retention. The next step is to measure inputs that drive that output, and then quantitatively correlate each input to the output. Only those inputs that drive the desired output should be included in the company’s strategy. 

Take, for example, a nursing home that attempted to craft a strategy for decreasing employee turnover. Relying on casual conversations with a few dozen employees, executives assumed higher pay would increase retention. They were wrong. 

When they statistically correlated multiple inputs — higher pay, health benefits, supervisor respect, promotion opportunities and paid vacation — with retention, they realized their intuitive leaps had been incorrect. Only health insurance and promotions were correlated with increased employee retention. Higher pay had no effect. 

Committing to this type of systematic review to drive strategy requires humility on the part of senior executives. The nursing home executives were able to look past their own assumptions and learn from this type of statistical analysis, recognizing the limits of salience-driven thinking and deferring to algorithms that could better predict the inputs of turnover than they could.

Doctors understand this as well. To treat their patients, they rely on data from groups like the Food and Drug Administration or the National Institutes of Health, which run clinical trials and rely on data, statistics and an infrastructure of knowledge.

Unfortunately, many senior executives lack humility when it comes to strategic planning. They equate decades of salience-laden thinking with a deep understanding of correlations between inputs and strategic outputs. They might think, “I’ve been in this industry long enough to know what works,” or “Since this worked then, it will work now as well.” But more often than not, relying on salience-laden intuition alone will not achieve the desired outcome. 

“Focus: How to Plan Strategy and Improve Execution to Achieve Growth” lays out specific steps for senior and mid-level executives who want to follow systematic, statistical processes to drive their company’s strategy.

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Vikas Mittal is the J. Hugh Liedtke Professor of Marketing at the Jones Graduate School of Business and author of “Focus: How to Plan Strategy and Improve Execution to Achieve Growth.” 

By Ashley Rabinovitch

Most leaders are keen to improve creativity and innovation among their ranks, but few have the time to scour academic journals for fresh ideas. A new book co-edited by Jing Zhou, the Mary Gibbs Jones Professor of Management and Psychology at Rice Business, aims to bridge the gap by gathering leading research on creativity and innovation in one place. Published in 2021, the “Handbook of Research on Creativity and Innovation” compiles some of the most groundbreaking recent findings on creativity for academics and managers alike. We spoke to her about how research on creativity has evolved and what readers will take away from the book. 

Rice Business: This is actually the third handbook on creativity and innovation you have co-edited, after the “Handbook of Organizational Creativity” (2008) and “The Oxford Handbook of Creativity, Innovation and Entrepreneurship” (2015). What inspired you to undertake this series of projects?

Jing Zhou: Up until the beginning of the 1990s, most research on creativity and innovation in the workplace focused on R&D and patenting in the tech industry. As their collective knowledge of management and organizational behavior improved, researchers began to go beyond studying ‘Big C’ creativity, referring to radical breakthroughs in technology, to acknowledge the impact of ‘Small C,’ or everyday creativity. They began to consider the value of harvesting creative ideas — defined as ideas that are both new and useful — about products, processes and services from employees. That’s really how the study of workplace creativity burgeoned. By the mid-2000s, the co-editor of the first book, Chris Shalley, and I identified a need to take inventory of all the research that had come out and organize it into something digestible. 

How does this third handbook differ from the previous two? 

Our 2008 book was the first attempt at summarizing research findings on how to promote employee creativity. The chapters in the book highlighted key things managers could do to increase the creativity of their employees, from giving feedback and goal setting to creating a culture of creativity. The 2015 book, which I co-edited with Chris Shalley and Mike Hitt, was an attempt to connect the dots between research on creativity, innovation and entrepreneurship. A few years ago, my current co-editor, Bess Rouse, and I realized that the time had come to produce a book that accomplishes a few new goals: First, it takes a deeper dive into creativity research than ever before, going into topics that weren’t even on our radar while editing the first two books. Second, it is intended to stimulate new research by pointing out opportunities for growth. Finally, it provides useful insights for anyone looking to spark creativity and innovation in the workplace.  

What new research directions are you hoping to encourage with this handbook?

One of the things we highlighted was the need to combine quantitative with qualitative research to generate better insights. My co-editor, Bess, an associate professor of management and organization at Boston College’s Carroll School of Management, is an expert on qualitative research methods, such as interviewing people in the workplace and observing how they interact while at work, while I focus primarily on quantitative research methods. To create knowledge, both quantitative and qualitative methods are essential. Researchers need to be able to capture phenomena in context, measure creativity and innovation properly, and draw inferences about causality. Our handbook summarizes useful, robust methods for quantitative and qualitative research with the hope that researchers will integrate these methods into their own work and generate more knowledge. 

We are also hoping to inspire more research on the receiving side of creativity. After an employee has generated a creative idea, how will their supervisor react? How does that reaction contribute to or impede a culture of creativity and innovation? As a field, we have a lot of interesting questions to answer. And these are just a couple of examples. The book presents plenty of other new research directions as well. 

Who are you hoping reads this book?

I hope that researchers and Ph.D. students in the creativity and innovation space will find this book thought-provoking. Ideally, it will serve as a platform for the cross-fertilization of ideas. Another audience I’m hoping to reach is managers. This work is intended, in large part, to encourage them to do more to cultivate both ‘Big C’ and ‘Small C’ creativity on their teams.  

What are some practical takeaways for managers looking to foster creativity and innovation on their teams?

Most managers talk about building a culture of innovation, but when you ask them how they go about boosting employee creativity or you try to dig deeper into what has and hasn’t worked, they can’t provide many specifics. Successful managers, in contrast, will take a systematic approach to enhancing creativity and innovation. Our book offers a number of practical suggestions for doing so. We wanted to drive home the message that engaging in creativity and innovation should be an integral part of the job for every manager and every employee, whether or not they are listed in a formal job description.

We also encourage managers to view creativity as a social process. In one of our chapters, a top researcher in social networks lays out the process of building a social network that generates creative ideas. Essentially, you need to be purposeful in the way you connect with people and gather diverse perspectives. That’s how you get a broader pool of ideas to connect the dots and spark innovation. 

Should we expect a fourth handbook in the future?

Given how quickly the field of creativity and innovation is progressing, I wouldn’t be surprised if we produced another handbook in a few years. And, for managers facing increasing competition in their industries, keeping their knowledge base upgraded and getting better tools to increase creativity and innovation on their teams is only going to become more important with time.   

Ashley Rabinovitch is a brand journalist who specializes in higher education, business and healthcare. 

Rice University's undergraduate tuition for the 2022-23 school year will be $54,100, an increase of $2,030 over the current year. The total cost, including $15,000 for on-campus room and board and $863 in mandatory fees, will increase 3.5% to $69,963.

As in previous years, Rice will meet the full financial need of admitted students. The Rice Investment, the university's leading financial aid program for domestic students, offers eligible students with family incomes below $75,000 grant aid covering at least their full tuition, mandatory fees, room and board; students with family incomes between $75,000 and $140,000 receive grants covering at least full tuition; and students with family incomes between $140,000 and $200,000 receive grants covering at least half of their tuition. (The grants assume families have typical assets for their income levels.)

The university also does not require loans as part of financial aid requirements for students who receive need-based financial aid.

"High school students across the nation and around the world will soon be receiving the news they've been accepted to study at Rice," said President David Leebron.
 

"We chose this year to further enhance our financial aid to ensure that Rice will be affordable for the extraordinarily talented and diverse group of students we are admitting. We will continue to fulfill our fundamental commitment to make sure that all our students, whatever their family circumstances, will have access to the very finest higher education."

Rice frequently rates as one of the nation's best values among private higher education institutions because its tuition is generally lower than its peer research universities and its financial aid policies are regularly reviewed to ensure that its exceptional education remains affordable to students from a wide variety of cultural and economic backgrounds.

One of the goals of Rice's Vision for the Second Century, Second Decade (V2C2) is expanding access, diversity and inclusiveness on campus. That includes building on the university's ongoing efforts to recruit high-achieving students from under-resourced and middle-class families and assuring affordability by providing financial aid policies that allow them to experience the full range of educational opportunities at Rice.

"One of our highest priorities is to continue attracting a student body that's diverse in every dimension," said Reginald DesRoches, the Howard Hughes Provost at Rice. "We're proud that Rice gives talented students from all backgrounds, including low- and middle-income families, a chance to achieve educational excellence at one of the nation's finest private universities."

Graduate education costs for 2022-23 will vary for different programs. Tuition for doctoral students will rise 3.9% to $54,100. Tuition for graduate students in architecture will be $35,350 for those entering in fall 2022, $35,350 for those who entered in fall 2021, and $30,000 for those who entered in fall 2020 and prior years. Tuition for graduate students in music will be $30,100. Tuition for students in the professional master's programs will be $20,000 for religion, $39,000 for global affairs, $35,000 for human-computer interaction and human factors, $35,000 for industrial-organizational psychology, $40,000 for social policy evaluation, $39,000 for master's programs in natural sciences, $52,530 for most master's programs in engineering and $58,000 for energy economics.

The online master's in computer science and the online master's in data science will cost $1,667 per credit hour. Tuition will be $66,000 for students in the full-time MBA program at Rice's Jones Graduate School of Business. Tuition for other Jones School programs will be $57,000 for the Master of Accounting, $113,400 for the online MBA@Rice and the Evening MBA for Professionals, $120,000 for the Weekend MBA for Professionals and $135,000 for the Executive MBA.

"Rice opens doors of opportunity to students from all walks of life," said Yvonne Romero da Silva, Rice's vice president for enrollment. "We look forward to making those opportunities available for the next freshman class walking through the iconic sallyport of Lovett Hall."

Rice routinely ranks among the nation's top 20 universities as rated by U.S. News & World Report. Rice has a 6-to-1 undergraduate student-to-faculty ratio and a residential college system that supports students intellectually, emotionally and culturally throughout their academic careers. Developing close-knit, diverse college communities is a strong and long-standing campus tradition.

For more information on Rice, visit www.rice.edu. For information about financial aid programs and to apply, see www.futureowls.rice.edu.

When did you graduate?

December 2020

What is your current job title?

President/Owner

What is your current company?

American Spray Technologies

Why did you select Rice Business for your MBA?

Growing up in Houston, Rice was always an aspirational school. Undergraduate studies took me out of Texas, and then my career took me to Seattle. When I was investigating MBA options I focused on hybrid programs that could expose me to other industries beyond the tech and aerospace crowd in Seattle. I planned to attend school while continuing to work in Seattle full time, and I wasn't aware that Rice could be an option, but then stumbled upon the recently-launched MBA@Rice. Rice quickly became my top choice, and after being accepted it was an easy decision based on the Rice reputation, business education philosophy and small class sizes.

How has Rice helped your career to date?

I was motivated to get an MBA to advance my corporate career by adding business tools and knowledge to my engineering background. From my first classes at Rice onward I immediately started seeing results in my work and gaining confidence with a new set of skills. Ultimately, my Rice experience exposed me to the concept of entrepreneurship through acquisition (ETA) which inspired me to pivot from my corporate career into business ownership.

What was the most surprising part of your Rice MBA experience?

I was pleasantly surprised how well I was able to quickly connect to my cohort and develop relationships when attending classes virtually. The on-campus intensives further cemented those connections.

What was your favorite thing about your MBA experience?

My favorite thing about the MBA experience was meeting and working with talented students from around the world in a wide variety of industries.

What advice would you like to share with prospective and current students?

I expected a high-quality environment based on the Rice reputation, but the actual experience I had with the Rice professors, instructors and courses far exceeded those expectations.

Anything else you’d like to share?

I went into Rice expecting to equip myself to climb another rung in the corporate ladder, but I left with a completely different career outlook and life-changing perspective.

We take pride in offering one of the most diverse MBA programs in the nation. Our commitment to diversity is evident not only in our student body and faculty but also in the wide range of events we host year-round, especially during Black History Month.
Black History Month is a time to celebrate the rich contributions of Black Americans in our community and share stories that advance a deeper understanding of the issues we still face. A vital part of our MBA program is learning through leadership. We design experiences for students to build their skills through clubs, organizations and community service to take an active role in their school culture, learn to lead and represent Rice in Houston.

In 2022, the Black Business Student Association (BBSA) worked overtime to help the Rice Business community celebrate Black History all month long. Throughout the month students were immersed in events that celebrated Black culture, sports and professional excellence.

Check out some of the club activities this past February:

• The BBSA led a social media takeover to share stories of Black students and alumni on Twitter, Instagram, Facebook and LinkedIn during the month.
• A kick-off luncheon was dedicated to opening the month-long celebration and featured Ashley Henry ’22 and Kandace Waddy ’22 as guest presenters. They had food from various black and African restaurants as well as a presentation on the importance of knowing your identity!
• A members-only exclusive event at the Toyota Center was sponsored by Julian Duncan ’06, the Rockets’ chief marketing and strategy officer, for a night of networking and fun at the game vs. the Raptors. 
• A member-led community service event was held at Bread Of Life, which is a nonprofit dedicated to providing love, hope, dignity and belonging to Houston’s underserved. 
• A Business and Brushes Luncheon event, co-sponsored by BBSA and The Consortium, embraced the theme of Black Mental Health and Wellness, featuring guest speaker Dr. Danielle Busby from Black Mental Wellness and evolved into a business school vibe with Trap and Paint!
• A special day dedicated to showcasing Black excellence was deemed BBSA Day and the club members sponsored a photoshoot that included professional headshots.
• To conclude the month’s events, BBSA hosted a Partio with Provost Reggie DesRoches, the incoming 8th president of Rice University. He shared new initiatives for the university, historically black university partnerships, his journey, his family and many stories. He could see we have students who care about diversity, equity and inclusion and who are invested in enriching and supporting Rice. 

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A key component of our diverse MBA programs is the opportunity for students to engage in leadership and community activities. During Black History Month, our Black Business Student Association (BBSA) plays a pivotal role in organizing events that foster a deeper understanding of Black history and culture. These activities are not only celebratory but also serve as a platform for dialogue and learning. At the same time the students were celebrating, the Office of Diversity, Equity and Inclusion was too.

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They co-sponsored a Black History Month Special Lecture with the George R. Brown School of Engineering and Multicultural Affairs Office featuring Dr. Sandra K. Johnson. She spoke to the greater Rice community about Life as a Technology Trailblazer and FinTech Start-up Founder.

Rice Business is proud to celebrate our diverse stories throughout the year and is always working to listen better and join forces to improve more. If you become a Rice MBA, you’ll have plenty of opportunities to participate in events and make your mark. Our diverse MBA programs offer a multitude of opportunities for students to learn from each other and grow together. Whether you're participating in Black History Month events or engaging in our various clubs and organizations, you will find a community that supports and celebrates diversity. You belong here. 
 

Explore Belonging and Engagement at Rice

What was your pre-MBA career?

I was a high school Spanish teacher at Lamar High School in Houston ISD. 

What is your post-MBA career?

I lead Medallia's Healthcare Sales team. We are SaaS company and help organizations deliver amazing customer, patient and employee experiences. 

Why did you want to pursue your MBA?

There were many aspects of teaching that I liked; however, I wanted more options, flexibility and economic security in my career. I initially applied to the Rice Education Entrepreneurship Program (REEP); however, I ended up deciding to attend the full-time program and leave education. 

Why did you choose Rice Business?

I attended Women's Preview Weekend and was totally sold! I was so impressed by the students, faculty and staff I met. 

How has Rice helped your career to date?

Rice made me feel like I could be anything I wanted to be and empowered me to take my career in any direction I wanted. 

What does it mean to you to be a woman in business?

The women from my Rice cohort have been invaluable to lean on since we graduated 10 years ago. I love how supportive everyone is in our careers, family and other aspects of life. 

What advice would you give to prospective and current MBA students?

Look at the jobs that students got in the prospective program you are looking at. If they seem like jobs you would like, it's probably a good fit for you. And take ALL of the international trips you can!