The 8 best books of 2016 for directors

1. The Undoing Project: A Friendship that Changed the World, by Michael Lewis, Allen Lane

Undoing project

With his trademark brio, Michael Lewis circles back to the themes of his 2003 classic Moneyball to tell the story of Israeli psychologists Daniel Kahneman and Amos Tversky who together overturned the conventional wisdom on how people make decisions. In research that would go on to win a Nobel Prize, Kahneman and Tversky showed that humans are not finely calibrated probability weighting machines, but are prone to systematic errors in their decision-making. Lewis traces the profound impact of their work in sports, medicine, policy and economics in a book which also serves as a personal oral history of the early decades of Israel and a fascinating portrait of the alchemical magic of collaboration.

2. What Works: Gender Equality by Design, by Iris Bohnet, Belknap Press

What works

Bohnet, a Harvard Kennedy School professor, walks through the evidence from business, education and policy on how to select and develop the best talent regardless of gender. Bohnet's stated aim is to improve gender equality, but her insights for organisations are much more general, giving practical (sometimes striking) advice on why your current hiring, training and management practices probably aren't working and how you can make them better and fairer.

3. Alibaba: The House that Jack Ma Built, by Duncan Clark, HarperCollins

Alibaba

"We didn't have any money, we didn't have any technology, and we didn't have any plan," says founder Jack Ma in Duncan Clark's enthralling story of Chinese internet behemoth Alibaba's expansion from bedroom operation to the breathtaking scale it operates at today. Clark, an early consultant to Alibaba who still kicks himself for turning down an equity offer, paints Ma as a genuinely likeable figure, with the former teacher's avuncular style and homespun aphorisms setting him apart from the spiky internet entrepreneurs of the West. With much to say on culture and leadership, the book is also an excellent primer on the rise of the internet, private enterprise and capitalism in China.

4. Dear Chairman: Boardroom Battles and the Rise of Shareholder Activism, by Jeff Gramm, HarperBusiness

Dear Chairman

Hedge fund manager and former indie rocker Jeff Gramm sketches the history of shareholder activism through eight famous letters that launched battles for corporate control of some of America's most iconic companies. While told from an investor's point-of-view, Gramm is even-handed in assessing the blind spots of all the key players – boards, management and shareholders of all stripes. From a colourful cast of characters including Warren Buffett, Ross Perot and Carl Icahn, Gramm draws a series of valuable lessons on management, governance, investment and hubris.

5. An Everyone Culture: Becoming a Deliberately Developmental Organization, by Robert Kegan, Lisa Laskow Lahey, Matthew L Miller, Andy Fleming and Deborah Helsing, Harvard Business Review Press

Everyone culture

"[O]ur experience has shown us that pursuing profitability and human growth emerges as one thing," the authors write in their paean to what they call the deliberately developmental organisation. Kegan, Laskow, Fleming and Helsing describe the unorthodox people management practices of hedge fund Bridgewater Associates, e-commerce company Next Jump and movie theatre owner and operator The Decurion Corporation. Many of the methods, often involving constant and honest feedback, may seem downright weird at first but will get you thinking about how your organisation looks after its people and if you could be doing better.

6. Originals: How Non-Conformists Move the World, by Adam Grant, Viking

Originals

In this year's Gladwellian bestseller, Wharton Business School professor and influential management thinker Adam Grant explores how leaders can best inspire creativity, combat the scourge of groupthink and challenge the status quo to achieve innovation and success. Grant jumps from one entertaining anecdote to the next, unpacking decision-making processes in stories of success and failure from politics and business. In what might suggest a trend, the book also lights on Bridgewater Associates' culture of 'radical transparency' as a potentially revolutionary management strategy.

7. The Disruption Dilemma, by Joshua Gans, The MIT Press

Disruption dilemma

Writing in response to Clayton Christensen's famous 1997 book The Innovator's Dilemma, which initially introduced the concept of disruption to a general audience, Gans, an Australian economist, aims to restore meaning to a term that has become vacuous through overuse. Drawing on a series of well-known case studies, the book delineates a theory of how disruption happens, with customer preferences sometimes being the main driving force, other times paradigm shifts in business processes. How companies should respond depends on what type of disruption they face. And sometimes, rather than jumping at every potentially disruptive shadow, it is wise to do nothing at all. "In retrospect, perhaps its best and most profitable strategy would have been to fade gracefully," Gans writes of former photography giant Kodak.

8. Competing Against Luck: The Story of Innovation and Customer Choice, by Clayton M. Christensen, Taddy Hall, Karen Dillon and David S. Duncan, Harper Business

Competing against luck

Christensen himself returned with another book this year, refining his ideas on innovation that deeply influenced Steve Jobs and almost every other major Silicon Valley figure. Competing Against Luck sets out Christensen and his co-authors' theory that when people buy a product they are looking for it to do a 'job'. If organisations think consciously about what job their customer is hiring their product for, it provides a way of understanding customer behaviour, which can then drive innovation. As with much of Christensen’s thinking, what seems at first a simplistic idea is revealed to be a powerful tool by way of the elegance and range of the examples used to illustrate it.

2016 titles from the AICD's publishing imprint


Which Two Heads Are Better Than One? How diverse teams create breakthrough ideas and make smarter decisions, by Juliet Bourke

Which two heads

What can boards and executive teams do to innovate? How can they be more certain that significant risks have been identified? How do diverse teams create breakthrough ideas and make smarter decisions?

Drawing on rigorous academic and applied research, Juliet Bourke challenges mainstream assumptions about diversity of thinking, and provides practical ideas to help ensure teams see scenarios broadly, discuss options thoroughly and mitigate social, informational and attentional biases effectively.

A Director's Guide to Governing Information Technology and Cybersecurity, by Nicholas J. A. Tate and Alexander J. G. Tate

Cybersecurity

Increasingly, information technology is an essential enabler of new product initiatives, product delivery and innovation in companies. Many organisations are now dependent on IT, not just for business as usual but also for the ability to bring new products to market. This book is essential reading for directors who increasingly find themselves in a position where IT is underpinning a digital transformation of their organisation, and/or rapidly becoming a key driver of their business.

Asset Management for Directors, by Monique Beedles

Assset management

Today's board directors are faced with an increasingly complex operating environment. There is greater scrutiny from shareholders and regulators, and a diminishing ability to predict the future based on past experience. Creating value from the company's assets is a key responsibility of the board and forms part of its fiduciary duty. In this sense, board directors are asset managers. Asset Management for Directors provides a clear framework for directors to address their asset management obligations.

Duties and Responsibilities of Directors and Officers 21st Edition, by Professor Robert Baxt AO FAICDLife

Duties and responsibilities

For the past 33 years, Professor Robert Baxt's Duties and Responsibilities of Directors and Officers has been a must-read for directors, corporate lawyers, academics and those focused on governance in Australia. At a time when regulation is a main priority for government, it remains the go-to source for a clear understanding of the fundamentals of the very broad legal framework in which directors and company officers must operate.

50 Matters To Be Considered Before Signing A Company's Financial Statements, 3rd Edition

Fifty matters

Although directors are not expected to be experts in financial reporting requirements, they are expected to be financially literate. This will require directors to examine and interrogate the financial information of their organisation. 50 Matters To Be Considered Before Signing A Company's Financial Statements, 3rd Edition, complimentary for AICD members, does not examine all areas that may be 'critical' to every company, but it offers a solid foundation to begin investigating.


All of the AICD's 2016 titles come with a complimentary webinar hosted by their authors. For more great governance reading, download the AICD's full book catalogue.