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March Madness Lesson: Lose a Little Now, Win More Later

March 18th, 2009 @ 4:53 am

1 Comment

Categories: Research, Uncategorized

Tags: Team, Adversity, Wolfers, Team Management, Management, Jessica Stillman

  • The Find: Data from NCAA basketball matches shows that teams losing by a little at halftime are more likely to win the game than teams that are up a little, proving what your grandmother already knew: a little adversity keeps you hungry.
  • The Source: A post by professor Justin Wolfers on the NY Times Freakonomics blog outlining some intriguing research by his Wharton School colleagues.

The Takeaway: March Madness brings a fever for all things basketball to offices across the country, and apparently to the academics of the Freakonomics blog as well. Wolfers’s post details some number crunching research on the subject of basketball, but with conclusions that are also applicable to business. The research found that in NCAA basketball, “teams that are behind by one point at halftime are actually more likely to win than teams that are one point ahead.”

The study’s authors, behavioral economists Jonah Berger and Devin Pope, offer an explanation for the results that’s more psychological than statistical: “Losing can lead to winning because of the strong motivating effects of being close to your goal…. you may be willing to work harder to avoid a negative outcome.” In other words, the sting of a loss is more of a motivator than the sweetness of victory. To show that this conclusion held true off the court, the professors set up a simple experiment:

Subjects were challenged to a trivial task — how many times they could type “a” then “b” in half a minute. The subjects were told that if they beat their opponent, they would get a bigger payout. After the first round of competition, some were given feedback, and others weren’t. And here’s the key to the experiment: they randomly told some folks that they were a long way behind their opponent, others were told they were a little bit behind, or exactly tied, a little ahead, or even a long way ahead. Those who were randomly told they were a little bit behind improved their performance dramatically, while the other groups improved by about the same amount as the control condition (that is, the same improvement as those given no feedback at all).

At a time when there’s plenty of adversity to go around, it’s nice to be reminded that so much loss and trouble may pay dividends down the road. For more on the study, check out the NY Times’ sports section write-up, or for those looking for all the technical details, download the study from the Freakonomics page.

(Basketball image by inboundpass, CC 2.0)

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    jstillman

    03/19/09 | Report as spam

    RE: March Madness Lesson: Lose a Little Now, Win More Later

    And here's Wharton's take on the findings:

    http://knowledge.wharton.upenn.edu/article.cfm?articleid=2187

    The profs conclude: forget lofty goals and "pick milestones that are within reach, such as passing a close competitor in sales."

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