The Daily Stat from Harvard Business Review

 

February 13, 2015 An Odd Thing: Firms Become Less Safety-Conscious When They're Meeting Their Profit Goals Do struggling airlines take more safety risks than profitable ones? It's not that simple, says Peter M. Madsen of Brigham Young University. In a study of records from all large U.S. commercial airlines operating from 1990 to 2007, he found that the incidence of accidents is highest when airlines are hitting their profitability targets and lower when they're significantly missing or surpassing these goals. Decision makers may have a subconscious tendency to reduce attention to safety when their firms are performing near their profitability aspirations. Madsen offers no conjectures on why that might be, but he adds that despite his findings, U.S. commercial aviation remains "almost incomprehensively safe" for passengers. SOURCE: Perils and Profits: A Reexamination of the Link Between Profitability and Safety in U.S. Aviation

BEST SELLERS HBR's 10 Must Reads: The Essentials | HBR's 10 Must Reads Ebook Boxed Set | HBR Guide to Persuasive Presentations Ebook + Video Case Study | HBR Guide to Better Business Writing | HBR Guide to Getting the Right Work Done

FEATURED PRODUCT Blue Ocean Strategy, Expanded Edition HBR Press Book This global bestseller, embraced by organizations and industries worldwide, challenges everything you thought you knew about the requirements for strategic success. Now updated with fresh content from the authors, Blue Ocean Strategy argues that cutthroat competition results in nothing but a bloody red ocean of rivals fighting over a shrinking profit pool. Based on a study of 150 strategic moves (spanning more than 100 years across 30 industries), the authors argue that lasting success comes not from battling competitors but from creating "blue oceans"—untapped new market spaces ripe for growth. Blue Ocean Strategy presents a systematic approach to making the competition irrelevant and outlines principles and tools any organization can use to create and capture their own blue oceans. Buy Now

FEATURED PRODUCT HBR Guide to Building Your Business Case Ebook + Tools HBR Press Book This enhanced eBook version of the HBR Guide to Building Your Business Case includes downloadable tools and templates to help you get started on your own case right away. You've got a great idea that will increase profitability or productivity – but how do you get approval for the budget and resources to make it happen? By building a business case that clearly shows your idea's value. Available exclusively through HBR.org. Buy Now

ADVERTISEMENT

HBR.ORG | THE MAGAZINE | TOPICS | BOOKS | CASES | STORE | SUBSCRIBE TO HBR UNSUBSCRIBE | NEWSLETTERS PRIVACY POLICY | CONTACT Copyright © 2015 Harvard Business School Publishing, an affiliate of Harvard Business School. All rights reserved. Harvard Business Publishing 60 Harvard Way Boston, MA 02163 CUSTOMER SERVICE: 800-545-7685 (US/Canada) 1-617-783-7600 (outside the U.S. and Canada)