Associate Professor of Strategy and Behavioral Science; Course Director of EMBA (London)
Since 2012, Chengwei Liu has received six awards for teaching excellence, was listed as one of the next generation of business gurus by Thinkers50, and has received several “best paper” awards and monetary grants to fund his academic studies. On the research front, he is widely recognized for his expertise on executive decision-making and biases, gaining advantage on competitors by exploiting biases, and engineering diversity within companies in order to enhance creativity and innovation.
On the teaching front, it’s the practical applications that earn him high marks. He’s known for his smooth teaching style, but mostly for the in-class experiments and games he deploys to help bring the material on executive behavior, decision-making, biases, and skill versus luck to life. Students say that through these mini experiments, Chengwei constantly raises the energy of each class session and adds to the level of engagement from students.
Institution: Warwick Business School
Title: Associate Professor of Strategy and Behavioural Science; Course Director of EMBA (London)
At current institution since what year? 2012
Ph.D., Strategy and Entrepreneurship, University of Cambridge, 2011
B.A., Economics, National Taiwan University, 2001
List of courses you currently teach:
Strategic Advantage; Behavioural Sciences for the Manager; Quantitative Methods for Business
TELL US ABOUT YOUR LIFE AS A PROFESSOR
“I knew I wanted to be a business school professor when…” a brilliant sequence of random events happened to me during the dot-com bubble which convinced me that I am good at teaching and motivating others to become entrepreneurs than being one myself…
What are you currently researching and what is the most significant discovery you’ve made from it? My main research program addresses a fundamental question in business: should we attribute performance differences to skill or to luck? For example, the most successful are often perceived to be the most skilled and therefore receive the highest rewards and are imitated.
I show that the belief that the exceptional performers are the most skilled is flawed because exceptional performance is more likely to occur in exceptional circumstances and top performers are often the luckiest people who have benefited from rich-get-richer dynamics that boost their initial fortune.
My experiments show, however, that people usually rely on the heuristic of learning from the most successful despite clear evidence that they were the luckier ones. This assumption is likely to lead to disappointment — even if you can imitate everything Bill Gates did, you will not be able to replicate the context he was in and his initial fortune which contributed to his exceptional success (see my BBC article here).
My current research also turns such “luck bias” on its head. The misattributions of luck can imply opportunities for informed entrepreneurs and strategists because these mistakes can lead to systematic mispricing of talents. For example, most firms pursue the top performers, i.e., “stars”, believing that they have the highest talents or skills. My research empirically shows that this practice is flawed because the top are likely to be the luckiest while the “second best” are in fact the most skilled.
The bias that favors the top leads to the second best being seriously underestimated. This provides an opportunity for the more informed — through the acquisition of superior talents with a price lower than their actual worth.
I’m now writing a book to elaborate these ideas — such as how leaders can maximize the return on luck by avoiding being fooled by randomness and taking advantage of the ways others mistake luck for skill.
“If I weren’t a business school professor…” I would like to continue my Hogwarts-like lifestyle as a college don at the Jesus College at University of Oxford.
What do you think makes you stand out as a professor? An anonymous teaching feedback from an EMBA student who took my Strategic Advantage module:
“Chengwei was absolutely brilliant. After the first morning we were all talking about him over lunch saying he was impressively bright, totally engaging, and an amazing tutor. As our first lecturer he gave us the best possible first impression of [Warwick Business School] and he’s an absolute credit to the institution. I can’t thank him enough for a thoroughly enjoyable, interesting, challenging and educational module.”
I would like to think so.
“One word that describes my first time teaching” :
If your teaching style/classroom experience had a theme song, what would it be?
Queen – Don’t Stop Me Now
As a b-school professor, what motivates you?
My students could learn something meaningful for improving their wellbeing from my teaching, even when the lessons learned are not immediately useful.
“Here’s what I wish someone would’ve told me about being a business school professor”:
MBA students are your students to teach, not your customers to entertain.
Professor you most admire and why:
Emeritus Professor James G. March at Stanford University, who is the mentor of my mentor (Professor Jerker Denrell).
Jim teaches us that scholarship should have an element of aestheticism – pursuing the elegance, beauty or surprise of ideas may be more important than their relevance. Following Jim’s advice, many of my research ideas are contrarian in nature and they took longer to be published in mainstream journals. But I totally enjoyed playing with these ideas and they engage the more curious students who are also more enjoyable to teach.
What do you enjoy most about teaching business students?
The diversity – their idiosyncratic experiences help us to learn how others may see the world differently.
What is most challenging?
The diversity – their idiosyncratic experiences hinder them from appreciating how others see the world differently.
Using just one word, describe your favorite type of student
Using just one word, describe your least favorite type of student:
What is the most impressive thing one of your students has done?
A MBA student read my research papers and extended a mathematical model I developed – we are now working together on a project about how to quantify the degree of luck in professional sports and to arbitrage the over- and under-estimation of luck.
What is the least favorite thing one has done?
I will keep it to myself.
What does a student need to do to get an A in your class?
Surprise me with unexpected insight supported by solid evidence
“When it comes to grading, I think students would describe me as …”
“But I would describe myself as …”
coach of critical thinking
Fill in the blank:
“If my students can disrupt the status quo with a piece of unconventional wisdom, then I’ve done my job as their professor.”
LIFE OUTSIDE THE CLASSROOM
Fun fact about yourself:
I teach my students about the danger of relying on gut feeling, when it helped me find my soulmate and convince me to marry her six months after our first date…
What are your hobbies?
How will you spend your summer?
That’s for me to know and you to find out
Favorite place to vacation:
Buenos Aires (and asado!)
Favorite book: All Quiet on the Western Front
What is your favorite movie and/or television show and what is it about the film or program that you enjoy so much?
I enjoy watching (Marvel’s, not DC’s) superhero movies because their worldview is so unambiguous that they guarantee a relaxing break for my brain
Favorite type of music and/or favorite artist:
Too many to be discussed here…
Bucket list item #1:
Build a personal library with a whisky bar next to my favorite books
THOUGHTS OF REFLECTION
What professional achievement are you most proud of?
Hosted a charity visit and gave a talk about my research to 20+ young students – and they understood and loved my ideas!
What is your most memorable moment as a professor?
The moment I saw the shocking face of a student who assumed I was a fellow student before the class started
“If I had my way, the business school of the future would have much more of this…”
a tuition system that follows “pay what you want” pricing strategy
“And much less of this…”
all the features that produce homogeneous graduates
In your opinion, companies and organizations today need to do a better job at doing what? Please explain.
I think organizations need to do a better job at embracing diversity. Enhancing diversity is our best hope to solve important problems and to create innovations. While individual abilities are important, they are not likely to grow much. In contrast, collective diversity can continue to grow if differences among individuals are valued, developed and leveraged.
For the purpose of enhancing diversity, I also study the concept of “nudging”, which is about engineering choice contexts to “engage a bias” to overcome a more damaging bias.
This is important, so important that Richard Thaler won the 2017 Nobel Prize in Economics for his contribution on nudging, because recent studies show that “working with biases” is more effective than the conventional approach of “de-biasing”.
One of my current projects studies how to apply nudge theory to engineer diversity in talent management. I recently published an article for the California Management Review, introducing a “Mindspace” framework that consists of nine effective behavioral interventions for managers to utilize when designing their nudges.
One of the nine components in the Mindspace framework is “S” or “Salience”. Our attention is drawn to what is novel and relevant to us, yet “Salience” can sometimes hurt diversity in talent management. For example, elite law firms in the UK are over-represented by graduates from Oxbridge. One possible reason is that Oxbridge degrees are so salient that CVs with this cue are more likely to receive further consideration.
Graduates from other schools could prove to be better than (at least some) Oxbridge graduates, but law firms cannot uncover these “hidden gems” unless the recruiters are made to ignore this salient cue. Leading law firm Clifford Chance adopted a “CV blind” policy in an attempt to break this Oxbridge recruitment bias, and the firm managed to find many hidden gems in the under-exploited pool of graduates from non-elite universities.
I am working with several large corporations to implement variations of CV blind policy to improve talent management. The results are fairly encouraging: the number of women, minorities and disabled applicants getting through to the next round of interviews increase significantly.
The message is clear – these “atypical” applicants are competent but unfortunately underestimated due to various conscious and subconscious biases the recruiters had. The approach of nudging can effectively expose these biases against diversity and help fix them through strategizing with, rather than fighting against, human nature.
Looking ahead 10 years from now, describe what “success” would like for you
The wellbeing of my students or readers is improved because of my ideas
“Dr Liu is an effective and innovative teacher of this core course of my degree. After being taught by lots of teachers/lecturers from different nationalities, cultural backgrounds of various education systems (I attended elementary school in China, middle-high schools and undergraduate in Vienna, Austria), I would like to emphasize that Dr. Liu is one of the few lecturers who is able to get students highly involved and interested of a foreign subject and increase your knowledge of it within a short time. Dr. Liu explains ideas clearly and has an attractive teaching style including running small experiments.”
“He managed throughout his smooth teaching to magnetize our attention, always providing necessary examples in case someone in the audience had trouble figuring out what’s going on! Another great strength that he possesses is immense patience. No matter how many times we did’t understand a question, had a problem with the lecture or even get stressed out because of an exam; he was always there to calm us down and provide solutions for all of us (if the time we had was enough). On the other hand, he was just and made to us clear that we have to try hard in order to succeed , not only for quantitative methods but for everything in life.”
“His classes gave me great help for he could not only explain concepts very clearly but also show how’s relationship between them. This is really important for an art student who doesn’t have very strong logic thinking like me. I would like to view quantitative method as a helpful tool in my further study and research rather than an invincible monster. Besides, his organized classes and his patience in answering questions show me an attitude towards life. He taught me by his behavior that as long as you have enough logic thinking and patience to life, you can conquer every problem you meet.”
“I have enjoyed an excellent MBA journey at Warwick Business School and the class taught by Dr. Chengwei Liu was the highlight of it all. I could quickly tell that his class was different from a typical business school “lecture.” Not only did Dr. Liu provided an interactive experience by utilizing current business cases, he strongly encouraged discussions that enhanced learning. His unique teaching style often started with conceptual discussions and would always end in real-world applications.”