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Yale, FSU Researchers Say ‘Street Smarts’ Important In Business

June 16, 1987 GMT

TALLAHASSEE, Fla. (AP) _ When it comes to business savvy, street smart managers appear to outshine those who were academic superstars in their younger days, according to a university study.

Research indicates that people who excelled academically in high school, college or even business schools frequently are dramatically less successful in their careers, said Richard K. Wagner, a psychologist at Florida State University.

And people who are superstars as managers and executives have unremarkable academic records, he said.

Wagner and research partner Robert J. Sternberg of Yale University used a sample of successful business executives with Fortune 500 corporations in their study, which was released Monday. Their subjects agreed that IQ and scores from ability and achievement tests do not necessarily predict managerial success.

″The most successful colleagues our study group knew were rarely those they would rate as the most intelligent,″ Wagner said. ″Some of our informants even expressed the view that a very high IQ can be a detriment to managerial success, observing that some highly intelligent individuals lack patience with their less able peers, subordinates and even their superiors.

″Furthermore, such individuals tend to rely too heavily on their extraordinary analytical powers, thereby neglecting important advice from others.″

Judging common sense has always been easier said than done. But Wagner and Sternberg developed a test to measure what might be called street smarts, or practical intelligence.

The Tacit Knowledge Inventory for Managers is based on work-related situations and possible responses by experienced managers.

″We found that scores on research measures of street smarts are quite predictive of one’s ability to learn to solve practical problems on the job, but they are less predictive of one’s ability to solve academic problems in formal classroom settings, typically the kinds of problems measured by IQ tests,″ Wagner said.

″Tacit knowledge, work-related practical know-how that is acquired informally on the job, is the aspect of street smarts that is so important for managers who are successful,″ he said.

Three kinds of tacit knowledge were found to be most related to managerial success - managing your own time, managing others and managing tasks, Wagner said.


Managing yourself refers to self-motivation and self-organization, such as learning how not to procrastinate.

Managing others refers to coordinating and motivating subordinates, peers and even superiors. How effective a manager is at convincing a superior of the worth of his or her ideas is one example.

Managing tasks is knowing how to perform specific jobs.

The FSU researcher advised managers not to waste a lot of time reading popular books on the subject.

″They should look around their organizations and determine what can lead to success. They should look to find people who are good at managing themselves, others who are good at managing their tasks, and those who are good at managing others,″ he said.

He said the more successful, street-smart managers tend to have a proper balance of idealistic and pragmatic orientations, mixing the ideal qualities of an idea with how practical it can be in a given situation.

Wagner and Sternberg are in their second year of a five-year $750,000 grant from the Army Research Institute. They are finishing a complete Tacit Knowledge Inventory and expect to see it published next year.

Wagner says the inventory could be used by corporations and organizations wanting to test potential managers for their common sense.