Monitoring and Managing Success Avoiding the CEO 'Self-destruct' Option

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Failure to manage personal success can breed arrogance, disdain for others and plant the seeds for a CEO's ultimate failure. CEOs and senior executives are vulnerable to destroying themselves through excessive self-belief, misbehavior,
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  9 Global CEO  August 2009 Monitoring and Managing Success  Avoiding the CEO ‘Self-destruct’ Option Failure to manage personal success can breed arrogance, disdain for others and plant the seeds for aCEO’s ultimate failure. CEOs and senior executives are vulnerable to destroying themselves throughexcessive self-belief, misbehavior, ‘organizational delusion’ and hubris. Senior executives dependent oncolleagues for accurate and honest data may inadvertently promote working patterns which block the very feedback they need to survive and succeed. Illustrated by consulting experiences, this article bringsout the susceptibility of senior executives for self-destruction. Four ‘lifelines’ are proposed to helpexecutives survive. T his article suggests that lead-ership failures are endemic inorganizationallife and thatmore attention should be given tomonitoring how an executive uses thepower and influence derived from hisposition as a leader. Drawing on casematerial from my work as an execu-tive coach and advisor, this article il-lustrates how the self-serving behav-ior of leaders resulted in the failure of the job. Whilst most executives mayoperate ethically, collegially andcollaboratively, my business experi-ence suggests that organizations arealso peppered with individuals—atall levels within the hierarchy—whoare determined to achieve their ownselfish agendas, irrespective of thedamage caused to others or to the orga-nization at large.Some failures of leadership arisebecause successful executives, who areperhaps driven by the need to main-tain and enhance their reputation, de-cide to exploit their positions of trust © 2009 The Icfai University Press. All Rights Reserved. LEADERSHIP  Global CEO  August 200910 if they believe they can get away withdoing so (see Babiak & Hare, 2006;Hornstein, 1996; Wright and Smye,1996). This possibility is increasedbecause executives are able to usetheir position of leadership, and theprivileged situations in which theyfind themselves, to justify what couldotherwise be seen as immoral andethical transgressions (Price, 2006).In other words, senior leaders exert a significant influence in defining whatis, and what is not, acceptable busi-ness practice and so can be prone to doso to suit their personal aims and ob- jectives. To summarize: Leaders areable to define the criteria by whichthey will be assessed as successful.Given such a situation, it wouldseem inadvisable to believe every-thing the leader espouses because, asKramer (2002) notes, “Contrary toexpectations, colleagues and bossesmay not have our well-being at heart.Indeed, many are often indifferent tous or see us as competitors.” It shouldnot be surprising to note that self-in-terest will most of the time influencethe thinking and subsequent behav-ior of executives because, as Jackall(1988) suggests, “As a matter of sur-vival, not to mention advancement,corporate managers have to keeptheir eye fixed not on the abstractprinciples but on the social frame-work of their world and its require-ments.” (1988:111). So the internalpolitical world of the organizationsignificantly influences who pros-pers, who fails, who gets the goodiesand who gets the dross. And it is a world managed by the power elite of each organization.It should be remembered that theholding of organizational power hasthe potential to corrupt – and a busi-ness culture that is founded on con-tinually delivering short-term targetsmerely intensifies a leader’s need todeliver success irrespective of howthat is achieved. If the demands andrewards of success are too great itshould surprise nobody that some ex-ecutives will misuse their position tomeet whatever success criteria hasbeen demanded of them. As Lord Acton (1887) observed, “Power tendsto corrupt, and absolute power cor-rupts absolutely.” Given that businessorganizations are essentially politicalentities, the monitoring and manage-ment of an organization’s power dy-namics should be a matter of highestpriority to limit the destructive forceof such dynamics. My experience sug-gests that this rarely happens.It follows that to succeed—or atleast stay safe—those in lesser posi-tions of power and influence will prob-ably conform to the status quo eventhough they may consider some prac-tices as a violation of ethical working.Indeed, the behavior of ‘followers’ inall this should not be overlooked asthey may be compliant in the decep-tion by their leaders by feeding themfalse information and in the sanitiza-tion of presented data in order to ad-vance their own aims and ambitions.(Gellman, 2008; Kellerman, 2008;McAlpine, 1998) Just how much havoc can be causedby exploitative and dishonest leadersand followers has become painfully ap-parent in recent times following theEnron, Arthur Anderson et. al., de-bacles, and the crises of confidence dur-ing 2008 and 2009 in the world’s fi-nancial services systems (Mason,2009). So, far from being unfailinglywell-intentioned, ethical, prudent, un-emotional and honest, leaders will notnecessarily be ‘a good thing’ nor willfollowers be as true and loyal as theymay present themselves to be!Caution about the misuse of powerthough is nothing new and has beenresearched and commented upon fordecades (Conger, 1990; Kets de Vries,1979; Whicker, 1996; Zaleznik, 1963,1970 amongst others). Yet, in spite of the attention such matters are nowreceiving (such as from Kellerman,2004, 2008; Lipman-Blumen, 2005;Kets de Vries, 2001; Offerman, 2004; Walton, 2005) it is intriguing to won-der why so little attention was given tomonitoring and policing more care-fully senior executive behavior untilmeltdowns, such as Enron hit thenews.Indeed it is a sobering thoughtthat such high-profile cases are likelyto be but the tip of an iceberg of en-demic pervasive corporate misbehav-ior (Walton, 2005, 2007) and to illus-trate this at local level, three ex-amples of leadership failure are out-lined below. Whilst they have no glo-bal significance, they were profoundlydisabling to those affected and ad-versely affected the effective function-ing of the organizations involved.Similar cases are probably being re-peated many times over in a widerange of organizational settings evenas this article is being read.The three cases are drawn from myportfolio of work as an external advisorand describe different types of dysfunc-tional executive behavior. My hypothesisis that similar cases of executive mis-management and excess are likely to bethe norm within the business world andthus more attention is needed to:  Protect the business world fromexecutive excesses, and  Help executives resist the tempta-tion to misuse their organizationalpower.Following these case descriptionssome suggestions are proposed toguard against such self-destructivetendencies taking hold. Examples of ExecutiveDerailment The details of each case have been dis-guised for reasons of confidentiality. Dr. Michael Walton CLS Fellow, Center for Leadership Studies,University of Exeter UK.The author can be reached atmichael.walton@btinternet.com LEADERSHIP  11 Global CEO  August 2009 Each has been selected to illustrate a different type of dysfunctional seniorexecutive behavior. In each case myrole was as an external advisor work-ing with the CEO/Director in facilitat-ing organizational change. In eachcase, the derailment features of theexecutive’s behavior slowly emergedbut came to adversely dominate eachorganization’s ways of functioning.Considerable harm was inflicted,some of which was unintentional andsome of it grossly uncaring and ex-ploitative.The top executive in each of theseexamples has been given a descriptivetitle to reflect what seemed to be theprimary feature underpinning theirunhelpful behavior. (Refer Table 1)In each case the CEO crashed andexited. Each had a track record of suc-cess and was bright, able and experi-enced. The senior executives in cases 1and 2 could be described as somewhatself-promoting, narcissistic and par-ticularly ‘image and status conscious’;whereas the CEO in case 3 was moreself-denying and reclusive. All threeheld high views of their own abilitiesand competence – and each was usedto having their way either throughforce of character or through force of analysis. They found it difficult—un-familiar even—to cope and adaptwhen their initiatives were chal-lenged or thwarted – or when theycouldn’t find the answer (Walton,2007, 2008).The drive for power, supremacy,conquests and status can be expectedto be prominent in many successfulexecutives. In ‘The Gamesman’Michael Maccoby (1976) illustrateshow the challenge of competitive ac-tivity can take over and lead to execu-tives resorting to stealth andpoliticising to secure advancement.Pfeiffer & Sutton observe how themere act of stepping into a powerfulposition can transform them, (i.e., ex-ecutives) from wise, successful leadersinto stubborn, dumb, and evidence-resistant jerks (2006:227). This wascertainly the case with the ‘Mean Ma-chine’ and ‘Macho Man’ but not at allwith the ‘Analytical Thinker’ – whowas the most unselfish and diligent of the three. A scientist by profession,facts, figures and logic were both hisstrength and the source of his derail-ment which became increasingly ap-parent when confronted by levels of complexity that he could not resolvethrough linear thinking.One of the concomitant dangers of status and power is that it can lead tohubris, overconfidence, complacencyand an exaggeration of personalstrengths – features of leadership dys-function which Maccoby (2000) andHayward (2007) highlight and whichcan blind a leader to the reality of what is actually happening aroundthem. Such ‘delusions’ were theprime bases for the leadership failuresin the first two cases outlined above.Furthermore, these two top execu-tives came to be feared, resented—even hated by some—and seriouslydamaged the organizations they led,by their self-serving arrogant actions.Case three however—the ‘Analyti-cal Thinker—was an altogether differ-ent case as failure here came throughanalysis paralysis and too fixated a be-lief that there was ‘an’ answer to thecomplex issues being faced and that it Table 1: Three Examples of Executive Derailment Case DescriptionOverview Rising Star – exploitative, vindictive, rampant arrogance and bravado; show, status and image-driven;opinionated. Internal terror and favoritism reigned. Generated fear, anger, disbelief, distress and strain. Onlywanted ‘success’ and good news, bad news wasgenerally withheld from the boss – the organizationbecamedysfunctional, reactive; reputations and careers were damaged.Pleasing and obeying the bossbecame the basis for survival.Removed from office following ‘whistleblower’ disclosures. ‘I Lead-You Follow’ – High profile heroic entry; doesn’t listen, arrogant, big footprint. Rather opinionated andbelieved own PR Image, status, high profile indulgent. Didn’t like challenges, confrontational, brutal andexploitative. After lack of success and decimation of the organization, removed under cloud. Created divisive‘In’ and ‘Out’ groups, generated fear and loathing.Bright, alert, diligent and thoughtful. Private and somewhat isolated; believed that logic and analysis shouldwin the day over emotions and rhetoric. Low impact, high intellect; self-effacing, workaholic. Seeminglyunable to adapt his approach. Slowly lost credibility with sponsors. Was retired away quietly to be replaced bya more dynamic ‘go-getting’ CEO. Case 1:  The ‘MeanMachine’—dramatic, lively,histrionic—‘Just do it, now!’ Case 2: The‘Macho Man’…‘I am the leader followme (or else)’ Case 3: The ‘AnalyticalThinker’—Careful,Considered, Considerate—do it right, do it carefully MONITORING AND MANAGING...  Global CEO  August 200912 could be found if only enough analysiscould be computed! This was an ex-ample of too unswerving and unselfisha desire, to do the ‘right’ thing andfind the ‘right’ answer but a behaviorwhich ultimately led the organizationinto a mire of confusion and a tangle of inaction as the CEO was shunted intoretirement. Although there were significantdifferences in how each of these execu-tives exercised their responsibilities,each wanted—needed even—to pre-vail and be seen as the star player intheir respective organizations. Theywere difficult to influence, they gener-ated win-lose dynamics and led in-creasingly fragmented and ‘dis-turbed’ organizations. Personal in-sight into the disharmony they werecreating varied from disbelief and sin-cere regret to total disdain. Sadly, inall three cases, colleagues who werebrave enough to challenge their pro-nouncements or draw attention to or-ganizational problems were penal-ized, excluded, ridiculed or ‘movedon’. Whilst the experience of working with these executives was very differ-ent there were significant differencesand similarities between them (ReferTable 2). What is interesting is how a failure of leadership may occur throughtoo high as well as too low-levels of self-belief, drives for achievement,narcissism and misplaced charisma. Whilst each wanted to ‘win’ and re-main successful, how they went aboutthis varied as Table 2 indicates. Imageand ‘impression management’ were im-portant preoccupations in cases 1 and 2but such matters were of no interest incase 3 whatsoever where that CEO wasmore concerned with quiet, unassuming analytic thought. Cases 1 and 2 were alsoself-promoting and attention seeking whereas case 3 was more reclusive andretiring even though all three occupiedprominent roles. Perhaps the most sa-lient difference is the balance eachstruck between people dynamics anddata-based leadership.But what about the internal powerstructure? As competent, accom-plished individuals as senior execu-tives—at the top end of the organiza-tional hierarchy—expect to prevail indiscussions and debates about requi-site action. Consequently, it should beexpected that some executives will re-sent it when their views are chal-lenged, blocked or denied. This maycause a petulant executive to disre-gard the opinions of others out of handor even penalize those who challengetheir views. Such reactions are par-ticularly likely if the executive hasfallen into what Culbert and Ullmen(2001) describe as the ‘HierarchyTrap’. Their hypothesis is that whilstit is necessary for business decisionmaking to have in place a hierarchy of roles, if that same hierarchy is appliedto relationships it will inevitably cre-ate ‘…a negative dominance/subordi-nation dynamic that works against anorganization accomplishing its goals.’The behavior of the executives inthe first two cases would suggest thatthey had indeed fallen into the ‘Hier-archy Trap’ and had used the role hier-archy to determine the worth of thepeople around them. Consequently,valuable insights and relevant contri-butions from colleagues lower downthe hierarchy were discounted or dis-missed if the views they held con-flicted with those of colleagues posi-tioned higher up the hierarchy. As pre-dicted by Culbert and Ullmen (2001),this resulted in a behavior (as in cases 1and 2) which was ‘…dominated by top-down, power differentiated thinking …’ the higher up the hierarchy you arethe more valid your opinion was seen tobe, irrespective of the issue under dis-cussion! In the third case evidence of the ‘Hierarchy Trap’ was far less appar-ent as decisions in that organizationwere usually based more on the qualityof the reasoned analysis presented thansolely positions of seniority.The careful management of per-sonal and positional power remains a  LEADERSHIP S. No.Case 1: The‘Mean Machine’Case 2: The ‘Macho Man’ Case 3: The ‘Analytical Thinker’ 1Driven to win and prevailDriven to win and prevail Driven to solve the issue and be proved correct2Record of success, hard to influenceRecord of success, hard to influence Record of success, hard to influence3High profileHigh profile Low profile4NarcissisticNarcissistic Not narcissistic5High Ego needsHigh ego needs Low ego needs6‘Image and Status’ important‘Image and Status’ important ‘Image and Status’ not important7People-dynamics focusedPeople-dynamics focused Data focused Table 2: Derailment Similarities and Differences  13 Global CEO  August 2009 vital dimension when examining thebases for executive success and failure.Occupying a position of power and au-thority is no defence against failureand, paradoxically, an executive’s fail-ure to manage success prudently canlead to his ultimate downfall. Staying Safe – Avoiding aSlide to Failure The cases described earlier illustrateshow three successful executives failednot because of incompetence or lack of ability, but because of how they usedtheir power and influence. In two of the examples, the executives misusedtheir authority and influence for per-sonal gain, while in the third example,the executive became so focused on hissolving an industry problem that heinadvertently pushed other contribu-tors aside, became increasingly iso-lated, lost the plot and was shuntedout. Whilst other examples could havebeen presented—with different un-derlying derailment factors—the pur-pose of these cases was to illustratehow, at a local level, even successfulsenior executives can easily fall frompower, if they don’t manage their suc-cess with prudence and care. So howcan senior executives:  Resist misusing their positions of power and privilege?   Acknowledge more openly thatthey are not infallible.  Remain open to challenge and thecontributions of others.  Stay sufficiently grounded so thatpersonal narcissism, arroganceand greed remain within ‘accept-able’ limits and do no harm. Whilst such questions are difficultto examine, doing so is vital in order tolessen the number of executives de-railing and failing to achieve their fullpotential. Whilst there are no readyanswers to such questions, four sets of considerations are suggested belowwhich, if addressed, can reduce thelikelihood of executive derailmentand the emergence of toxic leadershipbehavior. These four ‘lifelines’ canhelp an executive rebalance his ap-proach to business life and also re-mind him of the pitfalls of corporatebusiness and the seductive pressuresof life as an executive (Drucker, 1999;Price 2008). Four ‘Lifelines’  Remain alert to the underlying political dynamics of leadership.  People will tend to tell youwhat you want to hear.  People will show you what youexpect to see.  Those dependent on your spon-sorship are unlikely to con-front you openly.  Don’t believe your own public-ity and remember you don’t‘have all the answers’.  Monitor your ‘spin doctors’and beware of hubris and un-due flattery.   Acknowledge the ‘political’ de-mands on senior executives.  Understand that your rolecomes with a unique organiza-tional history.  Others will project onto youwhat they want and expect youto deliver.   You are destined to disappointsome of those dependent upon you.  Expect some of your ‘followers/ colleagues’ to be ‘toxic’.   You will be fed sanitized data –so don’t believe all you aretold.   Your name will be taken invain and you will, on occasions,be misrepresented.  Understand the organization’s in-ternal and external environment.  Monitor your sponsors, super-visory boards and benefactorswith care.  Diagnose the organizationalculture(s) to enhance effectivefunctioning.  Monitor the external environ-ment for its impact on the or-ganization and sector.  Coping with work-life pressures asan executive.  Prioritize where ‘the job’ and‘the family’ fits in your life.  Understand your personalityand psychological characteris-tics.  Increase awareness of your de-railment vulnerabilities.  Manage your strengths, workwithin your known limita-tions.  Stay physically and mentallyalert and healthy.Prompts such as these can help ex-ecutives remain alert to what is going on around them and can be helpful inresisting some of the derailment pres-sures inherent in the role of a seniorexecutive. These four ‘lifelines’ can beused as a way of identifying the vary-ing pressures and demands experi-enced by busy executives at work.Finding a way of integrating and bal-ancing these can help an executive‘stay safe’ and become less susceptibleto the ‘self-destruct’ option. Conclusion Senior executives are successful andinfluential people with considerableorganizational power to influence andshape the course of events and deter-mine the success or failure of thosearound them. Although executives remain assusceptible to manipulation as others,they are more vulnerable to flatteryand believing in their own publicity.Critically, a failure to manage theirown personal success can breed arro-gance, disdain for others and plant theseeds of ultimate failure. Reference # 15M-2009-08-02-01 MONITORING AND MANAGING...
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