The Arrogant and The Assholes: Both Are Incompetent

Dave Livingston sent me a snippet of a press report, which I paste in below. 

Lehman, AIG Chiefs Should `Man Up,' Stop `Kissing the Mirror,' Peers Say Executives passing the buck for failures that sank their companies or pushed them to the brink win no sympathy from business leaders and management experts. ``They need to man up and take responsibility,'' said Warren Bennis, founder of the Leadership Institute at the University of Southern California and author of books including ``Leaders'' and ``On Becoming a Leader.'' ``They kept winning, believing in their own omniscience and thinking they can get away with anything.'' Chief executive officers summoned to Capitol Hill this week by the U.S. House Committee on Oversight and Government Reform didn't point fingers at themselves, drawing criticism from fellow chiefs. ``There are three reasons why companies go out of business and individuals go out of business: No. 1 is arrogance, No. 2 is arrogance and No. 3 is arrogance,'' said Harvey Mackay, chairman and CEO of Minneapolis-based MackayMitchell Envelope Co. and author of ``Swim With the Sharks Without Being Eaten Alive'' and ``Beware the Naked Man Who Offers You His Shirt.'' ``They all have chapped lips from kissing the mirror too much

As I read this story and thought about what I learned from the recent financial crisis and from the last year or so from writing and talking about The No Asshole Rule with so many people, I realized that I've learned an important lesson about competence.  People who are certified assholes and those who are relentlessly arrogant often justify their behavior -- and are forgiven by others -- when they are seen as winners.I believe -- and the evidence is pretty clear for both assholes and arrogance (e.g., see this and this research CEO hubris) -- that although some leaders succeed (at least for awhile) despite these flaws, they are indeed dangerous flaws.  Just like missing other more tangible targets such as making money or winning games, being arrogant or leaving a trail of demeaned and de-energized people ought to be treated as a sign of incompetence. 

In fact, arrogance and acting like an asshole are especially great risks among people who are "winning" for the moment.   Although some people are more prone to such forms of incompetence regardless of performance levels, it is clear that any leader of a high-performing organization (regardless of past modesty and civility) is at great risk of turning into an arrogant and insensitive jerk because these are well-documented side effects of success. Just as patients who take a lot of aspirin need to be closely watched for signs abdominal bleeding, the more successful the company, the more likely that arrogance and asshole poisoning will spread, and these should be treated as known and highly dangerous risks.   Contrary to standard practice, top-performing leaders should be treated as at especially high risk of developing mindsets that will later cause them to run their organizations into the ground. At the first hint a leader has turned arrogant or is acting like a nasty, self-centered jerk, rehabilitation should commence, and if that fails, he or she should quickly be shown the door.

That's my view, as Dave suggested, perhaps my next book should be The No Arrogance Rule.  We would all be better off if those self-proclaimed geniuses on Wall Street had applied the rule a few years back. I guess the Master of the Universe mindset was still seen as a wonderful thing there until very recently.

P.S. I love that line from  "They all have chapped lips from kissing the mirror too much.''

Comments

[Chander]

Arrogance made Sony destroy Aiwa a few years ago, and Sony is now in trouble.
Arrogance is the hallmark of a certain Mr Sunny Varkey, an uneducated Indian in Dubai who thinks he is God's answer to establishing schools for huge profit all over the world. He is increasing school fees by 110% in April 2009 using money power to quell objections

[Kevin Rutkowski]

Unfortunately, I have seen that many companies tend to promote those who best take credit for successes and pass blame to others. It seems that these CEOs are just continuing the behavior that got them to where they are.

Perhaps the more prudent companies that are set up for long term success will tend to promote those who take responsibility when things go awry and dole out credit when things go well.

[Erik Sherman]

I think the two factors are closely aligned. A person as an asshole if they behave as though others don't exist or are there only for the perpetrator's convenience. To become arrogant is to take all aspects of success as your own and not the result of anyone else's efforts - in other words, to act as though other people don't exist. It also shows an immature level of comprehension of one's place in the world. How can you understand your own role if you don't understand those of others? So you get people in charge who are practically guaranteed to screw up badly (absent sufficiently talented fawning employees) because the person is working in a state that is literally detached from reality.

[dblwyo]

Bob - thanks. The more important question in my mind is what do we do about it ? It's been clear on a small scale that arrogance based on historical performance accidents sets up downfalls. The recent large-scale crisis now provides large-scale evidence points. At the same time it also provides large-scale evidence that non-arrogance (= sustained, moderated competence ?)pays off with measurable rewards in the long-run. The classic example being of course Uncle Warren but there are many others who in fact are profiting from the cultural breakdowns and failures we see around us.
Which thesis then suggests that a fundamental strategic question is how does one design the HR system and the resulting management system to encourage non-arrogant behavior.
Now that, IMHO, would make a great follow-on book !
What do you say fellow fans and readers ? Go Bob !

[Jan]

I see this crisis as the ultimate validation of what Business schools have been teaching for the last 50 years. It couldn't be clearer. The interesting question is what will happen when all this is over. Are we going to learn anything or are we doomed to repeat history? Where will people invest their future pension money? Will things shift back to building long term companies that give a steady 10% ROI, instead of putting your future pension on the roulette wheel?

[Wally Bock]

Thanks for posting that Bob. I agree, especially about the hubris. If I remember, Hubris is followed inevitably by Nemesis. It's hard to remember that when you're raking in the gold and everyone around you is telling you how smart you are.

The full Bloomberg article is worth a read. Here's a link.

http://www.bloomberg.com/apps/news?pid=20601109&sid=aY_c4z_m1M1Y

[Michael Sporer]

Bob;
Greed and unabashed arrogance is what caused this mess to begin with. And the system enabled it! It takes a modicum of integrity to avoid being an asshole. These CEO's have none.
Mike