“Do you believe in miracles? Yes!”
-Al Michaels, sportscaster
That’s the line sportscaster Mr. Michaels made famous on Feb. 22, 1980 in “The Miracle on Ice,” a famous hockey game in the Olympic Winter Games.
The U.S. team was comprised of unheralded players who were certain underdogs against a grizzled, veteran team from the Soviet Union. The U.S. team miraculously won, 4-3.
Announcers Al Michaels and Ken Dryden (prior to the game with the Soviet Union)
Mr. Michaels has called miraculous finishes in sports for decades.
He also has prowess as an investor, which is why he was interviewed decades later on CNBC by Larry Kudlow. When asked, he said he doesn’t expect miraculous performances by narcissistic chief executive officers.
For him, CEOs who appear to have strong egos are a red flag. If they appear to relish heavy publicity, Mr. Michaels said he keeps moving and invests elsewhere.
Indeed, strong egos may propel executives to become CEOs. But research has shown their companies suffer.
“It’s All About Me: Narcissistic CEOs and Their Effects on Company Strategy and Performance,” is an insightful study by two researchers at Penn State.
The 2006 study by Arijit Chatterjee and Donald C. Hambrick analyzed the track records of 111 tech CEOs. Their research serves as timeless source of information.
Narcissistic red flags
The professors identified “six indicators of narcissistic tendencies”:
- The prominence of the CEO’s photograph in the company’s annual report
- The CEO’s prominence in the company’s press releases
- The length of the CEO’s Who’s Who entry
- The CEO’s use of first person singular pronouns in interviews
- The CEO’s cash compensation divided by that of the second-highest paid executive in the firm
- The CEO’s non-cash compensation divided by that of the second-highest paid executive in the firm.
The researchers connected the dots. CEOs hunger after attention. To be glorified, they work long hours, which leads to influence and power. They don’t listen to experts as they embark on audacious strategies, such as mergers and acquisitions, which usually result in failure.
In reality, it’s important for CEOs tempted by mergers to consult their HR pros, first to make certain a merger is a good cultural fit. They should also avoid failure in risk management and strategic planning.
But the lines are blurred between what benefits their egotistical careers and the companies for which they work. That leads to major victories and embarrassing losses – volatility that victimizes all stakeholders.
A quote by the world’s leading business philosopher, Dr. Peter Drucker, comes to mind: “Arrogance is being proud of ignorance.”
Read the study here.
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7 Tips for a Young Professional to Become a CEO — For a professional to jump to the senior-management level in the 21st century, it’s imperative to demonstrate seven core competencies. Consider them part of your personal branding for success.
How Women Can Enhance Their Careers via Group Decision-Making — In group decision-making, women often participate 75 percent less than their proportional representation when they’re outnumbered in gender, according to a study. It found that “having a seat at the table is very different than having a voice.”
8 Career Tips to Unlock Your Potential as a Leader — It’s important to note that leaders aren’t necessarily born. They develop themselves. They don’t settle or languish. They evolve by constantly assessing their progress for improvement. Here’s how…
“The truest characters of ignorance are vanity and pride and arrogance.”