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Erika James
Scholar

Erika James

Erika James is the Bank of America Associate Research Professor of Business Administration at UVA's Darden School and co-author of the 2010 book, Leading Under Pressure.

Neither heroes nor villians

Q: Tony Hayward, once credited for BP's "green" turnaround, is forced to resign in disgrace. Michael Dell, the revolutionary high-tech entrepreneur, is sanctioned for misleading investors. Wall Street titans, once lionized, are now reviled. Where have all the CEO heroes gone?

Where have all the CEO heroes gone? The answer lies in part in the question. For too long now we have glorified CEOs as evidenced by the increasing wealth, power, visibility, and celebrity that we have accorded to the select group of individuals holding the title. Do CEOs have a tremendous amount of responsibility? Absolutely! Do they shoulder an inordinate burden for the lives and livelihood of their employees? Of course! Can they influence the financial, political, and emotional tenor of a nation with their decisions and actions? Clearly! Yet they are still human beings, as imperfect and subject to mistakes and wrongdoing as any of us. Our expectations of CEOs are clearly out of whack. We expect them to live up to impossible standards and are then disappointed, and at times downright angry, when they do not.

Granted, the outrageous acts of indiscretion and impropriety that we witnessed throughout much of this decade are inexcusable. But just as it is inappropriate to say that those CEOs were merely heroes who fell from grace, it is equally inappropriate to suggest that the men and women who are admirably leading corporations are heroes. They are not. Rather, they are human beings who have a very big job, and who, in order to do that job well, need and deserve the support of their leadership team, their board, their family, and a host of other stakeholders. They do not need to be put on a pedestal.

What never ceases to surprise me is that despite the many public examples of failed leadership, executives continue to make the same mistakes. Of all of the tragic displays of malfeasance and poor judgment by senior executives over the course of the decade, not a single incident was new or unique. Moreover, the consequence for such behavior 25 or 50 years ago was shame and disgrace just as it is today. The difference now is that with the 24 hour news cycle and a public's insatiable appetite for news, actions that were once known to only a small group are now public for the world to see. As a result, boards need to be very clear, open-minded, and realistic about the type of skill set that will allow CEOs to succeed in doing the right things in leading their firms to profitability and doing so with integrity. Yet they must also be careful not to imply that the job is so challenging that only a hero can do it well.

Not everyone is cut-out for the chief executive spot, but there are many who are. These are the men and women who are willing to put their ego aside in order to lead firms out of a vicious cycle of bad decisions, short-sightedness, and financial despair, and toward a vision of the future where innovation and creativity is the norm. They are willing and able to learn from mistakes, their own and others, and build on past experiences. They encourage growth and development in themselves and their employees, and listen to others as a cornerstone to building trust with key stakeholders. They have a history of demonstrating integrity and values-based leadership, and are receptive to a diversity of thought and perspective."

By Erika James

 |  July 27, 2010; 11:20 AM ET
Category:  CEOs , Corporate leadership Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati  
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Comments

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Erika - well written and encouraging to see someone that sees CEO's and other leaders as just one element of business, and not confused with hero status. It is a talent to be an effective leader, but requires an equal amount of talent in those that follow to produce results. Thank you for sharing your insightful comments on this topic.

Posted by: aviente | August 1, 2010 9:18 AM
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Its absolutely criminal how much CEO make in this country and even more criminal how they are rewarded for failure. The CEOs of this country are failing us badly much more than the work force.

We need new and better CEOs. We need boards that represent the stock holders of the companies without having conflicts of interests. Many boards have executives from the company on them or its a elite club where members are made up of other executives. Boards need to stop giving out these ridiculous salaries and parachutes.

Posted by: cirrus_nine | July 27, 2010 11:43 PM
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Great people with lots of responsibility. My take on it is that the quality of corporate leadership in the US today is that it is far more mediocre than in the past. Why we continue to compensate them in this obscene fashion is beyond logic. It is CRIMINAL!

Posted by: kerryberger | July 27, 2010 9:35 PM
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We should be talking about patriotism in corporate boardrooms with the same jingoistic zeal when it comes to supporting troops in useless wars.

Posted by: jfern03 | July 27, 2010 1:24 PM
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Fine but you may as well be talking about the patriotism of the steer in a Big Mac.

The bottom line, to coin a phrase, is that Corporations may be people if SCOTUS says so, but they are not American. Any of them, down to the small business on the corner. It goes like this: any entity which seeks to maximize profit and minimize labor costs cannot possibly support America's interest at both home and abroad simultaneously. It is a logical impossibility.

If the local barber shop hired the cheapest person who could use a scissors, or charged $1000 for a haircut obviously those would be bad decisions regardless of Nationality or Patriotism.

The CEO of a trans-national is not making the same business decisions as the barber shop. Like it or not, the Boardroom can harbor sociopaths in the same way Catholic Priesthood can harbor pedophiles. It is likely rare but it would be very surprising if the behavior was NEVER found.

Posted by: gannon_dick | July 27, 2010 7:59 PM
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We expect them to live up to impossible standards and are then disappointed, and at times downright angry, when they do not.

~~~
What standards are those, other than investment earnings.

Over the last decade, the BOD's at various companies seem to have changed their business model from one whose mission was built around quality goods and services to one that only cares about the bottom line.

This is a country that no longer cares about whether they are providing quality services, quality products, or whether their employees are being trained to keep up with the pace of a changing global economy.

If companies no longer care about the services they provide, the quality of their products, or whether the employees have the skills, the training do perform in certain functions, then how does one expect a company to be profitable in the end.

Posted by: lcarter0311 | July 27, 2010 1:56 PM
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We should be talking about patriotism in corporate boardrooms with the same jingoistic zeal when it comes to supporting troops in useless wars.

What will it take to shed the "get mine while i can" attitude of grotesquely deviant and obscenly greedy business attitudes of today.

It all died, we lost our collective innocence right about when Kennedy was shot.

R.I.P USA

Posted by: jfern03 | July 27, 2010 1:24 PM
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I agree with you 100%.

Posted by: bertzel | July 27, 2010 12:04 PM
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