There are two basic species of Superstar CEOs: those who think they are and those who are. The former can be relied upon to self-destruct; the latter can bring great advantages to their firms…as well as great harm. Advantages range from free advertising to access to key customers, shareholders, policymakers and the media. These latter individuals are generally highly intelligent and, by definition, very accomplished in their field.
The problem is that the superstar gene almost always carries with it certain vulnerabilities to diseases: namely, arrogance, invincibility, invulnerability and omniscience — the Four Horsemen of the Apocalypse for superstardom, including for superstar CEOs.
In my first job as a young aerospace engineer (rocket scientist, if you will), I was working for a highly prosperous aerospace company on the West Coast. Jobs were bountiful at the time among the numerous firms in the local area and pay was extraordinary (we were working 60-hour weeks!). Our company's leadership had just been transferred to the son of the firm's founder, who bore the firm's name and was eagerly sought by the area's society and media. In his capacity, the newly elevated superstar CEO apparently decided that the firm should reduce costs and increase profits. (That's the point where I came in.) Late one Friday afternoon, my boss's boss (“the Big Boss,” as we knew him) stood on a table among several acres of young engineers and announced that on the following Monday we would all be making 15% less pay.
There was silent shock in the giant room until someone realized that it was April Fool's Day and shouted out the news for all to hear! We cheered the Big Boss's sense of humor and cheered even louder at his subsequent protests that this was no joke. He was really pulling off his stunt! We all laughed as we headed home.
The problem was that it wasn't a joke.
Within hours, headhunters had the phones of our most capable colleagues ringing off the hooks; within days, the pay cut was rescinded; within weeks, we had an engineers union; and within months, the company was sold to our biggest competitor.
What was he thinking? Where were his advisors? In particular, where was the board?
The villain, in a word, was that vertical pronoun “I,” the pronoun that packs unlimited danger in its small size. Years after the above incident, and following my own retirement from the CEO world, I was preparing to join the faculty at my alma mater, Princeton University, and asked Warren Buffett, universally admired and deservingly so, what was the most important thing I should teach my students. Without hesitation he answered, “Always have someone around who can tell the emperor he has no clothes.” Sound advice; one might even say, the naked truth. Indeed, to be a truth sayer is one of the most important roles of a board — along with making sure the CEO is listening to the truth.
But, if one is a superstar, invincible and all-knowing, why does one need advisors? Undoubtedly, the best antidote for these diseases is humility, which is the difference between superstar CEOs who sustain their record of success and those who are mere comets passing in the sky.
As English poet John Donne noted, “No man is an island, entire of itself.” When superstars lose sight of this, they tend to believe they are immune to risk and to assume that those attributes that led to their earlier success in one lane apply in all lanes.
Thankfully, there are superstar CEOs who lead their organizations to great accomplishments. But it is a role that is beset by danger. As noted in this writer's non-bestselling book, Augustine's Laws, “When hubris is superimposed on power, it can be assured that disaster is not left to chance.”