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If you aspire to be a level 5 leader - learn to keep your ego in check

July 2012

Can you withstand the ego traps of success?  

In this Blog Article we will look at the interplay between humility and ego and their respective impacts on a leader’s effectiveness.

We will first focus on humility as one of the Level 5 Leaders’ characteristics identified by Jim Collins in the research study Good to Great and then we will unpack ego as discussed in the research study by David Marcum and Steven Smith reported on in Egonomics.

Good to Great: Level 5 Leaders

By Danie Eksteen 

In his often-quoted book Good to Great, Jim Collins trawled through a sample of 1435 Fortune 500 companies to identify those that “made the leap from good results to great results and sustained those results for at least 15 years”. He then undertook an in depth investigation of the 11 companies identified to look for similarities in what distinguished these “good-to-great” companies from their comparison companies. The first of seven aspects that was “overwhelmingly and convincingly” proven empirically by the data, was the presence of, what Collins called Level 5 Leaders or leaders who possess a paradoxical blend of intense professional will and extreme personal humility.

It is important to note that “Level 5” is not just a definitive term but indeed the fifth (and highest) level of a hierarchy of leadership competences and, in the context of Collins’ study, Level 5 refers to Executives that were able to build sustainable organisations that remained successful beyond the Executive’s reign.

The compelling evidence for Level 5 Leadership does not only come from the presence of specific characteristics in the Good to Great companies’ leaders but also in the absence of certain qualities (or in the presence of the opposites) in the leaders of the comparison group of companies, which included a group of companies that were briefly successful but were not able to sustain this.

So what does the intense professional will and extreme personal humility they found look like?

Builders vs. Takers

“It’s not that Level 5 leaders don’t have ego or self interest,” says Collins, but their primary intent and nearly fanatical drive is first and foremost for the progress and sustainability of their institution and not for their own personal interest or ego. It is in their “workmanlike diligence” that they have an uncompromising “dedication to making anything they touched the best it could possibly be”.

Whereas the Level 5 Leaders found significance in what they built and left behind, the comparison group (who we will call megalomaniacs) found significance in what they took, i.e. adoration, status and fame. In nearly three quarters of the comparison companies, Collins found that the incumbent leaders either left behind weak successors or successors set up for failure.

Humility vs. Ego

The Good to Great level 5 leaders had strong and healthy egos yet the language their peers used to describe them spoke of humility and shying away from the limelight rather than being attracted to it. Descriptions included words like: quiet, humble, modest, reserved, understated, gracious and mild mannered. The humility identified did not indicate a lack of ego but rather a balanced ego. This is probably best described in this quote from one of the level 5 leaders identified: “I never stopped trying to become qualified for the job”, he clearly never thought that he had arrived. 

The leaders in the comparison group of companies were often larger than life characters that wanted to be put on a pedestal or become an unreachable icon. In fact, in over two thirds of the companies Collins found a “gargantuan personal ego that contributed to the demise or continued mediocrity of the company”.

Another expression of humility in Level 5 leaders is that they are quick to apportion credit to factors outside of themselves, however when things go poorly they look at themselves and take responsibility. The comparison group was just the opposite: quick to take the accolades for themselves and as quick to blame others for failures.

Can Level 5 Leaders be developed?

For one category of people Collins believes it is possible to develop Level 5 leadership, for another, not. The latter group he describes as those for whom work will always be about what they get (or take) out of it – money, power, admiration. So what can the rest do?

Pondering this question was the basis for a second excellent research study, which we also want to cover here, namely Egonomics, what makes Ego our greatest asset (or most expensive liability) by David Marcum and Steven Smith.

Egonomics: understanding the benefits and risks of ego

The impact of ego on the bottom line

Egonomics describes ego as “the invisible line item in every company’s profit and loss statement”. It impacts every decision, every debate, performance review, negotiation etc.

This was confirmed in the MarcumSmith LC survey of about 850 business executives that was specifically aimed at investigating the impact of ego in the workplace. In this survey 63% of respondents said that ego negatively impacts work performance on an hourly or daily basis and 53% of respondents estimated that ego costs their company 6 to 15 percent of annual revenue – 21% said it cost their companies between 16% and 20%. Sure ego is pretty difficult to measure, but even if it’s only a 6% impact, then ego costs the average Fortune 500 Company nearly $1,1 billion per annum.

In a different research study, which was conducted over more than 20 years, Dr. Paul Nutt of Ohio State University empirically found that 50% of all business decisions fail. The failure in itself is not what is important. (In fact, we have colleagues who use Fail Fast methodologies to help build businesses.) What is important for this blog article, however, are the major reasons Nutt identified for the failures, which were that managers/ leaders:

* Fail to use participative decision making despite understanding the benefits.
* Don’t explore alternatives once their minds are made up.
* Push decisions through by persuasion or edict and not by the relevance of their ideas.

All of which sound a lot like they originate in an “I am the boss/ I have the answers/ let’s get on with it” excessive Ego driven mindset (which is what a number of subsequent commentators on Nutt’s research have concluded).

The ego continuum

In Egonomics, Marcum and Smith set out to determine how one might learn the humility described in Good to Great based on the assumption that ego was bad and needed to be eliminated. However, what they found was that too little ego can be as problematic as too much ego. In fact, ego in the right amount is inherently positive and provides a healthy level of confidence and ambition. However, it is when ego gets out of control and these strengths are overused or left unchecked that it becomes a problem. These are some examples:

* When assertiveness and being able to lead and guide becomes domineering and dictatorial, not listening to others and having to be right at all cost.
* When charisma and being able to get others to follow becomes manipulative and posturing without substance (e.g. Skilling, Enron).
* When courage that allows one to make brave investment decisions leads to reckless trading to cover up losses (e.g. Nick Leeson, Barings Bank).

Other examples of the impact of ego in the workplace include:

* Purporting to hear, but not really listening.
* Thinking that only some people have good ideas. 
* Thinking we know better than the client what they need. 
* Some people’s failures are buried and never mentioned again.

The conclusion of Egonomics was thus not one of choosing humility above ego, but rather that humility as a trait is the point of equilibrium between too much ego and not enough. Thus humility does not mean pushover, weak, or indifferent (as in many cultures it might be interpreted as). Rather, as a point of equilibrium between too much and too little, it includes confidence, ambition and willpower.

Track and manage ego

Dr. Sandy Gluckman says that “when our ego is in the driver’s seat, our genius is in the passenger seat”. The problem is that we all subjectively think our egos are well under control, not doing the driving and not impeding our effectiveness as leaders. So how can we objectively test if we are indeed allowing our genius to drive?

In Egonomics, Marcum and Smith identified the following warning signs that we have stepped out of balanced humility and are allowing either too little or too much ego to do the driving:

* Comparing your performance (personally or the organisation’s) to others rather than to what is possible.
* Not debating but defending at all cost and in the process actually lying (exaggerating, understating, manipulating, fabricating).
* Showcasing your brilliance and only building your own profile rather than focusing on the task.
* Seeking acceptance and wanting to be popular rather than doing what is right (being courageous and honest). 

Similarly Marcum and Smith identified the following ‘antioxidants’ that neutralise excessive ego and manage ego towards equilibrium, to being an asset rather than a liability:

* Humility not for the sake of being humble but for the sake of opening up everyone’s minds to what the writers refer to as “constructive discontent” and organisational progress. (see below)
* Curiosity that is insatiable in asking questions opens up the willingness in others to give access to what they think. Rudyard Kipling referred to this type of questioning as follows: "I keep six honest serving men/ They taught me all I knew/ Their names are What and Why and When,/ And How and Where and Who."
* Veracity, which is “the habitual pursuit of and adherence to truth” and reality in all things. This means creating openness for courageous conversations by always allowing and hearing dissenting voices.

Humility unpacked

So how does the humility look that Good to Great identified and that Egonomics describes as the equilibrium point between too little and too much ego? It is a combination of three things that all turn the spotlight away from me, my success and my brilliance and towards keeping the focus on building something enduring and sustainable in the longer term:

1. First of all the leader’s focus is always firstly on the progress of the organisation and only thereafter on themselves.
2. Secondly complacency (or thinking you have arrived) is never an option – asked what his favourite song or album was, U2’s Bono (after 12 albums that sold over 130 million albums) responded: "We haven’t written it yet."
3. Thirdly the ability to sit comfortably with duality (dichotomy), i.e. objectively hold, argue, explore and openly consider opposing ideas and also accept and be comfortable with the existence of opposing traits in themselves.

How can Strategic Human Capital Consulting help you?

In Good to Great, Collins said that “...under the right circumstances – self reflection, conscious personal development, a mentor, a great teacher, loving parent, a significant experience, a Level 5 boss, or any number of other factors – they [Level 5 characteristics] begin to develop”.

Whether by way of a Leadership Development Programme or Coaching, Strategic Human Capital Consulting and its network of senior and experienced consultants can assist you or your leadership team with designing and implementing the right programme or coaching to build towards level 5 leader characteristics.

PS: We really appreciate the feedback we get to our Blog Articles so we have now updated our website so we can consolidate those comments there and spur further interesting discussions. We would love to hear you feedback or get your input!

RESOURCES

Leadership the Care and Growth Model, E Schuitema, 1998, Ampersand Press / Good to Great, Jim Collins, 2001, Random House / Egonomics, what makes ego our greatest asset (or most expensive liability), David Marcum & Steven Smith, 2007, Fireside / Spirited Economics, using spirit as an asset, Sandy Gluckman PhD, February 9, 2008, http://www.gdaspotlight.com/documents/90-Sandys%20WhitePaper%20pdf%20version.pdf  / Surprising but true: Half the decisions in organizations fail, Paul C Nutt, The Academy of Management Executive, 1999, Vol. 13, No. 4