Why Do Many Smart Leaders Fail… While Others Succeed?

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Are you a leader seeking to improve your skills, a person who wants to become a leader, or an individual who desires to know how successful leaders should perform and treat others? Leaders are everywhere—workplaces, churches, non-profits, schools, sports, politics, associations, and government agencies.

One of my favorite authors, John Maxwell, in his bestseller, The Right to Lead, determined “Leadership requires the ability to influence others in positive ways, facilitate an organization’s growth, and create change. Everything falls and rises on leadership. The key to becoming an effective leader is not to focus on making others to follow, but on making yourself the kind of respectful person they want to follow.”  Bill George, Harvard Business School professor, reported “Successful leadership is leading with the heart, not just the head. They possess qualities like empathy, compassion, humility, and courage.” Peter Drucker in his book, “Management,” outlined, “Effective leadership is not about making speeches, being liked, or trying to look good; leadership is defined by results not attributes.” Joanne Ciulla, Rutgers Business School professor, noted “Leadership is not a person or a position. It’s a moral relationship between people, based on trust, respect, obligation, commitment, emotion, and mutually-shared visions for the future good of the organization.”

Ideal leaders create exciting environments where everyone is inspired to travel into the future “as one!” The right leaders can fire up organizations to experience wild success, filled with happy employees and consumers.  All the players know where they are going and have significant input in planning the organization’s future. They feel they’re a part of a professional family whose leaders value them as individuals and their opinions, even if they’re contrary to the leadership’s thinking. Effective leaders in these positive organizations are competent, respected, and trusted.

While writing my book, “The Art of Building a Great Business,” I was very curious about what successful leaders were made of. Is leadership an inborn genetic trait? Do parents and peers mold people into becoming leaders? Do leaders grow and evolve over time? Does high intelligence, ego, and/or need for attention play into molding leaders? Or is it a combination of some or all of the above?

I wanted to be a great leader in my family of companies but never achieved that lofty goal. In my quest for knowledge, I read 40+ books on leadership. Over a ten-year period, I interviewed many Fortune-500 CEOs like Jack Welch of GE and AG Lafley of Proctor and Gamble. I met researchers who studied leadership, such as Jim Collins, who wrote the best-seller, “Good to Great.” I served as an administrator with an SC Governor, four state agencies, and a non-profit in my early work years. I don’t share my past to impress you but rather I was blessed with many opportunities to witness a wide range of different leadership styles—great, good, average, and downright terrible! Incompetent leaders who make bad decisions can wound and destroy organizations and drive valued, talented people away. All organizational stumbles and failures are due, in at least some part, to human error. Circumstances beyond leaders’ control, like Covid and the economy, can be contributing factors, but people are responsible for decisions that shape organizations. Whether their actions are foolish, selfish, impulsive, or wise depends on the leaders who are making them, and intelligence is certainly a factor—but not the only asset.

Sydney Finkelstein, Director of the Center for Leadership at Dartmouth College’s School of Business, wrote an excellent book, “Why Smart Executives Fail” based on more than 50 major organizational failures. His university research team interviewed hundreds of insiders across many different industries, searching for common trends among the failed organizations and their leaders. Jim Collins also conducted similar in-depth studies and dedicated an entire book, “How the Mighty Fall,” to the stages of decline undergone by many once-successful organizations.

Unfortunately, no matter how intelligent leaders may be, when it becomes apparent that changes are needed to lead the organization in a different direction, they may refuse to accept new realities and remain stuck in the past. Often, they hold on to outdated ideas that were brilliant in the beginning but have since lost their ingenuity and innovation. They are frequently afraid of the future, bury their heads in the sand, and resist input from others that leads to “taking the safer routes.”

The well-known Rhodes Furniture Company experienced this disastrous leadership after 100 years in a thriving business. During our interviews, managers reported that ten Rhodes’ stores surrounded the Atlanta-based headquarters. Corporate executives never visited local stores and employees to solicit advice on what changes were needed to remain competitive. Headquarter leaders arrogantly thought they had all the answers and didn’t need input as they drove a once very successful business into the ditch. Competition wiped them out!

You have to pause and ask the questions: “Is your organization growing and thriving with excited, enthusiastic constituents? Or is it stumbling along doing the same old things barely paying the bills with outdated leaders who cannot envision a bright, new future?” Organizations don’t suddenly fail. Failure is usually a slow drain of revenue and dissatisfied, talented people who gradually leave to find places where they are welcomed and appreciated.

Let’s visit some of the leader traits that promote failure.

Inexperience: Harvard professor Dr. Bill George noted that “many imposters fight to get to the leadership level to obtain power, recognition, prestige, and money but upon reaching the top, they have no idea how to effectively lead!” I mistakenly promoted brilliant, hard-working PhD-level researchers to leadership positions who then created chaos within my businesses upon reaching their “Peter Principle.” They were excellent workers but simply didn’t have “the-right-stuff” to lead!

Pride and Arrogance: Jim Collins, in his bestseller “Good to Great,” conducted in-depth studies of successful and failed organizations. His team determined humility was the most significant asset of great leaders. Many prideful, arrogant individuals believe they have all the answers and plan in secret, treating their employees and constituents “like children.” Harvard University leadership experts noted these leaders’ primary goal is to “look good” at the expense of others and the organization while hiding anything that can tarnish their reputation. Because these individuals believe they’re so smart, they “rule” over others by telling them what they can and cannot do—They “dictate” by “announcing decisions” in isolation made from the top of an authority pyramid without input versus humbly from the bottom.

Resistant to Input: Leaders who believe they’re right all the time fiercely oppose differing opinions. Ken Blanchard in his book, “The Heart of a Leader” indicated that successful decision-makers are servant leaders who build positive environments where everyone is respectfully heard and valued. They solicit others’ opinions to build ownership and passionate teams that have heartfelt purposes. Before we implemented leadership promotions, policy changes, or strategic plans in our companies, varying points of view were encouraged.

Surround Themselves with “Like-Minded-Individuals”: General Colin Powell said, “Many leaders tend to talk more, listen less, and surround themselves with ‘Yes People’ who passively agree with them.” These individuals won’t offer differing opinions or tell a leader “The Emperor isn’t wearing any clothes!” Dr. Travis Bradberry determined “Some leaders become so obsessed with loyalty that they expect mindless support for every decision they make. This alienates valuable employees and consumers whose opposing voices could help organizations grow and prosper.” While it was uncomfortable and startling at times, I learned the importance of listening and surrounding myself with challenging leaders who were smart, creative, and could think “outside the box!” When we all agreed on “win-win” strategies, the chances of success increased. Our productive teamwork helped us survive the disastrous “2009 Great Recession.”

Blame Others: Blanchard noted “Leaders are often reluctant to admit they’re wrong and ask for forgiveness.” Professor Dr. Thomas Harris reported, “Great leaders take responsibility for everything they do and for all that happens under them. They don’t blame others, their subordinates, the environment, or the economy. They take ownership of mistakes and failures. When you have a leadership team that blames instead of taking responsibility, you have an organization that’s diving towards failure.” Scholars echoed that the most damaging leaders’ remarks when conflicts and mistakes occur are: “We did everything right” or “We didn’t do anything wrong!”

Bully Others: Professor Dr. Michael Kruger stated, “Bullying leaders wield their positions to manipulate, dominate, and intimidate those under them as means to accomplish what they want.” They’re very clever, devious, and skillful. They don’t attack horizontal leaders, who are equally guilty, while witnessing verbal abuse towards others and say or do nothing. Instead, they terrorize, ambush, and demean victims under them or leverage their sinister powers through allies on committees. According to Kruger, bullies have two sides to them: One is domineering, disagreeable, and aggressive towards those who threaten them, while other personality traits are charming, friendly, attentive, and flattering. They’re welcomed by those who become avid defenders during conflicts and believe they’re great people. Bullies “foster a culture of secrecy and self-protection where abuse quietly happens behind-the-scenes undetected by others.”

Run Off Mavericks: Leadership researchers report “Arrogant, controlling leaders will ruthlessly eliminate those who are not completely behind their decisions. They lead by choice: ‘Get in line with our demands or leave!’” Toxic environments are created against those who offer differing views and remaining with the organization becomes unbearable. Defective leaders spread damaging gossip and slander against those who oppose them. They often weaponize supportive followers to create “We versus the enemy” atmospheres and encourage their allies to attack, avoid, and discredit those who disagree with them. As Kruger noted, “The results are broken relationships and debris fields of dead bodies.” Over time, individuals avoid challenging them for fear of retaliation and being labeled “trouble-makers!” Most of the talented people leave and those remaining behind reluctantly give in! When leaders begin to equate disagreement with disloyalty, or worse, undermining their authority, eventually, “there is no one left to challenge the status quo and ask the tough questions to take the organization into new, successful paths. The remaining ‘Yes People’ who have been brainwashed or unaware of the flawed leaders’ actions contribute to a complacent, stagnant ‘Zombie Organization’.” This leads to a lack of growth and excitement, while income to pay the bills dwindles.

Absence of Trust: Stephen Covey in, “The Seven Habits of Highly Effective People,” noted “Trust is the glue of life. It’s the most essential ingredient that holds all relationships and organizations together.” Harvard University Abbey Lewis reported recent studies verify, “Trust is the most vital form of capital leaders have. Employees and consumers in ‘high-trust organizations’ feel safe to take risks, express themselves freely, and innovate. When trust is prevalent, people will collaborate and communicate in positive ways. They experience less stress and more energy, higher productivity, fewer sick days, increased engagement and personal satisfaction, and lower burnout than people in low-trust environments.” Leadership expert David Grossman determined “Trust takes years to build, seconds to break, and forever to repair! Trust must be earned; it comes from a conscious effort to walk your talk, keep your promises, and align good ethical behaviors with the organization’s purpose and values. In contrast, employees and constituents in ‘low-trust-organizations’ are often bogged down by conflict, gossip, and infighting.” Trust is broken when leaders: cover up mistakes; secretly operate; leak sensitive information; discredit, muzzle, demean, or slander messengers with opposing views; micromanage; are dishonest; lack transparency; spring unexpected decisions on people without input; and throw others “under the bus” to promote their reputations, agendas, and ego. Since some individuals play “both sides of the fence,” leaders’ devious actions, both publicly and secretly, will spread like wildfire!

Lack of Compassionate, Caring Attitudes: Eleanor Roosevelt once said, “To handle yourself, use your head. To handle others, use your heart.” Leadership expert Laurel Donnellan noted that compassionate leadership influences people so they inspire and influence others. Wise leaders positively impact themselves and others practicing compassion—a style that improves everyone’s morale and productivity. Unfortunately, many introverted managers, who are elevated to senior-level-leadership positions, aren’t compassionate, fail to build relationships and engage with people. Or, worse, cold-hearted individuals, who ruthlessly use fear, bullying, and control to force their teams into submission. They’re unable to see the importance of expressing their support, compassion, and caring attitude towards their constituents and employees, especially in troubling times.

Lead By Position: Successful individuals see themselves as “servant leaders” who humbly operate at the bottom of an authoritative pyramid. Purdue University’s Center for Leadership defines servant leadership as “A philosophy and set of practices that enriches the lives of individuals, builds better organizations, and ultimately creates more caring atmospheres.” The servant leader focuses on the growth and well-being of employees and other stakeholders. To summarize how leaders fail when demanding allegiance from followers because of their lofty titles, we interviewed a retired human resource director who served under “ten corporate presidents” over a 30-year period in a large insurance company. When I asked him what common traits among all ten CEOs were, he noted with disgust, “All were arrogant with big egos! They thought they had all the answers and didn’t need others’ opinions. They used their positions to rule from the top of the ladder.”

No Respect: According to Harvard professor and leadership expert Dr. Bill George, “Authentic, respectful leaders remain true to good values and mission even in the face of difficulty.” Employees and consumers know when leadership is “saying one thing” and “doing or plotting another.” Psychology Today reported “Successful, respectful individuals choose to do the right thing, honor others, and stay above the fray, even when they want to jump down into the mud with those who are taunting them. They treat others with compassion and care.”

Poor Communicators: Inc. Magazine noted “Effective leaders require being good listeners and excellent communicators. Clear communications are needed to manage employees and consumers, assign tasks, voice expectations, and properly communicate their thoughts and plans, while inspiring people.” Great leaders seek others’ input, incorporate their suggestions into planning the organization’s future, and implement the goals with ongoing feedback. Dale Carnegie determined “Often leaders don’t understand that cooperation failure is caused by not establishing the right communications. Carnegie believed that 9 out of 10 businesses and other organizations’ failures and struggles are due to a lack of good leadership communication skills.”

Fail to Manage Conflicts: Indeed.com Career Development Team shared “Conflict management is a skill that helps leaders create unity amongst everyone to achieve goals, develop mutually-agreed-upon strategies, and streamline effective processes. When leaders gather individuals together with varying personalities, there’s potential for conflict, but knowledge and mastery of conflict management insight help leaders avoid problems altogether or resolve them quickly when they occur.” Sydney Finkelstein, Dartmouth College Professor, wrote in his bestseller, “Why Smart Executives Fail, “Many leaders don’t have a sense of reality in their organization. Information is secretly filtered and managed by them which sends organizations in the wrong direction.” Regretfully, leaders who are blind to brewing conflicts allow their egos to inflame smaller problems into disasters by “throwing more gas on the fire!” Had they sensed danger after implementing a bad idea, parked their egos, re-grouped to design better plans, and played their cards correctly, outcomes could have been far different!

Concluding Comments

As I summarize our leadership research, my focus is on describing the “ideal leaders.” My humble comments are based on extensive readings and research, working with many different leaders, and experiencing countless failures during my leadership journey. The following provides insight into how mature leaders think, act, grow, and treat others. They are the ones whom I admire, respect, and seek advice from!

Are Servant leaders: It’s the highest form of leadership that involves sincerely caring for people and serving others. Leaders are positive coaches who actively help others become the best versions of themselves who, in turn, build great organizations. Humble leaders know their strengths and weaknesses and acknowledge them. Rick Warren in “The Purpose-Driven-Life” said, “True humility is not thinking less of yourself; it’s thinking of yourself less.” Humble leadership power is what people are seeking. This style invites learning, shares credit for successes, takes responsibility for failures, and inspires leadership in others.

Exhibit Passion: Leaders motivate others by demonstrating infectious passions and happiness in workplaces amongst the people they’re leading. It’s rewarding to work with passionate people who have similar values and believe in the organization’s purpose and future vision. 

Promote Learning: Leadership gives people platforms for sharing and experimenting with novel ideas. We developed discussion reading groups in our companies and purchased bestselling books to help individuals grow personally and professionally.

Listen: Great leaders hear their constituents’ issues with quality time without interruptions. Encouraging listeners to avoid discounting others’ opinions by saying, “I disagree with you” or “Your idea won’t work.” Instead, competent leaders seek two-way discussions exploring concerns, suggestions, and opposing ideas with open minds. I learned to wait to express my thoughts until everyone had shared their opinions during discussions and debates.

Hire the Right People: Jim Collins’ bestseller, “Good to Great,” recommends that experienced, knowledgeable leaders thoroughly screen job candidates and place them into jobs that best fit their skills, education, and experience. Ronald Reagan said, “The greatest leader is not necessarily the one who does great things but the one who motivates others to do great things.” Successful organizations are filled with talented, smart, and productive individuals who love their work, have fun, and collaborate with colleagues to achieve results.

Advance Innovation: Good leaders encourage creativity and change through brainstorming. Our desire was for everyone to consider new perspectives and take calculated risks to grow our organizations. Monitoring successful competitors became important to help organizations evolve as consumers’ needs changed. Many unsuccessful leaders encourage disaster when they “take the safest routes” or live in the past “doing the same old things” and “expecting different results!”

Promote Transparency: Being open and honest is critical for leaders as role models for employees and others to do likewise. Leaders welcome differing opinions and coach others to respectfully express their viewpoints.  Employees and volunteers are never surprised by leaders’ decisions.

Discourage Micromanagement: Teddy Roosevelt noted, “The best executives are ones who have enough sense to pick good people to do what needs to be done, and self-restraint to keep from meddling with them while they do it.” When we hired employees, leaders coached alongside them and once newcomers understood and agreed to our companies’ values, purpose, and mission, we released them to blossom.

Can Be Trusted: Harvard researchers discovered “Trust starts with creating safe environments where people are valued, feel comfortable expressing themselves, and taking risks. It means leaders being transparent and authentic. It requires establishing clear expectations and following through on commitments.” All team members rely on their leaders to be fair, predictable, and trustworthy.

Create Caring Purposes: Our company’s original objective was greed—“make money!” As we evolved, our teams agreed on an exciting higher purpose “Creating Opportunities to Improve Lives.” Our culture began to flourish with happy employees, customers, and consumers. Researchers determined, if you have an inspiring purpose everyone owns, money will follow. We placed our employees, community, and customers as our “highest priorities.” It was rewarding when we paid off layaways for the poor, helped employees through difficult times, picked up roadside trash, distributed Christmas presents for the needy, and gave large portions of our profits to charities and staff. We all felt “CARE” was our middle name. We became a “close-knit-professional family” having fun while making a profit in the process! Our goal was for everyone to enjoy coming to work.

Develop Strategic Thinking: As a wise friend shared, “If you go into forests, without a compass, you’ll wander in circles.” Successful organizations don’t wander—they have clear roadmaps! Leaders solicit everyone’s input to carefully plan the organization’s future. They develop flexible, accountable strategies with specific steps that guide the organization’s journey. The flexible plans are executed with ongoing input. Our goal was for everyone to row eagerly as “united teams” in the same direction. “Our efforts worked!”

Are Budget-Minded: Leaders carefully build 2-year budgets and monitor revenue, cash flow, and expenses to ensure strategic plans are financially supported and to recognize financial problems before they occur.

Have Good Character: Great leaders have histories of being reliable, ethical, honest, and won’t deceive others with hidden actions or agendas. Aristotle determined “In order to have good character, one must not only know and desire the good, but pursue it in both private and in public actions. To be of good character means one’s habits, actions, and emotional responses are united all the time.”

Many thanks to my employees, family, and friends who molded me over decades into becoming a servant leader! Now retired, it’s been an “extraordinary journey” and an honor to have served alongside them! “Praise God!”

The bottom line: Many factors contribute to success and geniuses can fail. Likewise, you don’t have to be brilliant to propel your organization to success. As Finkelstein noted, with hard work, humility, and innovative thinking from others, you are well on your way to leadership success! Being a wise, outstanding, and humble leader takes “the right stuff” to bring people together with a united, heartfelt purpose.

Mike DuBose is a Deacon with the Presbyterian Church and has been a staff member with USC’s graduate school since 1986 when he began his family of companies. He is the author of The Art of Building a Great Business. Please visit our blog for additional published business, travel, and personal articles, as well as health articles written with Surb Guram, MD.