Helping CEOs who are Jerks

Unless a business leader cares at least three times as much about their customers and employees as their own ego, they probably don’t have what it takes to succeed

The development this week of a Utah tech founder resigning in disgrace after issuing a conspiracy-mongering, anti-Semitic public email is deeply sad. As a relative newcomer to Utah of less than a decade, I applaud the #SilconSlopes startup community for condemning this embarrassing rant. But there’s a deeper issue we need to come to grips with: CEOs and other business leaders who are bad actors.

Years ago I read a Quora forum where someone asked what Robert Redford was like in real life. One answer was insightful: “What would you be like if no one had told you that you were wrong since 1977?” Exactly. (And nothing against Redford; love him as an actor but know nothing about him as a person.)

The problem of CEOs who are jerks is misunderstood and misconstrued. On the one hand, the loudmouth egotistical CEO is so prevalent a perception as to be a popular media meme. On the other hand, bad actors are often not only tolerated but lauded within their companies and business communities. Dilbert’s boss man is an incompetent blow-hard. I’ve never met that CEO. The CEOs I know are wonderfully talented, highly intelligent, work incredibly hard, and are gifted leaders. Even the reputed excessive and sometimes crushing drive of a Steve Jobs or Elon Musk has very much to be admired (though I believe deeply there is a better way). While I don’t know Dave Bateman, the aforementioned Utah tech leader who resigned in disgrace this week, these same attributes of talent, intelligence, and dedication almost certainly apply to him, or at least once did.

The common denominator is that when a leader becomes self-focused, they begin making stupid moves. And few will tell them when they’re wrong. It is my view that unless a business leader cares at least three times as much about their customers and employees as their own ego, they probably don’t have what it takes to succeed. (Unfortunately, that’s not always true. Some goods like oil and cotton can be produced with Neanderthal management tactics by egotist leaders to maintain enough success to keep them in power and prospering. The leaders still do great harm, but they don’t always fail either.)

The common denominator to CEOs who harm their companies is that they can only pull it off with the active help of others.

Esse Quam Videri or “To be rather than to seem”

They have it right in North Carolina: Esse Quam Videri or “To be rather than to seem”. Companies that hold a worthy and ennobling purpose, create an intense level of visibility to the value they deliver to their customers, and create a culture of ownership for solving problems and delivering solutions have no end to the good they can accomplish together.

The sad irony is that in pursuing even a modicum of self-aggrandizement these leaders debase themselves, as Bateman has, and their companies. I don’t know what rabbit hole he went down to rant about a Jewish conspiracy to euthanize the world through the Covid-19 vaccine. I do know that self-focused leaders undermine their usually high intelligence and make very stupid moves at an increasing rate. They and their companies are invariably capable of making a much greater impact for good on the world but when they shift their aim inward, they stumble. Badly.

Nietzsche said that a man’s character is best “measured by how much ‘truth’ he can tolerate.” Factual accuracy, especially in the subtle details that are so important to successful strategy execution, is the first casualty of ego. I knew one founder who became irate, even threatening, when his Engineering and Finance teams created an accurate bill of materials on which to base their cost of goods and gross profits financial reporting. The founder acted the same way when IT made a dashboard showing actual weekly production — he preferred to calculate production at 7X peak daily production and the dashboard, of course, didn’t count weekends and factory downtime, only what was actually produced. I knew a CEO who asked his head of Marketing to make a sales forecast for the year. It came back lower than the CEO liked and he challenged that it be doubled. The Marketing head promptly complied. When Finance later highlighted that the company was missing sales targets by 50% (and jeopardizing its cash position by procuring excess inventory to meet the inflated forecast), Marketing replied they never believed the forecast. “We just gave the CEO what he wanted.” These are extreme examples, but whether subtle or extreme, I all too often see companies incur great self-inflicted damage by failing — at every level of the organization — to have the courage to see the world as it is rather than as they wish it were.

I’m not a CEO hater, quite the opposite. The thing is, the jerk CEO is most of us. I’m confident it’s me if I had billion-dollar startup success, certainly in my 20’s or 30’s. Warren Buffet once said that someone who is a jerk will be a bigger jerk if he becomes a billionaire. I would extend that to say that a young man who through hard work, leadership and skill becomes a very wealthy and powerful tech CEO has a bigger chance of becoming a jerk and going on to do great harm. It’s similar to the young sports star or rock star. Rock band Bad Company’s “Shooting Star” poignantly and poetically tells the story of young rock, sports, and tech stars cracking up over ego.

Well Johnny died one night, died in his bed

A bottle of whiskey, sleeping tablets by his head

Johnny’s life passed him by like a warm summer day

If you listen to the wind you can still hear him play

What do we do?

CEOs and other business leaders desperately need people who will tell them the truth. That’s rare because there’s a rapid Darwinian process that leaves such leaders surrounded by yes-men. In the wisdom of Proverbs, “Faithful are the wounds of a friend; but the kisses of an enemy are deceitful.” None of us are immune from the allure of pride and ego. And all have a role to play in helping leaders, especially CEO founders, avoid its pitfalls. Here are my initial thoughts. I would be very interested in yours, whether in the comments or a live conversation:

• Culture. We need to stop the mutual admiration club of unquestioned adulation to financially highly successful CEO rock stars. We need to help leaders prize their character and that of the companies they lead as the most priceless asset to be protected, preserved, and expanded above all.
• Investors. Venture capital investors need to be examples of groundedness themselves and guide and coach their CEOs in the supreme import of character and humility. The VC that is successful in keeping their CEOs grounded has an enormous competitive advantage.
• Push back. Employees at all levels from line to executive need to be courageous and thoughtful in finding the right way to let the emperor know when he has no clothes.
• Social. The young woman at a social function needs to throw her Diet Coke on the (married) billionaire tech founder hitting on her.
• Family. The wife of a rising star business leader can bring him back down to earth better than almost anyone.
• Public Stages. Political parties, candidates, charities, and civic organizations need to make themselves aware of the character of their supporters and not accept the donations or leadership of bad actors.
• Learn. Read Ryan Holiday’s Ego is the Enemy. It’s a tour de force of the history of ego and how ego can make a wreck of otherwise highly capable leaders and their companies. Then read Liz Wiseman’s Multipliers for a deeply insightful look at how we as leaders can choose whether to be a multiplying effect for good in the world or a diminishing effect for evil.
• Visibility. Build visibility into the cultural fabric of your company with reporting that frame results in terms of delivering value to customers and communications structures that actively and automatically (i.e. calendared) facilitate open dialog and feedback.
• Audit. The rigor and precision of GAAP financial reporting and a financial audit by a qualified CPA firm are vital grounding forces for good in the business world. Likewise for another important profession, I’ve seen competent attorneys bring CEOs out of their god-complex like nobody’s business with sound and frank legal advice.
• Mentors. Seek out good mentors who embody wisdom and strength of character. Every executive needs to purposefully identify three mentors to guide and keep them grounded.

Companies exist to do good in the world. Leaders exist to help teams move mountains and work miracles in delivering solutions to customers. The world needs this dynamic to flourish. However, the leadership dynamic at play creates a pedestal that sets CEOs up for an ego-driven fall. Let’s all do our part to be true leaders ourselves and help the leaders we work with not undermine the great good they are capable of contributing to the world.