Org Hubris: A Recipe for Disaster

In my previous post (“Org Turnaround: It’s All in Your Head”), we discussed the dangerous situation in which an organization (by way of its principals) has little self esteem. Low self esteem (personal and/or organizational) engenders a “beaten” mentality. Every decision made in this mindset threatens the company.

Today’s post is about the opposite situation: When organizations (and their principals) have way too much self esteem.

Let’s start with possible reasons why an organization might operate under this mindset:

  • At one time, it was a leader. And though conditions have changed, it doesn’t recognize them.
  • Individually, the principals lack confidence — and realize they’re in over-their-heads. So they “make up” for this by living in fantasy world. This approach, they feel, protects their position in the company.
  • The chief decision makers falsely believe in a “mind over matter” approach to business. If they believe all is well, reality will follow.

Let me start by saying that I don’t view a situation, automatically, from a negative perspective. Even in companies with major issues, I look for those gems that — in spite of the environment — are keeping the place breathing. Earning the reputation as “naysayer” won’t help anyone.

But I also believe that any organization, irrespective of its (real) success in the marketplace, can use help…can always improve. All the more true for organizations truly in the weeds.

Here are some indicators for concerned executives:

  • High turnover
  • Poor employee satisfaction and/or engagement scores (and, relatedly, poor productivity)
  • Difficulty recruiting
  • Negative research on constituents’ opinions (note: difficulty even getting participation in surveys should be a warning of imminent self-destruction)
  • Regular, major reorganizations
  • And, of course, poor/diminishing financial condition

An organization with too much self esteem (borne by ignorance and arrogance) will create a culture in which no one will speak up. It’s the story of the “Emperor’s New Clothes.”¬†But, in this parable, forget the young child who challenges the king’s thinking. Instead, the kingdom becomes more and more threatened by its own hubris — and its serfs’ “shut up and save yourself” modus operandi.

Sure, consultants will be engaged, periodically, to address problems that even the key decision makers aren’t able to ignore. And there’ll be lots of talk about “transparency,” and “openness,” and the like. But, be not deceived: Consultants are often role players paid to support the ongoing masquerade. (“See? We even hired so-and-so to help us with x.” Consultants who speak the truth will not enjoy repeat business.) Nice words conveying an open, receptive leadership are just those — and little more — to maintain the illusion.

“…Instead, the kingdom becomes more and more threatened by its own hubris — and its serfs’ ‘shut up and save yourself’¬†modus operandi.”

Organizations that want to improve aspects of their business will improve those aspects. Excuses about the “complexity” of the organization, the “culture” (“we’ve always done it that way”) and other barriers to improvement are, in a word, sad.

Employees and principals who oppose¬†improvements will leave the organization…either on their own accord, or by way of the decisive, intelligent leadership at the very top not afraid to confront its problem children.

Gordon Ramsay, the outspoken British chef/restaurateur who visits desperate restaurants on life support and devises improvements, realizes this more than any other underlying threat. Owners who just won’t acknowledge that different conditions are now threatening their livelihood.

Ramsay said it succinctly when he noted: “Ignorance plus arrogance is the recipe for one thing — and one thing, only: Chapter 7 bankruptcy.”

Take heed my friends.