Wall St. and Business Wednesdays: Secret of CEOs’ Success? It Just Might Be Insecurity by Del Jones
Chicago Bears cornerback Nathan Vasher was disappointed when he was drafted in the fourth round in 2004 and said last week in Miami that it has driven him to the Pro Bowl and today’s Super Bowl.
Indianapolis Colts kicker Adam Vinatieri, formerly with the New England Patriots, has been to the Super Bowl five times in 11 years, but each time he steps on the field, “I have to reprove myself,” he said at a pre-Super Bowl media day.
Then there is three-time Super Bowl winner Tom Brady of the New England Patriots, who has said that insecurity is the reason for his success. “I guess I always feel there’s someone hunting me down, someone right on my footsteps,” the sixth-round draft choice told The Washington Post in 2005.
Insecurity is common among superachievers, not just those who make it to the Super Bowl. But perhaps nowhere is it more rampant than among corporate CEOs, an observation that struck a chord a decade ago when Intel CEO Andy Grove, a Jewish Hungarian immigrant, wrote “Only the Paranoid Survive.”
“We are all insecure,” says Mark Lancaster, CEO of SDL, a 1,500-employee British software company. “We feel inferior to our audience and surroundings, and drive very hard to compensate and to prove we are better than the rest.”
Insecurity among leaders dates back to before Napoleon and touches all aspects of society. Actor Meryl Streep has confessed to being insecure, and many of those taking home Oscars this month might consider thanking insecurity in their acceptance speeches.
CEOs seem to give credit where credit is due. “I am driven by fear of failure,” says Dennis Manning, CEO of the giant Guardian Life Insurance Co. of America, which has annual revenue in excess of $7 billion. “It is a strong motivator for me.”
Manning, unrelated to Colts quarterback Peyton Manning, started as a sales agent and says he has noticed insecurity in other successful salespeople. The feelings only get stronger at CEO. “If I fail, maybe 50,000 people will fail with me.”
He does not know where the fear comes from, only that it can be traced to his boyhood, when he studied harder than others so as not to look stupid. “I’ve never been to a psychologist,” he says, and he agrees with the suggestion that a professional might cure him by taking away the edge that has taken him to the top.
What, me worry?
What do CEOs worry about? Name it.
The PricewaterhouseCoopers 10th annual Global CEO Survey released about a week ago at the World Economic Forum found their overall optimism almost twice as high as it was in 2001. More than 90 percent of the 1,100 CEOs surveyed predicted higher revenue in the coming year.
Sounds like reason for unprecedented euphoria. Yet 37 percent of those same CEOs worry about pandemics, 40 percent about global warming and 50 percent about terrorism, according to PricewaterhouseCoopers. They even are given reasons to worry about the Super Bowl. A Harris Interactive survey paid for by HR consultant Kronos says 5 percent of full-time employees admit to having called in sick with “Super Bowlitis” the day after the game. Other surveys estimate lost productivity as high as $2 billion.
Quantified Marketing Group, a 50-employee restaurant consulting firm, has doubled in size every year for six consecutive years. Surely, CEO Aaron Allen is secure. “I sometimes lay awake at night in a state of paranoid anxiety that someone is plotting against us,” he says. “I still feel insecure that this growth is not enough.”
Some insecurity can lead to disaster. For example, today’s Super Bowl could be lost if an insecure player is goaded into retaliation at the expense of a 15-yard unsportsmanlike conduct penalty. In executives, it can lead to bullying, arrogance and mistakes no less decisive than drawing a penalty flag.
Last year, leaders at Hewlett-Packard were overtaken by insecurity about leaks to the news media. Then-Chairwoman Patricia Dunn resigned when it was revealed that security experts were hired to spy on other board members and journalists.
Mathew Hayward, author of “Ego Check,” says it is common for insecure leaders to pretend they are someone they are not. Sometimes they take it too far. David Edmondson, once a Baptist pastor, resigned as CEO of RadioShack a year ago for putting fictitious degrees in theology and psychology from Pacific Coast Baptist College on his resume.
Benefits of insecurity
But while there is often harm in insecurity, there is also a brand of insecurity that spurs underdogs to success. “The insecure person will always outperform. It’s that insecurity that will drive a person,” Hayward says. “It’s a powerful tension that you’re not really good enough and the way to deal with that is to work extremely hard, get feedback and play with your strengths.”
Martin Frid-Nielsen, CEO of telecommunications company SoonR, says insecurity is an outstanding attribute in a CEO even when it is an unfortunate trait in most others. “Paranoid people often see problems long before their more complacent counterparts. A little bit of insecurity goes a long way to push a company toward perfection, especially when that insecurity resides in the CEO.”
Many heart-tugging rags-to-riches stories are really no more than stories about insecure people who struggle to get into third-tier universities and then work extremely hard to climb past the Ivy Leaguers.
It doesn’t take much for that insecurity to morph into something ugly, such as CEO revenge, the topic of a BusinessWeek cover story in January, or the inability of many CEOs to accept criticism, the topic of a USA TODAY cover story, also last month. Successful people, including Mike Eruzione, captain of the 1980 miracle U.S. Olympic hockey team, have wondered out loud about the fine line between successful childhood friends and those who wind up in prison.
Former General Electric CEO Jack Welch had a stammer. Charles Schwab is among those who are dyslexic.
Even though he owns three companies including a Chicago public relations firm, Robert Smith says he remains insecure because he is African American.
“I’ll be honest. I’m insecure about people finding out that I’m black and not wanting to do business with me,” says Smith, who never uses his photo on Web sites or promotional material.
Not all insecure CEOs come from humble beginnings. Ask Donald Trump for his short list of business advice, and it includes a prenuptial agreement before marriage.
“Let paranoia reign,” he told USA TODAY during the 2004 first season of “The Apprentice,” his reality-TV show built on the insecurity of contestants who face weekly firings. “You have something others want. Don’t let them take it away.”
Of course, just as many athletes are secure, so are many CEOs. “I don’t come from that paradigm,” says Mary Wilderotter, CEO of Fortune 1,000 company Citizens Communications. “It is common in certain leaders and companies. Some have a tendency to rule more by fear than by motivation. That’s usually a sign of insecurity.”
“I am more motivated by challenges and the ability to make a difference,” says DeWayne Nelon, CEO of Ortiva Wireless.
Mounting pressure
Every CEO enjoys a sense of accomplishment upon getting the ultimate promotion, but for most it doesn’t last long. The pressure quickly mounts from customers, employees and investors, says Ciena CEO Gary Smith, who kept his job through a fiber-optics depression that caused sales of the company’s core product to plummet from $1.5 billion in 2000 to $18 million in 2001.
“Healthy doses of corporate insecurity help keep a company fresh and competitive and ensure that the leadership and drive ... remain active,” he says.
Few would argue that NFL coaches have no reason to feel insecure. They are, on average, replaced nearly every two years.
CEO job security is only slightly better. In 2005 and 2006, 132 of Fortune 500 CEOs were replaced, and the pace accelerated to 72 last year from 60 in 2005, according to executive search firm Spencer Stuart. The average age of the CEOs who left, 55, indicates that most of the exits were involuntary.
Outplacement consultant Challenger Gray & Christmas tracks CEO turnover at smaller companies and says there were 1,478 departures in 2006, up 12 percent from the record 1,322 departures in 2005.
This article was published by The Gannett News Service
Del Jones
Wednesday, February 7, 2007