Philosophers and social scientists have debated the role of leaders for centuries. Plato, writing his Republic in the fourth century B.C., argued that the ideal city would have an elaborate system to choose its leaders that made any individual leader replaceable. Thucydides, writing just a bit earlier than Plato, took a very different position by describing how individual Athenian leaders, particularly Pericles, played a crucial factor in the course of the Peloponnesian War, as their varying skills and preferences led directly to Athenian victories and defeats.
Many, many have followed the Greeks’ lead, but two nineteenth century thinkers have become more contemporary champions for each viewpoint. Karl Marx argued for the unimportance of individual leaders, proclaiming, “Men make their own history, but they do not make it just as they please; they do not make it under circumstances chosen by themselves, but under circumstances directly found, given, and transmitted from the past.” Thomas Carlyle, the Scottish writer who named economics “the dismal science,” famously declared for the other side: “The History of the world is but the Biography of great men.” Our instincts might lead us to side with Carlyle (and Thucydides), to think that leaders matter. Certainly, many leaders (especially the successful ones) make this claim—just have a look at the business section of your local bookstore. But social scientists who systematically study leadership generally agree with Marx. From psychology to political science to management to economics, researchers who study leadership argue or assume that individual leaders are surprisingly unimportant.
Strikingly, social scientists in every field have identified different versions of the same three forces that, together, minimize the impact of individual leaders. Although these three forces have only sometimes been explicitly identified, they underpin every social science theory that argues or assumes the dispensability of individual leaders. The combination of all three forces usually means that individual leaders have little or no real impact on the organizations they lead. The forces are:
1. The external environment. The external environment forces leaders to act in response to its pressures, leaving individual leaders little control or influence on policy and implementation.
2. Internal organizational dynamics. Leaders respond to the bureaucratic politics and interests of constituencies within their organization, making the identity of the leader unimportant as long as the internal dynamics of the organization remain constant.
3. Leader selection systems. The process by which leaders come to power homogenizes the pool of potential leaders. Different people might have acted differently, but those who would have chosen differently never gain power in the first place.
Forces 1 and 2—the external and internal forces—can be enormously strong and severely limit a leader’s impact. This problem is compounded by force 3: how organizations choose leaders. Organizations tend to select their leaders carefully, so managers become “more and more homogenous” the higher you go. Or, to put it another way, organizations try to weed out the crazies, the incompetent, or anyone who just doesn’t fit in. That means that CEOs and other leaders tend to be drawn from a pool of candidates that contains little variation. Established interests within organizations move to control the succession process to ensure that the winners are conducive to their interests. Management is important, but individual managers need not be.
Given the power of the three forces, it might seem hopeless to believe that a leader could have any impact. Yet sometimes, particularly during crises, forces 1 and 2 are weak enough to allow leaders considerable discretion. And when someone manages to bypass the process that filters candidates for office, a leader who is very different from all the people who almost won can gain power. If that leader is sufficiently unconstrained, he or she can have a large impact.
What do we mean by leader impact? Should we give a leader credit or blame for everything that happens while he or she is in power? This would ignore everything that the social science arguing for the relative unimportance of leaders has to teach us. Instead, I thought that the definition of leader impact grows out of the influence of force 3. Not everyone is equally likely to become leader. We know who actually gained power and what happened afterward. If things had fallen out differently, someone else might have filled the same role. Leader impact can best be thought of as the marginal difference between what actually happened and what would have happened if the most likely alternative leader had come to power. A leader has impact because what happened to the organization on his or her watch is very different, because he or she was in charge instead of one of the other people who plausibly might have been.
GE puts extraordinary effort into picking good managers and good CEOs. So how important was Welch? Asking this question isn’t to suggest that Welch wasn’t a superb manager. The fact that an organization as thorough as GE thought he was the right person for the job is, by itself, evidence that he was, even without his record of success. Welch’s impact wasn’t GE’s success, though, it was the difference between how well GE did under his leadership and how well it would have done had GE picked someone else. Given GE’s skill at picking managers, there is every reason to believe that this alternative CEO would also have been a very good leader. Maybe he or she would not have been as good as Welch—but that still leaves a lot of room for the alternative CEO to have been very good indeed.
If you’ve read the book Moneyball or seen the movie, you’re already familiar with a version of this idea. One way of analyzing a baseball player’s value is to measure him against a “replacement player.” So if you want to know how good your third baseman is, you’d compare how well he hits and fields to a really good minor league player whom you could add to your team for virtually no cost. You should only pay your major league third baseman for the marginal value he adds over that replacement player. Here, we’re measuring leader impact by comparing a particular leader to a “replacement leader”—the person who could have had the job instead of the person who really did.
So, instead of just thinking of leaders as good or bad, or even high impact or low impact, think of each leader as existing on a distribution, one that might look something like a bell curve, of all of the people who might have gotten the job. Most leaders will be at the fat part of the curve. They, or someone very like them, were pretty likely to end up in charge. If, like Welch, they are the product of a careful process of selection and evaluation, then those leaders might be very good at their jobs.
But they’ll also be roughly interchangeable with other leaders who have been similarly chosen, and so have a low individual impact. We can call such leaders—one who are near the mode of the distribution—Modal leaders. Others, the high-impact leaders who exist at the tails of the distribution, we can call Extremes.
How Extreme Leaders Are Different
Splitting leaders into Modals and Extremes can help us understand many traits often associated with leadership. Charisma, for example, has been a focus of leadership studies since sociologist Max Weber wrote about leadership in the nineteenth century. The truth is, most leaders are not charismatic. The rare leader who is, however, can have extraordinary influence, sometimes having followers who are totally obedient to his or her wishes. Narcissistic leaders in particular often display remarkable degrees of charisma, and such narcissistic leaders can often take their organizations to great successes or equally great failures. Charisma is an intensifier. Charisma is simply the ability to convince people, by force of personality, to do things that they could not be persuaded to do by rational argument. It increases a leader’s ability to convert his or her desires into policy and allows a charismatic figure to avoid being filtered out when a noncharismatic candidate would be. Charisma helps Extremes bypass filtration and, once they have done so, to influence policy. In and of itself it is neither a good nor bad quality for a leader.
Yet there are circumstances in which such disorders can be beneficial. Mild paranoia, for example, might aid the aspiring coup leader or revolutionary. This means that some LFPs might even preferentially choose Unfiltered candidates with disorders such as narcissism or paranoia that improve short-term impressions at the cost of long-term performance.
Extremes are also likely to be more prone to risk acceptance and false optimism. Extreme leaders have survived a process that eliminated most aspirants, and they have done so by adopting an unconventional path. Most were unlikely to triumph in the struggle for power. They were either aware of this fact and chose to compete anyway or were so overoptimistic that they did not realize it. Either condition would result in risk acceptance or over optimism. This is likely to be particularly true in the case of the victors of a winner-take-all LFP. In this respect Extreme leaders are much like entrepreneurs, who similarly are engaged in a process with a high rate of failure but substantial rewards from success.
Many characteristics that make a candidate Extreme are not psychological pathologies or unearned advantages. They might be out-of-the ordinary ideologies, unconventional allegiances, or goals or skills not shared by his or her peers. An examination of individual candidates or the systems that brought them to power might allow the identification of the particular traits that make them Extreme. Just as Extreme leaders are likely to be different in their personal characteristics from conventional ones, they should choose policies that are different—often very different—from those that would have been chosen by a different leader.
Extremes and the Fuzzy Gamble
If there’s a watchword that helps us understand Extremes, it’s innovation. Innovation’s central dilemma is simple. Any organization facing innovative competitors must innovate to survive. Any individual innovation, however, is risky and may destroy the career of its proponent if it fails. A purely rational individual should therefore choose not to innovate under most circumstances. Innovations are “fuzzy gambles”—gambles taken where the odds of success are unknowable and the level of unpredictability increases with the degree of innovation. Innovating is similar to using a deviating strategy in the pursuit of power. Both are fuzzy gambles with a low probability of success but high rewards for victory.
If an innovation were obviously superior, after all, then it would not be an innovation. For an innovation not to have already been adopted, it must be nonobvious that it will succeed. If an innovator waits until it is certain that his or her idea will work, others will have already adopted it. Although there may be some candidates so gifted that their judgment is consistently superior to that of their rivals, such people must be rare. If they are not, then much of the population of people they are competing with will have the same superior judgment, rendering it merely average once again. If someone’s decisions differ from those that most would make in the same situation and they pay off, it is nevertheless likely that this performance was more a result of risk and luck than superior ability.
In the same way, Extreme leaders will be much more likely to change the goals their organization or state is pursuing and to adopt means to achieve those goals that other leaders would not—that’s why they have such marked impact compared with Modals.
Traditionally, though, the ends of business competition are noncontroversial and uniform—namely, profit maximization. Business leaders may sometimes, of course, manage their companies for their own benefit instead of that of their shareholders, but leaders’ impact on goals is primarily important in politics.
Imagine a candidate for leadership who wishes to radically change a state’s goals—shifting it, for example, from a state satisfied with the current international system to one that wants to radically change it. Some groups in the state are likely to oppose changing the state’s goals. Most groups and interests in the state will prefer the status quo (that’s how it became the status quo, after all). Filtration should tend to eliminate leaders who want to move in a different direction. A short career might even mean that these interests were simply unaware of the Extreme’s true intentions, only to be surprised by what happens when he or she gains power. Whatever the scenario, Extreme leaders should be far more willing and able to alter the state’s goals than their Modal counterparts. Just as leaders can influence or determine an organization’s goals, they also help determine how it gets there—the means the organization uses. Some state leaders may prefer diplomacy to violence, and some the other way around. Some CEOs may show a preference for acquisitions, and others for internal growth. Whatever the circumstance, the chief executive often has significant discretion in the choice of tactics.
Extremes’ acceptance of high levels of risk and their false optimism are likely to play their strongest role in choice of means. Even the most conservative leader might gamble when facing destruction or removal from power. The risk-acceptant or falsely optimistic Extreme, however, will gamble when a Modal would not or pursue maximal goals when others would compromise.
The upshot is, Extremes deviate. They are therefore far more likely than Modals to have dramatic successes and failures. Because of these characteristics, they’re also more likely to have great freedom of action, a greater range of choices, and to ignore external constraints (for better or worse). Many Extreme leaders will look, in retrospect, like gamblers riding a winning streak who raise the stakes on each hand. His or her approach has produced successes. It may continue to do so until luck runs out or opponents adjust. Extreme leaders will often display a pattern of spectacular successes followed by spectacular failures.
Depression can be disabling. But the depressed may actually be better at realistically evaluating their odds of success than the psychologically normal—a phenomenon known as depressive realism—so a mildly depressed leader can actually outperform his or her healthy counterparts. A leader whose ideology is radically different from that of his or her predecessors and contemporaries could be a tyrant who destroys his or her country or the visionary who saves it. This is because Extreme leaders make the choices that no one else would make. Such actions may succeed brilliantly or fail catastrophically. They are unlikely to be mediocre. Extreme leaders will tend to be great successes or great failures. Few will be quickly forgotten.
Reprinted by permission of Harvard Business Review Press. Adapted from INDISPENSABLE: When Leaders Really Matter. Copyright 2012 Gautam Mukunda. All rights reserved.
About the Author
Gautam Mukunda is an assistant professor in the Organizational Behavior Unit at Harvard Business School. Before joining the HBS faculty, he was the National Science Foundation’s SynBERC Postdoctoral Fellow at MIT’s Center for International Studies. His research focuses on leadership, international relations, and the political, economic, and social implications of innovation and technological change.