CEOs are faking it, Stanford professor says

IDG News Service ^ | July 22, 2005 | Robert McMillan

[hripka]

Your company's chief executive might be a pretender, and that may be a good thing, according to Stanford University Professor of Management Science and Engineering Robert Sutton.

Sutton, the author of a 2001 study of corporate innovation, "Weird Ideas that Work," says that a close look at the evidence shows that chief executive officers (CEOs) probably deserve less credit for their company's fortunes than they receive, and that the best of them manage a tough balancing act: secretly aware of their own fallibility, while also realizing that any sign of indecisiveness could be fatal to their careers.

"In just about every study I've ever seen ... the amount of control a leader has over the company is exaggerated," Sutton said, speaking during a keynote address at the AO05 Innovation Summit at Stanford Thursday. Although top executives of the largest companies are often considered uniquely powerful, their effectiveness actually dwindles as companies get larger, he said. "If you look at these Fortune 500 companies where they get paid a fortune, they have the least impact."

The notion of the CEO as a captain, steering the corporate ship, isn't so much a fallacy as it is a "half truth," according to Sutton, who has devoted a chapter to the topic in his upcoming book, titled, "Hard Facts, Dangerous Half Truths, and Total Nonsense."

In fact, leaders -- even great ones -- often have no clear idea where they are going, he said. And they make mistakes.

The best executives, like Intel's former CEO Andy Grove will admit that they face a dilemma in needing to appear decisive, while at the same time being conscious of their limitations. "You have to pretend" Sutton said. "It's sort of a dilemma, but if you want to accept a leadership job, you've got to accept the hypocrisy of it."

In a 2003 interview with the Harvard Business School, Grove admitted that no business leader has "a real understanding of where we are heading."

In the interview, Grove added that it was important not to be weighed down by the burden of making important decisions without a clear picture of things. "Try not to get too depressed in the journey, because there's a professional responsibility. If you are depressed, you can't motivate your staff," he said.

The interview illustrated the dilemma that Grove is "getting even more honest," as his involvement in the day-to-day management of Intel lessens, Sutton said.

Sutton and co-author Jeffrey Pfeffer have tackled other "half truths," in their book, which is to be published next year. Their aim is to shine the light of empirical research on a number of widely held management beliefs, including the idea that leaders should always keep a close eye on their workers, Sutton said.

Sometimes the best managers are the ones who do the least, Sutton said, quoting an aphorism he attributed to 3M's retired senior vice president for research and development, Bill Coyne: "When you plant a seed in the ground, you don't dig it up every week to see how it works."

Sutton even disputed the idea that most of the management advice being published is new or even helpful. "There's too much advice," he said. "Most of it is bad if you actually bother to dig into the evidence."

"If you find a new management idea. I want to see it," he said. "Every idea that's been described as new has, in fact, been around for a very long while."

[whd23]

Bush doesn't seem to the need to show off or brag how bright he is in public. Unlike a certain former Democratic candidate for President.

Can you be more specific? Both Gore and Kerry come to mind!

[VA_Gentleman]

I hated working with consultants.


You missed the best part about consultants. You pay them 3X to tell you what you already know is the problem.

[Apercu]

I hate to break it to the good "perfessor", but University
Professors (tenured & non- tenured)- but not all - have been faking it in much greater numbers than their corporate counterparts. A good example would be one Ward "Me Big Indian Chief" Churchill and the minions of liberal I-hate-America types that infect our learning institutions with their leftist nonsense.

[Ticonderoga34]

I was thinking of Kerry but now that you mention it, Al "I invented the Internet" Gore would fit in that category.

[Paraclete]

and a key to effective delegating is loyalty. I've oftened thought about Reagan's success as a leader -- and you can see some of the same traits in GW -- loyalty.

[em2vn]

Consultant; A person who will call you with your telephone to tell you what you want to hear.

[antienvironmentalist]

Am I the only one who see's another jealous professor?

[leadpenny]

I've heard that too, and, not that you were saying it, I certainly wasn't trying to slam him. I think Clinton is absolutely jealous of Bush's management skills. Had Bush decided to make the military a career he would have made it to three or four stars. Clinton would have been found out at the 05 or, at the most, 06 level.

[neocon1984]

My academic background (Ph.D.) and experience (15 years as a business consultant) leads me to the conclusion that many university professors are faking it.

Overpaid and underperforming CEOs eventually get the axe (with a nice settlement). However, that's up to the stockholders. Overpaid and underperforming professors are never held accountable. There is no system in place to do so.

[tom h]

"Your company's chief executive might be a pretender, and that may be a good thing, according to Stanford University Professor of Management Science and Engineering Robert Sutton."

I attended liberal universities for seven years as a young man, and I can guarantee you that a higher percentage of college faculty are faking it, than the percentage of CEOs.

Remember, CEOs don't get tenure and are fired if they don't produce.

[Jimmy Valentine's brother]

he's 'not the brightest bulb in the chandelier,

You are correct that he surrounds himself with quality people. But they wouldn't work for a dim bulb. GW's a lot smarter than people think. I believe that he was a good time boy until Laura told him that she was disappointed in his foolishness. Those words from the woman he truly loved gave him a course reset. He also developed a deep personal faith.

[leadpenny]

I agree and I hope you also read my 28, JV'sb

[kcvl]

Robert I. Sutton

Professor of Organizational Behavior (by courtesy); Professor of Management Science and Engineering, School of Engineering

BA, Univ. of California, Berkeley, 1977; MA, Univ. of Michigan, 1981, PhD, 1984. Fellow, Center for Advanced Study in the Behavioral Sciences, 1986–87 and 1994–95. Award for the best paper published in the Academy of Management Journal, 1988; Eugene L. Grant Award for Excellence in Teaching, 1990; McCullough Faculty Scholar Chair, 1992; McGraw-Hill Innovation in Entrepreneurship Pedagogy Award, 1998. Asst. Prof., Stanford Univ., 1983–89, Assoc. Prof., 1989–92, Prof., 1992—. Prof. of Organizational Behavior, Haas School of Business, Univ. of Calif., Berkeley, July 1997-June 1998. Associate Director of the Stanford Center for Organizations Research, 1988-91. Codirector, Center for Work, Technology, and Organizations, 1996-. Research Director, Stanford Technology Ventures Program. At Stanford since 1983.

How the hell would he know anything about being a CEO since he has never done anything but talk about it?!