What Leads to Dangerous Decisions?

What Leads to Dangerous Decisions?

Longtime spy. Former community organizer. What the background of leaders, heads of state and managers says about how they handle crisis.

By Sydney Finkelstein

what-leads-to-dangerous-decisions

 

Syd-FinkelsteinHow do the past experiences of leaders affect how they make decisions, especially in crisis situations? Is it unusual that the global chess game currently being played out between Vladimir Putin of Russia and President Barack Obama features a longtime spy versus a former community organizer and law professor?

Historically, the people who ended up running countries came from religious or military backgrounds, often coupled with royal bloodlines. Yet that has never guaranteed a great leader. Just consider England’s Queen Mary I, nicknamed “Bloody Mary” for having Protestants burned at the stake and famed for losing Calais to the French.

In her classic book The March of Folly, the historian Barbara Tuchman documented incredible missteps by popes, kings, and presidents, famously using the term “woodenheadedness” to describe how their decisions were often colored by what they wished was true and not what actually was true.

If that sounds familiar even today, there’s a reason for it. Despite the rarified air that leaders of countries may breathe, they are much more like the rest of us than they, and perhaps we, care to admit. Rather than draw on a seemingly endless number of available and applicable data points and pieces of information in making a decision, we focus on the few that resonate with us.

Wishing Doesn’t Make It So

Usually, the “facts” we care about most fit a pattern that is aligned with what we wish were the truth. But wishing it doesn’t make it so. When fantasy finally gives way to reality, it’s often too late to undo the mistakes into which we have deluded ourselves.

The business world is replete with examples. There’s a reason Apple products stand out for their design and their brand—that’s how founder and longtime CEO Steve Jobs thought.

On the flipside, leaders at handset maker BlackBerry focused on the facts with which they felt the most kinship—namely, that they had a superior technological solution, and that such solutions always win. Unfortunately, wishing this was true turned out to be a failing strategy, making BlackBerry especially vulnerable to more customer-friendly products like Apple’s.

Decision-making at Apple under Steve Jobs was straightforward. Whatever Steve wanted, he got. The fact that his instincts were so aligned with what customers actually wanted was the genius—or luck—of Apple. I’ve often thought that a CEO who adopts the Steve Jobs leadership playbook is much more likely to fail than to succeed.

Even when decision-making is more open and more data points are considered—reportedly the case with Obama, who is known to bring a group of experts and advisers together to share their perspectives with him as he contemplates an important decision—personal interpretations still can rule the roost.

Obama doesn’t want to, say, hear Vice President Joe Biden debate solutions with Secretary of State John Kerry on how to deal with Putin, he wants each member of his inner circle to make the case to him directly. Then he can engage in the law professor’s favorite tactic—of grilling the interlocutor on his own terms. It’s not an open exchange of ideas—it’s a carefully controlled series of one-on-one dialogues that yields insight, but rules out a messier, but usually higher-quality, exchange of ideas that can emerge in a more open debate.

Background and Experience

Why leaders behave as they do is not only a function of personality. It is also heavily influenced by their backgrounds and experiences. To take a simple example, senior executives who have spent years in marketing jobs are more likely to look at the world with a customer orientation, while leaders coming up through manufacturing and operations tend to be more tactical (and not strategic) in their thinking.

There’s more. CEOs who have predominately worked in finance will view their companies as portfolios of businesses to be bought and sold. It’s not coincidence that a major predictor of merger and acquisition activity is whether a company’s CEO has a finance background.

A leader’s background experiences define his comfort zone, his natural first solution to any problem, and the place where he retreats in times of stress.

That makes the career path government leaders have taken on the way to the top highly relevant for how they will behave once they get to that pinnacle. Despite the wide variation of backgrounds, there is one career track that is most common for government leaders: politics! Most career politicians will value retaining their jobs above all else, often to the detriment of the countries they serve. They are comfortable with political gamesmanship, sometimes at the expense of leadership.

Never excelling in a career other than politics before leading a government is worrisome for many reasons, not the least that it represents an intense lack of curiosity.

One can admire people who have the courage to move out of a successful career into something new, in part because it signifies the entrepreneurial mindset—to try something new, to experiment and to challenge yourself.

Unfortunately, the modern political figure can be described in precisely the opposite way most of the time. Playing it safe, using opinion polls as a muse and appealing to the loyalists that make up your base are their modus operandi. For example, despite the posturing of Tea Party stalwarts in the United States as game-changers who would revolutionize how governments operate, their close adherence to a narrow sliver of political principles places them squarely in a risk-averse circle of thought. It’s hard to be a leader when you don’t have at least a little bit of the entrepreneur in you.

Unfortunately for President Obama, German Chancellor Angela Merkel and the European Union, espionage is one of the most entrepreneurial of all careers. There is an element of risk-taking that can become ingrained. It is as close to the opposite of how law professors are trained to think—logic, cool calculation, employing the power of past precedents—as one can imagine.

Where leaders come from does matter, a great deal.

The Conference Board Review is the quarterly magazine of The Conference Board, the world's preeminent business membership and research organization. Founded in 1976, TCB Review is a magazine of ideas and opinion that raises tough questions about leading-edge issues at the intersection of business and society.