Why Bad Leaders Rise in Professional Companies: Causes and Solutions

In the political arena, the election of subpar leaders can often be attributed to societal and systemic factors. However, in the structured environment of the corporate world, one might expect a more meritocratic approach to leadership selection. Yet, the phenomenon of incompetent, political, and dishonest individuals rising to leadership positions persists. This article delves into the reasons behind this troubling trend, its implications, and solutions to prevent it.

The Framework of Leadership Failure

In her profound and thought-provoking book, Leadership from BAD to WORSE, Professor Barbara Kellerman explores why bad leaders prevail. Kellerman hypothesises that bad leaders thrive because bad followers allow them to. She supports her argument with detailed case studies of prominent figures such as Martin Winterkorn, the CEO of Volkswagen involved in the emissions scandal; Recep Tayyip Erdo?an, President of Turkey; Elizabeth Holmes, CEO of Theranos; and Xi Jinping, President of China. Kellerman categorises leaders based on several attributes: competent/incompetent, secure/insecure, political/non-political, honest/dishonest, intellectual/ordinary.

Shiv Shivakumar , who has worked with world-class companies such as Hindustan Lever, Nokia, PepsiCo, and Aditya Birla Group, reflects on Kellerman’s framework. Shivakumar notes,

"I used the filters she has to classify the leaders I have worked for, and it made an interesting classification for me. Of the 19 leaders who I worked for: 6 were secure and competent, 6 were secure and incompetent, 3 were insecure and dishonest, 1 was secure and dishonest, 1 was insecure and arrogant, 1 was political and arrogant, 1 was political and incompetent, So, I was lucky; I worked for great leaders 33% of the time."

The Corporate Conundrum

In professional settings, leaders are not elected by the employees, who must endure the consequences of their decisions and behaviour. Instead, leaders are often imposed upon employees by higher-level executives or board members. The reasons for promoting incompetent, political, and dishonest individuals are multifaceted:

1. Network and Influence: In many corporate environments, who you know can be more important than what you know. Political manoeuvring and building alliances can often pave the way to leadership roles. Individuals with strong networks and the ability to navigate corporate politics may rise faster, even if they lack competence or integrity.
2. Short-Term Results: Companies often prioritise short-term financial results over long-term sustainability. Leaders who can deliver quick gains, sometimes through questionable means, are often rewarded. This focus on immediate outcomes can overshadow ethical concerns and long-term vision.
3. Echo Chambers: Executive teams and boards often consist of individuals from similar backgrounds and mindsets, creating an echo chamber. This can lead to a lack of diverse perspectives and critical thinking, allowing mediocre leaders to thrive. Promotions may be based on comfort and familiarity rather than merit.
4. Lack of Accountability: When bad leaders are not held accountable for their actions, it sets a precedent that such behaviour is acceptable. This lack of accountability can stem from a fear of confrontation, a desire to avoid conflict or even complicity within the organisation’s culture.
5. Cultural Tolerance: In some organisations, there is a cultural tolerance for unethical behaviour if it aligns with the company's short-term goals. This creates an environment where dishonest and political individuals can flourish.

Spotting and Stopping Bad Leaders

Identifying and preventing the rise of bad leaders is crucial for maintaining a healthy organisational culture. Here are five ways to spot and stop these individuals from climbing the corporate ladder:

1. 360-Degree Feedback: Implement comprehensive feedback mechanisms that include input from peers, subordinates, and superiors. This provides a holistic view of a leader’s behaviour and performance.
2. Transparent Promotion Criteria: Ensure that promotion criteria are transparent and based on merit, competence, and ethical behaviour. Clear guidelines reduce the influence of political manoeuvring.
3. Ethical Training and Development: Provide regular training on ethical leadership and decision-making. Foster an environment where integrity is valued and rewarded.
4. Diverse Leadership Panels: Form diverse promotion panels to avoid echo chambers and ensure a variety of perspectives are considered in leadership decisions.
5. Accountability Systems: Establish robust accountability systems where leaders are held responsible for their actions. Encourage a culture where unethical behaviour is reported and addressed promptly.

The Cost of Promoting Bad Leaders

Promoting incompetent, political, and dishonest individuals comes at a significant cost to organisations:

• Erosion of Trust: Bad leaders erode trust within the organisation, leading to decreased morale and increased turnover.
• Poor Decision-Making: Incompetent leaders often make poor strategic decisions, resulting in financial losses and missed opportunities.
• Toxic Culture: Dishonest and political leaders create a toxic work environment, fostering cynicism and reducing overall productivity.
• Reputation Damage: Scandals and unethical behaviour can severely damage an organisation’s reputation, affecting relationships with clients, investors, and the public.
• Long-Term Instability: Short-term gains from unethical leadership are often followed by long-term instability and decline, as the foundations of the organisation are weakened.

Conclusion

The promotion of bad leaders in professional companies is a complex issue rooted in organisational culture, network dynamics, and a lack of accountability. As Professor Barbara Kellerman’s research and insights from experienced leaders like Shiv Shivakumar illustrate, the quality of leadership is a reflection of the followers and the systems in place. By emphasizing meritocracy, fostering accountability, encouraging diverse perspectives, and cultivating ethical cultures, organisations can prevent the rise of bad leaders and ensure a more sustainable and ethical future.

The challenge lies in recognising and addressing these issues proactively, ensuring that leadership truly reflects the values and needs of the society it serves.