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Narcissistic Leaders Destroy Culture from Within

The dark side of narcissism and how to avoid falling into the narcissistic leadership trap.

By Gustavo Razzetti

October 26, 2020

When leaders are self-serving, toxic behaviors infect the entire organization, creating an impact that outlasts them.

Narcissism is growing – and I’m not just talking about people taking selfies, but also about grandiose leaders. The business world is experiencing enormous challenges that require visionary leadership. Unfortunately, narcissists possess the same traits that we look for in a leader: confidence, extraversion, and dominance.

Narcissistic leaders have a dark side, Freud warned us a long time ago.

Charm, charisma, humor, and enthusiasm – the characteristics that create a first positive impression are the same ones that help narcissists rise to power. Those who perform best in job interviews are the ones that we should worry about the most.

Narcissists are attracted to power and will do everything to get what they want, including more power.

As Charles O’Reilly, a professor of management at Stanford Graduate School of Business, explains, “Being appointed to office validates their sense of entitlement. At the same time, even without narcissism, power disinhibits — it encourages people to indulge their worst instincts — so now you’ve got the two working together.”

Grandiose leaders prioritize loyalty over performance – they care about themselves, not the organization. Narcissistic leaders infect your culture like a virus, creating an impact that will outlast them.

The Problem with Narcissistic Leaders

Leaders with grandiose narcissism have high self-esteem, are more extroverted, and are more driven – but also more dangerous. Although they achieve high positions, are paid more than normal people, and get promoted faster, they aren’t as effective as most people believe.

The problem with narcissists is that they want to be admired and feel superior – rather than leading others, they want to dominate them. Multiple studies show that, although most people think narcissists are effective leaders, the reality shows that they are not. They will abuse power to get what they want, not what the company needs – rather than building culture, they destroy from within.

There are three personality traits associated with leadership failure. Referred to as the “Dark Triad,” it comprises three closely related yet independent vicious behavioral patterns: narcissism (excessive self-love), psychopathy (lack of empathy), and Machiavellianism (manipulation, deceit, and exploitation of others).

Narcissists create cultures that are toxic, but fail to realize the stress they create around them. Achievements feed grandiosity, creating a distorted self-image. As one executive said to describe Larry Ellison, former CEO and co-founder of Oracle, “The difference between God and Larry is that God does not believe he is Larry.”

Many destructive traits characterize narcissistic leaders; here are the five most common:

1.     Seek social status through dominance

Narcissists have a shallow self-concept; they tend to view others as inferior to themselves, thus having a sense of entitlement and superiority. Narcissists are unconsciously comparing themselves to others, seeking social status through dominance. When feeling threatened by other people’s ideas or smarts, they respond aggressively to preserve their position.

2.     Need to be in the spotlight

Grandiose leaders crave attention all the time, stealing the spotlight. Their low self-esteem creates a strong need for attention. They think in terms of “I,” not “we.” Narcissists are incapable of anything but taking. They believe the world revolves around them and want everybody to pay attention.

3.     A lack of empathy

Narcissistic leaders have a hard time understanding other points of view. They are so self-absorbed that they can’t pay attention to others. Narcissists are also incapable of relating to other people’s feelings or accepting diverse perspectives. They fail to put themselves in someone else’s shoes because they only care about how their own look.

4.     Credit stealing and blame throwing

Narcissists are always criticizing others – not because of high standards but because they want to stand out. They are quick to steal all the credit and even quicker to blame others when something goes wrong. Narcissistic leaders exploit others to benefit themselves, stealing all recognition and never feeling responsible. They have a short fuse that gets ignited every time things go awry.

5.     Unwillingness to listen to feedback

Narcissists listen to only one voice ­– theirs. They are unwilling to hear other people’s opinions and unable to receive feedback. Grandiose leaders assume that feedback is rooted in either animosity or envy, taking it personally. They usually fight back against criticism, even when it’s well-intentioned. For them, no one is good enough to tell them how to do things.

Narcissistic leaders are emotionally isolated. Despite their charisma, they are not comfortable with their own emotions. They like to indoctrinate rather than teach. Narcissists see themselves as transformational agents – a view that’s not usually reciprocated by others.

Do bold leaders like Elon Musk or Steve Jobs need to be a little bit narcissistic to disrupt an industry? The answer is a definite no, according to Chatman. “You can be confident and be innovative, and not be self-involved.” – The California University professor explains.

A study about toxic leaders found that narcissistic CEOs have a dark side that reveals itself slowly over time. Their manipulative, self-absorbed behavior sets them apart from transformational leaders. They are usually paid more because they take all the credit. However, their need to steal the spotlight, makes narcissistic leaders more likely to manipulate earnings, increase firms’ vulnerability to lawsuits, and commit fraud.

“There are leaders who may be abusive jerks but aren’t really narcissists,” O’Reilly says. “The distinction is what motivates them. Are they driven to achieve some larger purpose? Or is it really all about their own aggrandizement?”

It’s critical to differentiate transformational leaders from narcissists. The health of your company culture depends on it.

How Narcissistic Leaders Infect Culture

Narcissistic leaders not only think they are superior, but are also abusive to their subordinates. They expect the organization to revolve around them – people are either loyal or enemies.

Narcissists often say they want teamwork – what they actually want is a culture of “Yes-men.” Their toxic behavior is a virus that quickly infects workplace culture, a recent study by Chatman, O’Reilly, and Doerr shows.

The authors of “When ‘Me’ Trumps ‘We’: Narcissistic Leaders and the Cultures They Create” conducted a series of experiments to discern the impact of CEOs’ bad behavior. The researchers revealed how narcissists institutionalize less collaborative and ethical patterns, damaging morale and performance.

The fact that leaders act like jerks doesn’t mean that employees will become jerks, too.

As Chatman explains, “Narcissists don’t create narcissists. It’s not about doing what the leader does. It’s about the leader creating a culture that induces people to act less ethically and less collaboratively than they would otherwise.”

Narcissists infect the culture with long-lasting poison. They implement policies and practices that encourage the wrong behavior, or fail to punish employees who violate shared norms.

Narcissistic leaders undercut performance management systems. They tend to overestimate their own performance, thus rejecting metrics or feedback that doesn’t align with their expectations. Their leadership style is counterproductive to business performance, creating a negative effect on followers.

The personalities of leaders affect organizational culture. The study by O’Reilly and colleagues shows that narcissistic leaders harm two key areas: collaboration and integrity.

By signaling which norms and values are rewarded and punished, leaders shape the culture of an organization.

The results of their field studies and experiments revealed that people who are more narcissistic are less concerned about collaboration and integrity. They also prefer organizational cultures and followers that are lower on cooperation and integrity. Not only do they think the rules don’t apply to them, but they also enjoy to divide-and-conquer.

Narcissists reward and punish the wrong things – what helps them, not the organization. They hire and promote people based on loyalty, not expertise. Narcissistic leaders expect subordinates to flatter them, reinforce their narcissism, and defend them at all costs.

The study evaluated leaders using the seven dimensions of culture: collaborative, customer-oriented, detail-oriented, integrity, innovative, results-oriented, and transparent.

Leaders who are more open lead detail-oriented organizations; those who are agreeable lead organizations that are less results-oriented.

On the other hand, narcissistic CEOs cultivate highly political organizations. They promote praise and loyalty over dissent and doing what’s right. Their propensity for taking credit fosters a culture of fear and blame. Narcissistic leaders are prone to derogate others, encouraging toxic behaviors such as division, backstabbing, and scapegoating.

The paradox of narcissists is that while they act boldly and love taking risks, the fear that they seed makes their employees afraid, thus creating a low risk/low innovative culture.

Leaders model expected behavior – both good and bad.

Narcissists are entitled and feel that rules shouldn’t apply to them. They don’t feel guilty about manipulating others or breaking the rules to get what they want. Narcissistic leaders crush employees’ ability to learn, grow, and gain new expertise. When people see that leaders take credit for every success and blame them for every failure, morale sinks and self-confidence plunges.

How to Protect Your Culture from Narcissists

The easiest way to avoid narcissistic leaders is to not hire – or promote – them at all. Use interview methods to detect early signs of self-centeredness or low collaboration.

One approach requires asking tough questions to uncover negative behaviors and find more references, not just those provided by the candidates. However, narcissists are savvy enough to manipulate external sources. Even executive search firms become complicit, hiding past flaws.

As Chatman told Quartz, “I believe organizations should get more deliberate about screening for narcissism. Finding out what the candidate’s true track record is in terms of developing people and giving them credit for accomplishments is essential. Narcissists will over-claim credit and are significantly less likely to help other people develop as leaders.”

Narcissistic patterns are easy to spot if you focus on behavior, avoiding being pulled in by their charisma and seductive conversations. Ask candidates to discuss their own failures, mistake-tolerance, and how they deal with subordinates’ mistakes. Seek for specific stories that will unearth whether they tend to steal the credit and/or blame others.

Interviews play to the strengths of narcissists – they know how to evade detection. Don’t just look at performance because they can fake performance or manipulate past results. Cover your bases by instituting regular monitoring once a leader joins the organization. Chatman recommends 360-degree evaluations from a wide range of employees to surface self-absorbed leaders.

So, what can you do when you realize your company has a toxic leader at the top?

In the CEOs’ case, it requires a relentless effort from the board to deal with the narcissist’s worst behaviors. However, most board members are not eager to do so.

One solution that Chatman suggests is aligning a leader’s compensation with their team’s performance. Developing their people, fostering a culture of collaboration, and promoting psychological safety – all things that can be objectively measured – should play a significant part in a CEO’s compensation package.

Another suggestion from the professor is to give any proposed grand visions for the company’s future a reality check. “Check the assumptions, check the projections, check the investment required,” says Chatman. “All aspects of the plan should be subject to very rigorous analysis.”

It’s crucial to create intermediate benchmarks and checkpoints so that the narcissist is accountable along the way before wasting enormous resources.

The last resource is to fire a narcissistic leader. However, turning around a toxic culture requires more than replacing a CEO – the effects of a narcissistic leader are long-lasting.

O’Reilly reflects on the struggles of Uber CEO Dara Khosrowshahi to turn the company around after its founder, Travis Kalanick, was terminated. “Once you create these cultures, it’s very hard to change them. There are long-term consequences.”

Transforming your company culture, especially a toxic one, takes time and consistent effort.

Overall, prioritize job performance and team building capabilities over charisma and individual capacities. The key responsibility of a leader is to build a strong culture, not to be the superhero that saves the day.

Regardless of how smart they are, narcissists can be destructive. They create a culture of fear, passive-aggressiveness, division, and low integrity. To survive, people must surrender their individual thought and willpower.

Narcissistic leaders are relentless and ruthless. So is their legacy – it creates lasting organizational damage.

People embrace low integrity and individualism when both leaders and the company culture support those behaviors. Collaboration and ethics are more than values; leaders must encourage them and reward those who consistently practice it.

Preempt narcissism by paying attention to the early signals. Avoid falling into the narcissism trap and being seduced by someone’s self-confidence and charisma. Don’t promote self-centered executives to positions of power.

The stakes are high. As O’Reilly says, “These people aren’t going to change.” Don’t let narcissistic leaders infect your culture like a virus.

What do you think?



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