Are CEOs Businesspeople?

CEO Politician

This post examines the question “Why do most top leaders resist, reject, or ignore progressive management” from the viewpoint of politics, an ever-so human predilection, rather than business. It reconsiders CEOs principally as politicians, and secondarily as businesspersons, to explain their general desire to maintain the status quo with respect to leadership and management practice.

While people may view politicians as having some positive characteristics, most people also view them as having many negative characteristics. These could be one or more of the following: dishonest, corrupt, partisan, demagogue, incompetent, inflexible, etc. Because of this, there can be a strong dislike for politicians due to policy disagreements, broken promises, gridlock, inefficiency, money and sex scandals, negative campaigning, conflict, etc. These, in turn, lead to a deep sense of disconnection between leaders and followers.

Likewise, while people view top business leaders as having some positive characteristics, most people also view them as having many negative characteristics. These could be one or more of the following: arrogant, authoritarian, micromanaging, lacking empathy, unethical, poor communicator, risk averse, etc. Because of this, there can be a strong dislike for top business leaders due to offshoring/outsourcing jobs, income disparities, focus on short-term profit-making, lobbying and political influence, corporate scandals, automation, environmental problems, status quo, waste, etc. These too lead to a deep sense of disconnection between leaders and followers.

There is overlap between politicians and top business leaders. For example:

PoliticianTop Business Leader
Policy disagreements Environmental problems
Broken promises Offshoring/outsourcing jobs
GridlockStatus quo
InefficiencyWaste
Money and sex scandalsCorporate scandals
Negative campaigningLobbying
ConflictShort-termism, automation

Because of these negative characteristics, the American public holds both politicians and top business leaders in low regard with respect to honesty and ethical standards, with the former rated a bit lower than the latter. That is likely the case in many other countries.

Could the low regard for business leaders be due more to the politics associated with leading a company (I do not mean political party affiliation) than the core duties associated with running the company? After all, business leaders are often praised for core duties such as being visionaries, strategic thinkers, decisive, motivating, and adaptable. But then why do business leaders rate multiple times lower than nurses, engineers, doctors, and police officers with respect to honesty and ethical standards? It could stem from a sense that business leaders do not keep people safe in the ways that nurses, engineers, doctors, and police officers do. These occupations tend to require its practitioners to react quickly to problems, not slowly, and to not sacrifice people’s interests for personal gain.

Politicians generally react slowly to problems. They seek to carefully regulate the type of change and the rate of change regardless of ideology. And while they may keep a nation safe from armed conflict, they expose the public to endless internal conflict and turmoil that generates a chronically unsafe mental environment. As a result, people tend to scorn or tune out politics. That works to the advantage of those who wish to thwart change.

Like politicians, business leaders occupy a superior position, one of higher status and influence, so they are able to direct outcomes that are favorable to their personal or other interests. However, too little change too slowly can make people feel unsafe just as too much change to fast can make people feel unsafe. Whether it is society or employees, they often can see the need for change, in some cases significant change, much more clearly that politicians or CEOs. This will be mostly ignored or actively rebuffed until such time as it can no longer be ignored or actively rebuffed.

If a CEO is more politician than businessperson, then their concerns lie more with maintaining the status quo and, when change is unavoidable, carefully regulate the type of change and the rate of change. If a CEO is more businessperson than politician, then they tend to be more amenable to recognizing and quickly making the social and technical changes that will produce better business results.

Decades of empirical evidence tells us that “Fake Lean” (continuous improvement) is far more common than “Real Lean” (continuous improvement and respect for people). In other words, most CEOs are more politician than businessperson because their concerns lie more with maintaining the status quo. And when Lean comes along, CEOs carefully, and slowly, regulate the type of change and the rate of change. This has the added effect of reducing the legitimacy of the change and increasing the legitimacy of the status quo.

While CEOs are widely understood to be businesspeople, it seems that they are more in the mold of political leaders when it comes to change in leadership and management practice. The company can be seen as a type of mini country where the CEO decides what changes, when it changes, how much it changes, and how fast it changes. The only problem is their judgment is often badly incorrect.

Politics can be friend as well as foe. Most top leaders see sufficient value in politics that it is worthwhile for them to underperform in business. Yet when seen as a form of waste (behavioral waste), politics is surely foe to both the CEO and to progress.

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