Monday, August 30, 2004

Freud and L.: Transference

Normally you don't often see the name Sigmund Freud associated with leadership in management literature, where followers are described largely in terms of their leaders’ qualities.
In an article in this month's Harvard Business Review, Michael Maccoby interestingly turns this habit around, by delving into the unconscious recesses of followers’ minds. He looks closely at the often irrational tendency to relate to a leader as some important person from the past. A parent, a sibling, a close friend, or even a nanny. Sigmund Freud discovered this dynamic when working with his patients and called it “transference”.

Maccoby explains the most common types of transference: paternal, maternal, and sibling, and shows how they play out in the workplace. He notes that they have evolved as our family structures have changed. Whether followers perceive a leader as an all-knowing father figure, as an authoritative yet unconditionally loving mother figure, or as a brother or sister who isn’t necessarily a model of good behavior, the leader can manage transferential ties by bringing unconscious projections to light. Then debilitating resentment and animosity can give way to mutual understanding and productivity.

Friday, August 06, 2004

Believing one's own press

"Welch has delivered extraordinary growth, increasing the market value of GE from just $12 billion in 1981 to about $280 billion today. No one, not even Microsoft's William H. Gates III or Intel's Andrew S. Grove, not Walt Disney's Michael D. Eisner or Berkshire Hathaway's Warren E. Buffet, not even the late Coca-Cola chieftain Roberto C. Goizueta or the late Wal-Mart founder Sam Walton has created more shareholder value than Jack Welch (Business Week, 1998)".
According to researchers Mathew Hayward, Violina Rindova and Timothy Pollock (Strategic Management Journal, July 2004), journalists systematically over-attribute a firm's actions and outcomes to it's CEO rather than to broader situational factors.
Even more interesting is their conclusion that a CEO who internalizes such celebrity will also tend to believe this over-attribution and become overconfident about the efficacy of his/her past actions and future abilities, underestimating the impact of situational factors in the external environment, especially the actions of competitors, on the firm's ability to realize its own strategies.
Hubris arises when CEO overconfidence results in problematic decisions, including undue persistence with actions that produce celebrity.
Hayward ea suggest that "The greater a CEO's celebrity, the more a CEO will commit to continuing the actions that are associated with the celebrity and the greater the strategic inertia of the firm".