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Often, powerful leaders tend to leap before looking.
New business research explains how powerful are blind to risk

Not every company has an Iron Man, but many have a Tony Stark – a highly powerful, intensely-focused individual who often ignores risk in order  to achieve his or her goals.

That’s usually a good thing – as long as companies make sure to also  hire a Pepper Potts to keep their powerful leaders grounded, according to new research co-authored by a BYU business professor.

“Organizations need to anticipate the tendency of their most powerful members to leap without looking,” said study co-author Katie  Liljenquist, a professor of organizational leadership at BYU's Marriott School of Management. “The remedy is to surround them with people who can see other angles, or can play a devil’s advocate role to point out risk. Interestingly, it is the low-power members of the organization who are best equipped to do this.”
The study, appearing online ahead of print in the Journal of Experimental Social Psychology, found that powerful people are less likely to see constraints in pursuing their goals. Meanwhile, their low-power counterparts are more aware of the risks around them.

Liljenquist says the phenomenon mirrors the animal kingdom: Predators have evolved to have an extremely narrow eye focus for tracking prey, but this compromises their peripheral vision.. Meanwhile, prey animals sacrifice such visual focus for more sensitive peripheral vision that tracks movement and potential threats in the surrounding environment.

“In business settings you need both,” Liljenquist said. “You need the
 people with  that unfettered confidence and optimism and the willingness to take big risks, but you need those low-power individuals who say, ‘Hey wait a second. Let’s identify the pitfalls.’”
The study included two experiments, the first of which measured how power affects memory for goal-facilitating or goal-constraining information.

In that experiment, participants were given a goal, such as traveling to the Amazon, and were then primed with a set of statements about the new venture. Half the statements were goal-constraining (“You are afraid of some of the native animals”) and half were goal-facilitating (“You have prior experience visiting jungles”).

Researchers found that high-power participants recalled less goal-constraining information than low-power participants.

The second experiment asked participants to finish a fairy tale about a king and his princess daughter. The results showed that powerful people don’t even conceive of threats when they create imaginary narratives.

Donald Trump is a perfect example of a leader whose confidence guides business decisions. During the first season of his reality show, The Apprentice Trump offered the winner a chance to manage the construction of the Trump Tower in Chicago – even though the tower hadn’t been fully approved yet.

See more on the research from UT-Austin's Texas Enterprise

Liljenquist said that failure to consider constraints can carry weighty repercussions – such as the housing market crises and bank  failures of 2008 that caused the worst economic recession since the 1920s.

“Although blindness to constraints may make the powerful more willing to pursue their goals, their willingness to leap before they look may also sow the seeds of their own fall and the fall of those who depend on them,” she said. “Power often perpetuates itself and can lead to great  things, but when powerful people are blind-sided by unexpected  challenges, they may crash and burn.”
The 1986 Challenger Space Shuttle disaster is a classic example of  how power can be blinding. On that fateful day, powerful individuals  doggedly pursued launch while ignoring the low-power employees who tried to be a voice of warning about the possibility of mechanical failures.

The study was led by Whitson, an assistant professor of business at the University of Texas at Austin’s McCombs School of Business. Other contributing researchers are from Columbia University, New York University, Stanford University and the University of Colorado-Boulder.

Liljenquist’s business research, which includes this study on how people are unconsciously more fair and generous when they are in clean-smelling environments, has been featured multiple times by Time and other national outlets.

Here is the link to the original press release:

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Comment Preferences

  •  Interesting perspective. n/t (0+ / 0-)

    When you are right you cannot be too radical; when you are wrong, you cannot be too conservative. --Martin Luther King Jr.

    by Egalitare on Fri Feb 08, 2013 at 02:11:25 PM PST

  •  I once evaluated a memory chip for a (0+ / 0-)

    Japanese company.  The CEO was absolutely convinced that his chip was the fastest in the world - not even close, but he apparently was surrounded by 'yes-men' and not living in a reality based world.  Never heard of the company again.

    Then again, IBM was pretty surprised when I told them, yes your chip is very fast, but the power consumption...

    There is a phenomenon with a cute name (that escapes me, along with the location of the book) that if two CEO's with big egos bid on the same company, their egos will cause them to bid above the value of the company (sometimes way above) because the HAVE to win.  HP recently found they had way overpaid for an company they purchased.  And Meg Whitman brags about how competitive she is, so I wonder...

    ...Son, those Elephants always look out for themselves. If you happen to get a crumb or two from their policies, it's a complete coincidence. -Malharden's Dad

    by slowbutsure on Fri Feb 08, 2013 at 02:50:38 PM PST

  •  In other words you need sane people around (0+ / 0-)

    To regulate and control those that not sane, that don't know how to control themselves.

    Those sane people need to have power too, so they can do their jobs. Too many times they don't, and it all goes in the crapper.

    You know, like jockeys on race horses.

    Women create the entire labor force. ---------------------------------------------------------------------------------------- Sympathy is the strongest instinct in human nature. - Charles Darwin

    by splashy on Sat Feb 09, 2013 at 12:58:32 AM PST

  •  JARVIS is really the one in charge (0+ / 0-)

    Tony and Pepper just provide comic relief.  :)

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