I recently finished reading Stanford Psychology Prof. Carol Dweck’s excellent book, Mindset: The New Psychology of Success. In this outstanding book, Prof. Dweck shows how success over a long period of time correlates with a “growth mindset,” where people keep an open mind in solving problems and work cooperatively and diligently. By contrast, those with a “fixed mindset” claim that their own brilliance and innate talent is all that matters.
I’d like to share a few quotes about the vainglorious auto executive of days past. After claiming credit for the Ford Mustang, and then getting fired, Lee Iacocca promised to be the savior of Chrysler. Instead, he was just focussed upon personal glory.
“According to James Surowiecki, writing in Slate, Iacocca’s rise to prominence was a turning point for American business. Before him, the days of tycoons and moguls seemed long past. In the public’s mind, CEO meant “a buttoned-down organization man, well-treated and well-paid, but essentially bland and characterless.” With Iacocca, all of that changed. Business journalists began dubbing executives “the next J. P. Morgan” or “the next Henry Ford.” And fixed-mindset executives started vying for those labels.”
After reaching the top, he quickly surrounded himself with yes men:
Should they confront their shortcomings or should they create a world where they have none? Lee Iacocca chose the latter. He surrounded himself with worshipers, exiled the critics—and quickly lost touch with where his field was going….
[and pages later]“You’ll see they all start with the belief that some people are superior; they all have the need to prove and display their superiority; they all use their subordinates to feed this need, rather than fostering the development of their workers; and they all end by sacrificing their companies to this need.”
Iacocca worked on building personal glory for himself, not making things better:
“Just a few years after his humiliating exit from Ford, he was able to write a triumphant autobiography and in it declare, “Today, I’m a hero.” Within a short time, however, Chrysler was in trouble again. Iacocca’s fixed mindset would not stay put. He needed to prove his greatness—to himself, to Henry Ford, to the world—on a larger and larger scale. He spent his company time on things that would enhance his public image, and he spent the company’s money on things that would impress Wall Street and hike up Chrysler’s stock prices. But he did this instead of investing in new car designs or manufacturing improvements that would keep the company profitable in the long run. He also looked to history, to how he would be judged and remembered. But he did not address this concern by building the company. Quite the contrary. According to one of his biographers, he worried that his underlings might get credit for successful new designs, so he balked at approving them. He worried, as Chrysler faltered, that his underlings might be seen as the new saviors, so he tried to get rid of them. He worried that he would be written out of Chrysler history, so he desperately hung on as CEO long after he had lost his effectiveness. Iacocca had a golden opportunity to make a difference, to leave a great legacy. The American auto industry was facing its biggest challenge ever. Japanese imports were taking over the American market. It was simple: They looked better and they ran better. Iacocca’s own people had done a detailed study of Honda, and made excellent suggestions to him. But rather than taking up the challenge and delivering better cars, Iacocca, mired in his fixed mindset, delivered blame and excuses. He went on the rampage, spewing angry diatribes against the Japanese and demanding that the American government impose tariffs and quotas that would stop them. In an editorial against Iacocca, The New York Times scolded, “The solution lies in making better cars in this country, not in angrier excuses about Japan.” Nor was Iacocca growing as a leader of his workforce. In fact, he was shrinking into the insulated, petty, and punitive tyrant he had accused Henry Ford of being. Not only was he firing people who were critical of him, he’d done little to reward the workers who had sacrificed so much to save the company. Even when the money was rolling in, he seemed to have little interest in sharing it with them. Their pay remained low and their working conditions remained poor. Yet even when Chrysler was in trouble again, he maintained a regal lifestyle. Two million dollars were spent renovating his corporate suite at the Waldorf in New York. Finally, while there was still time to save Chrysler, the board of directors eased Iacocca out.” [Italicies are mine]
How terrible that the U.S. auto industry suffered because of a man with that ego and attitude.
At least, it was only Chrysler...
