to being a successful CEO today, it's almost universally assumed, is leadership. Such qualities as strategic thinking, industry knowledge, and political persuasiveness, though desirable, no longer seem essential. Particularly when a company is struggling, directors in the market for a by Rakesh new CEO-as well as the investors, analysts, and business journalists who are watching their every move-will not be satisfied with an executive who is merely talented and experienced. Companies now want leaders. But what makes a successful leader? When people describe the qualities that enable a CEO to lead, the word they use most often is "charisma." Biographers and journalists have spilled much ink trying to deconstruct the charisma of superstar CEOs such as Lee Iacocca, Jack Welch, and Steve Jobs. Nevertheless, charisma remains as difficult to define as art or love. Few who advocate it are able to convey what they mean by the term. Fewer still are aware that the concept is borrowed from Christianity. In a passage from the New Testament, the apostle Paul THE SECRET 60
Curse of the Superstar
lists the various charisms, or gifts of the Holy Spirit, that Christians may possess. According to Paul, those gifted with charisma in this sense include "good Ieaders."They also include church members with extraordinary endowments, such as the power to speak in tongues or work miracles. Khurana Of course, the meaning of charisma has changed since Saint Paul's time, but there is a lingering sense of admiration-even worship-for the few who are thought to possess uncommon inspirational powers. We now think of charisma as a set of personal qualities that inspire awe and submission in others. Jeffrey Garten, dean of the Yale School of Management, vividly captured the aura of the charismatic leader in his book The Mind of the CEO. Describing hisfirstmeeting with C. Michael Armstrong, now the CEO of AT&T, Garten effused that Armstrong "radiated the confidence, enthusiasm, and energy of a seasoned politician.. .You had the sense that if you were making a movie and said, 'Get me a CEO,' to the casting director, he'd give you Michael Armstrong." HARVARD BUSINESS REVÍEW
The Curse of the Superstar CEO
In researching CEO successions in large U.S. companies over the last half dozen years, 1 have found that such rapt responses play a surprisingly significant role in determining who is considered qualified to lead America's great corporations. And [ have concluded that the widespread quasi-religious belief in the powers of charismatic leaders is problematic for a number of reasons. First, faith exaggerates the impact that CEOs have on companies. Second, the idea that CEOs must have charisma leads companies to overlook many promising candidates and to consider others who are unsuited for the job. Finally, charismatic leaders can destabilize organizations in dangerous ways. Before taking a closer look at each of these dangers, let's untangle the paradox of just how charismatic leadership has come to be the ideal for American business in an era we like to celebrate as being rational and enlightened.
The Pull of Charisma
Charisma wasn't always as important in business as it is today. For the three decades following World War II-in what has been called the era of managerial capitalismthe typical CEO was an "organization man" who worked his way up the ranks and was no better known to the general public than his secretary or his dentist. All that started to change in the 1980s, when a long-standing decline in corporate profits ushered in today's era of investor capitalism. Senior managers-once viewed as enlightened corporate statesmen - began to be portrayed by disgruntled investors as an insulated, self-interested elite, ill prepared to face the...