The cost of the ‘Big ego’

Last night was one of those rare occasions when I managed to switch off and try anaesthetise myself in front of the TV. In actual fact I was a reluctant audience as the programme I was subjected to was something my wife likes watching. You know, one of those ‘fly on the wall’ programmes about people who are having some sort of problems and some ‘expert’ who descends to help fix them (mercifully  it wasn’t yet another of those endless string of cooking programmes). On this occasion it was Alex Polizzi in the guise of “The Fixer”. I was quietly impressed with her approach on her venture to help a business owner put fresh life into a business that had all but consumed his own ‘raison d’être’.

I was passively interested in this story because it focussed on someone who had a very organised mind, in fact his background was originally in the military and it showed through in ways I all too often see in my business travels – someone blinkered in their own paradigm of how a business has to run. I was genuinely feeling emotional about this person – as a person I felt he didn’t deserve to be in the trap he was in, even though it was clear that he was indeed part of the problem – but as is all too often the case wasn’t able to see it. And I suspect he probably never had the time, opportunity or inclination in the past to be able to learn from others.

What really was the ‘hook’ for me in this programme though was the mention of just four, very appropriate words uttered by Alex – The cost of ego. I couldn’t let go of this one comment and it’s been playing on my mind ever since. To the point that I thought I really must exorcise this demon and share this concept because it really is an interesting phenomenon that we should perhaps take more notice of.

Back in 2007, David Marcum and Steven Smith published a book called egonomics – what makes our greatest asset (or most expensive liability) if you can get hold of a copy I would thoroughly recommend it.

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They state in their work that fifty-three percent of businesspeople estimate ‘ego’ costs their organisations between six to fifteen percent of annual revenue. Moreso, twenty-one percent say this cost ranges from sixteen to twenty percent! Putting that into perspective that would translate to over $1bn for the average Fortune 500 company in the US or, the equivalent of what the average Fortune 500 company realises in annual profit. Frightening, yes?

Many years ago, the esteemed psychologist Abraham Maslow developed a theory of self-actualisation based on a hierarchy of needs. I think it draws interesting parallels to what Marcum and Smith speak of in egonomics. Maslow’s hierarchy of needs alludes to the fact we build up our character from basic instinct, then through social interaction, leading to a state of self-actualisation – a place where our ‘egos’ can start to dominate – for better or for worse.

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Although Maslow’s hierarchy of needs draws out the positive aspects of self-actualisation, as always there are two sides to the human condition aren’t there, and the balance of nurturing and social interaction that we are ‘permitted’ to experience during our development essentially has to have a marked impact on where our self-actualisation actually takes us. Sometimes our egos can get out of control, almost inevitably without us even realising it.

We typically associate ‘ego’ with negative attributes such as arrogance, self-interest, inability to listen, defensiveness and conceitedness. ‘Big’ egos apparently can get in the way of progress. Yet we all have to culture some degree of ego to drive our ambitions – ego is in fact an important attribute to have. So degrees of ego could really be considered a continuum which can range from having a well-balanced and effective decision making character right through to megalomaniac tendencies! In business, megalomania isn’t a good attribute.

So what are the warning signs we need to observe to avoid the ‘dark side’ of the continuum? Marcum and Smith’s research, which took them more than five years to develop, draws our attention to the ‘cost of ego’ influenced specifically by a number of negative characteristics we sometimes experience in the workplace – recognise any of them?

  • Hearing but not listening
  • Me-first
  • Only the ‘right’ people can have good ideas
  • Inability to challenge the status quo
  • Inability to speak candidly within a group
  • Hiding failure
  • Rule and divide – silo mentality
  • Fear of being seen to make mistakes

A successful organisation has to be populated with talented people – at all levels – who must strive to avoid these tendencies for it to stay healthy, progressive and profitable.

The trouble with overblown ego is that it can be good at hiding behind apparently positive attributes. Successful positive management ‘strengths’ could be characterised as being charismatic and dedicated to the cause while projecting an optimism in delivering these. Possessing a healthy ego will promote a healthy return, but consider what can happen if ego gets out of hand and becomes self-centric:

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Dr. Paul Nutt of Ohio State University spent more than twenty years researching hundreds of organisations looking for underlying patterns for why businesses fail, publishing his results in 2002 (See Why Decisions Fail – avoiding the blunders and traps that lead to debacles). He found that fifty percent of decisions fail for just three key reasons:

  1. More than one third of all failed businesses are ‘driven’ by ego
  2. Nearly two thirds of executives never explore alternatives once their mind is set
  3. Eighty one percent of managers push their decisions through by persuasion or authority rather than by the relevance of their ideas

Sadly, egocentric behaviour is hardest to see by those suffering from it – yet it is the most obvious to those around them. According to the research in egonomics, more than sixty percent of businesspeople say that ego negatively impacts work performance on a regular basis, while an additional thirty-one percent state egos impact business decisions weekly.

So how can we ‘tame’ egocentric behaviour? Well there must fundamentally be two participants in any solution. Irrespective of the consequences, it is essential that egotistic behaviour is confronted by bringing it to the attention of the perpetrator. Easier said than done perhaps, but there are ways which can be taught to do this, and in reality most people will be thankful in the long run of knowing how they are really perceived. So we owe it to our colleagues as well as our organisations to be open and honest about how we interact.

An egotist can’t change unless they know there are better ways to interact. Once there is awareness, there can be acknowledgement. And then behaviour can be modified.

There are three key attributes that can effectively control egos – humility, curiosity and veracity. And humility is the ultimate key that tempers our ego towards effective behaviour. There is no disgrace in humbly acknowledging the contributions of others – it is actually perceived as a strength in its own right. Not to be confused with defeat, humility projects an ability to be open-minded which releases more potential into the decision making process.

Curiosity then plays its part to explore alternatives and validate those ideas that work best for the organisation as a whole.

Veracity is the ability to relentlessly pursue the truth, however it is perceived and uses that truth to drive our decisions in the right direction – even in the face of adversity.

So, be humble then, listen to others and let your curiosity explore the alternatives.

And what was the outcome for our poor business owner? Was he an egomaniac? Well, actually I don’t think so at all, even though he clearly displayed some of the more prominent signs of a big ego. All he needed was a reality check. In typical cringe-worthy manner that these programmes include for dramatic effect, our unsuspecting victim was made to attend a strategic meeting with Alex on the gloomy premises of a business chain that had already recently failed. Not subtle, but a real eye opener. And this did indeed trigger a genuine inward look resulting in some really satisfying business decisions with that ‘happily ever after’ outcome he deserved.

There’s an old saying in the north of England where I come from ‘there’s nowt so queer as folk except for thee and me, and even thee’s a little queer’ (actually its roots are Welsh). Re-stated in modern parlance ‘theres nothing as strange as people’. How true, but wouldn’t life be boring if it wasn’t.




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