Amsterdam, May 13, 2020- While history shows us that power tends to corrupt, a team of Swiss and German researchers have recently examined historical examples of large-scale business fraud and misconduct at the highest-levels of government in order to highlight how leaders sometimes lose all sense of morality. Inflicting serious harm on their company or society in the process.
Leaders often attribute their success to their superior ability and bask in their own brilliance. Drunk from power and overconfidence, they embark on endeavors that often begin to bring about detrimental outcomes. In recent times, we have witnessed accounting fraud at Enron, software fraud at Volkswagen, and corruption at FIFA - the list of misconduct by successful top managers is long.
"In classical Athens and medieval Venice, political positions were filled using a mixed procedure of targeted selection and drawing by lots," explained author Professor Katja Rost, University of Zurich, Switzerland. "We wanted to see how appointing leaders partly by random selection affected their performance."
Candidates were pre-selected according to conventional performance criteria. After conducting a large laboratory experiment and reviewing the existing literature, Dr. Berger, Assistant Professor, University of Bern, Switzerland and his research team including, Profs. Margit Osterloh, University Basel, Switzerland, Rost, and Thomas Ehrmann, University Münster, Germany confirm that partly random selection avoids hubris in leaders.
Their analysis found that overconfident leaders selected partly randomly are less prone to misusing their power and making decisions that are more beneficial to other members of the group, compared to overconfident leaders selected through the usual competitive selection process.
A competitive selection process typically triggers leadership hubris of overconfident people due to two factors. First, positions of power are often occupied by persons with overconfidence; and second, competitive selection methods confirm overconfident leaders' feeling that they are exceptional and perform far "above the average" of other candidates and feel entitled to enrich themselves.
In contrast, partly random selected leaders are more "humbled" than those selected by competitive methods without performing any less effectively.
"This study is intriguing and points to the problem of a current leaders selection methods. Yet, a potential better solution was discovered by city states and institutions of the past, who used, in part, random selection from a pool of candidates to appoint leaders," said Dr. John Antonakis, Editor-in-Chief of The Leadership Quarterly. "Dr. Berger and his colleagues now provide experimental evidence to support such a practice; this article should stimulate more research but more importantly, further reflection too by institutional legislators and selectors of leaders."
Notes for editors
The article is "How to prevent leadership hubris? Comparing competitive selections, lotteries, and their combination," by Joël Berger, Margit Osterloh, Katja Rost, and Thomas Ehrmann (https://doi.org/10.1016/j.leaqua.2020.101388). It appears as an Article in Press in The Leadership Quarterly (May 2020), published by Elsevier.
Copies of this paper are available to credentialed journalists upon request; please contact the Elsevier Newsroom at firstname.lastname@example.org">email@example.com. Journalists wishing to interview the authors can contact Prof. Katja Rost at firstname.lastname@example.org">email@example.com or +41 79 745 90 50.
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