When Leadership Goes Wrong #17 #cong21


We often celebrate and revere “good” leaders, but don’t always do such a good job of examining and understanding “bad” ones. Misguided and ill-intentioned leadership can be seductive and charismatic and can lead to dismal outcomes if not challenged and countered. This is a story of one leader who focussed on her desired outcomes, and not the social good.

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Key Takeaways:

  1. If not actively and consistently challenged, poor or bad leadership can persist for long periods
  2. It can take tremendous bravery and persistence to challenge strong, negative leadership
  3. The culture we build as leaders enables or disables active debate and creates or destroys psychological safety.
  4. We don’t just set the vision as leaders – we have to establish the appropriate guard rails for execution, and ensure they are consistently and visibly applied.

About Ger Mulcahy:

 I’m a husband and a dad. I’m a technologist and a leader. I have published a book on management, and am writing another. I love to write, but it’s not my primary role. I am also a Brain-Based certified coach, a flyfisherman, a continuous learner and a terrible liar.

I spend a considerable amount of my time thinking and writing about good and bad leadership and management – and about why what we do as leaders carries well beyond the walls of our organisations.

Contacting Ger Mulcahy:

You can connect with Ger on LinkedIn, see his work in his blog or reach him by email.

By Ger Mulcahy

I’ve recently finished reading “Bad Blood” by John Carreyou, which is a fascinating expose of the cultural and leadership failures at Theranos (why do I always think of Infinity Stones when I read that name?). It’s a well-written, highly critical view of how Elizabeth Holmes and her partner, Sunny Balwani, systemically lied and misled investors, staff and regulators before eventually being exposed. It made me think in a broader context about leadership failings, and I’m going to try and capture some of those thoughts in the paragraphs that follow.

We frequently talk and write about what constitutes good leadership, and we can all cite examples of leaders we think epitomise the qualities we aspire to. We talk, write and think less often about leaders who abuse their positions for personal or professional gain.

Leaders set a vision for an organisation or entity, and frequently establish the strategy and norms to meet that objective. Some leaders start out with motives that are not generally considered acceptable, or even downright evil. Hitler and the Nazis spring to mind. Hitler was initially a very effective leader in setting a vision and establishing strategies through his generals, but few would agree with his thinking. Most, myself included, find it abhorrent.

Then there are leaders who think they are doing the right thing but go about it in the wrong way. Bankers “building shareholder value” by generating record profits caused the Great Recession, but I suspect none of those banks’ leaders intended to do so. They were incentivised to do the wrong thing and not focus on the broader social good. Generals in the First World War sent battalions of troops “over the top”, believing they were doing the right thing by sacrificing tens of thousands of men at a time to an insatiable engine of destruction. They may have been uncaring or ignorant, but I believe the majority thought they were doing what they did in service of a greater aim. Their shortsightedness led to massive casualties on both German and Allied sides of the conflict and often moved the trench lines no more than a few feet at a time.

Some leaders sacrifice the truth and their integrity for the sake of expediency. At one point, these leaders may have been well-intentioned, but through a series of sometimes small decisions, become irrevocably lost down a path that has no positive end. The story of Theranos seems, to me, to fit into that category. At some stage in her career, I believe that Elizabeth Holmes may have been a well-intentioned leader. Certainly, the vision she sold to her company, her investors and her board was one of reducing human suffering, which is a noble endeavour. Over time, the means to achieve that end became muddied by greed or an unwillingness to admit failure.

What was astonishing to me in reading Carreyou’s book is the number of competent, renowned, deeply intelligent men (and they were mostly men) who Holmes was able to convince of her sincerity and integrity. Holmes was obviously a superb sales executive. She was not a good leader, however. She cultivated a culture of secrecy, demanded absolute loyalty and fired anyone who raised concerns about her methods. According to “Bad Blood”, her partner (and paramour) Balwani bullied and belittled staff and created a hugely toxic environment.

In the end, it was the deep bravery of individuals willing to stand up to a highly litigious Theranos that exposed the rotten heart of the company. A number of whistleblowers worked with Carreyou and the Wall Street Journal to bring the truth to light. They, to me, were demonstrating leadership characteristics that Holmes could well have learned from – courage, strength of purpose, resilience in the face of fear and active legal threat and a clear and continuous sense of integrity.
Good leadership requires that we not just set a vision but establish the appropriate parameters within which we should execute it. “Win at all costs” is different to “Win, ethically”. Truth (which is obviously sometimes subjective, but I’m talking objective truth here) should not become a casualty in the pursuit of success. Sharing openly whenever possible creates a culture that values honesty and transparency and leads to problems being raised in a timely and public manner. Maintaining fair compensation and a blame-free approach creates an environment with psychological safety. And rewarding instead of punishing those who challenge us to be better should be a hallmark of any leader.

I recommend Carreyou’s book, not just because it’s a good read, but because it clearly articulates how misdirected leadership is a powerful force for ill – and that is a lesson any of us who lead or manage people must take to heart.