Pride, Arrogance, and Leadership

I recently sent an email to the founder and CEO of a large online retailer. His company had recently created a new brand and a new advertising campaign to match. In my humble opinion, the branding as well as the ad campaign were poorly conceived, and I sent an email to the CEO offering my perspective on things. The CEO was not impressed with my observations, to say the least. I later learned the company had increased revenues 14% with the same ad campaign I loathed.

I’ve spent a bit of time thinking about this experience. On the one hand, I should be feeling humiliated, not only because the CEO described my opinions as “typically superficial marketing professional thinking,” but also because I learned through a third party about the 14% increase in revenue due to the ad campaign I felt left something to be desired.

I did and still do feel a little humiliated, although I feel worse about offending someone because I don’t like offending people. I’m a white/blue on the Hartman Color Code in case you’re curious.

But rather than just sulking about it, I’ve tried to learn from the experience, and I feel I’ve learned a few things.

First, let me give some context. I’ve been a young, aspiring entrepreneur since I was in elementary school and my passion has been especially felt during the past few years.

As I was going through college, I attached myself to entrepreneurs and business people who I felt could teach me what I needed to know to be successful. One thing I heard repeatedly from these people was a theory about how entrepreneurs each have their area of expertise and ability, and it is generally restricted to certain revenue thresholds.

For example, the entrepreneur who is a whiz at starting businesses often is good going from $0 to $500,000, but not so good at taking the business from $500K to $1M. The entrepreneur who is good at taking a business from $500K to $1M generally can’t take the business from $1M to $5M, and so forth. The increments I’ve heard are usually $0-$500K, $500K-$1M, $1M-$5M, $5M-$10M, $10M-$20M, $20-$50M, and $50-$100M.

I heard this theory expressed as though it were fact on many occasions, and it distressed me because I want to grow a business from $0-$100M someday.

One day, I was having lunch with one of my mentors, and I asked him about this theory, and what it was that kept entrepreneurs from being able to transition from one revenue milestone to another. His immediate answer was “Arrogance.” Pride was the killer. Part of the problem is that the business dynamics change at different revenue milestones, but oftentimes leaders are unwilling to change their behaviors and habits to deal with the changes because they “already know how to run a business.” The last nail in the coffin is when the leader is too proud to turn the reigns of the business over to someone else, and this is when companies go out of business.

This was something of an epiphany for me and gave me a lot of encouragement, because I’m pretty much the most humble guy I know, so I should be able to do well in business. But seriously, it was encouraging because it gave me hope.

Now to come back to my recent experience. When I received the email back from the CEO of this multi-hundred-million-dollar company telling me I was rude and superficial, I was shocked. Yes, the email I sent him was direct and to the point, and could even be taken as rude, although I didn’t intend it to be taken that way (that’s the trouble with email, you don’t get the tone of voice or body language that is a large part of how we communicate). I was shocked because I had met this CEO on a few other occasions and heard him speak and I had always been impressed with him. I felt he was a man of integrity, someone who was a good leader, someone with an even temper, and I was surprised that he would react angrily to an email.

Put yourself in the CEO’s place. You’re responsible for hundreds of employees, and you’re trying to grow a multi-billion dollar enterprise. Wouldn’t you want all the help you could get? And don’t some of the best suggestions for improvement often come from customers, potential customers, and front-line employees?

What if you were an employee of this company, and you sent an email to the CEO saying “This ad campaign is a mistake. Sure, it might work, but we can do a lot better.” Then imagine that the CEO sent you an email back saying your thinking was superficial and you were rude. Would you ever speak up again? Even if you noticed something you knew would seriously damage the company, would you bring it to the attention of the CEO?

I believe a CEO should, with perhaps few exceptions, be gracious about receiving criticism, if only so that the criticism keeps on coming, because that criticism can be a goldmine.

I think it was Plato who said something along the lines of “we should love most those who hate us” because it is those who dislike us who are willing to point out our faults, and by having our faults pointed out to us then we can work on them and overcome them. If someone has that quote and the source, please send it to me.

A second thing I’ve learned from this experience is the folly of being proud and rejecting criticism on the grounds that what you’re doing is working. The CEO of this company didn’t tell me they had increased sales 14% with their ad campaign, I heard that from a third-party. But I’m betting he was thinking “This punk, how dare he tell me my ad campaign stinks. We just increased revenues by $80M, that shows how much he knows.”

Ok, maybe I should give him the benefit of the doubt, maybe he wasn’t thinking that, and maybe he responded to my email in anger because he was having a really bad day. But for the sake of learning something, lets assume he was actually thinking the thoughts I’ve attributed to him.

Can anyone deny that this a foolish attitude to have if you want to be as successful as possible in business? Maybe if he had a better ad campaign he could have increased revenues 30% instead of only 14%. One thing I was taught by another mentor of mine is “there is always a better way.” A CEO’s duty is to always be looking for that better way, and never to assume that because something has worked well that nothing else could work better.

So what would I have done in his shoes? Maybe I wouldn’t have answered the email at all. Maybe I would have responded and said “Thank you for your comments” and then told me executive team how this idiot sent me a rude email. Actually no, I wouldn’t have done that. Maybe I would have laughed at it with the executive team if I could pick it apart logically and show the stupidity of the reasoning. Maybe. But I think most likely if I were to receive an email from someone criticizing the way I’m running my business, I’d look to see if there was any logic or reason behind what the person was saying, and if there was maybe I’d take that into consideration as I set the course of my business.

Now you might say “But why shouldn’t he react the way he did? After all, he’s already got a business well on its way to being a billion-dollar behemoth, doesn’t that give him the right to tell you that you don’t know what you’re talking about?”

This is where principle-centered leadership comes into it. For a business leader to criticize someone’s advice simply because they’ve been a successful business person up to this point is taking a short-term view. It’s inherently reactive. It might work for some people, and it might work for them all their lives, if by “work” you mean they make lots of money. But their lives will not be all they could be, and I’d wager they aren’t as happy as they could be, and I would also wager that those who act on the short-term and are successful are the exceptions, rather than the rule.

Ok, nuff said. Any thoughts?