MARCH 2016 / NO. 1
TAGS: BIG BOYS BIG EGOS, NARCISSISM, ANTOINETTE RIJSENBILT, CEO, STEVE JOBS, APPLE, MICHAEL EISNER, WALT DISNEY, JACK WELCH, GE, INGVARD KAMPRAD, IKEA, HENRI FORD, FORD MOTOR COMPANY, FREDDIE HEINEKEN, HEINEKEN, RICHARD BRANSON, VIRGIN, SEPP BLATTER, FIFA, MICHEL PLATINI, UEFA, AIR FRANCE-KLM, RYANAIR, ROYAL IMTECH, VOLKSWAGEN, COMPANY RADAR ROOM, CISCO

Big Boys Big Ego’s and Strategic Intelligence

Strategic intelligence creates the countervailing power towards destructive narcissism of the Big Egos
Narcissism is widespread at the top in both private and public companies as well as in non-profit organizations and the public sector. Narcissism is a necessary element for effective leadership, but it can, however, also become a negative trait. So we may therefore speak about positive and destructive narcissism. Examples to be emulated are Steve Jobs (Apple), Michael Eisner (Walt Disney), Jack Welch (GE), Ingvard Kamprad (IKEA), Henri Ford (Ford Motor Company), Freddie Heineken (Heineken) and Richard Branson (Virgin). All are leaders with vision and charisma who have been able to inspire and motivate their employees tremendously. But there are also examples of destructive narcissism; think of the ‘sun-kings’ at the top of many private and public companies and in politics. Examples include top management at banks, insurance companies, NGOs, public organizations, and Sepp Blatter (FIFA) and Michel Platini (UEFA) in sport. Research shows that narcissism can be measured objectively by looking at five key elements which tell us something about the narcissistic personality of the CEO. These five elements are media, remuneration, power, growth and emoluments.
Variables which we can objectively determine include, amongst others, the number of publications in the press, number of awards, size of photo(s) in the annual report, compensation, duality, number and size of acquisitions and special perquisites such as private use of the corporate jet. Narcissism is not necessarily a personality disorder, but can be expressed on a scale on which one may score either high or low.
Strategic intelligence is the way to organize countervailing power towards the board of management and the board of directors. Strategic intelligence is executed by a small team of 3-4 professionals who report directly to the board. This means that strategic intelligence is positioned at the highest level in the organization, above risk management, because the focus of strategic intelligence is on gaining maximum insight and foresight on all aspects of the dynamics of change in the external business environment: future developments of markets, customers, competition, new legislation, and new technologies. The key objective of strategic intelligence is to try and prevent in a timely way a situation where the company faces a strategic crisis, and thereby avoid the usual solutions of cost-cutting and personnel layoffs. In addition to delivering the necessary countervailing power to the big egos, the strategic intelligence team counteracts arrogance and complacency at the top, preventing the company from relying too much on past successes.
The Ford Motor Company shows a nice example of how to do this. When Alan Mulally moved from being CEO at Boeing to become CEO of Ford in 2006, he initiated a policy of cost-cutting and debt reduction. In 2009 Ford returned to profit after the heavy losses of US$ 14.7 billion in 2006. What made the crucial difference? When Mulally started at Ford he created a strategic intelligence team with a war room, in which he had three walls each with a different color: green, orange, and red. This was Mulally’s strategic intelligence approach to visualize ‘Ford’s Global Battlefield’ and his way of structuring the countervailing power at the top of the company.
Air France-KLM is a company where countervailing towards the board of management and board of directors failed. In 2004, KLM was sold to Air France. For many years KLM suffered from Air France’s under-performance and from fierce competition from easyJet and Ryanair. Ryanair even considered starting using Amsterdam Schiphol Airport, KLM’s home base, in 2016.
At the end of the 1990s Ryanair started competing on price as price: In 2000 they had just 13 planes (KLM had 186), in 2005 they had 60 planes (KLM 182) and in 2015, 320 planes (KLM 200).
Other examples of destructive narcissism are the disasters of the ‘Sun-Kings’ at the Dutch housing corporation sector, at Royal Imtech, and at Volkswagen in 2016.
Strategic intelligence professionals use unique analysis tools such as strategic war-mapping, scenario analysis, competitive arena analysis and Grey Swan analysis, strategy under uncertainty, and early warning. Strategic intelligence professionals deliver actionable intelligence to top management to help them make the best decisions, 12-24 months ahead of the game. This is their way to give countervailing power to those at the top. These professionals are able to do so because they have at their disposal a Company Radar Room whereby all the dynamics of change in the external business environment are constantly monitored. In addition to Ford Motor Company, another excellent example of a company which has a radar room or war room in place is Cisco.
Want to read more in-depth information? Check out the book: “BIG BOY’S BIG EGO’S AND STRATEGIC INTELLIGENCE”
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