Can an Organization Survive the Fall of an Iconic Leader?

Internal perceptions impact a company’s ability to pull through a crisis in leadership

by Ray Benedetto, D.M.

iconic-leaderRecent revelations by disgraced “hero” Lance Armstrong raised speculations about the future of LiveStrong, the charity Armstrong founded to fight cancer in the aftermath of his own cancer-fighting experience. Although some anticipate a short-term drop in LiveStrong’s fundraising, many believe the nonprofit will survive because its core mission goes far beyond the image of its founder.

Parallel situations experienced by other organizations and companies have also hit the headlines. Although different circumstances existed, core issues are similar: shattered perceptions of a “hero” figure combined with the betrayal of the trust and honor given to a leader who failed to do the right thing. Becoming enthralled with “heroes” based on celebrity, position, wealth or athletic prowess creates a foundation for mental distress because people are human and will make mistakes. Leaders of well-run organizations understand the disruptions such mistakes can have on mental stability, and put leadership systems in place to counteract the negative effects of such events.

Many people associate strong leaders with the success of an organization, but, regardless of its size or purpose, an organization succeeds through the efforts of many people rather than the reputation of any single person. Studies by Booz and Company about CEO succession and longevity within large, publicly-held companies show CEOs have a median tenure of about five years, while a quarter of CEOs from 2,500 reporting companies have eight or more years in that role. (CEO tenure in privately-held companies is longer, many times because the CEO is also the founder, owner or primary stockholder.) Regardless of organizational size, CEOs are responsible for company performance, including growth and sustainability.

Leadership shakeups rarely occur when leaders are doing the right things and objectives are being met or exceeded. Shakeups invariably occur when a leader betrays a trust or stakeholders lose confidence in that person’s ability to lead, guide and influence others effectively. Leaders who break or betray a trust lose credibility and, with it, the ability to lead. Armstrong is simply a very visible example of many more that exist.

Poor performance stems from several factors that build over time and contribute to a company’s demise. Early warning signs of failure are lack of a well-defined vision, high turnover rates, cuts in training programs and core business operations, an exodus of top talent and a series of “quick fixes” by managers fighting a losing battle.

Compared to civilian organizations, the military services match or exceed Fortune 100 companies in size, infrastructure and resources. The military services are well-known for executing their missions, and do so despite thousands of promotions, retirements, job rotations and replacements each year. How do they do it?

Rather than rely on personality or charisma, the military services have well-defined leadership systems that meld individual character, emotional intelligence, critical thinking and business knowledge with collective commitment — regardless of rank, position or responsibilities — to high ideals, teamwork and service to others. We found similar characteristics in the high-performing small to mid-sized companies we studied. People who share core values and develop positive relationships around those values within the organizational setting are more likely to be committed to their work, especially when leaders set the right example. Leaders develop trust with those they serve by being authentic, honest and forthright rather than setting themselves apart from others. 

By modeling the way and teaching others how to lead at all organizational levels — strategic, operational and grassroots — senior leaders develop the talent that will sustain the organization despite external changes and potential disruptors. Surviving any type of leadership change begins long before the event occurs.

The following actions are anchors for surviving leadership changes expected through natural evolution and also for surviving unexpected changes and evaluating existing leadership: Re-emphasize organizational purpose, especially the core values, vision and mission. Regain trust by pursuing moral and ethical “high ground.” Communicate openly and regularly with employees to regain trust.

Employees at all levels need and want to know what is going on. They need to be respected for the value each person brings to the organization. Lack of regular communication gives rise to rumor, speculation and distrust, which work against the leaders who remain and continue to carry responsibilities for company performance.

Ray Benedetto, D.M., is a retired USAF Colonel. His doctorate is in organizational leadership, and, in addition to teaching leadership and strategic planning for the University of Phoenix Chicago Campus MBA program, he founded a consulting firm that helps leaders build high-performing, character-based cultures. He is a co-author of It’s My Company Too!: How Entangled Companies Move Beyond Employee Engagement for Remarkable Results.

Speak Your Mind

In Business Dailies

Sign up for a complimentary year of In Business Dailies with a bonus Digital Subscription of In Business Magazine delivered to your inbox each month!

  • Get the day’s Top Stories
  • Relevant In-depth Articles
  • Daily Offers
  • Coming Events