The corpus of literature on leadership truly boggles the imagination. One would be readily believed if one were to say that there are as many writings on the subject as there are stars in the sky! Google Search throws up 126 million results.

Most of the time, the feeling you get on jet-reading as many as you can get hold of is that they cover familiar terrain, but make it look like new by indulging in a clever play on words.

Really stimulating ideas which throw a new light on the meaning, content and manner of exercise of leadership are hard to come by. That is what explains the pleasure one gets when one comes across original thinking on this age-old theme. Hitherto, one of the prescriptions blindly accepted all over the world was that for leaders to be inspirational and go-getters, they should be capable of positive thinking. Its power was claimed to be immense in terms of both self-motivation and achievement of goals.

A recent paper titled “The weakness of positive thinking” by Prof David Collinson of the Lancaster University Management School, contained in the May 2012 issue of Leadership (No. 2, Vol. 8), and included in the Strategy+Business Web site of July 27, puts paid to this presumption.

The gist of the paper is that “when an upbeat management style becomes excessive, it wards off reality and asks for trouble”.

“DELUSIONAL OPTIMISM”

“Prozac leadership” (derived from the ‘high’ one gets by taking the anti-depressant) is the appellation that Prof Collinson has given to what he calls “delusional optimism” that prompts the Prozac leaders to gamble against odds fired by their irrational exuberance.

Since their mental make-up takes account of only the best case scenarios, they are taken in by their conviction that nothing can go wrong and everything is going well.

“As a consequence, they ask fewer and fewer questions and become deaf to feedback that is ‘off message,’ leaving them, and their companies, dangerously insulated from economic and social realities…By insisting that subordinates’ upward communication (be) exclusively positive, Prozac leaders and the uncritical cultures they encourage can silence committed and concerned followers…

“Regardless of whether Prozac leadership is fuelled by wishful thinking, naivety, hubris or more deliberately manipulative motives (or a combination of these), subordinates can perceive Prozac leaders to be contradictory, remote and unwilling to consult, and may dismiss their excessive optimism as insincere and manipulative.”

Beginning from the currency meltdown of the 1980s and dotcom bubble of the 1990s, to the boom-and-bust of the sub-prime mortgage crisis that directly led to all the financial devastation of which the industrial nations are experiencing the effects to this day, the business landscape is littered with the detritus of an excess of exuberance.

What happens when a degree of overzealousness bordering on recklessness which, in turn, is misconstrued as positive thinking, takes over is scant effort devoted to risk analysis, neglect of due diligence, and a disregard of danger signals.

CAUSE OF ACTION

An over-optimistic attitude on the part of organisational leadership also leads to exaggerated claims in regard to quality, delivery and performance.

When expectations roused sky-high come crashing down, not only does the credibility of the entire enterprise get irretrievably damaged, it also suffers loss of enormous resources in terms of time, money and manpower in litigation.

The paper mentions the results of analysis of 165 lawsuits from 2003 to 2008 in a study undertaken last year which found that the statements of sued companies were markedly more optimistic than those of similar firms that weren’t sued.

In 91 per cent of the cases, plaintiffs cited the optimistic language as the cause of action against a firm.

One is tempted to readily agree with the author’s conclusion that “leaders can become excessively positive, making them reluctant to listen to alternative viewpoints and leaving their firms unprepared to deal with unexpected problems… Prozac leadership ultimately results in resistance from employees, customers, and shareholders.”

Fortunately, Indian ethos has always favoured the golden mean. Normally, corporate leaders as well as government policy makers do not go overboard but prefer to adopt a cautious and restrained approach.

If anything, they sometimes seem too timid, carrying their risk-aversion to a state of the much-maligned “policy paralysis”.

There is much that industrial nations can learn from India’s economic management.

(This article was published on August 7, 2012)
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