It was Mark Zuckerberg who commented that "Someone who is exceptional in their role is not just a little better than someone who is pretty good. They are 100 times better." Picking that up, Bill Taylor, one of the cofounders of Fast Company magazine, recently asked whether talent is overrated.
This is not an unfamiliar issue. Underneath it is more than three centuries of American history and myth- making about individualism. Historically, the notion of individualism has been shown to be a mixed bag. A very mixed bag of good and evil. Taylor's blog, which I've linked to above, states his answer to the question: Great people are overrated. And, he argues, the belief that the gap between a highly productive individual and the average person is getting larger and larger is false. So he sets out to right that wrong.
More than 300 have commented on his two blogs, many with a great deal of rejection and hostility toward his ideas. Taylor wasn't surprised at the rejection, but he wasn't prepared for the derision and hostility to him and his notion. What crossed my mind as I read many of the comments was not the accuracy of his comment, but why so much hostility? Why so much protest? Why so much rejection? Why so many unwilling to even give consideration to his idea. That was a Harvard blog with a readership,I assume, of fairly literate people. Methinks the commenters were protesting a bit too loudly.
Understand that there's a lot invested in the belief of the highly talented individual. Although Taylor was concerned with the implications of this belief upon organizational productivity, there are other implications. Including executive compensation. Executives are so much more capable than the average worker that they deserve the huge pay they receive. Or so the argument goes.
The Washington Post reported just a few days ago on the compensation issue. Seems that companies and CEOs are trying to limit the publication of the information. Wonderfully, the article included research by Carola Frydman and colleagues at MIT showing that though average executive pay at the nation's top companies in 1970 was 28 times the average worker income, by 2005 executive pay had jumped to 158 times that of the average worker. Some CEOs receive as much as 400 times average worker pay. Obviously the compensation committee thinks CEOs can make a unique contribution. But are the compensation differences truly representative of a huge gap between executives and workers? The research doesn't support that idea.
The issue is up front in the sports business. A huge majority of sports teams spend their time looking for those standout players. And the financial offerings suggest that team leadership believes that their success is tied solely to individuals. Although, Taylor calls our attention to some important exceptions to the rule.
Ever ask why team play is so difficult in business? The truth, I suspect, is that people don't really believe in it. Instead, organizations reward bonuses to individuals, believing that it's always the individual that makes the difference. Is this really true?
What we have going on here is what we with background in American studies call the "John Wayne syndrome." There's always one unique person out there who'll rescue us. The team may not be able to resolve our problem, so we'll have to find that one highly talented individual and leader. Could it be that what's going on has cultural blinders so strongly fixed that we can't see reality. Thankfully, one highly successful organization completely rejects the notion of the standout person: the US Marines.
But back to Bill Taylor's question: Is one standout person better than a team of pretty good people?
Malcolm Gladwell dealt with the same issue a few years ago and put it into focus in a New Yorker article, The Talent Myth. This "talent mind-set" is the new orthodoxy of American management. It is the intellectual justification for why such a high premium is placed on degrees from first-tier business schools, and why the compensation packages for top executives have become so lavish. In the modern corporation, the system is considered only as strong as its stars, and, in the past few years, this message has been preached by consultants and management gurus all over the world.
More often than not, Gladwell writes, it's the other way around. The system builds the talent.
Talent and leadership certainly matter, but the notion of the standout person turns out to be a half truth. James Meindl and Jeff Pfeffer, among many researchers, who have studied this issue, found that the US culture romanticizes leaders, anointing them with "esteem, prestige, charisma, and heroism" that outstrips the weight of evidence.
The most recent research is that of Boris Groysberg, whom I've referred to in previous blogs as one one of the best researchers in the business. Taylor quotes from the publisher of Groysberg's book, After examining the careers of more than 1,000 star analysts at Wall Street investment banks, and conducting more than two hundred frank interviews, Groysberg comes to a striking conclusion: star analysts who change firms suffer an immediate and lasting decline in performance. Their earlier excellence appears to have depended heavily on their former firms' general and proprietary resources, organizational cultures, networks, and colleagues. There are a few exceptions, such as stars that move with their teams and stars that switch to better firms. Female stars also perform better after changing jobs than their male counterparts do. But most stars who switch firms turn out to be meteors, quickly losing luster in their new settings.
But why do we hold so tightly to the half truth of the standout person?
Given that Groysberg's research is just the latest contribution to a systematic analysis of the subject, why does this half-truth persist? In their book, Hard Facts, Dangerous Half-Truths and Total Nonsense, Pfeffer and Sutton line up the studies and then suggest four major reasons for its persistance. Reasons that are worth chewing on. They reveal an awful lot about our thinking and they also suggest serious limitations to it.
- Overly-simplified perceptions. When we look at organizations, we see the people who are in charge. We don't see the constraints that affect both behavior and performance. We attribute the outcome to the person in charge and miss all the work others carried out. We see the tip of the iceberg and miss the mountain beneath the surface.
- Cognitive shortcuts to make sense of confusing information. All humans simplify complex information by means of shortcuts. The huge list of ever-shifting possible causes of organizational performance are difficult to predict and control, so we search for a way to controlling that data. Putting excessive faith in leadership is one way to manage the information. It also makes for a lot less mental demand and effort. Pfeffer recounts a telling conversation with a former GE exec, Spencer Clark who joked about Jack Welch, "Jack did a good job, but everyone seems to forget that the company had been around for over a hundred years before he ever took the job, and he had 70,000 other people to help him."
- Generalizing from unit performance to the leader. People readily conclude that good companies have good managers (and bad companies have bad managers) regardless of other mitigating factors. It's especially true when organizational performance is particularly good or particularly bad. Having consulted at Sunbeam shortly after Chainsaw Al Dunlap's destructive leadership in the mid-1990s, it struck me that he wasn't the only thing wrong with the company. The company had a surplus of less than mediocre people, teams and processes, but that was never mentioned in all the press releases. The strategic bankruptcy that followed was not only a way to handle the financial mess, but also a means to revamp the entire organization and put it on a stronger performance track.
- Money, money, money. The financial rewards mentioned above incentivize the behaviors of execs fueling the half-truth that leaders are lords and masters of all that transpires around them. That means, of course, that these "lord" are completely responsible for the organization. And, since they're master of all, they can hand out raises and promotions, hire and fire high-priced consultants and attorneys, and allow or forbid media access. Of course, those of us who consult to them, and especially the executive search and compensation firms have the same incentive.
There are great many reasons for all of us, execs, consultants and workforce, to believe that one standout person is better than a team of "pretty good" people. The truth, of course, is that a team of "pretty good" people typically performs better than the solo standout person. But there's a lotta money involved in the myth.
Photo from Flickr: Courtesy Pierre-Olivier
