Wikipedia describes Hubris as “a personality quality of extreme or foolish pride or dangerous overconfidence, often in combination with arrogance.
"In its ancient Greek context, it typically describes behavior that defies the norms of behavior or challenges the gods, and which, in turn, brings about the downfall, or nemesis, of the perpetrator of hubris. Hubris often indicates a loss of contact with reality and an overestimation of one's own competence, accomplishments or capabilities. In modern usage, it is also referred to as "pride that blinds" because it often causes the person to act in foolish ways that belie common sense.”
In the world of family business governance where conflict is inherently part of the ecosystem, flawed behaviors and past hurts by the leaders and their offspring, when left unchecked, almost always mutates into some form of power struggle and generational conflict. With certainty, as the conflict escalates and conflicted members refuses to yield, hubris takes over and becomes “that pride that goes just before the fall.”
History constantly reminds us how once proud and mighty organizations all over the world crumbled due to stubborn and arrogant leaders.
As family business consultants, our role can be daunting and stressful, especially when we are confronted with hubris, aptly called in governance language as “founder arrogance.” It is one of the biggest issues that is causing many businesses to degenerate. Working with these high net worth (HNW) egocentric individuals can be cerebrally and emotionally challenging.
In many ways, this behavior has a direct correlation to the short tale “The Emperor's New Clothes.” Written by Hans Christian Andersen in 1837, this story is about an emperor who was sold a magnificent set of clothes by two con artists.
The parable talks about how pride, ego and power can lead one to think that he is superior and intelligent. It also highlights how a crowd can and will fall behind an authority figure even through stupid actions. It takes an innocent child who is outside the social norms to point out what everyone can see.
For individuals afflicted with hubris, there is a confirmation bias: He or she is above everybody else and adjusts his or her reality to confirm this bias. And there’s more. For them, it is some form of defense mechanism: When there are some bad decisions made, they deny their mistakes and stubbornly refuse to admit them.
In the workplace, few people are willing to risk the wrath of the leader by telling him or her that they are arrogant. As a result, this form of collective apathy can leave the owner blind to the harsh realities of what’s going on in the business and the competitive environment. And all too frequently, the task of telling them that they are wrong falls to an outside adviser.
A consultant’s role is not only to question the status quo but to articulate and embed the values that governance brings to the enterprise. Every good advisor worth his salt must stand his ground against arrogant owners and get “paid to disagree with the founders and next generation leaders.”
My advice to colleagues is this: If you want to get the desired results without compromising your values, be “ready to walk away” when the bloated ego manifests an erratic, irrational, self-centered behavior.
And finally, as a fair warning to business owners (borrowing a quote from Charles Koch, president of Koch Industries, with $115 billion in revenues and 120,000 employees in 2017), “Success is one of the worst enemies of success, because success tends to breed complacency and lack of humility.”