Reference no: EM1371595

THE RISE OF THE NICE CEO?

If asked to describe the traits of an effective CEO, most people would probably use adjectives such as driven, competitive, and tough. While it's clear that some hard-nosed CEOs, like Blackstone chief executive Stephen Schwarzman (see the chapter opener), are successful, recently some authors have suggested that being "nice" is really important in today's workplace, even in the CEO suite. In a recent book titled The No A--hole Rule: Building a Civilized Workplace and Surviving One That Isn't, Stanford management professor Robert Sutton argues that getting along well with others is important to the successful functioning of organizations.

Many companies, such as Google, have developed policies to weed out those who habitually behave in an uncivil manner. Lars Dalgaard, CEO of SuccessFactors, a business software company, identifies himself as a recovering Fortune 500 "a--hole." Now, Dalgaard has implemented a strict "no a--hole" rule in his company. Job interviews are lengthy and feature probing questions designed to uncover any browbeating tendencies. Last year, Dalgaard took candidates vying for a chief financial officer vacancy to lunch at a local restaurant to see how they treated the wait staff. Some got a free lunch but nothing more. When managers and employees are hired, they get a welcome letter from Dalgaard that spells out 15 corporate values, the last of which is "I will not be an a--hole."

Although it's not clear whether they've read Sutton's book, some CEOs of Fortune 500 companies do seem to project the image of a "kinder, gentler CEO." Let's consider three examples, all of whom were protégés of Jack Welch when he was CEO of General Electric (GE) and of whom were candidates to be his successor: Bob Nardelli, James McNerney, and Jeff Immelt.

Bob Nardelli, former CEO, Home Depot. When Bob Nardelli wasn't chosen to be CEO of GE, he demanded to know why. Didn't he have the best numbers? His bitterness was palpable, say GE insiders. When Nardelli became CEO of Home Depot, in his first few months on the job, he became notorious for his imperious manner and explosive temper. At one meeting, he yelled, "You guys don't know how to run a f---ing business." When

Nardelli was fired as CEO in 2006, it was due to a combination of factors, including Home Depot's lackluster stock price, but his abrasive personality played no small part. BusinessWeek wrote: "With the stock price recently stuck at just over 40, roughly the same as when Nardelli arrived 6 years ago, he could no longer rely on other sterile metrics to assuage the quivering anger his arrogance provoked within every one of his key constituencies: employees, customers, and shareholders."

James McNerney, CEO, Boeing. - These are heady days at Boeing, which commands record levels of new orders and dominates its European rival Airbus as never before. Most CEOs would take credit for this success. Not James McNerney, who gives the credit to Boeing's engineers and employees. "I view myself as a value-added facilitator here more than as someone who's crashing through the waves on the bridge of a frigate," he says. A former GE colleague compared Nardelli and McNerney, saying, "Jim's problems have been as tough, or tougher, than the ones that Bob had to face. But he has tried to solve them in a much more pleasant way. The guy is loved over there at Boeing."

Jeff Immelt, CEO, General Electric. - Although Jeff Immelt is the first to point out that the nickname "Neutron Jack" for his predecessor Jack Welch was misleading, and that the differences between him and Welch are not as dramatic as some claim, Immelt is noted for his calm demeanor and trusting approach. In speaking of his approach, he said, "I want to believe the best in terms of what people can do. And if you want to make a growth culture, you've got to have a way to nurture people and not make them fight so goddamn hard to get any idea through the door."

Questions

1. Do you think Sutton is wrong and that the contrasting fortunes, and personalities, of Nardelli, McNerney, and Immelt are coincidental? Why or why not?

2. Do you think the importance of being "nice" varies by industry or type of job? How so?

3. How comfortable would you be working in a culture like that of SuccessFactors, where a certain level of "niceness" is part of the job description?

4. Do you think being "nice" is the same as the Big Five trait of agreeableness? If so, do you think companies should screen out those who score low on agreeableness?

5. Earlier we discussed the fact that entrepreneurs score significantly lower than managers on agreeableness. How would you reconcile this finding with Sutton's point?