Stress-testing Your Reality

What with the European banking stress tests that have been going on and the on-going lack of effective solutions to the Euro crisis, it brought to mind the need to stress-test one’s ability to recognise the reality of situations and how important this is for a leader. Clearly, there’s been a lot of “heads in sand” going on over the last few years, in the US and Irish property and financial markets at any rate. But is the ability to clearly see the wood for the trees that important?

I have just finished reading the very excellent book “Good to Great”, by Jim Collins. For those of you who haven’t heard of it, Jim Collins and his team spent 5 years researching if it was possible for a “good” company to actively develop itself into becoming a “great” company and then wrote a book about their findings. Only 11 eleven companies made it past the tough selection criteria but for those that did, one of the common denominators was the need for each company to take a good, long hard look at themselves and, with a level of painful honesty, to clearly recognise and understand what did and didn’t work. That said, they also needed to hold strongly to a belief that they could do better, much, much better. They named this duality, the Stockdale Paradox.

While Jim and his team found this duality to be a paradox, I was struck by how the Stockdale Paradox seemed to nicely capture two elements of emotioanl intelligence – reality testing and optimism. As is well established at this stage, IQ is not the be all and end all of intelligence and other things such as the ability to deal with stress or build relationships with others are often much more important in dealing with everyday life. Specifically, reality testing is the ability to see things as they really are, not as we fear them to be (too low) or how we wish them to be (too high). Optimism is the ability to look at the brighter side of life and to maintain a positive attitude, even in the face of adversity. Again, low Optimism tends towards the pessimistic while overly high optimism moves into Walter Mitty territory.

As I read the book, it struck me that the Stockdale Paradox provided wonderful evidence of two elements that are vital for effective leaders: the ability to maintain a positive outlook and keep going, even when times are tough plus the ability to see the reality of the situation and adjust appropriately and in a considered way. So, the evidence would suggest that a leader’s ability to clearly see the woods for the trees is a key factor to long-term success. Is this what separates the effective from the lucky leaders?  Have you seen examples of these behaviours in action in your workplace?


3 Responses

  1. I am enthralled at the wonderful leadership insight this blog presents with crispness and clarity.My only comment is that the approach may well get unstuck under political compulsions. And this is what I suspect is the problem with the Euro Banking crisis at this poit of time.

    A good read indeed!

    Shakti Ghosal

    • Hi Shakti, I think you’re right that politics is hampering what really needs to be done and politics also hampers the effectiveness of the workplace too. This is why there are so few effective leaders; they’re so busy playing politics that they can’t see the situation clearly.

      Thanks for the post.

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