Washington Post

On Leadership

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Dov Charney is not planning to fade into the California sunset. The controversial founder of Los Angeles-based American Apparel, whose board announced last week that it was stripping Charney of his chairman’s title and intended to fire him as CEO “for cause,” said in a regulatory filing late Friday that he is working with an investment firm to boost his stake in the company as he fights the board’s move to oust him. He also said he planned to continue talking with shareholders about potential changes to the clothing brand’s board and management. In a filing earlier in the week, he had said he would contest his termination “vigorously.”

Since the board’s announcement, several accounts have chronicled his ouster with more detail than tends to publicly air when a CEO is fired. Charney’s termination letter has even been published online, in which the board cites his failure to stop an employee from creating “false, defamatory and impersonating blog posts” about former employees, as well as misuse of corporate assets. (His lawyer has called the accusations “baseless.”)

But while Charney’s example may stand out for its lurid details and the public nature of the fight, governance experts and psychologists who work with executive transitions say what’s not unusual is for founders to push back – albeit rarely with much success. “Founders have much more emotional attachment,” says Charles Elson, director of the Charles L. Weinberg Center for Corporate Governance at the University of Delaware. “For an average CEO, it’s a job and money. For a founder, the company is an extension of self. It becomes much more personal.”

A year ago, for instance, Men’s Wearhouse founder George Zimmer was unceremoniously ousted as executive chairman of the company he founded 40 years before. After being shown the door, Zimmer, famously known for his “you’re going to like the way you look” ads that made him the public face of the brand, issued a statement that left open the possibility he would try to take the company private. In it, he said he was “greatly concerned” about the future of the company. (Zimmer later decided against making a move, and Men’s Wearhouse has since acquired Jos.A. Bank in a heated takeover battle.)

Other founders retire or step aside from executive roles with less pushback initially, but then attempt to re-exert their influence later when the company stumbles. Earlier this month, for example, Lululemon founder Chip Wilson voted against two of the company’s directors, saying in a statement that he is “concerned that the board is not aligned with the core values of product and innovation on which Lululemon was founded.” Wilson had already resigned as chairman following a verbal gaffe he made in the aftermath of the company’s sheer yoga pants recall, but still owns 27 percent of the company’s shares. Though the company fired back with its own response, Wilson is reportedly in talks with bankers about his options to shake up the board.

And back in 2012, Best Buy co-founder Richard Schulze, who had not been CEO since 2002, stepped down as chairman following a probe into why he hadn’t alerted the retailer’s board sooner to an alleged inappropriate relationship between the then-CEO and a female employee. Within months, Schulze began trying to buy out the company and take it private. The talks ended early last year with no deal; Schulze was given the honorary title “chairman emeritus” as well as the right to name two directors to the board until January 2016.

Of course, itcan be good for a company when founders return to influence, whether through their own moves or at the urging of the board.

Kerry Sulkowicz, a psychiatrist and psychologist who advises CEOs and boards, says that “as emotional and irrational as creative entrepreneurs can get under circumstances of transition – and as blind as they can be to some of the consequences of their behavior – some of their core criticisms about the direction of the company are often spot on. They’re often absolutely right about what the company needs, or what is currently wrong with it.” Few would argue, for instance, that the return of Steve Jobs to Apple wasn’t good for the tech behemoth.

Some founders say they are motivated by wanting to improve the company rather than by personal pride. In his statement from last year, Zimmer said the board was trying “to portray me as an obstinate former CEO, determined to regain absolute control…for my own personal benefit and ego. Nothing could be further from the truth.” And Chip Wilson’s spokesman, Greg Lowman, characterizes the Lululemon founder as having “the long-term focus of the company in his heart and his actions reflect that.”

Yet for all founders, says Sulkowicz, their identities are still closely tied to the companies they’ve started. So the question is not if they have a personal attachment, but how much. “The best ones are often the ones who are most wrapped up in it,” he says. “Their identity and the identity of the company is almost inseparable. It’s wonderful when it works. But it’s also a source of great vulnerability.”

That’s particularly the case for leaders in creative industries, such as retail or fashion, who tend to have more emotional and less corporate personality types that match their creative endeavors, according to Sulkowicz. “Without them, these companies would not exist,” he says – but the much less welcome side of that personality can be narcissism. Many founders “have an unconscious desire to prove that they are needed forever and that the company can’t survive without them.”

That fusion of professional and personal identity is what can make it particularly painful for founders when they become sidelined, end up fighting with the board, or get stripped of their authority. Jeffrey Sonnenfeld, a professor at the Yale School of Management who has studied CEO retirements, classifies such leaders as monarch CEOs. “Their business is defined around them and their life is defined around the business,” he says.

At American Apparel, for instance, Charney’s overtly sexual persona has always been part of the company’s racy image. Charney, who has been trailed by allegations of sexual harassment for years, has appeared in several of the company’s suggestive ads, including one where he and two women – wearing clothes – look to be holding a meeting on a mattress. The caption? “In bed with the boss.” His personal style mirrors the 1970s- and 1980s-inspired hipster aesthetic American Apparel sells in its stores. As he told the Financial Times: “I am a deep part of the brand.”

And like most founders, he appears to have lived and breathed the company he founded. When a new distribution center began running inefficiently, Charney has said he had a shower built and literally moved in to the facility to try to fix the problems. A source close to the situation said Charney worked 24/7 and had little life outside the company. (When reached via phone, Charney said he was not able to speak for this article.)

The single-minded focus that helps many founders succeed is the same attribute that can also come back to haunt and hurtthem. “The kind of people who start businesses are highly motivated risk-takers,” says Michael Freeman, an executive coach and clinical professor of psychiatry at the University of California, San Francisco. They tend to be “somewhere on the scale between assertive and aggressive,” he says, and have a dominant personality. “The worst thing that can happen to somebody like that would be public humiliation.”

Still, it isn’t just founders who face the public shame of getting pushed out who have a hard time letting go, says Paul Winum, a psychologist and senior partner with RHR International‘s board and CEO services practice. “You worked 70 hours a week for years and years to build a business for years, and you feel like this is yours – both in terms of having a big financial ownership and a tremendous psychological ownership.”

When the change happens abruptly, as it did for Charney, the experience can be particularly jarring, Winum says. It takes a long time for any CEO, even a non-founder, to prepare for the idea of succession and for losing the power that goes with a leadership position. “When suddenly someone is being forced to separate from their baby,” he says, “that’s when the resistance – and the fight – can be vigorous.”

By Jena McGregor

On Leadership

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This piece is part of an On Leadership round table exploring the role of first lady.

With their armies of advisers and their entourages of consultants, it’s easy to believe most top leaders would have more than their share of confidants. Anyone will make time for them. They have access to experts on any number of topics.

But in fact, one of the most defining aspects of leadership is how inherently isolating it can be for people in power. Few colleagues will speak with them with true candor. They can’t always be completely honest with those who work for them, either. And showing they’re vulnerable might help them explore their weaknesses that need improving, but it could also potentially undermine their position of authority.

That’s why many top leaders find themselves turning to their spouses for unfiltered advice. As a psychiatrist and psychoanalyst who advises CEOs and boards of directors around the world, I’ve found that more of my clients turn to their wives or husbands about critical decisions in their job than one might think. And if they don’t open up to the person they share their bed with, they’ve typically found someone to whom they can confide their secrets – whether it’s a former mentor, a close friend or a trusted adviser instead. (Ahem.)

The isolation that leadership creates couldn’t be truer than in the case of the presidency, which may very well be the loneliest job in the world. For Barack Obama, having a strong, supportive relationship with his wife, Michelle, is essential. Sure, he has his inner circle, but the first lady may be the only one who doesn’t ever have to call him Mr. President. Presumably (one hopes, for the sake of their marriage) she sees him at his most unguarded, listening not only to his innermost thoughts but to his innermost fears.

Leaders need candid sounding boards – whoever they may be – for several reasons, not least of which is to counter the unavoidable, and at times painful, feelings of insulation. But it’s also important because of the emotional dangers of that isolation, which can create a self-reinforcing cycle of believing in one’s own perceptions without the ability to test them against some external voice of reality. Power makes this even worse because it inhibits the upward flow of candid feedback, and instead invites varying degrees of, well, derriere kissing.

The most perilous outcome – to which far too many leaders succumb under such hermetically sealed conditions – is what I call “pathological certainty,” that state in which one believes in the absolute rightness and infallibility of one’s ideas and decisions. George W. Bush’s complete self-confidence and his apparent disinterest in the lessons of history both may have been manifestations of this problem. While it has been said that Laura Bush was a maternal presence for the president throughout their marriage, with her rather rigid moralism tempering his habits, she apparently steered clear of being a sounding board on his work. The arrogance and hubris of some leaders, which are expressions of an underlying narcissism, can go unchecked in the absence of a confidant or spouse who is able to speak truth to power.

Not surprisingly, leaders who are emotionally unstable to begin with fare even worse. When the emperor has no clothes and he is allowed to remain naked for extended periods of time, he begins to lose touch with reality and, eventually, paranoia can take hold. From a distance, it appears that dictators such as Hugo Chavez and the late Kim Jong Il have lived in paranoid fear of the outside world. Their fears lead them to exert cruel control over their domains, and, eventually, their enemies become real rather than mainly imagined.

Could a strong and loving spouse prevent this kind of extreme downward spiral? It’s unlikely, especially since it’s rare for emotionally troubled leaders to have truly intimate relationships in the first place. By the time things get to the point of a paranoid dictatorship, it’s far too late for anyone to make much of a dent.

Of course, spouses of leaders can have blind spots too, as their love, protectiveness and closeness to the boss obscures their ability to perceive trouble and deliver much-needed feedback. Michelle Obama, for instance, apparently shares the president’s disdain for the congressional glad-handing and schmoozing that come with the territory. This has contributed to, or at least reinforced, the aloofness and seeming emotional disengagement that detracts from his effectiveness as a leader.

No matter how good or bad a sounding board a spouse might be, a leader who is married but doesn’t have a supportive spouse can face the most trouble. Not only is he lonely at work–and I use that pronoun only because most of my CEO clients are in fact male–but lonely at home, too. That makes him more likely to reach out to others who may not have his best interests at heart, and who can exert undo and often exploitative influence.

In the end, it’s the personality of the leader as well as the nature of the relationship that determines whether the confidant serves a productive sounding board role, or whether the confidant simply reinforces the leader’s distorted perceptions and maladaptive behaviors.

Kerry Sulkowicz is managing principal of the consulting firm the Boswell Group, and a clinical professor of psychiatry at NYU School of Medicine.

On Leadership

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This piece is part of a leadership roundtable with four expert contributors – Wharton Professor Peter Cappelli, Space Policy Institute Professor Emeritus John Logsdon, NYU Professor Kerry Sulkowicz, and former NASA leadership program director Gail S. Williams – about the leadership challenges of shuttering NASA’s iconic space shuttle program.

As Atlantis lifted off Friday from the Kennedy Space Center, America bid farewell to its space shuttle program. It was an emotional moment for the country, and, in a less public way, represents a major loss for NASA workers. It was also something perhaps less obvious: a leadership moment for Charles Bolden, NASA’s administrator.

So far, Bolden’s handling of this inflection point in America’s space program can serve as a lesson for leaders faced with the challenge of closing beloved initiatives–a difficult process no matter how rational and justified these decisions may be. As the centerpiece of NASA for 30 years, the space shuttle brought further glory to the agency that gave us the Mercury, Gemini and Apollo programs, not to mention steady employment for generations of employees.

In a speech delivered to the National Press Club on July 1, Bolden did what a good leader should do under such circumstances: He made an emotional connection to his people, was honest about the facts, acknowledged the loss they’ve just experienced while putting it into larger context, and painted a vision that realistically yet reassuringly connects the past with the future.

Bolden, himself a retired Marine Corps major general and a four-time shuttle flight veteran, has instant credibility with NASA’s employees. And in his speech to the National Press Club, he drew on his own career to establish that emotional connection. “I spent 14 years at NASA before leaving and then returning to head the agency. Some of the people I respect most in the world are my fellow astronauts. Some of my best friends died flying on the shuttle. I’m not about to let human spaceflight go away on my watch. I’m not going to let it flounder because we pursued a path that we couldn’t sustain.”

Early in his remarks, he addressed head-on the concern that last week’s final shuttle flight marks the end of America’s dominance of spaceflight. Naysayers, he said, “must be living on another planet.” While he didn’t dwell on the sense of loss that some NASA employees must be feeling, he did add, “We are not ending human space flight, we are recommitting ourselves to it and taking the necessary — and difficult — steps today to ensure America’s pre-eminence in human space exploration for years to come.”

In his more private leadership role inside NASA, one presumes that Bolden is attuned to the multiple layers of meaning in the shuttle’s last flight, ranging from the literal loss of jobs to the more purely emotional losses of purpose, self-esteem and organizational pride that may come with such a transition. He would do well to tolerate, and even encourage, employees to voice such feelings. No matter how exciting the new plans might be, it’s a crucial step in helping the organization transcend this loss and move on.

Not surprisingly, though, it’s those future plans that have been the primary focus of Bolden’s public speeches: “It is vital that we keep exploring. …So we keep generating new knowledge about our planet and our universe and new solutions to the challenges our planet faces on many levels,” Bolden said. And, like other charismatic leaders, he set this future within the context of NASA’s history–from its founding 50 years ago by the “young President Kennedy” to the re-articulation of its mission now by the “young President Obama”, who has challenged the agency to explore asteroids and, eventually, Mars. His evocation of youth effectively yet subliminally connects the mission of NASA to what’s modern, preparing the next generation of NASA workers, as well as Americans generally, for a new phase in the agency’s development.

None of this, of course, comes easily. We can only assume that what Bolden conveys so effectively in public gets translated with equal conviction and passion when he addresses NASA employees internally. External political pressures to reduce government spending will undoubtedly make it harder for NASA to achieve all of Bolden’s — and Obama’s — lofty goals. And the extensive investigations of two of NASA’s darkest moments, the tragic Challenger and Columbia disasters, have already revealed NASA’s ongoing struggle with internal organizational problems and their impact on decision-making. While NASA hasn’t cornered the market on dysfunctional organizational culture, the stakes are arguably higher (and higher profile); and to the extent that they persist despite being identified in both investigations, these management hurdles won’t just disappear with the end of the shuttle program.

Shuttering an icon represents not only a logistical challenge for an organization but also a profoundly emotional one for its employees. So far, Administrator Bolden seems to be handling the passing of the shuttle era masterfully; to continue to do so, he’ll need to attend to the varied feelings of loss, even while articulating a path for passionate re-engagement with the future.

Kerry J. Sulkowicz, MD, is a clinical professor of psychiatry at NYU School of Medicine and, as managing principal of the Boswell Group LLC, advises CEOs and boards of directors on leadership and organizational culture. (Dave Cross)

The Office Tattletale: A Waste of Everyone’s Time

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You noticed it one day coming into the office: The receptionist was on a personal call. The next day, you watched for it. And before you knew it, you were so worked up that she spent her time talking to friends, you wanted to tell your boss.

We revert to grade school in many ways in the workplace. The tattletale impulse is just one of those ways we digress and turn something minor into a major issue that probably has nothing to do with our own work.

“People get irritated about the most fascinating things,” said Heather Bradley, founder of the Flourishing Company LLC, a workplace consulting firm. “If it’s really in the way of someone getting a job done, a manager will find out.”

Bradley’s earlier days as a human resources manager were spent listening to one co-worker complain about another. Unless there was an ethical breach, she would mostly just think the tattler was wasting too much of his own time worrying about someone else. Once, Bradley’s company introduced a no-smoking policy on company property, so smokers began to go outside to smoke. First, nonsmoking colleagues started grumbling. Soon, co-workers were “telling on” colleagues who left their desk for a smoke break. Bradley’s thought was, how could a co-worker know the smoker had stopped working, or thinking about a work problem, during a 10-minute smoke break? Or that he might not stay a bit late to make sure the work was finished? The time-wasters, in fact, might be the people who were so worked up about the smoker taking a break.

“If a person is committed to getting a job done, they manage their time,” Bradley said. “If someone’s tracking when someone is gone, they’re doing what with their [own] time?”

Sure, there are times when one person should blow the whistle on another (Enron being a prominent example). Recently, though, there have been a couple of incidents in which tattling about personal, not financial, matters caused upheaval.

New York Times reporter Susan Sachs was accused by management, according to anonymous sources in press reports, of sending correspondence to the wives of two colleagues telling them their husbands were having affairs. She was subsequently fired. She has denied writing the messages, and the Times will not discuss its reason for firing her.

In March, Boeing Co. forced chief executive Harry C. Stonecipher to resign after the company’s non-executive chairman received an anonymous tip that Stonecipher was having an affair with a subordinate. In that case, the company said it was less about the affair and more about poor judgment.

“What the Stonecipher case does is help companies view ‘company business’ perhaps more broadly and policy violations more broadly,” said Jeffrey M. Kaplan, an attorney and member of the Law and Business Ethics Advisory Board at Midi Corp., which develops compliance and ethics training programs. “If you do anything work-related, that is now seen as fair game. That’s because corporate reputations are seen as more important recently.”

But there is a right way and a wrong way to “inform,” if one must.

In good, strong workplaces, tattling doesn’t really happen. Successful teams of workers push each other to work hard and not goof around. Those co-workers have high expectations for one another.

“In great teams in the workplace, the co-worker goes to the person and talks with the person first,” said Curt Coffman, global practice leader at the Gallup Organization. “One of my fundamental beliefs is that you have to stop talking about the person and take the talk- with -people approach.”

More often than not, someone who wants to spread the word that a co-worker sneaks out for a two-hour lunch every other Wednesday is only going to show a boss a personal conflict with the co-worker and an interest in getting ahead. What such workers are actually doing is wasting company time and breaking down morale.

“It’s not really for betterment of an organization, but really because their feelings are hurt, they feel slighted, or have some need to hurt somebody else,” said Kerry J. Sulkowicz, founder of the Boswell Group LLC, a consulting firm that specializes in the psychology of business.

The person may be telling a boss about an issue “out of deep-seated feeling of unfairness,” Sulkowicz said. “It’s like telling parents, ‘You have to control this other person’s behavior because it makes me feel bad.’ “

And often, it’s easy for a manager to see why a co-worker is spreading the word about another’s misdeeds.

What that tattling tells a boss is, “I’m not a good co-worker or team player,” Coffman said. “It’s all about me.”

Written by Amy Joyce

Playing At the Top Of Their Games

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Women executives are also making it a point not to be shut out. In recent years, golf clinics for women executives have popped up across the country. And executives such as Cynthia Gilmer, president and founder of Opus Plus Inc., a McLean information technology firm, encourage younger women interested in going into business to tee up. Gilmer, who trained in classical ballet, took up the game herself only four years ago.

David M. Mott, chief executive of MedImmune Inc., the Gaithersburg maker of FluMist, uses skiing and football to strengthen ties among his employees. The MedImmune management team takes a four-day ski trip ever year. “There’s no formal business agenda,” Mott said. “We ski hard, play hard, and have fun. It’s about communication and breaking down barriers. When you’re skiing, everyone is on equal footing.”

Thayer Capital Partners Chairman Frederic V. Malek has learned to mix a normally solitary passion — cycling — with business. Malek, 68, regularly hits the Capital Crescent Trail with Benjamin R. Jacobs, founder of JBG Cos., which is buying the Marriott Wardman Park Hotel from Thayer. He goes on annual biking tours in Europe and out west. When he’s in Aspen, Colo., he rides with Franklin Mint Chairman Stewart Resnick. The two have invested together and own part of the Raleigh Cycle Co., Malek said in an e-mail.

Written by Annys Shin

When Strange Duty Calls

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Or, in the case of Laurie Stewart, call local pet stores to borrow a guinea pig for a photo shoot. Stewart, a reporter for a Pennsylvania trade publication that focuses on diagnostic imaging, was asked a year ago by her boss to “rent” a guinea pig for the day. Her boss wanted the next publication’s cover to show a guinea pig getting an MRI.

For the most part, employees will simply do what is asked of them, unless it puts them in danger, or feels like harassment. I had a position in a former life where pretty much anything was fair game. Ask [Amy Joyce], she’ll do it. And I did. But I didn’t hate it. Those requests often put a little extra spring in an otherwise flat day. Renting a guinea pig would have been a fun item to add to the repertoire.

Those wacky demands made of employees can often fall into the “someone’s-gotta-do-it” category. And, [Kerry J. Sulkowicz] said, some employees could really take it as a compliment that their boss trusts them enough to buy his clothes in an emergency, or get that guinea pig.

Written by Amy Joyce

Misunderstandings at the Office

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Just before heading out the door one afternoon, [Jessica Lipnack] said she got a call from her lead investor saying that he didn’t like a phrase in one of the slides. Lipnack dashed off an e-mail to [Carrie Kuempel] along these lines: “Hey here’s some feedback from Bruce. Just one person’s opinion, but he thinks [this phrase] looks too trivial.”

In the Vault survey, 37 percent of respondents said they hated the smiley face and 63 percent said they didn’t. Lipnack said she uses smiley faces only with “e-mail mavens.” But she thinks that people may get over their aversion to the little guys once they’ve experienced enough confusion–people like Bonnie Barhyte.

Barhyte, vice president for international training at the Academy for Educational Development in Washington, has seen humor misfire in her organization. After the academy held a drawing to reward a lucky employee with free tickets to an event, congratulatory e-mails flew around the office. One jokester remarked in his e-mail that the drawing must have been rigged. He was baffled at the angry responses. “Some people thought that this person was really accusing people of having rigged the drawing,” Barhyte recalled.

Written by Sarah Schafer