Narcissistic CEOs More Likely to Adopt Disruptive Technologies
Revolutionary technologies have the potential to change everything about the way a business is run, but will your company be an early adopter? New research from Penn State Smeal College of Business Professor Donald Hambrick, along with colleagues from the University of Erlangen-Nuremberg and IMD International, suggests that CEOs who exhibit narcissistic personality traits are more likely to embrace discontinuous, or disruptive, technologies than their less narcissistic counterparts.
The researchers describe discontinuous technologies as “[contradicting] the prevailing mindset in an industry, rendering existing organizational structures and processes obsolete, and diminishing the value of existing knowledge.” As such, existing firms are often seen as resistant based on the risk and the high level of resources that would be needed for implementation.
CEOs who exhibit narcissistic personality traits will likely be more willing to take the risks associated with early adoption of discontinuous technologies.
But not all existing firms eschew adoption of these technologies, according to the researchers. Their study shows that CEOs with narcissistic personalities are more likely to take the associated risks. Through investigating investments in biotechnology made my large pharmaceutical firms from 1980 to 2008, the researchers found considerable support for their hypothesis.
Narcissism, as a personality dimension on which everyone can be arrayed, refers to traits such as a “strong sense of superiority,” a drive to “dominate their environments,” a “high degree of restlessness,” a “lack [of] empathy,” and a “strong need for attention and applause,” the researchers write.
Narcissistic personality traits include a sense of superiority, a drive to dominate environments, restlessness, and attention-seeking.
CEOs who exhibit more narcissistic traits, then, are seen as more likely to adopt discontinuous technologies for several reasons. These CEOs’ sense of superiority gives them the confidence to take big risks. Their tendency toward restlessness makes them more open to change—even the radical sort that discontinuous technologies can bring. And they lean toward more dramatic decision-making with the understanding that their bold moves will garner attention among peers and in the press.
To this, researchers add two moderating factors: audience engagement—or, “the degree to which observers view a domain…as noteworthy and provocative”—and managerial attention—the level of focus that a firm’s senior managers place on a certain phenomenon.
CEOs will press their senior managers to pay more attention to discontinuous technologies when respected external audiences are engaged with those technologies.
“Bearing in mind that audience enthrallment with a technology can ebb and flow, and envisioning that managerial attention to a technology can similarly rise and fall, we anticipate that the narcissistic CEO will press for more attention at those times when a respected audience considers the technology as provocative and noteworthy,” write the researchers.
“CEO Narcissism, Audience Engagement, and Organizational Adoption of Technological Discontinuities” appears in the June 2013 issue of Administrative Science Quarterly. Its authors include Wolf-Christian Gerstner and Andreas Konig of the University of Erlangen-Nuremberg; Albrecht Enders of IMD International; and Smeal’s Donald C. Hambrick, Smeal Chaired Professor of Management.