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Smeal Research Shows CEO Narcissism Can Have Its Advantages

Immediate opening: Cutting-edge biotech/pharmaceutical firm seeks CEO with sense of superiority who likes to dominate his or her environments, lacks empathy, is very restless and needs lots of attention and applause. Not your idea of a great leader? According to recent research from Penn State Smeal College of Business Professor Donald Hambrick, narcissism can sometimes serve a CEO well.

The more narcissistic the CEO, the more likely he or she is to embrace revolutionary technologies with the potential to change everything about the way a business is run – at least that’s what Hambrick’s research shows. Working with colleagues from the University of Erlangen-Nuremberg and IMD International, the Smeal business professor took a close look at investments made in biotechnology by large pharmaceutical firms between 1980 and 2008, discovering that CEOs with narcissistic personalities were more likely than their less narcissistic counterparts to be early adopters of “discontinuous technologies.” And by that the researchers referred to those technologies “[contradicting] the prevailing mindset in an industry, rendering existing organizational structures and processes obsolete and diminishing the value of existing knowledge.” Or, in other words, game changers.

Hambrick and team offered several reasons for the correlation between CEO narcissism and adoption of discontinuous technologies. Among them: These CEOs’ sense of superiority gives them the confidence to take big risks, their tendency toward restlessness makes them more open to change and their desire to garner attention causes them to make bolder moves.

The researchers did note two moderating factors, namely audience engagement and managerial attention. “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,” they wrote.

The full research, “CEO Narcissism, Audience Engagement, and Organizational Adoption of Technological Discontinuities,” was published in the June 2013 issue of Administrative Science Quarterly. Its authors are 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.

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