The last few days had an old name popping up after a noticeable absence — Jack Ma. Every headline used the same phrase — was Jack Ma, a modern-day business Icarus who flew too close to the sun. A year ago, he was to have literally flown to the sun with a $37 billion IPO for the Ant Group, his fintech firm. Instead, Chinese regulators ensured the wax on his wings melted, the IPO was suspended, and Ma went out of sight. Some blamed the unofficial diplomat status he had gained for himself, meeting Trump in the US, and promising to create a million jobs. Others pointed to the October speech he gave in Shanghai accusing the financial watchdogs of stifling innovation.
They replied by biting back. This isn’t an isolated tale. We see leaders, organisations, teams soar with victory after victory, success after success, and then suddenly things come crashing down. The Indian cricket team beat a humble retreat from the T20 World Cup — the fall preceded by a string of successes that made them the favourite. What is that causes Icarus leaders to fly too close to the sun and how can we learn to avoid this mistake?
Overconfidence
One of the biggest reasons is overconfidence. Leaders used to a consistent string of successes grow an inflated sense of their own capabilities. Turns of luck are read as the exceptional capability of the leader. A leader starts to believe his own press. As the delusion grows, he flies higher and higher and then reality lands a body-blow.
The Nifty 50 Index churns by around 50 per cent every decade. Hence if a stock is in the Nifty 50 index today, there is a 50 per cent probability that it will not be in the index ten years from now, and a 75 per cent probability that it will not be in the index twenty years from now, according to the book Diamonds in the Dust , written by Saurabh Mukherjee, Rakshit Ranjan, and Salil Desai. Most often it is because companies, which means its leaders, grow overconfident and cocky. They believe anything they touch will turn to gold.
What can we do to check whether we’re flying too close to the sun? Icarus’ father Daedalus, who created the wings for their escape from Crete, warned Icarus not to fly too close to the sun, lest the wax that held the wings melted. Icarus ignored this warning. We too are likely to have a Daedalus in our lives — perhaps a mentor, a colleague, a family member. It’s important to check in with this person and listen for the warning signals. Often Daedalus’ warning can come from looking at our own metrics and goals. Are we careful that our BHAGs (Big, Hairy, Audacious Goals: Jim Collins) are not bordering on the impossible and sometimes self-destructive?
It’s important as our business or team grows at breakneck pace to deliberately create a speed governor. To slow down and take a breath, to pause the pace. My South African friend who climbed Mt Kilimanjaro told me of how the porters who accompanied the climbers would keep chanting in Swahili “pole, pole” — meaning slowly, slowly. From their wisdom gained from experience they knew that you could only move fast up the mountain and get to the peak by, counter-intuitively, slowing down. That’s good advice for those of us in danger of becoming Icarus leaders.
Insensitivity
Sometimes it has to do with plain insensitivity. In 1985, there was the mouth-watering media merger that the two leaders of the two mega media houses were planning to make reality. Al Neuharth, President of Gannett, and Tom Wyman, President of CBS, had agreed on pretty much everything. CBS was keen to fight the hostile takeover from Turner and this merger promised an exciting path forward. Neuharth would be the new entity’s Chairman and CEO and Wyman would become President and COO.
But as Neuharth describes in his memoir Confessions of an S.O.B (1989), “A dozen bankers, lawyers and executives were assembled around the long rectangular table. Tom and I sat side by side. I was really pissed that people in this room for nearly three days had been unable or unwilling to do what Wyman and I had agreed upon…I didn’t waste a lot of time with social niceties. Tom and I thought it might help if the two CEOs got in on the act and explained to all of you how to get this deal done. It’s pretty damn simple…Tom and I have agreed on the management structure of the company…I will be chairman and CEO. Tom will be President and COO.”
While Neuharth’s own team nodded and smiled, the CBS team looked surprised. Neuharth writes: “I sensed immediately that I had screwed up. Wyman’s people were hearing this news for the first time from me, not from him…I had satisfied my ego at the expense of crushing his.” And that’s all it took for the almost-mega deal to unravel.
That’s why we need to keep asking — what’s the impact of what I’m doing or building or growing, on those around me? Sometimes leaders build great business balance sheets but at great cost to their personal and relationship balance sheets. They end up with money in the bank, but their personal and spiritual vaults are empty. Marriages end in divorce or their children, tired of being in second place, no longer listen to them. In business itself, a leader may aggressively and offensively hound his team to chase bigger and bigger growth targets, until suddenly they burn out or no longer take the humiliating treatment.
Unpreparedness
Sometimes we’re just unprepared for the height we plan to fly to. Maybe we’ve set the team and the organisation on the path of a new business but have not done enough research of the market or the business. Maybe we’ve not hired the right people or trained our existing teams. Sometimes we’ve not provided enough time for preparedness to emerge and just throw people at a problem or opportunity but as the saying goes — ‘nine women can’t make a baby in one month’.
Are we drifting too far from our circle of competence? While it isn’t a bad thing to be growing our circle of competence — learning new things, trying out different initiatives, sometimes we try to cross a bridge too far. One of the big reasons for Kingfisher’s crash to earth was the foray into the airline business. (I suspect Rakesh Jhunjhunwala has not heard Richard Branson’s advice on how to be a millionaire — you start with a billion dollars and launch an airline!)
Videocon, a real player in the appliances space, saw its fortunes nosedive as it diversified into telecom, oil, and media. Even the venerable Tata steel saw foreign acquisitions like Corus become a dead weight. Mahindra and Mahindra after years of trying to make its SsangYong acquisition work had to finally throw in the towel. So, while ‘our reach must always exceed our grasp’, leaders must ensure that the difference is not suicidal.
There’s a difference between a dream and a fantasy. If we must avoid becoming Icarus leaders, we must not confuse the two.