Directors and managers must effectively govern without killing the motivation of these brilliant yet prickly innovators. The book is organized in a logical sequence: The authors identify the problem, offer a range of potential solutions, and explore suggestions for readers to apply to their own careers.
Epstein and Shelton describe archetypal, well-known examples of visionary CEOs—Elizabeth Holmes of Theranos, Elon Musk of Tesla, Steve Jobs of Apple, Larry Page of Google, Travis Kalanick of Uber, Jeff Bezos of Amazon, and Ken Lay of Enron. The various attributes and behaviors that portend success for entrepreneurs and chief executives are frequently double-edged swords that simultaneously pose risk to the company, its employees, investors, and even society.
Drawing on historical events and anecdotes relating to these famous CEOs, the authors detail the warning signs, traits, and behaviors that present risks and governance issues. The spectrum of negative CEO actions ranges from abusive treatment of employees to illegal conduct. The suggested solutions include concrete best practices and structural organizational changes.
The role of directors is to exercise due diligence and informed judgment in evaluating the strategy and actions of management. In doing so, it isn’t appropriate to simply take the CEO and management team at their word. The Theranos scenario illustrates that point. Had the company’s prominent directors such as former U.S. Secretary of State Henry Kissinger been even reasonably diligent, founder Elizabeth Holmes couldn’t have perpetuated an outrageous fraud based on the false claim that Theranos had technology providing warp-speed medical testing and results for a huge array of medical pathologies.
It might’ve been useful for the authors to identify the post-Enron regulatory and legal changes that created additional standards and tools for effective governance of public corporations. On balance, the book is an engaging read that does a good job of describing the difficulties inherent to the governance of companies with larger-than-life CEOs with abrasive personalities and offering strategies to cope with such “brilliant jerks” effectively.
September 2020
