The Contest between Optimism and Realism in Leadership

Last week a Senior Manager in a large company was telling me about his CEO and senior Exec group who he feels are running his organisation off a cliff like lemmings.

He has huge respect for his exec team and for his CEO – he simply believes they are overly optimistic in their view of the industry, the market and the internal ability to deliver on set targets. This manager has his feet planted firmly in the mud and grime of the business. He believes he is a realist to their optimists.

I don’t know which camp is right, and I am a firm believer in setting stretch targets.

However I am also a firm believer in being realistic about the current situation and making a plan to get to the stretch targets, and then working the plan like heck to get there.
Back in the Vietnam War Jim Stockdale was the highest ranking America Naval POW. After his release 7 years later he was extensively interviewed on his thoughts about survival as a prisoner. He was fairly blunt in his assessment of who survived and who died.

The optimists believed they would be home by Thanksgiving, then Christmas then Easter and so on. With each event passing without a release, their belief and will died until they were left with nothing to cling onto and they too died.

The realists on the other hand had a full and hard look at their appalling situation. They accepted the situation for what it was and had a deep belief that they would prevail in the end. They lived.
Stockdale said,  “This is a very important lesson. You must never confuse faith that you will prevail in the end—which you can never afford to lose—with the discipline to confront the most brutal facts of your current reality, whatever they might be.”

Stockdale Paradox 

Optimist –Realist Dichotomy has been adopted into leadership literature.

The optimistic leader sets targets with no present day reference point or status review. Whilst the optimistic leader sounds visionary,  as each milestone passes without an associated delivery success, his people lose belief; they disengage, and eventually leave.

On the other hand the Realistic Leader can also set stretch targets, but he is more likely to be the cautionary voice advising the CEO to downgrade forecasts, reset project deadlines and take a more conservative view. He is also much more likely to ensure that status updates are accurate and fully reflect both internal and external conditions. He is the leader who will do the Gap analysis, and have a realistic plan to achieve his stretch goals, based on current conditions.

The optimistic leader tends to be more well-known and high profile based on his success and more likely because of his failures.
Amongst his other interesting characteristics I would name Edward Smith (captain of the Titanic) as an optimist. More recently I would mention Roy Bostock, Chairman of the Board of Yahoo for believing a flawed goal of “becoming the world’s premier digital media company” could be achieved by an inexperienced CEO.  He is of course now more famous as the “Doofuss” who then fired her via a phone call.

The realistic leader is usually less well known however my mind is drawn to David Thodey, CEO  of Telstra who surely took on a poisoned chalice with his eyes wide open.
Whatever happens with my colleague’s organisation, I will be watching the optimists vs. the realists to see who prevails.

Liz Cassidy founder of Third Sigma in Brisbane is an Executive Behavioural Coach, transforming Problem Managers into Inspirational Leaders.

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