When other factors are controlled for, strong management teams accounted for about 40 percent of their firm's superior return on investment and 35 percent of its income growth. Contrary to popular perceptions and much business reporting, strong CEO personality traits alone have little connection to strong financial returns for the company. Even strong CEOs can have their efforts undone by dysfunctional senior management teams. In successful companies, the study found, the CEO fosters healthy group dynamics among his immediate subordinates, allowing them to mobilize the energies and talents throughout the organization to overcome key problems and create new opportunities for growth. In today's steadily less hierarchical and more flattened organization, having personality traits that enable you to manage and operate in teams will be essential for executives in profitable and growing companies.
Successful companies have healthy group dynamics.
Group dynamics veered toward the pathological in weak organizations, freezing when faced with problems, postponing difficult decisions and failing to delegate authority. With executives primarily interested in themselves and determined not to become the next to fall out of favor, loyalty to the company was minimal. Peterson, a social psychologist, is an assistant professor of organizational behavior at the Johnson School, specializing in the influences on the quality of decisions made by groups.