5 Leadership Styles That Can Derail Companies—And End Careers

Most, if not all, leadership failures of the past 50 years can be traced back to one of these five archetypes. Here's how to tell if you are at risk for one of them.

In his 10-year tenure as CEO of Medtronic, Bill George managed to grow the medical technology company at 35-percent-per-year and oversaw huge market cap growth—from $1.1 billion to $60 billion. In his forthcoming book, True North: Emerging Leaders Edition, coauthored with millennial entrepreneur Zach Clayton, George shares some of the secrets of his success, as well as those of 220 other leaders, including Satya Nadella, Mary Barra, Ken Frazier and Indra Nooyi. In short, the best CEOs first discovered their “true north”—based not on platitudes or maxims, but on their own life stories and crucibles—and from there, with great self-awareness, they found their “north star,” or the purpose of their leadership.

Those who don’t lead from that north star, George argues, are doomed to failure. In the following excerpt, he outlines the five leadership archetypes that can derail any CEO’s success. To hear more strategies for emerging leaders—and for those mentoring them—register for our live, virtual CEO Talent Summit on September 28th, where George and Clayton will be featured guest speakers. 

The 5 Archetypes of Derailing

In observing leaders who have derailed, we identified five archetypes of leaders who lead without their True North. Can you see yourself in any of these archetypes? Could these patterns of derailment pull you offtrack?

1. Imposters

Imposters rise through the organizational ranks with a combination of cunning and aggression. They understand the politics of getting ahead and let no one stand in their way. They are often unabashed students of Machiavelli, determining every angle to advance as they execute their gameplan. They are the ultimate political animals, adept at figuring out who their competitors are and then eliminating them one by one. They have little appetite for self-reflection or developing self-awareness.

Abraham Lincoln once said, “If you want to test a man’s character, give him power.” Having acquired power, Imposters lack confidence about how to use it. They are beset with doubts about their leadership and are often paranoid that underlings are out to get them.

Prior to founding WeWork in 2010, Adam Neumann sold high-end baby clothing. His insight about New York real estate was that Millennials would accept higher density commercial office space in exchange for better perks. Adam pushed this idea to the max, raising $10.4 billion in the following decade, largely from tech investor Masayoshi Son of SoftBank.

WeWork grew rapidly and so did Adam’s ego. The Cult of We by Eliot Brown and Maureen Farrell describes Adam’s behavior as CEO, as he installed an ice plunge pool in his personal office, acquired a $63 million corporate jet, put friends and family in executive roles, and engaged in outrageous self-dealing. The most ridiculous example is trademarking the term, “We,” then selling it to his company for $5.9 million.

Adam alienated colleagues through dehumanizing antics. Adam often asked employees to ride in his chauffeured $200,000 luxury car when he was going to a meeting. Once Adam was done speaking with them, he dropped them off and told them to take alternative transportation to their destination.

When WeWork attempted to go public in 2019, Adam’s behavior as CEO and his controlling position came under fire. The Wall Street Journal’s investigative journalism portrayed Adam’s darker sides—drug use, shirking work for surfing, and his erratic management style. When the IPO failed, Adam negotiated an eye-dropping $185 million consulting fee for himself as part of an even larger exit package. Existing employees and shareholders were left with huge losses as WeWork announced thousands of job cuts.

A charismatic pitchman, Adam succeeded at selling visions of transforming the real estate industry, but his model never proved financially viable. When he departed a billionaire, everyone else was left with the remains of a broken business.

2. Rationalizers

Rationalizers always appear on top of the issues. When things don’t go their way, they blame external forces or subordinates. Masters of denial, they rarely take responsibility themselves. As they advance and face greater challenges, they transmit pressure to their subordinates instead of modulating it. When pressuring subordinates fails to produce the numbers, they try to hit financial expectations by cutting funding for research, growth initiatives, or organization building. Eventually, these short-term actions catch up with them. Then they borrow from the future to make today’s numbers look good, or stretch accounting rules, rationalizing that they can make it up further down the road.

Unfortunately, their actions only make the future worse. Then they turn to more aggressive schemes, such as reporting future revenue streams in quarterly sales or filling customer warehouses with inventory. When these short-term actions fail to stem the tide, they resort to desperate measures that often cross into illegal actions. Ultimately, they become victims of their rationalizations, as do their depleted organizations.

The misdeeds of rationalizers have become all too apparent in recent years. Pressures from shareholders caused many executives to play the game of meeting stock market expectations while sacrificing the long-term value of their companies. Even years later, many rationalizers cling to denial, unwilling to take responsibility for problems they caused. As Warren Bennis said, “Denial and projection are the enemies of reality.”

Rajat Gupta was a close professional colleague of mine. We served together on three boards: Goldman Sachs, World Economic Forum USA, and Harvard Business School Board of Dean’s Advisors. Rajat was also a board member of Procter & Gamble and American Airlines. He was one of the world’s most accomplished leaders—intelligent, savvy, and well connected with the most prominent people.

Rajat was the first worldwide managing partner of McKinsey born outside America. He built a global powerhouse during 9 years at the helm, growing McKinsey’s revenue by 280 percent to $3.4 billion. Rajat led philanthropically as well, chairing the Global Fund and founding the Indian School of Business. For the Indian community, he was a role model of the American dream fulfilled, a symbol that an Indian immigrant could make it to the top in America.

On October 24, 2012, Rajat was sentenced to 2 years in federal prison. He was convicted on four criminal counts for providing inside information to Galleon Fund founder Raj Rajaratnam. He shared privileged information he learned at Goldman board meetings during 2008, which Rajaratnam used to make insider trades. In the crucial board meeting to approve Warren Buffett’s $5 billion investment in Goldman, Rajat called Rajaratnam at 3:52 p.m., just 16 seconds after the board meeting ended, to advise him the transaction was approved. Rajaratnam then bought $90 million in stock before the market’s 4:00 p.m. closing.

How could such an exceptional leader at the peak of his success fall so far, so fast? We may never know the full story since Rajat still denies his misdeeds, but his life story offers clues. Rajat’s father was a journalist and freedom fighter jailed by the British when India was fighting for independence. Young Rajat faced a crucible when he was orphaned as a teenager as his father died when he was 16, and his mother passed away 2 years later. With no money to live on, he took responsibility for raising his two younger siblings. Despite these challenges, he gained admission to the famed Indian Institute of Technology and immigrated to America to attend business school before joining McKinsey in 1973.

What caused Rajat to cross the line to provide Rajaratnam with inside information? On paper, Rajat had it all—talent, wealth, power and respect—but apparently none of this was enough.

As a Goldman Sachs director, I was subpoenaed by the U.S. government to testify in his trial. Throughout the trial, Rajat maintained his innocence, suggesting he was a victim of Rajaratnam, who had already been sentenced to 11 years in prison. Although his net worth was $120 million, Rajat seemed to have an unquenchable thirst for more. A 2013 article in New York Times magazine speculated, “Teaming up with Rajaratnam seemed to be his plan for a spectacular career finale—to establish himself in the elite circle of billionaires.”

Rajat reflected on this weakness in a 2005 speech at Columbia University, saying, “When I look at myself, yeah, I am driven by money,” adding:

When I live in this society, you do get fairly materialistic. I am disappointed. I am probably more materialistic today than I was before. Money is very seductive. You have to watch out for it, because the more you have it, you get used to comforts, big houses, vacation homes. However much you say that you won’t fall into the trap of it, you do fall into its trap.

When we sat together at board meetings, there were no outward signs of Rajat’s inner struggle, but my intuition tells me he was deeply scarred by his teenage crucible and never resolved his need for financial security. His thirst for money may have been his shadow side, controlling him more than he understood. His story shows how vulnerable we are to temptation if not guided by our moral compass.

3. Glory Seekers

Glory seekers define themselves by the acclaim of the external world. Money, fame and power are their goals. Often it seems more important to appear on lists of the most powerful business leaders than it does to build organizations of lasting value. Their thirst for fame is unquenchable. No achievement is sufficient because there are always people with more money, more accolades and more power. Inside, glory seekers feel empty and envy those who have more.

Greg Lindberg’s story is one of Horatio Alger lore. The fifth child of a middle-class family, Greg was first to graduate from college. Starting a trade publication, Home Care Week, as a college student, he invested $5,000 in making the newsletter his full-time work upon graduation. He says, “I rented office space for $285 a month and lived there, sleeping under my desk for 10 years.” His mantra was “6 to 6 by 6”—working from 6:00 a.m. to 6:00 p.m., 6 days a week.

Greg paid himself just $40,000 annually and poured his earnings into acquisitions, first to expand his publishing business and then to expand into other industries. His formula for acquiring broken businesses was to find a business in distress, buy it cheaply, use offshoring to reduce costs, and grow revenue. When he was limited by Alabama law in funding related-party transactions of an insurance company he owned, Greg moved the company to North Carolina to secure different regulatory treatment.

To ensure this favorable treatment, Greg and his team contributed extensively to the North Carolina insurance commissioner’s campaign and formed a super PAC to donate $425,000 in advertising. When a new insurance commissioner was elected, Greg pressured him to approve extremely aggressive related-party deals. He offered to donate $500,000 to the North Carolina Republican Party, with $250,000 directed to the commissioner’s campaign fund—violating campaign finance limits. The commissioner contacted the FBI, which wired him up for a conversation in which Greg promised him $2 million in campaign donations to remove a regulator.

The trial made national headlines, as the media chronicled Greg’s $35 million in luxury homes, expensive Gulfstream jets, and $45 million yacht. To reward women he met through matchmaking services, Greg provided jewelry, extravagant trips, and, in one case, a $90,000-per-month Manhattan apartment. In 2020, a federal jury convicted Greg of bribery. At his sentencing, Judge Max Cogburn said, “It was shocking that so much could be done in terms of buying and selling government, like sacks of potatoes.”

In 2001, Greg Lindberg was a smart, creative, and hard-charging entrepreneur, but he never cultivated the moral character he desperately needed. Greg’s glory seeking transformed him into a bully who ran over regulators. Did his lack of true friends blind him to feedback? Why did he shut down those who challenged him, forcing people to fall in line to keep his loyalty?

Today, he lives in a small prison cell. Greg hit his financial goals year after year until his lack of True North led to massive disaster.

4. Loners

Loners avoid forming close relationships, seeking out mentors or creating support networks. They believe they can make it on their own. Not to be confused with introverts, loners often have myriad superficial friends and acolytes but don’t listen to them. They reject honest feedback, even from those who care about them.

Without wise counsel, loners are prone to making major mistakes. When results elude them and criticism of their leadership grows, they circle the wagons. They are rigid in pursuing their objectives, not recognizing their behavior makes it impossible for them to reach their goals. Meanwhile, their organizations unravel.

Lehman Brothers CEO Dick Fuld was a loner who denied the deep trouble his firm was in. From March to September 2008, his associates warned him that the firm was overleveraged, lacked liquidity, and was inadequately capitalized, making it vulnerable to market volatility. Treasury secretary Hank Paulson had 50 discussions with Dick, telling him Lehman had “to recognize its losses, raise equity and strengthen liquidity.” In his book Hank wrote, “My conversations with Dick were very frustrating. Although I pressed him to accept reality and operate with a greater sense of urgency, I suspected that despite my blunt style, I wasn’t getting through.”

On Friday, September 12, 2008, Hank called the heads of the big investment banks to a meeting to address the implications of Lehman’s pending bankruptcy. Dick was not present, choosing to stay in his office behind closed doors, perhaps hoping for a government bailout. He was still waiting at 8:00 pm on Sunday evening when Securities and Exchange Commission (SEC) commissioner Chris Cox called to tell him there would be no bailout. In the early hours of September 15, Lehman filed for bankruptcy, putting Dick and most of his employees out of work, making their Lehman stock worthless, and triggering the greatest financial crisis since the Great Depression.

As a leader, you need to listen to your colleagues, accept honest feedback and be willing to face reality when your strategy is going awry.

5. Shooting Stars

The lives of shooting stars center entirely on their careers. To observers, they are perpetual motion machines, always on the go, traveling incessantly to get ahead. They rarely make time for their families, friendships, communities or even themselves. Much-needed sleep and exercise routines are expendable. As they run ever faster, their stress mounts. Kabir Barday found himself in this situation as he built OneTrust, but his health crisis prompted him to reevaluate his life and his leadership.

Unlike Kabir, many shooting stars move up so rapidly in their careers that they never take time to learn from their mistakes. A year or two into any job, they are ready to move on, before they have to confront the results of their decisions. When they see problems of their making coming back to haunt them, their anxiety rises, and so does the urgency to move to a new position. If their employer doesn’t promote them, they are off to another organization. One day they find themselves at the top, overwhelmed by intractable problems. At this point, they are prone to irrational decisions.

Shooting stars place their success above any deeper purpose for their organization, as Uber founder Travis Kalanick’s story demonstrates. Travis grabbed headlines for the extraordinary international growth of his ride-sharing app. With profanity-laced tirades, he willed the company to success, often encouraging employees to drive the competition into the ground. As Uber grew to 12,000 employees, 40-year-old Travis explained his management style as pushing himself to the limit. “In a car, you can go fast, but there is a red line. You want to push into that red line and see what that engine’s made of.”

Red-lining CEOs are not fun to watch. By 2017, Uber was enmeshed in controversy over workplace culture issues, including a floodgate of sexual harassment complaints, issues with regulators claiming Uber broke transportation laws, and a Google lawsuit alleging Uber stole its intellectual property. A video of Travis lashing out at an Uber driver went viral.

While he admitted to arrogant outbursts, Travis saw them as a strength, boasting about Uber’s tough culture. He dismissed internal survey data showing his employees’ negative view of his leadership, saying he had a public relations issue, not a culture issue. He lacked confidantes who provided honest feedback. Ultimately, five board members requested his resignation.

Travis had a brilliant app that transformed transportation, but he lacked the leadership to develop a company around the app. His replacement, Expedia CEO Dara Khosrowshahi, reset the culture, established new values, and apologized for the company’s mistakes. Dara streamlined the company’s sprawling investments, grounded the company in making transportation simple by giving people access to vehicles, and made respect the culture’s cornerstone.


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