A Kellogg School of Management study underscores that the more flattery we receive, the more we allow our self-impressions to be inflated. According to this study, this holds true for CEOs and constitutes “the Icarus Paradox:”
- “’What we are saying,’” Stern explains, ‘is that with CEO status, the greater the status, the more flattery and opinion conformity will be directed towards the CEO. And the more flattery and opinion conformity directed at the CEO, the greater the CEO’s self-enhancement.'”
- “The results showed that CEOs subject to flattery were more likely to believe themselves to be better leaders and more adept at strategy. Firm performance data, however, did not bear that out. Firms with flattered CEOs were less likely to change strategy when company performance dipped.”
- Stern and his colleagues call this the “Icarus Paradox.” “The high levels of flattery and opinion conformity that high-status CEOs receive can foster self-enhancing cognitions that lead them to become over-confident in their strategic decisions and in their ability to correct performance problems with the current strategy,” the authors write.