Why Construction Leaders Fail

Sidney Finkelstein wrote a book called Why Smart Executives Fail. He examined some of the spectacular business failures of the 1990s and early 2000s, companies like Tyco and Enron, and attempted to discern what kind of leadership flaws could cause such spectacular flops. Finkelstein documented the seven habits of unsuccessful leaders—habits construction executives and managers should recognize and change.

1.  They think they dominate their markets. They read their own press clippings and think their company is a gift to the world and they're business geniuses. In construction, if your company disappeared and you had contracts for a series of 100,000-square-foot warehouse projects, do you think the owner of those projects would quickly find a replacement for you and get them built with satisfactory quality and schedule in your absence? You're darn right they could. Complacency is a business killer.

2.  They don't have clear boundaries between their business and their personal lives. It’s healthy to take time away from the office and to develop interests outside of work, but don't let your boundaries become blurry. You’ve heard the old cliché that no one ever uttered on his deathbed, “I wish I had spent more time at work.”

3.  They think they have all the answers. In Max DePree’s great book Leadership Is an Art, he wrote about the leader abandoning themself to the strengths of others. If you think you have all the answers and everybody else is a dolt, you're apparently unwilling or unable to attract or recognize top talent. Even if you’re a business genius, and some of our members at Performance Construction Advisors really are business geniuses, what would happen if you got a couple more geniuses to work alongside you? Couldn't that raise you to new heights?

4.  They get rid of people who they perceive aren't behind them. You've seen in our articles that it is beneficial to have some disagreement and debate in your meetings. For those of you that resent debate, that's a potential sign that the wheels might be coming off a bit.

5.  They obsess over the company image. Again, they don't have that boundary. They view any criticism of the company, a process or an outcome as a personal criticism. They're not the same thing.

6.  They underestimate obstacles. This makes sense. Let's say there is a 70-year-old business leader who started his company pulling himself up by his bootstraps with very little, if any, capital. He probably made lots of mistakes but survived. Every time there was a substantial challenge, he was able to figure out how to work harder or smarter to overcome the challenge. And now, at age 70, with a proven track record of overcoming obstacle after obstacle, he says, "I've overcome every single challenge in my business life, and my company is now worth $10 million. Why should we change in any way? How come I just can't keep meeting the challenges head on?” Underestimating obstacles is a big mistake that gets back to ego. That long track record of winning can create a flabbiness that causes people to underestimate new challenges or trends as well as growing weaknesses they may have in their organizations.

7.  They stubbornly cling to the ideas and solutions that worked in the past. Strategic coach Dan Sullivan says entrepreneurs usually overcome problems by working harder. Well, there's only 24 hours in a day, and at some point in life you simply cannot work any harder. You must figure out ways to work smarter. The only way to do it smarter is to give up some of the things that you've done in the past, so you can learn new skills and develop new capabilities for the future.

Professional hockey star Wayne Gretzky had a great philosophy. He said he didn't skate to where the puck was. He skated to where the puck was going to be. He wasn't the biggest, fastest guy; he didn't have obvious advantages over other players. He skated to where the puck was going to be. That's the challenge for successful leaders. Figure out where the puck is going to be in your industry and skate there with your organization.