Every move Murdoch has ever made has paid off by making his organization more powerful and his shareholders more wealthy. Can you imagine working for Murdoch or even standing up in a shareholder meeting, and questioning him over putting his young children into highly visible and senior positions within the organization? His glare alone would probably vaporize you on the spot. And yet who didn’t feel a slight kernel of doubt when Murdoch anointed his 30 year old son, Lachlan, as the head of Star Europe and his heir apparent? There was something oddly anachronistic, robber-baronish and even Enron-esque to the practice of treating a global company like a private fiefdom. Indeed, the royal family quality of the saga was reinforced when Lachlan mysteriously resigned.

So why do the Rupert Murdochs of the world, and the many corporate leaders we rarely hear about like Ned Johnson at Fidelity or Brian Roberts at Comcast, lose so little sleep over how such behavior gets perceived by the rest of us? For a simple reason: they don’t see it the same way. Much of the motivation and rationale for favoritism and nepotism can be uncovered by considering the real nature of leadership. Leaders are people, too. Their emotions and perspectives shape and influence their decisions in ways that we don’t always get at first glance. For example, few of us appreciate how lonely it can be at the top. It may sound like a cliché, but therein lies a grain of truth. A leader’s life is consumed by his role. Very little of his life is set aside for extracurricular activities. What might be extracurricular to us is work-related to the leader. The fishing trip. The golf game. The dinner party. The African safari. Try separating the leader from his thought processes, pending decisions, and thirst for relevant ideas and information even for a minute… go ahead, I dare you. It just doesn’t happen. Is it any surprise, therefore, that the leader views his work as an extension of his personal life? The line is blurry, if it even exists. Why should it matter to anyone if people the leader knows from the social realm slide into the work realm? For the leader, it’s virtually the same universe. In other words, a leader is simply not hung up on the idea of separating friends and family from the job, despite the opinions of the chattering class.

This is not to say that the leader chooses people for his inner circle who have no reasons to be there. To the leader, those reasons are very sound, and they relate to trust, certainty, and predictability. It seems ironic and it may not be macho to admit, but the powerful people who run organizations are actually in positions of extreme vulnerability. So much depends on them, and yet they are also completely dependent on others. Who the leader turns to for advice, confidential conversation, strategic thinking, information, opinion, perspective and emotional support really matters. Why would any leader question the value of having trusted lieutenants in place around him? It’s only natural that a leader often finds such trusted lieutenants by turning to the family, social or work environments that he knows so well.

Moreover, knowing someone and feeling comfortable with them is not the primary reason the leader has chosen them. What matters to the leader is that he knows how that person thinks, what skills and capabilities they bring to the job, and how reliably they perform. The leader knows that his best friend, a former colleague at his last company, has an absolutely flawless sense of timing when it comes to marketing new products. So he brings that friend over to become the new head of marketing as the company is gearing up for its next major product launch. Others, not privy to this experience, may question that decision because they don’t have the same data the leader possesses. To the leader, it’s about certainty and predictability. He’s worked with his friend before. He knows that friend’s character, and thinks he knows his strengths and weaknesses. He is comfortable with the friend and likes him. And he has experienced, in person, how well that friend delivers in a pressure situation. More than anything else, leaders hate surprises. Once they’ve made a decision, they want to check it off the list and move on, certain that it will be accomplished. They don’t want the anxiety of wondering: Will this person really come through?

But there’s more to the taboo of favoritism than just trust and reliability. Would it surprise you if politics also entered the equation? Politics, at senior levels, can be incredibly brutal. Trusted friends and family members make important political allies. They are inclined to watch the leader’s back, and support him at critical moments because of the depth of their relationship. They may also owe the leader a great deal, and the leader may be more than willing to draw interest on those debts whenever necessary. On a board of directors, for example, why wouldn’t the chairman and CEO want the board stacked with as many allies as possible? He wants his decisions to go his way. He wants a supportive board, not one that is waiting for his first bad move. He wants to know that he can walk into the room and discuss challenges relatively openly rather than be always on the look out. If the board directors owe the leader for various reasons, so much the better. Leadership, after all, has a transactional component to it. It is the process by which a leader accomplishes his objectives.

Finally, there’s a third and somewhat more selfish (if still understandable) motivation for loading up on friends and family. Leaders, never lacking in ego, think they probably ought to live forever. Short of being able to clone yourself, one form of immortality comes from seeing your own likeness in front of you. The leaders I have worked with who have been succeeded by people they have mentored closely are enormously proud of that accomplishment. To a degree, they see that individual as an extension of themselves. Gail Sheehy, in her book, New Passages,  calls it “generativity.” Leaders who see their children take over are similarly moved. There’s a sense that the organization, which the leader has worked so hard to build, will be even more of a legacy if it is in the hands of one’s children. There’s also a feeling of well-earned privilege in that transfer of power. It took a lot to get as far as the leader has gotten. He earned it; he should be able to take advantage of that effort by passing the keys to the next generation. It may not be a selfless emotion, or a particularly sound one, but it’s a real emotion, one that influences some of the most critical decisions the leader ever makes.

Anthony Smith is Co-Founder and a Managing Director of Leadership Research Institute and author of ESPN: The Company (Jossey-Bass, September 2009). He is also the author  The Taboos of Leadership: 10 Secrets No One Will Tell You about Leaders and What They Really Think (Jossey-Bass, May 2007). This article originally appeared in different form in his book, The Taboos of Leadership.

And yet, there are many complex aspects to any argument that some people should or should not get more than others. In addition to living in an egalitarian society, we live in a capitalist one. We believe that people should be rewarded differently, depending on the market value of the work they do, the services they provide or the assets they possess. By default, this means that some people will have more, get more, and be able to do more, than others.

We also believe in the American Dream, the idea that we have an inalienable right to build a prosperous life for ourselves, and pass on that prosperity and security to our children. Under such a system, is it possible or even rational to imagine each generation beginning its own journey from the same starting point?

As a society, we believe that some people are more talented than others and we applaud those capabilities and accomplishments. In our obsession with fame and uniqueness, we shine a bright light on such people, on and off the job, and treat them like modern day royalty. Whose fault is it that teachers and nurses don’t get celebrated and rewarded like pop stars and second basemen? It’s our fault. We don’t value those capabilities or services as much as we say that we should.

To an objective observer, the answer is clear. We make the decision to differentiate via the double standard every day. Should we be concerned at how large or shocking the gap between the elite few and the many becomes? It doesn’t make any rational sense, and yet the taboo remains. Is our reaction to the double standard an outmoded concern that should wither and disappear? Or is it a healthy way to keep in check the avarice and elitism inherent in our social system? Taboos can be rooted in superstition. They can also be functional, providing a necessary barrier to bad habits.

Is there any reason to believe that the taboo of the double standard has anegative or positive impact on our business leaders? On the one hand, we need to compensate and support our business leaders adequately because their talent is so rare and their value is so critical. On the other hand, human beings can be extremely sensitive to feelings of justice, fairness and equity. Peter Drucker, and other theorists, warned that in a healthy organization executive pay should not exceed that of average worker by more than four times. Yet, upward mobility is so much more available to all people these days. Perhaps the double standard provides a healthy incentive for entrepreneurial energy?

When it comes to special treatment in an organization, should it bother us that some people receive exceptions to the general rule? The treatment can be justified in terms of relative contributions. But what are the costs? Does the erosion of consistency carry with it a more significant burden than we may realize? Credibility is an important currency for leaders. One of our most powerful definitions of credibility can be summed up in the following way: A leader does what he says he will do. In other words, he walks the talk. If a leader proclaims that we must all tighten our belts to survive a rough period, and then continues to receive lavish treatment; or if a leader freezes bonuses but garners them himself; or if a leader transgresses on a core value that he has declared sacrosanct; isn’t his credibility greatly diminished in the eyes of his followers? On a personal level, a danger exists that special treatment can blind or protect a CEO from unwelcome but ultimately helpful data. Many times, I have been called in by a CEO to conduct extensive evaluations of that CEO’s top people, but been told by the CEO that he doesn’t need that kind of assessment himself. Is the CEO the best judge of that fact? Who is going to contradict him in an environment in which the double standard is the norm?

The debate remains open, the answers are murky and situational. The question for future leaders should be: Are you comfortable with the costs and benefits of operating under a double standard? The question for companies should be: Is your organization healthier without the double standard, or is it being put at a competitive disadvantage because of that aversion?

Anthony Smith is Co-Founder and a Managing Director of Leadership Research Institute and author of ESPN: The Company (Jossey-Bass, September 2009). He is also the author  The Taboos of Leadership: 10 Secrets No One Will Tell You about Leaders and What They Really Think (Jossey-Bass, May 2007). This article originally appeared in different form in his book, The Taboos of Leadership.

We are shocked and titillated with each new revelation. Several very public CEOs could be described as poster children for over-doing it. Take Dick Grasso, head of the New York Stock Exchange. On the one hand, Grasso was a true success story in the American mode. He started at the NYSE at an entry level position, working in the proverbial mail room, and climbed the ranks over the next thirty years until he reached the top position. From that leadership post, he oversaw the NYSE’s evolution through a period of tremendous technological change; he maintained public confidence in the capitalist shareholder system despite a wave of corporate accounting scandals and a sense of entrenched favoritism in the financial companies that create stock offerings; and he helped the organization literally survive the devastating terrorist attacks on the World Trade Center.

For all of these accomplishments and more, he was rewarded handsomely. When the extent of those rewards were revealed, he fell with a mighty thud.

The double standard taboo which got exposed in Grasso’s case was all the more electrifying because the NYSE is a non-profit organization. Although no one could ever imagine the beating heart of Wall Street functioning or even thinking like a non-profit in any ordinary sense, nevertheless, that word “non-profit” was repeated over and over in news reports discussing the “scandal.” It was as though Grasso, as leader of some charity like the United Way, had cooked the books and robbed donors blind at the expense of malnourished children in the third world!

The truth was somewhat different. Grasso’s compensation package was awarded to him by his board of directors. Yes, most of those board members had been appointed because of their support for and friendship with Grasso; but they also had impeccable credentials as leaders of the very institutions that Grasso was being paid to serve. To suggest that Grasso was caught with his hand in the cookie jar is a complete mischaracterization of what happened. Indeed, Grasso was operating completely within the boundaries of the rules by which he had played his entire life. But publicly, Grassohad broken a taboo.

Jack Welch, former CEO of GE, encountered a different aspect of the double standard taboo. Many would argue that Welch was the greatest CEO of the twentieth century. While he was overseeing GE’s phenomenal growth, no one complained about his compensation, nor called any aspect of it into question. During his messy divorce, however, details of his retirement package became public knowledge. In addition to a great deal more money than had been known about, Mr. Welch was also the beneficiary of a multi-million dollar Manhattan apartment and use of the corporate jet, among other surprises. Most shocking of all, Welch an extremely wealthy man, had his dry cleaning services covered, too.

To those already frothing about the excesses of double standards, this information was proof that even Saint Jack was corrupt. Why in Thomas Edison’s name should GE shareholders pay for Jack Welch’s dry cleaning when he no longer ran the company? In fact, Welch’s benefits were not out of line with what other CEO’s have typically received. More significant still, few of those other CEO’s have ever come close to producing the value that Welch created for shareholders. Indeed, the benefits of his leadership extended beyond GE, raising the bar for executive performance at companies everywhere. And yet, there was something about the idea of Jack Welch getting his dry cleaning expenses reimbursed which made people upset. Welch, unwittingly, had broken a taboo, and his luster was a touch less shiny as a result.

Anthony Smith is Co-Founder and a Managing Director of Leadership Research Institute and author of ESPN: The Company (Jossey-Bass, September 2009). He is also the author  The Taboos of Leadership: 10 Secrets No One Will Tell You about Leaders and What They Really Think (Jossey-Bass, May 2007). This article originally appeared in different form in his book, The Taboos of Leadership.

Is there any issue more toxic in today’s organizations than the notion of the double standard? It manifests itself most blatantly in terms of CEO pay, extravagant perks, and the kind of favoritism in which one set of standards is applied to top executives and another set to rank-and-file employees. When the economy is good, we tend to overlook such differentiation, comforted perhaps by the idea that a rising tide raises all boats. When the cycle turns, however, the resentment of unfair treatment brings a scrutiny of the double standard akin to a modern day witch hunt.

The taboo is simple: leaders should avoid any impression that they are the beneficiaries of special treatment. Our politicians are the most public demonstrators of this sensibility. Consider the 2004 presidential election between John Kerry and George Bush.  Both men came from privileged backgrounds, one merely very well-to-do, the other extremely wealthy. Both attended elite schools at every level of education, and received special treatment throughout their public and private careers by those who saw their tremendous potential. And yet, both also attempted to outdo one another in conveying an impression of being ordinary folk in touch with ordinary Americans. John Kerry’s political commercials focused on his humble beginnings and service to the American people, overlooking his marriage to a woman in command of a one billion dollar fortune. George Bush’s persona is a masterful display of common touch, and his speaking style demonstrates a bemused anti-elitism which many voters found comforting and refreshing.

Notice, too, that our business leaders, when writing their biographies or answering questions in interviews, tend to emphasize humble origins and everyday passions over anything which might strike people as being refined, privileged or rarefied. We prefer to think of our elite business people as the son of a mill worker or the child of the public school system, blessed by the fortunes of this great country. We prefer not to hear about the young man so obsessed with personal ambition that he worked hard enough to make it into an Ivy League school and gained access to elite connections which gave him a necessary foothold for later accomplishments.

The message leaders would like to convey through this reticence is that they are not recipients of special treatment and are, in fact, no different than the rest of us. At some level, they sense that the public’s attitude to the double standard is deeply negative. And yet, as with all taboos, there is a complicated set of emotions involved. As much as it likes to deplore double standards, the public is also fascinated by them. Consider our obsession with Hollywood stars and other members of the modern royalty. Not surprisingly, leaders also feel one way about double standards in private and another way on the record. In the gap between those two extremes, exists the electric nerve of the taboo.

Anthony Smith is Co-Founder and a Managing Director of Leadership Research Institute and author of ESPN: The Company (Jossey-Bass, September 2009). He is also the author  The Taboos of Leadership: 10 Secrets No One Will Tell You about Leaders and What They Really Think (Jossey-Bass, May 2007). This article originally appeared in different form in his book, The Taboos of Leadership.

Other people become political by experience. They learn the art of politics because they realize that being political is essential for achieving their objectives.

Perhaps they have observed others getting what they want and wondered “what do they have that I don’t have?” Maybe they are immersed in a highly political environment and must learn to swim or sink. Or, maybe they realize that position and authority don’t really influence people as much as one would hope; and learn to play the game differently in order to be more effective. In any case, being political is just one more weapon in the leadership arsenal.

Some leadership experts coach executives to be less political because they have a glossy, idealized, or politically correct view of what being a leader means. In reality, most organizations can’t afford their leaders to mute or restrain those political skills. Efficiency, aggressiveness, and effectiveness would be sacrificed as a result. Instead, coaches need to recognize that leadership is a contact sport, in which hands get dirty and noses are sometimes bloodied. It takes skill to be viewed as a leader who is not political while being politically astute. Despite what many may wish to think, leadership is  a self-serving exercise which happens to benefit the organization as a whole. Political behavior that does not serve the leader’s vision or the organization’s direction is viewed negatively. Political behavior that does serve the leader’s vision is called “leadership.”

In the movie Power, Richard Gere plays an extremely successful political handler who has become tired of working for the highest bidder. So many of the well-financed politicians he helps get elected simply do not do any good once in office. To salve his conscience, he decides to select an honest candidate who really stands for something and help that person get elected by using his dark arts. The candidate Gere selects is thrilled to receive his help and guidance. Gere tells the man how he must change his image and message in order to get elected, but the man refuses. He wouldn’t have integrity if he did so. Richard Gere argues that the candidate cannot accomplish any good if he does not succeed in getting elected. Put aside your integrity for the time being, he advises, and you can return to it once you are in power.

It often seems, of course, that the political leaders we elect are rarely able to live up to their potential or best intentions. Once they have sacrificed integrity to be elected, they must continue to sacrifice integrity to be re-elected. Even a second term president or a retiring senator is still beholden to the interest groups and powerful individuals who saw them elected in the first place. There is a fear that being political can be an effective way of gaining power, and maintaining power, but at significant cost. Does this fear mean we should avoid being political at all? Or does it indicate that being political is a taboo ¾ and a luxury that effective leaders can’t afford?

Leaders who believe that they can stop being political once they reach the top are often deeply disappointed. In truth, being political will always be part of the game. Nevertheless, the skill set for being political changes as a leader rises in the ranks. A leader who is an up-and-coming middle manager will probably need to gain accolades and recognition from above, while creating supportive friends and allies all around, and not distancing or turning off anyone in the process. A leader at the very top of the organization might need to be viewed by followers as benevolent, compassionate, articulate and visionary. But do those attributes have to be real; or is perception more important than the reality? The question reeks of being political. To many of the world’s CEO’s, the answer is self-evident ¾ part of their job is to convince people of those perceptions, regardless of the truth. I doubt, however, that they would ever admit to that in public.

Anthony Smith is Co-Founder and a Managing Director of Leadership Research Institute and author of ESPN: The Company (Jossey-Bass, September 2009). He is also the author  The Taboos of Leadership: 10 Secrets No One Will Tell You about Leaders and What They Really Think (Jossey-Bass, May 2007). This article originally appeared in different form in his book, The Taboos of Leadership.

The ebb and flow of organizational energy is difficult to harness, let alone use efficiently. Leaders can use positional or hierarchical power to control resources, make moves, and define direction. But this power doesn’t ensure that others will follow, let alone perform up to their potential in service of the leader’s vision. Leaders are constantly vigilant in their search for ways to win the competition for followers’ hearts and minds. This makes them, by definition, political. We should not look at political behavior as necessarily good or bad, but neutral. To evaluate the extent to which political behavior is contributing to or distracting from the organization, don’t look for the existence of politics ¾ figure out what it’s being used to do.

But What About the Dark Side? In my view, political behavior gets perceived as a negative attribute of a leader when it does not reinforce a leader’s vision or the organization’s needs. When colleagues, reports and supervisors point out that a leader is political, chances are that person simply does not know when to “turn it on” and when to “turn it off.” They aren’t using their political skills with acumen.

Anthony Smith is Co-Founder and a Managing Director of Leadership Research Institute and author of ESPN: The Company (Jossey-Bass, September 2009). He is also the author  The Taboos of Leadership: 10 Secrets No One Will Tell You about Leaders and What They Really Think (Jossey-Bass, May 2007). This article originally appeared in different form in his book, The Taboos of Leadership.

I could cite many highly respected leadership and organizational experts for their negative views of politics, too. At the same time, I recognize that in the world of book reviews and jacket endorsements, this might be an impolitic thing for me to do. Oh, what the hell.

Henry Mintzberg, Bronfman Professor of Management at McGill University, is one of the smartest and most refreshingly unorthodox management and organizational experts in the world. Like Peter Drucker, he recognizes the good and bad in our organizations. According to Mintzberg:

“I am no fan of politics in organizations. But neither am I a fan of illness. Yet I know we have to understand one like the other. In fact, politics can be viewed as a form of organizational illness, working both against and for the system. On one hand, politics can undermine healthy processes, infiltrating them to destroy them. But on the other, it can also work to strengthen a system, acting like fever to alert a system to a graver danger, even evoking the system’s own protective and adaptive mechanisms.” [Politics And The Political Organization, from Mintzberg On Management.]

In other words, Mintzberg (like most of us) believes that the existence of politics in organizations is a bad thing; but there’s a good side. When we spot the existence of politics, we know something is terribly wrong. The patient is sick, and politics is the symptom. Recognizing that, we can rush the patient to the emergency ward and save his life.

Mintzberg thinks of politics in terms of gamesmanship, too. He’s even come up with names for those games, many of which you will read with a thrill of recognition. There’s the insurgency game; the counterinsurgency game; the sponsorship game; the alliance-building game; the empire-building game; the budgeting game; the expertise game; the lording game; the line versus staff game; the rival camps game; the strategic candidates game; the whistle-blowing game; and the young Turks game. I think that just about covers it.

From this perspective, politics is a sign of “war by other means.” It indicates dissatisfaction within the ranks, conflict between power bases, division between factions;  it distracts people from important goals; and it uses up vital energy in unproductive pursuits. Mintzberg points out that some organizations are more prone to politics than others. The entrepreneurial organization, for example, is not very political because the founder is a strong figure with a strong vision, and most people are focused on urgent objectives. The industrial (machine) organization is more prone to politics because it is more bureaucratic. Divisions have budgets which they scramble over. New generations can be in conflict with the generation in power. Line can be in conflict with management. Whistle-blowers might try to bring down the whole system. The professional organization is also prone to politics because hierarchy is flat and authority is decentralized. In schools, law firms, and innovative start-ups, people assume power bases, alliances are formed, sponsorship is critical, and everyone needs to work gamely for whatever influence they can gain. In pure ideological organizations, like cults, politics is not tolerated because belief is so strong, people follow it without question.

All of this feels accurate, if viewed through a particular filter. Mintzberg does allow that politics can have a functional role. He thinks of it as a Darwinian process in which the strong survive; a conflict-heavy method by which various sides of an issue can be debated; a means by which change can be stimulated by dissatisfied people from within; and a way of easing the acceptance of executive decisions. Mintzberg implies that in a healthy organization, only a minimum of politics would be necessary; but he also suggests that the existence of politics is a sign of life. Only a dead organization is free from politics; because nobody cares what happens in them anymore. If politics is a necessity, Mintzberg believes, it is because disease goes with life. That said, we need to be vigilant about watching for it, and try to lead lives that are as healthy as possible.

Anthony Smith is Co-Founder and a Managing Director of Leadership Research Institute and author of ESPN: The Company (Jossey-Bass, September 2009). He is also the author  The Taboos of Leadership: 10 Secrets No One Will Tell You about Leaders and What They Really Think (Jossey-Bass, May 2007). This article originally appeared in different form in his book, The Taboos of Leadership.

Most of us feel the same way.

And yet, we all know such people in our organizations. In fact, more often than not, politicians ¾ meaning people who are skilled at getting what they want without necessarily having the authority or power to do so ¾ seem to thrive in bureaucracies. They rise through the ranks. They gain allies and supporters as well as recognition, reputation and status. They also accumulate detractors and even enemies ¾ people who feel used, pushed aside, out-maneuvered and neglected. If those detractors aren’t completely ousted, they always seem to be waiting in the wings, hoping for the politician to fail, ready to pounce if he does ¾ and just as quick to jump back on the bandwagon when that “political bastard” favors them again. When an organization is dominated by politics, it’s not pretty ¾ an indication that trust is low, leadership is weak and the organization itself is in distress.

As an executive coach, there have been many occasions when I’ve had to be the messenger of feedback in which a leader’s colleagues, direct reports and superiors describe him as being political. I know that stings. It’s not a term that has any gloss or neutrality to it. Instead, it’s a term that implies a disparagement of that person’s character and an attack on the core of who they are, not just the way they behave. One of my mentor’s, Joe Keilty, used to say that a politician is someone who kisses up and kicks down. They tell the boss what the boss wants to hear; they look out for their own interests, more than anyone else’s; and they treat everyone around them badly. It’s not easy to tell someone that they are a political slime ball; but occasionally they need to hear the news straight, in order to change how they behave and how they are perceived in the world.

Now it’s time for some straight talk of my own. As an executive coach and leadership expert, I don’t see my role in life as being on a mission to eradicate politics and political behavior from the hallways, corner offices and meeting rooms of corporate America. Far from it. In fact, it is my belief, based on years of experience observing leaders and organizations, that politics is not a necessary evil in the leadership game ¾ it is just plain necessary. No leader achieves his goals without politics. No organization is utopian because it is politics-free. Instead, politics is the air leaders breathe and an important source of an organization’s energy and dynamism. The fact that politics is such a dirty word only points to its status as another taboo of leadership. We don’t like to acknowledge the existence of politics because we prefer an idealized and sanitized view of our leaders.

And yet, if we ever encountered a leader who was truly not political we would find that leader disappointingly ineffective. Politics is a necessary skill for making leadership meaningful. When I work with leaders who have been labeled as too political by their colleagues, reports and superiors I don’t coach them to change their ways in order to become better, more morally centered and likeable people; I teach them to change their ways because it’s time, at this stage in their careers, to do the political thing differently. For a leader, appearing less political is a very political act! Like any critical skill, it needs to be mastered.

Anthony Smith is Co-Founder and a Managing Director of Leadership Research Institute and author of ESPN: The Company (Jossey-Bass, September 2009). He is also the author  The Taboos of Leadership: 10 Secrets No One Will Tell You about Leaders and What They Really Think (Jossey-Bass, May 2007). This article originally appeared in different form in his book, The Taboos of Leadership.

When Jim Collins wrote about Level 5 leaders, he mentioned that many had a “formative experience” which impacted the direction of their lives. Abraham Zeleznick wrote about the same phenomena 15 years ago in his book, Managerial Mystique. He said that “leaders grow through mastering painful conflict during their developmental years, while managers confront few of [those] experiences.”

I believe such an experience is a common ingredient in mystique. Leaders with mystique have often been shaped and inspired by traumatic events such as an accident, the loss of a loved one, or a trying period.. The impact seems to raise self-awareness; cause questioning or reflection; deepen a sense of meaningfulness or understanding; and create a drive for urgency and action. Of course, many of us have potentially formative life experiences which fail to turn us into charismatic leaders. The ability to influence others in a transformational way accompanies many other factors ranging from competence, responsibility, vision, and circumstance.

The power of mystique should not be underestimated, however. As one can imagine, it must be difficult to build a sense of mystique when a leader is surrounded by the same people for many hours of every day. Indeed, at most ranks in an organization, competence, clarity, certainty, pragmatism and teaching are much more valuable and productive skills. If anything, an up-and-coming leader does not create a sense of mystique in others around him, so much as in those above. Supervisors, executives and senior leaders, watching this highly competent, influential and effective individual, might wonder, “how do they do it?” and become intrigued. At the top ranks, the directionality of mystique is reversed. Those who know the leader well may be less taken in by all aspects of the leader’s strong personality; although they may remain suitably impressed with certain core aspects. For those below the senior leader, however, a sense of mystique, mystery and intrigue can grow even more powerful with distance. Many who have never met, or had any direct experience with a leader, can feel that leader’s mystique. It’s a form of identification that comes primarily from within.

Mystique, I believe, is the essence of charisma. We identify with leaders who are like us, who exemplify qualities that we admire and desire but do not have, and who ensnare or engage us with a sense of mystery or intrigue. But is there a net benefit to this charisma for organizations? I believe there can be. If the charisma is used well, by the leader, it can serve as an influence tactic ¾ one more tool in the arsenal to create desired action. If the charisma is used for negative or poorly considered ends, then it is a powerful force which wastes energy on a pointless cause. Like any tool, its value arises from its utility. Not all leaders have charisma, but some do. Not all leaders with charisma are effective and good, but some are very effective and very good. Under some circumstances, particularly moments of great trial or challenge, charismatic leadership can pull a group together and inspire focus like no other force.

Does this mean that organizations should look for leaders who have charisma, or actively aim to develop charisma in emerging leaders? I don’t think that charisma ¾ like leadership ¾ is always the answer. At some levels and under some circumstances, charisma is far less important than sheer competence. Organizations which parachute larger-than-life figures into their top leadership roles may get a short-term bang for the buck in terms of impact because of the mystique factor; but I doubt whether that mystique will stand up over time. Like credibility, mystique is easily lost and extremely difficult to regain. To deny that charisma exists and has power, however, is to put our heads in the sand about a fundamental social phenomenon. Not all leaders have it, but many of the great leaders do. It has a dark quality, undeniably. And yet, it is something we seek out in those we wish to follow.

Anthony Smith is Co-Founder and a Managing Director of Leadership Research Institute and author of ESPN: The Company (Jossey-Bass, September 2009). He is also the author  The Taboos of Leadership: 10 Secrets No One Will Tell You about Leaders and What They Really Think (Jossey-Bass, May 2007). This article originally appeared in different form in his book, The Taboos of Leadership.

When a leader has mystique, there’s a force to them.

They have a high degree of personal presence. They command attention through exceptional verbal or nonverbal communication styles. Their way of looking at the world is unique, and they somehow create an environment which is exciting, fun or inspirational to be around. They seem larger than life, and we are always curious and interested in learning more about them.

Not all successful leaders have mystique as a natural quality. I doubt, if we were to meet Bill Gates at our neighborhood Starbucks, for example, we would find him to be exceptionally interesting or intriguing. The level of mystique that he does have relates primarily to his accomplishments and does not seem to exude from his person. The legendary CEO of Southwest Airlines, Herb Kelleher, on the other hand, seems to cultivate mystique deliberately. He works and plays harder than ordinary mortals, outdrinking, outsmoking, and having more fun than the people around him. He has tattoos on his biceps, and wears Elvis costumes to company parties. He once settled a major legal dispute through an arm wrestling competition. His antics, his personality, and his sense of group mission make him a unique personality that others want to emulate and please. Winston Churchill is another leader who had mystique aplenty. His eloquent speeches, his bold pronouncements, his decisive depictions of the future and his deeply considered ideas made him seem a giant among us. We relied on his strength, clarity and resolve when we could find it nowhere else. Seeing leadership close up only highlights the importance of charisma. The famous turning point in the Nixon-Kennedy race for president occurred during the televised debates. Richard Nixon, pale, weary and sporting a five o’clock shadow looked less leaderly next to the tall, youthful, tanned and athletic-looking John F. Kennedy. At the end of the debate, television watchers overwhelmingly selected Kennedy as the winner, while radio listeners thought that Nixon had done the better job. Of course, Kennedy won the election, in no small part because of his charismatic appeal. His leadership legacy lives on because of his mystique.

Mystique is a transformational quality rather than a transactional one. It affects our internal state, rather than our external. A follower of a mystic leader has drunk the Kool-aid, as they say. They have been impacted on the inside, at the level of values and beliefs, because of their contact with the leader. Transactional leaders who rely on carrots and sticks to move followers lose their power when they are no longer in positions of authority or influence. But transformational leaders establish a sense of leadership beyond the managerial or supervisory role. They are able to get people to do things which nobody else can.

Anthony Smith is Co-Founder and a Managing Director of Leadership Research Institute and author of ESPN: The Company (Jossey-Bass, September 2009). He is also the author  The Taboos of Leadership: 10 Secrets No One Will Tell You about Leaders and What They Really Think (Jossey-Bass, May 2007). This article originally appeared in different form in his book, The Taboos of Leadership.

Societal norms as to what is or is not leaderly play an undeniable part in who we choose to elevate as leaders. Those norms can shift dramatically depending on times and circumstances. What was appealing in one era may be less appealing today. The basic urge to elevate somebody into a leadership role, however, is a biological instinct, rooted in our need for survival ¾ we’re looking for direction, guidance, security and emotional identification. We may prefer to deny that urge, or sanitize it for public consumption, but it’s a powerful force, nonetheless.

The power of charisma is an indication of our desire to identify with our leaders. In general, we tend to follow or be influenced by those with perceived similarities to ourselves. Psychologists call this homopholy. At its most basic, homopholy can refer to an identification with physical characteristics. If you are tall, male and white, you will tend to identify with leaders who are tall, male and white. If you are female, African American and over fifty, you will tend to identify with leaders who are also female, African American and over fifty. Of course, identification can go deeper than physical attributes. If you have a southern accent and enjoy hunting, chances are you will identify more strongly with a political leader who also hails from the south and supports gun ownership. If you have strong religious convictions, you feel more comfortable being led by someone who is also religious.

Perceived similarity is one aspect to leadership identification, but so is perceived difference. We are not necessarily looking for our leaders to be absolutely like us; we also hope that they have some differences. Those dissimilarities, however, should be positive ones ¾ what’s known as optimal heterophylly. We hope that our leaders are smarter than we are, more competent, visionary and articulate. We want them to be like us, at a core level, but better than us, too. We are drawn to leaders we can look up to and idealize.

Political consultants monitor these two variables closely. When consultants poll voters to determine which candidate they are most comfortable with, they are essentially asking who they identify with most strongly. When they ask voters which candidate embodies a critical value like strength, integrity or virtue, they are assessing the degree of idealization. Similarly, if the leader of your organization articulates values that you embrace, and a vision which you share, chances are you are open to being highly influenced and directed by that person. You feel that they are like you, at some basic level, but also capable of directing you to a place you could not get to by yourself.

Anthony Smith is Co-Founder and a Managing Director of Leadership Research Institute and author of ESPN: The Company (Jossey-Bass, September 2009). He is also the author  The Taboos of Leadership: 10 Secrets No One Will Tell You about Leaders and What They Really Think (Jossey-Bass, May 2007). This article originally appeared in different form in his book, The Taboos of Leadership.

Charisma is at a low point in current views on leadership.

We’re somewhat distrustful of charismatic authority figures today, perhaps equating a leader’s charm and over-sized personality with the kind of snake oil salesmanship that typified the worst of the late 1990′s stock bubble. After Enron, AIG, and Tyco, who can blame us?

The academic position against charisma was articulated particularly well by Jim Collins in his excellent book, Good To Great. In describing companies that had made the leap from good to great, Collins and his research team found that such companies were run by “Level 5″ leaders. “Level 5 leaders are a study in duality: modest and willful, humble and fearless.” He characterized them as often modest, shy, introverted, and awkward. They “never wanted to become larger-than-life heroes. They never aspired to be put on a pedestal or become unreachable icons. They were seemingly ordinary people quietly producing extraordinary results.” Indeed, the only remarkable feature of their lives, outside their accomplishments, was an early formative experience, often life-threatening, which seemed to put them into closer contact with core values or a sense of larger meaning. Furthermore, according to Collins, one of the reasons why few companies make the leap from good to great is because most organizations believe that “larger-than-life, egocentric” leaders are necessary. In other words, charisma isn’t just unnecessary for great leadership ¾ it’s a detriment.

I know a few Level 5 leaders, some of them well. George Bodenheimer, president of ESPN and ABC Sports, is one of the most effective and capable leaders I’ve ever encountered. He was labeled the most powerful man in sports by the Sporting News. He is beloved by his employees as a humble man, in part because he started in the mail room. But charisma is also part of Bodenheimer’s impact on people, and I have known few successful leaders without a healthy dose of it. Collins’ view of humble versus charismatic leadership has become de facto conventional wisdom. Post Enron, there’s an undeniable appeal to down-to-earth, stick-to-the-knitting, and (most of all) serious leadership. But I think that while Collins’ assertions say some important things about how leaders achieve their effectiveness, he is missing some nuances about what makes our leaders compelling. It’s hard to argue against the charisma of some of our most heralded and successful leaders, inside and outside business. Gandhi had charisma, so did Martin Luther King, Mother Theresa, Winston Churchill and Ronald Reagan. These people were known as leaders because of their vision, conviction and tremendous influence over others ¾ as well as their appealing mystique. In business, few of our leaders have been as notable as the public figures listed above; but those who transcend their organizations are often undeniably intriguing. Whether Jack Welch, Richard Branson, Herb Kelleher or Warren Buffett, we want to know more about them; and we want to know more about the secrets they possess. We are drawn to them, and want to be more like them.

Anthony Smith is Co-Founder and a Managing Director of Leadership Research Institute and author of ESPN: The Company (Jossey-Bass, September 2009). He is also the author  The Taboos of Leadership: 10 Secrets No One Will Tell You about Leaders and What They Really Think (Jossey-Bass, May 2007). This article originally appeared in different form in his book, The Taboos of Leadership.