The Narcissistic Organization

Part 3 of a series on the illnesses of today’s organizational cultures

A narcissistic organization suffers from delusions of success and grandeur. From the outside, the organization probably seems to be nothing unusual. From the inside, in its own estimation, it can do nothing wrong. Every problem or setback is attributed to external situations beyond anyone’s control. Its leaders are portrayed as near geniuses and their every action or speech eagerly reported. Employees are expected to become cult-like in their devotion to the enterprise. So distorted does this kind of sick organization’s view of the world become that it eventually loses touch with reality. Many of the strategic mistakes and failures that seem so obvious to outsiders occur in organizations that suffer from narcissism.

Narcissism is especially prevalent in long-established organizations with a past track-record of success. They become so proud of their past, and so complacent about their prestige, that they no longer notice clear signs of pending problems and an obvious need for change. Just as psychotic organizations “breed” psychotic leaders, narcissistic organizations tend to have an unusually high proportion of narcissistic leaders fixated on issues of power, status, prestige, and superiority.

Here is how Professor Manfred Kets de Vries, writing in The European Management Journal (Vol. 22, No. 2, pp. 183–200, April 2004), describes the “reactive” (i.e. negative) narcissistic leader:

Reactive narcissistic leaders are not prepared to share power. On the contrary, as leaders they surround themselves with ‘yea-sayers.’ Unwilling to tolerate disagreement and dealing poorly with criticism, such leaders rarely consult with colleagues, preferring to make all decisions on their own. When they do consult with others, such consultation is little more than ritualistic. They use others as a kind of ‘Greek chorus,’ expecting followers to agree to whatever they suggest. Reactive narcissistic leaders learn little from defeat. When setbacks occur, such leaders don’t take any personal responsibility; instead, they scapegoat others in the organization, passing on the blame. Even when things are going well, they can be cruel and verbally abusive to their subordinates, and they are prone to outbursts of rage when things don’t go their way. Likewise, perceiving a personal attack even where none is intended, they may erupt when followers rebel against their distorted view of the world. Such ‘tantrums,’ re-enactments of childhood behavior, originate in earlier feelings of helplessness and humiliation. Given the power that such leaders now hold, the impact of their rage on their immediate environment can be devastating. Furthermore, tantrums intimidate followers, who then themselves regress to more childlike behavior.

How can you spot a narcissistic organization? Here are some clues:

• The members of the top leadership are revered and accorded almost god-like status.
• Employees treat the organizationally-approved way of thinking or acting as Holy Writ.
• No one ever admits to any mistakes. Problems are always blamed on someone else—often people outside the organization.
• People treat the bombastic, dictatorial behavior of certain bosses as justified by their exceptional status.
• Questioning any aspect of the organization is strongly discouraged. Objections to policy or procedures from outsiders are met by an amused and superior smile.
• Obtaining employment within the organization is seen as a life-changing achievement and a gift of immeasurable value, which must be repaid with unquestioning loyalty.

My own experience of narcissistic organizations confirms how easily they become a mutual admiration society, where employees act as if simply being part of the organization confers automatic superiority; and the leaders are more concerned to polish their image than take tough decisions. Such an idealized view of themselves and their organization quickly seduces executives into believing that they are in truth the wonderful managers and flawless business strategists that the organization’s PR has made them out to be.

One of the most negative aspects of working in a narcissistic organization is the way it forces everyone to take sides. Since narcissistic leaders typically show strong hostility to anyone who fails to give them the unquestioning loyalty to which they believe they are entitled, employees are faced with a stark choice: do what the leader wants or suffer nasty career consequences. Worse still, there will be no support from colleagues for any “rebellion.” As organizational “cult members,” people rapidly become like their leaders: deeply hostile to anyone who questions the prevailing organizational culture. Independent thought is squashed. Leaders are deprived of truthful feedback. The self-satisfied blindness that results can lead to catastrophe, as leaders are deprived of sensible reality-testing and followers provide sycophantic praise for personal gain. As Max McKeown wrote recently in Management Issues:

Far too many organizations are stuffed with sycophants prepared to overlook anything shady, illegal, or unethical as long as they are getting to hang around and share some power.

Narcissistic organizations breed arrogant, power-obsessed leaders and sycophantic, manipulative followers. The archetypal “organization man” is a product of a narcissistic organization. So is the status-obsessed CEO who believes that he or she is entitled to use the organization’s resources to demonstrate superior standing. And, since whatever demands the organization sees as “reasonable” must be met, narcissistic organizations quickly produce zombie-like employees who sacrifice any other parts of their life to the organization’s needs. There can be no work/life balance where employment in the organization is seen as such a stupendous gift.

Is that where you want to spend your time? The longer you stay, the less your capacity for independent thought will be, and the more you will come to believe that whatever the organization approves is automatically right. I have known several people who spent most of their careers in an organization of this type. In conversation, their constant praise for the organization quickly became embarrassing. It was also obvious that they formed an elite group, at least in their own estimation. For example, all agreed that in any problem situation, anywhere in the world, their automatic response would be to turn to the local branch of their organization for help and guidance. Not the authorities. Not friends or neighbors or family. Not even their own commonsense or critical thinking ability. If you hadn’t worked in their organization, you were automatically seen as somehow inferior.

Unless this seems an ideal world to you, don’t be tempted to work in such an environment. If you’re in one, and haven’t yet succumbed to group-think, start job hunting right away.

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