Towards an organisational theory of hubris: Symptoms, behaviours and social fields within finance and banking

Abstract

Hubris has become a popular explanation for all kinds of business failure. It is often reduced to the one-dimensional notion of ‘over-confidence’, particularly on the part of CEOs. There is a need to clarify the extent to which other attitudes and behaviours constitute hubris, and how they are affected by such organisational dynamics as the struggle for power, status and material rewards between actors. This article explores these issues within the finance and banking sectors. It uses the Critical Incident Technique to identify behaviours associated with hubris and probes the interaction between them and the organisational contexts in which they occur. Five categories of behaviour based on an analysis of 101 incidents are described, as are a series of ‘inflection dynamics’ that reinforce the behaviours in question and constitute a social field conducive to hubris. I challenge the reductionist views that hubris is primarily a psychological state consisting mainly of ‘over-confidence’. This article seeks to complexify the term hubris and to develop an organisational rather than purely psychology theory of its emergence and institutionalisation within finance and banking.

Barriers to leadership development: Why is it so difficult to abandon the hero?

“…Reinforcing behaviours and attitudes are influenced by various contextual, organisational , and social forces (Sadler-Smith et al, 2017), such as the systematic pressure for success, a high level of reward, and the acquisition of power, as Tourish (2020) shows in his study. When individuals have a heroic sense of self-as-a-leader, individuals are forced to keep up appearances (Ford et al, 2010) and are permanently confronted with the need to live up to unrealistic expectations (Alvesson and Blom, 2018).…”

“…In the ‘illusion of control’ (Langer, 1975), they overestimate their own abilities to predict events and to produce excellent results from uncertain conditions. Hubris, however, should not be reduced to the notion of overconfidence on the part of individual managers only (Tourish, 2020). The phenomenon is embedded especially in western cultural narratives.…”

Differentiating leader hubris and narcissism on the basis of power

“…While researchers have intensely debated on the dark and bright sides of narcissism, hubris is typically discussed in terms of dysfunctional excess of some leader attributes (e.g. confidence), which places it firmly on the dark and destructive side of leadership (Tourish, 2019). Only recently was it dichotomised into positive versus negative types, or as having dark and bright sides (Zeitoun et al., 2019).…”

On the moral side of enterprise

“…We do so by elucidating how traits such as complacency, hubris and arrogance engenders resistance to coercive pressures for regulatory compliance. Previous research has linked complacency to a lack of vigilance, attention and awareness (Moray & Inagakit, 2000), the inability to see, recognize or detect information (Arstad & Aven, 2017) and constitutes a barrier to adequate responsiveness (Tourish, 2020;Tushman & Nadler, 1986). Our findings resonate with aspects of previous research and extend the literature on responsiveness by unveiling that complacency, once institutionalized through perverse learning, becomes manifested in a strong force for rigidity and stasis.…”