Research shows that leaders can improve their performance simply by becoming more self-aware. In fact, it is critical for leaders to recognize their own strengths and weaknesses in order to reach their potential and avoid derailment. Findings suggest that blind spots are most common in areas related to adaptability, creativity, and assessing talent.

“There are three things extremely hard: steel, a diamond, and to know one’s self.” Benjamin Franklin cataloged that axiom in Poor Richard’s Almanack in 1750, but the struggle for self-awareness has bedeviled people for centuries before and since.

Many of today’s business leaders continue to wrestle with a lack of self-awareness, a problem that can stall or even derail their careers. Experienced executive coaches report that close to 90 percent of leaders lack self-awareness in one or more areas.

Study after study has found that self-awareness is a key factor associated with high performance and potential and an indicator of long-term career success, especially for leadership roles (Church 1997; Sala 2003). To be sure, leadership demands cognitive ability, motivation, experience, learning agility, and more. But when all things are equal, self-awareness appears to be the trait that best explains why some leaders succeed when others derail.

By comparing executives’ self-assessments to those completed by their bosses, peers, and direct reports, we have identified the specific areas where leaders most often overestimate or underestimate their own skills. While not a perfect measure of self-awareness, these findings do indicate the degree to which a leader is aware of his or her strengths and weaknesses. Just contemplating these frequent blind spots and hidden strengths is a step toward enhancing self-awareness.

Armed with self-awareness, leaders can see themselves without deception or distortion. They can gauge how they are perceived, and can assess whether they are having a positive impact (Church 1997; Goleman 2004). They are open to feedback–indeed, often seek it out–and are willing to change (Lombardo and Eichinger 2009).

The cost of self-deception

Barriers to self-awareness take two forms. Hidden strengths are the skills leaders have, but underestimate. This can cause such individuals to expend needless energy “fixing” something that isn’t broken or under-using a critical leadership skill. Blind spots, the skills that leaders overestimate, are more problematic. These are weaknesses leaders can’t see in themselves, even though they are evident to everyone around them. For example, a leader may think he is a creative problem solver, whereas others see him recycling the same two or three ideas.

Distorted or inflated self-perception is a widespread problem. One poll found that 90 percent of leaders believe that they are in the top 10 percent of performers (Church 1997). What’s the harm in such pervasive self-esteem? It can allow blind spots to go unchecked until suddenly otherwise smart, successful leaders find their careers taking a negative turn. They are either demoted, plateaued early or fired (Lombardo and Eichinger 1989). Derailment is described by Michael Lombardo and Robert Eichinger in this way:

Derailment is neither topping out nor opting out nor not winning a promotion each time one is available. It is reserved for that group of fast-track managers who want to go on, who are slated to go on, but who are knocked off the track.

Derailment can stem from lacking a critical skill, exhibiting negative behaviors or even over-using a strength. It also can occur at any stage of a person’s career (Shipper and Dillard 2000); however, research indicates that lack of self-awareness and the risk of derailment increase at higher levels of leadership (Sala 2003; Tang, Dai, and De Meuse 2010). Up to 50 percent of high-potential managers and executives temporarily or permanently derail.

Derailment is costly for the individual and the organization–and the price escalates dramatically for high-level leaders. One estimate put derailment costs at $12 million to $50 million per C-suite executive. In the United States alone, it has been estimated that the failure of top executives costs the economy as much as $13.8 billion per year (Stoddard and Wyckoff 2008). Self-awareness may not be a panacea, but by helping leaders mitigate their weaknesses, leverage their strengths, and address problem areas, it will significantly increase their likelihood of success.

Self-awareness is a key factor associated with high performance and potential and an indicator of long-term career success. Lack of self-awareness and the risk of derailment increase at high levels of leadership.

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