The Leadership Paradox

“What is a man? A miserable little pile of secrets.”

— Andre Malraux

BCG founder Bruce Henderson never imagined his simple strategy called the BCG Matrix would play a starring role in the movie Wall Street. The main character, Gordon Gekko, ruefully admitted the reason he planned to destroy a company was a line borrowed from Henderson, “because it’s a dog…with different fleas.”

(This article previously appeared in Chief Executive Magazine)

The BCG Matrix recognized that different companies in a portfolio reflect different rates of growth. To figure which had the best chance of earning a good return, Henderson captured their future prospects in a diagram that labeled them a star, question mark, cash cow, or a dog. As Gekko made clear, no one wants to be a dog.

The sheer genius and simplicity of the BCG Matrix became fodder for corporate honchos like Jack Welch. When the GE chief told his troops, “if you are not number one or two, either fix, sell, or kill it,” he was saying if your business is not a star, it’s a dog and get rid of it. It struck me as ironic that Welch and Gekko were saying the same thing, yet ruthlessness in one was the stuff of legend while in another became the road to prison?

This was truly a leadership paradox.

The New Leadership Matrix

What our discovery boiled down to was that much like Bruce Henderson’s Portfolio Matrix, there is a portfolio matrix for leaders, equipped with similar positive and negative attributes. Every CEO starts out as either as an Ace, Wizard, or Centurion and hopes to rise to the level of stars, the equivalent of Nobel Prize winners in business.

In defining the types of leaders, I had to make a few changes to the BCG Matrix imagery to reflect leadership styles: Star, Ace, Wizard, and Centurion. Each type has positive and negative attributes as discussed below, which reflect what certain types of leaders will do to gain success, glory, or wealth. That dichotomy is what separates the leaders from fallen angels. It’s also how you end up with Elizabeth Holmes, Bernie Madoff, and Andy Fastow.

For someone to be a true leader, it doesn’t matter in which quadrant you start, as long as you are genuinely superb — one who inspires those around them. Taking the fictional example of Gordon Gekko, whose character was based on a composite of Michael Milken and Ivan Boesky, and compare him to the real-life Jack Welch, they were both “Aces” that possessed superior technical skills. But Welch transformed himself into a leader so he could build GE into the stratosphere. Gekko found the only thing he was good at was killing companies, much like the greenmailers of the ’90s who eventually went to prison.

Where do the paths diverge, I wondered?

Elizabeth Holmes

The Super Manipulators

Bernie Madoff was a self-made finance whiz, whose star rose so high he was appointed the chairman of the NASDAQ, and pulled down $100 million per year in income from his brokerage — legitimately. Elizabeth Holmes was an engineering student who spoke Mandarin for fun and dropped out of Stanford as a freshman to launch Theranos, a unicorn medical device startup. Super Manipulators like Madoff and Holmes come from backgrounds that suggest accomplishment and fulfilled lives, not the villainy they perpetrated. So where do they go wrong?

Bernie Madoff

The culprit isn’t greed, as the media likes to portray, an easy out for a lazy reporter. Stealing when you are highly talented is like marrying for money if you’re already rich. It makes little sense. What lies beneath the surface is a personality driven by unhealthy levels of ambition and determination to overcome any challenges that block their path.

Many of us find we are not the superstars we think (or we are told) as we grow up. The high school football quarterback or the debate champ suddenly discover in college they are also-rans. Functional types recalculate the odds. After a period of self-examination, they get back on a not-so-fast track. But Super Manipulators are not like the rest of us, to paraphrase Fitzgerald’s line about the rich.

They Are Different Than You And Me

Fitsgerald’s famous line to Hemingway about the rich applies to Super Manipulators. Their ambition is extraordinary and they will be ruthless in going after whatever goal their scheming mind creates. The problem is they usually lack extraordinary talent, and when they fail, they lack the patience necessary to overcome the setback. Before the world discovers they are imposters, they cover themselves with an iron-willed determination that impresses the folks watching from the bleachers, like journalists and investors. From that perspective, they seem more like shamans than con artists.

Madoff sits like a financial Wizard of Oz in an undisclosed office where he hides his Ponzi from prying eyes under the cover of a secret hedge model. Holmes replaces her device with one that actually works in an attempt to game the testing. By the time the super manipulator reaches a level of authority and power, only Shakespeare could write a more convincing tragedy.

The perceptible difference between manipulators and the chess moves of true leaders is that one cares only winning for the sake of self-glorification. The other possesses qualities that rise above transactions. Even a Warren Buffett can be ruthless when necessary, but never for the sake of gaming the scoreboard. Leaders like Buffett focus on building something that changes outcomes — they care about what they leave behind, not just what they conquer.

Doubting Your Grandchild

The problem is it can be downright hard to tell them apart. Someone as capable as Theranos board member and former Secretary of State George Schultz rebuked his grandson for doubting Holmes — at a time the grandson worked in the lab! When the young man challenged Holmes, Theranos took him to court and his father had to take a second mortgage to pay legal bills. When super manipulators have power and money are on their side, they stop at nothing and can be invincible. For a while.

Former Secretary of State George Schultz with President Ronald Reagan

Society takes some of the blame. The belief that innovation always breeds success (99% of the time it produces failure) sets up the con, just like Madoff’s mathematically improbable returns or Holmes’ testing that smart scientists claimed had to be contrived. Even when they fail, society encourages them to keep at it, and the effect on super manipulators, unfortunately, is to convince them that a solution is a little bit further out on the risk curve. One more trial for Holmes and one more good quarter for Madoff is all it will take.

That’s when the long spiral towards infamy and the trail of ruined lives follows. It is why it is necessary to pull aside anyone of consequence in an organization to be certain that attributes are consistent with values. Don’t assume rockstar talent means everything’s okay. It could mean anything goes, including criminal behavior. It is up to responsible people inside the organization to make the call. When Holmes began dressing like Steve Jobs, her board failed to ask why, a simple enough request. By the time they got around to it, she expected to be indulged as if she were Jobs, and if when challenged, she would demonize.

Usually, the way to flush them out is a sign that a super manipulator can’t conceal that relates to ego or self-importance. It is why we point out both negative and positives in our leadership matrix. That way, remediable action can be taken while a disaster is preventable.

The 4 Leadership Types Defined


  • Definition: If there were a Nobel Prize for business, the finalists would be here. As golfer Bobby Jones said about Jack Nicklaus: “he plays a game with which I am not familiar.” They have exceptional longevity because they are not replaceable.
  • Best example: Warren Buffett, Berkshire Hathaway. The test of stardom is whether a crisis helps or hurts their reputation. Buffett was the only financial CEO to come out of the Financial Crisis of ’08 with his reputation enhanced.
  • Potential negative: may have a hard time admitting setbacks or dealing with challenges to authority.
  • Potential positive: Buffett is notorious about creating transparency in the face of mistakes.


  • Definition: Technical genius that can figure out probabilities better than anyone, and we like to say “they cracked the code.” They win games of chance like software, hedge funds, and biopharma, and that’s where you will find them.
  • Best example: Tim Cook, Apple
  • Potential negative: Can be prone to egotism or arrogance due to technical superiority.
  • Potential positive: They realize they are gifted, and they are often transparent and are willing to undergo scrutiny.


  • Definition: They are the ‘pull a rabbit out of a hat’ CEOs, and appear to have near-magical powers to avoid disaster. There is something of the sorcerer in them, possessed by a vision. You will find them in businesses where “feel” is critical, like Hollywood or venture capital.
  • Best example: Elon Musk, Tesla
  • Potential negative: They trust their instincts to the point they may feel infallible. As their style is ‘mysterious’ unethical behavior may be concealed for a time, in some cases tragically so.
  • Potential positive: True wizards build empires based on achievement, not publicity. They don’t crave media attention (e.g., Steve Jobs refusing to let reporters into the iPhone design studio) although unorthodox ways draw the media to them.


  • Definition: They are the tortoise in the race. If there is something they don’t know, they will learn. People worship Centurions because no one sacrifices more or works harder or cares more about their people. You will find them running retail and consumer product companies that require more substance than flash.
  • Best example: Mary Winston, Bed Bath and Beyond
  • Potential negative: They may resort to cutting corners if threatened with defeat.
  • Potential positive: they inspire amazing dedication and will teach teams how to lead and achieve lofty goals, as their style demands rapid iteration and delegation.



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Jeff Cunningham

Jeff Cunningham

Just trying to make sense of things. ex-publisher Forbes