Clueless at the Top

05/31/2015 09:56 am ET | Updated May 31, 2016

Fourteen executives of FIFA, the Swiss-based organization that governs soccer were arrested recently in a 47-count indictment including charges of racketeering, conspiracy, money laundering, wire fraud, and obstruction of justice. Alleged abuses included accepting bribes for awarding media contracts and vote-rigging in the location of major events. FIFA President, Sepp Blatter, was not charged. He defended himself by noting that the abuses were the "actions of a few" and that "I cannot monitor everyone all of the time."

Blatter would have us believe that he was clueless about what was happening in his own organization, including by three officers that reported directly to him. He is not the first to use this defense

Clueless leaders in government are routine. Gov. Chris Christie of New Jersey said he knew nothing about the 2013 bridge-closing scandal that rocked his administration, though some of his top aides were implicated. Secretary of Veterans Affairs, Eric Shinseki, was blindsided by the falsification of patient wait times in VA hospitals in 2014. Senior IRS officials claimed they were unaware of the targeting of conservative groups in the review of tax-exempt applications conducted in several IRS field offices. President George W. Bush was unaware of the poor FEMA response to Hurricane Katrina until the media showed him how bad things were. He was also clueless about the weak evidence that Saddam Hussein had weapons of mass destruction.

The private sector is not immune from cluelessness at the top. Financial executives often defend themselves over securities and banking violations by noting that they were the rogue actions of traders several levels below, actions they learned about only after major losses. In the auto industry, top GM executives claimed they knew nothing of concerns expressed below about a faulty ignition switch that resulted in more than 100 deaths.

Leaders want recognition for their successes but too often expect exoneration for organizational failures. But cluelessness should not eliminate culpability. President Kennedy, after the disaster at the Bay of Pigs in 1961, is a better model: "There's an old saying that victory has a hundred fathers and defeat is an orphan ... Further statements, detailed discussions, are not to conceal responsibility because I'm the responsible officer of the Government." He learned how he had been misled by those below and how he had contributed to being clueless. In the Cuban Missile Crisis the world gained from his commitment to not be clueless again.

The intriguing question, then, is: why are leaders clueless?

Let's take them at face value (i.e. they really were clueless). Social science research offers several explanations. First, leaders are high on the hierarchy. The bigger the organization, the more isolated they are from those below by multiple organizational layers. They may also be more protected by their direct reports. Bad information does not flow up easily in organizations, both through fear of giving the boss bad news and for fear of being blamed for it. When you add in geographic distance between leaders in headquarters and those in field locations, the barriers to bad information flowing up increase.

Second, leadership success can result in a loss of strategic focus. Egos are flattered by success and by sycophants who seek the boss's favor. Leaders then get out of touch with the core issues that threaten their organizations. As Pope Alexander VI put it: "The most grievous danger for any Pope lies in the fact that encompassed as he is by flatterers, he never hears the truth about his own person and ends by not wishing to hear it."

Third, the leader's continued success depends on continued good news. They can subtly (or blatantly) signal that they do not want to hear about missed objectives. This tendency is exacerbated when leaders have an unbalanced personal life. Their identity becomes so wrapped up in their job that failure at work threatens their sense of self-worth and purpose in life. The result is "motivated blindness." Leaders choose not to see the forest or the trees.

Fourth, leaders and subordinates can collude to lie. According to a recent report by the Army's Strategic Studies Institute, the inability to meet all of the demands placed upon officers in field led them to falsify their reports to headquarters. The latter knew that field officers could not get everything done so just accepted the false reports in what the report's authors labeled "mutually agreed deception." After a while, such lying can become so routine that it desensitizes leaders to the fact that they are managing with worthless information. They succumb to mutually reinforced cluelessness.

It is easy to demonize leaders. Some may well be unethical liars. But cluelessness is a human tendency. Some leaders really are the proverbial deer caught in the headlights -- unaware of what has led them to the spotlight of infamy. The only solution is prevention.

Leaders need to model the message that they want and expect to hear the truth -- and will punish those who withhold it. They need to get out into the organization, talking to people (frankly and without intimidation) at the front lines to verify the information coming to them from below. They need to surround themselves with people unafraid to take the rose-colored glasses off of unpleasant truths. They need to establish dissent channels that go around the bureaucracy, and they need to protect not punish morally driven whistle blowers. They need to recognize that when everyone is agreeing with them, it is time to worry.

Sepp Blatter, just re-elected, is getting another chance at FIFA. He will need to change himself and his organization, or he will be clueless again.