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We Like Leaders Who Underrate Themselves

Nov. 10, 2015 Harvard Business Review

The Stanford Graduate School of Business asked the members of its Advisory Council which skills were most important for their MBA students to learn. The most frequent answer was self-awareness — possessing an accurate view of your skills, abilities, and shortcomings, as well as understanding how other people perceive your behavior.

Much of the research literature on emotional intelligence published in the last two decades reinforces the importance of self-awareness. For instance, academic researchers have found that people are happier and more well adjusted when their view of themselves accords with others’ views of them. And Korn-Ferry has even published research suggesting that a company’s financial performance is related to the level of self-awareness of the firm’s leadership team.

But is self-awareness always a good thing? And how many managers really have it?

We decided to find out. We delved into 360-degree feedback data describing 69,000 managers as seen through the eyes of 750,000 respondents at hundreds of firms. We found that leaders’ views of themselves generally don’t fit with how other people perceive them.

Here’s why we make that statement: first, we created a benchmark score using the average score from all respondents (boss, peers and subordinates, but excluding the self-score). We then looked at the difference between that benchmark and the other scores. The biggest difference we found: the difference between the benchmark and the self-score.

So if managers don’t see themselves accurately, the next logical question is this: “Do managers tend to overrate or underrate themselves?” Both overrating and underrating could be technically defined as lacking self-awareness. More importantly, would correcting these errors make better leaders?

Not necessarily. Our research on 360-degree assessments suggests that having a highly accurate view of your skills and abilities that is exactly in alignment with the perceptions others have about you does not always result in high ratings of your leadership.

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