The researchers behind the study, called the CEO Genome Project, used a database of assessments -- comprehensive performance appraisals and extensive biographical information -- of 17,000 C-suite executives, including 2,000 CEOs. The database, created by the consultancy ghSmart, includes everything from career history to behavioral patterns to how the executives performed in past jobs, decisions they've made and demographic information.
Their analysis, which included help from statisticians, data scientists and financial analysts, examined a sample of 930 of those CEOs to come up with the traits and patterns that most predicted which ones became a CEO. They also gathered information on the performance of 212 of them to compare how top-performers' behaviors lined up with the traits that tend to get CEOs hired.
What they found surprised them. A little more than half of the CEOs who did better than expected in the minds of investors and directors were actually introverts, not the usual gregarious CEO known for glad-handing customers.
"The biggest aha, overall, is that some of the things that make CEOs attractive to the board have no bearing on their performance," said Elena Lytkina Botelho, a partner at ghSmart and a co-founder of the project. "Like most human beings, they get seduced by charismatic, polished presenters. They simply do better in interviews."
Botelho says she doesn't necessarily think introverts are always better performers, but that they may be more prevalent, and do better in her sample, because boards are so attracted to them.
"I've been in the room and had directors express the concern -- 'this person is such a strong introvert, how will they really lead?' " she said. Similarly, candidates who displayed a lot of confidence had more than double the chance of being chosen as CEO, the study found, even though particularly confident CEOs were no more likely to show better performance once they got the job.
Meanwhile, only 7 percent of the best-performing CEOs -- who ran companies from Fortune 10 behemoths to those with just $10 million in annual sales -- had an Ivy League degree, despite the conventional wisdom that pedigree matters. "There was zero correlation between pedigree and ultimate performance," she said, acknowledging that number could be higher if they were just looking at large Fortune 500 firms.
Another misconception boards make when picking their next CEO is to choose candidates who have an impeccable career trajectory, with nothing but a resume full of achievements lining their path from MBA to the boardroom. But nearly all of the executives in their sample who were candidates for a CEO job had some kind of major mistake, the project found, such as overpaying for an acquisition or making a wrong hire, in their assessment. Nearly half of them also had what the researchers called a career "blowup" that pushed them out of a job or cost the business a large amount of money -- and three-quarters of that group went on to actually become a CEO.
So what did make CEOs successful? After analyzing all of their data, the researchers found that roughly half of the candidates earning an overall 'A' rating in their database, when evaluated for a CEO job, had distinguished themselves in more than one of four management traits. (Only five percent of the weakest performers, meanwhile, had done the same.) The four were: reaching out to stakeholders; being highly adaptable to change; being reliable and predictable rather than showing exceptional, and perhaps not repeatable, performance; and making fast decisions with conviction, if not necessarily perfect ones.
Indeed, that last trait -- a willingness to make a call quickly, even without all the needed information -- was one of the four "essentials" Amazon CEO Jeff Bezos, who also owns The Washington Post, detailed in his own letter to shareholders last week. Calling it "high-velocity decision-making," Bezos wrote that "most decisions should probably be made with somewhere around 70 percent of the information you wish you had. If you wait for 90 percent, in most cases, you’re probably being slow." Being wrong isn't always so bad, he wrote. "If you’re good at course correcting, being wrong may be less costly than you think, whereas being slow is going to be expensive for sure."
Botelho agreed that first trait was the most surprising. "We frankly expected to find that strong CEOs stood out for the quality of their decisions -- that they turn out to be right more frequently," she said. "But what very clearly stood out was the speed. Quality was likely something they developed earlier, but then they're willing to step up and make the decision faster, even with more uncertainty."