Megan McArdle writes:
Not that being a CEO is easy, or that they don’t do valuable work; I venture to say that 100% of the commentators who think that running a major company is a matter of riding around on the corporate jet and stealing from the workers and shareholders would be surprised at how quickly the company sank under them if they were thrust into that cushy sinecure.
I think that running a major company is largely a matter of riding around on the corporate jet, etc., etc. But at the same time, I’m 100 percent sure that if you put me in charge of Proctor & Gamble, the company would sink like a stone. But that’s because there’s a big element of bluff to the whole thing. Appointing some random blogger CEO would seem very weird to people, and then it would immediately become clear to all my subordinates that I can’t play the part of CEO very competently. There’d be damaging leaks in the press that this new guy doesn’t know what he’s doing, some top executives might leave and others would start trying to shiv me. Waves of bad vibes would ricochet throughout the corporate structure, and the stock price would start to tank in response. And with the stock tanking, I’d be expected to act as a good front man for the firm and say something very confident and serious sounding. But I’d look like what I am — a 27 year-old political blogger with no interest in running a business — and next thing you know our credit would dry up and the whole thing would collapse.
But that’s different from saying that brilliant CEO decision-making is really crucial to the success of a well-established firm and that people are succeeding because of brilliance rather than good luck. Or in another venue, guys who make a fortune earning commissions off trading in the market do have to have a real skill that most people lack. It’s just not the skill of beating the market through canny stock-picking, it’s the skill of tricking people into thinking they have that skill. That a lot of the people succeeding in business are sort of frauds (needless to say, other people get rich by inventing stuff that turns out to be incredibly lucrative and that’s a whole different sort of thing) doesn’t detract from the fact that the most successful among them are good at being frauds and that most people couldn’t do nearly as well.
Ultimately, though, this sort of issue doesn’t get explored properly because business issues are covered by the business press which needs to be very respectful of the whole enterprise.