Sunny Side Up: How Optimistic CEOs Outperform Their Pessimistic Peers

Are you a half glass full or half glass empty kind of person? Chances are, assuming you’re a CEO, you’re the former.

Research at Duke University’s Fuqua School of Business which involved 3,000 comprehensive personality tests of CEOs and CFOs found, perhaps unsurprisingly, that 80% of CEOs are “very optimistic” compared with 65% of CFOs.

Leadership tends to require positive outlooks, much more so than the average person, and more so than CFOs who by nature of their calling tend to be more cautious. In fact, in the Duke research only 5% of chief financial officers considered themselves more optimistic than their CEO.

Manju Puri, professor of finance at Fuqua, said, “CEOs are much more optimistic than others, including CFOs. Finance executives go so far as to say that their CEOs are more optimistic about almost everything in life, even beyond their outlook on business prospects.”

For sure, born optimists generally have a sunnier outlook on all aspects of life. Perhaps you’ve heard the statement (often mistakenly attributed to Sir Winston Churchill), “A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty.”

It’s a statement with which I concur, but with a few caveats. Too much optimism can be too much of a good thing. It’s all too easy to be blinded by unbridled optimism. The most successful CEOs with whom I’ve worked across the country in my role as a culture change strategist display what I regard as rational optimism. 

They see the opportunity in every difficulty, but they don’t barnstorm ahead without a serious analysis of the data and seeking counsel from their more cautious colleagues (including the CFO!) A little dash of pessimism to allow time to consider potential downsides is not a bad thing. 

Legendary designer Bruce Mau calls it “fact-based optimism” and emphasizes it is a collaborative endeavor. In his book “Bruce Mau: MC24,” he writes, “To undertake the challenges we face today, we have no choice but to be optimistic. If the world is going to the dogs, there’s nothing you need do but watch, wait, and grab what you can from what’s left of it. Optimism challenges you to action. Wherever there is opportunity, there is work to be done. Possibilities are not actualities. We have to roll up our sleeves to make them real. Pessimism engenders a cynicism that closes the mind: only through optimism does opportunity become visible.”

One born optimist who succeeded when others poured doubt on his vision is Mark Zuckerberg’s who says one of his favorite sayings is that “optimists tend to be successful, and pessimists tend to be right.” He explained what he meant in a podcast interview, “If you’re discussing any idea, there’s all these reasons why it might not work. And those reasons are probably true. The people who are stating them probably have some validity…But the question is, is that the most productive way to view the world? Across the board, I think the people who tend to be the most productive and get the most done—you kind of need to be optimistic, because if you don’t believe that something can get done, then why would you go work on it?”

Why indeed? Optimism is so essential that Daniel Kahneman, renowned professor, Nobel laureate in economic sciences, and author of the international bestseller, “Thinking, Fast and Slow” goes so far as to  describe it as “the engine of capitalism.”

Why is that?

The Rewards of Risk-Taking

Optimism fuels entrepreneurs to take risks and innovate. Entrepreneurs who believe in the success of their ventures are more likely to invest time, money, and resources, even in the face of uncertainty or potential failure. 

Attracting Top Talent and Investment

People are naturally drawn to positive leaders who exude confidence in their business’s future. Optimistic leaders engage in long-term planning and visionary thinking, essential for the sustained growth and evolution of businesses and in doing so attract like-minded employees and investors.

Boosting Team Performance

Optimistic leaders can have a contagious effect on their teams, boosting morale, team cohesiveness, and overall productivity. Employees under optimistic leaders often report higher job satisfaction and a greater sense of purpose. The positive attitude of an optimistic CEO serves as a powerful motivator, inspiring their teams to roll up their sleeves and work together, and see beyond obstacles, especially when a project is not running smoothly. 

Resilience Rules

The CEO who always looks on the bright side is more resilient to setbacks and failures which are seen as temporary hiccups on the way to success. Optimism is easy when the going is good, but it is vital when the going gets hard. The optimist will always persist and adapt.

Final Thoughts

Harvard Business School professor Robert Simons, who profiled 23 leaders from politics, sports, entertainment, and business, for his MBA course “Changing the World,” says, “Without exception, all these people are opportunity seekers. They wake up every morning and see the glass as half-full not half-empty. People are attracted to optimism and hope in leaders.”

The link between a leader’s optimism and business success is compelling. While optimism alone is not a guarantee of success, it is a powerful ingredient in  successful leadership mix. Business leaders who cultivate an optimistic mindset can inspire their teams, attract investment, and turn challenges into opportunities for growth.

Written by Jason Richmond.

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