Taming Your Ego: The High Cost of Ego

We all have the experience of working with someone who has a strong ego. Maybe it describes yourself. Leaders who have a need to be right all of the time can have a negative effect on employee morale and productivity.

I am currently coaching an executive team. One of the executives is very competitive and influential.
The team avoids conflict and members rarely confronts this leader. The result is a very dysfunctional leadership team that effects the workforce at all levels.

Unchecked egos can have a powerful negative influence on the workplace climate and retention.

Fifty-three percent of businesspeople estimate ego costs their company 6 to 15 percent of annual revenue; 21 percent say this cost ranges from 16 to 20 percent.

That’s somewhat astonishing, considering “ego” is difficult to measure by any standards. But even if ego accounts for only 6 percent of revenue, the annual “cost of ego” would translate to nearly $1.1 billion to the average Fortune 500 company — roughly equal to the average annual profit of these same companies.

What exactly is ego? Most people associate “ego” with words like “arrogant,” “self-centered,” “closed-minded,” “defensive” and “conceited.”

Big egos invade every team conversation, boardroom debate, marketing plan, client interaction, contract negotiation, employment interview and performance review. There’s no question it gets in the way and is a major cause of bad decision-making.

Each of us has an ego. Most of us strongly believe ours is healthy and vital to our success. Our egos contribute to self-confidence, optimism and drive for success. The overwhelming majority of us — 99 percent — don’t have over-inflated egos, but we’re all capable of letting our egos run rampant on occasion.

When this happens, our personal success and organization’s performance pay the price.

Is your ego in check?