It is widely understood that leaders should be confident, but can they be overconfident? And how can overconfidence impact leader effectiveness? To answer these questions, Shipman and Mumford (2011) conducted an experiment in which undergraduates responded to a simulated leadership scenario.
OVERCONFIDENCE AND PLANNING
The authors found that overconfidence consisted of two dimensions: (1) seeing deficiencies, and (2) expectations of positive outcomes. In other words, an overconfident leader failed to see deficiencies and expected positive outcomes. In this experiment, leaders who were overconfident regarding their expectation of positive outcomes developed less effective plans but more emotionally appealing vision statements. Leaders whose overconfidence was associated with failure to see deficiencies developed less effective plans and less practical vision statements. In fact, those who had the lowest levels of confidence related to failure to see deficiencies were the leaders who created the best plans.
PRACTICAL IMPLICATIONS FOR ORGANIZATIONS
Although we should encourage leaders to be confident, we must be wary of encouraging overconfidence. In fact, leaders should try to keep their confidence fairly low when it is necessary to see deficiencies and make plans. Overconfidence may be reduced through critical self-evaluation.
Shipman, A. S., & Mumford, M. D. (2011). When confidence is detrimental: Influence of overconfidence on leadership effectiveness. The Leadership Quarterly, 22, 649-665.