Charisma, coldness, risk – does there is anything that connects leaders with psychopaths? (part1)

Have you ever wondered how effective leaders resemble psychopaths? Both groups seem to exhibit similar traits that lead to goal achievement: determination, lack of fear of risk, and even a certain emotional coldness. But is it enough to put an equal sign between them? And what really distinguishes a charismatic leader from a ruthless manipulator?

What are the characteristics of an effective manager?

An effective manager is a visionary who predicts the effects of his actions, questions the usual patterns and is not afraid of risk. His charisma can inspire people to achieve above-average results.

Let's imagine such a leader. Every day, he motivates his team, showing how the work of each employee translates into real benefits for the company. When necessary, he makes quick decisions, even without complete information, because he knows that inaction is the worst option. He is also consistent – he enforces the performance of tasks, and when someone regularly fails to fulfil his duties, he can make a difficult decision to break up. Sounds like a strong, confident leader — but is he? What if these same traits, in the hands of the wrong person, become a tool for manipulation and deception?

The Dark Side of Leadership

Visionary, Theranos-style

Elizabeth Holmes founded the company Theranos at the age of 19 with the goal of revolutionizing medical diagnostics. Her vision was to make blood tests cheap, fast, and painless—requiring only a single drop of blood from a finger. Between 2004 and 2015, she raised over $900 million from investors, and the company’s valuation soared to $4.5 billion, allowing her to build a private fortune. However, Theranos never delivered on its promises. Test results were falsified, and employees were kept in the dark to hide the problems. Staff were instructed not to ask questions, and any dissent was punished. Internal warnings were ignored—even those from prominent board members like Henry Kissinger and General James Mattis, whose presence lent credibility to the company despite their lack of expertise in medical diagnostics.The truth was uncovered by journalist John Carreyrou from The Wall Street Journal, despite numerous attempts by the company’s lawyers to silence him. Holmes’ trial became a symbol of Silicon Valley’s “fake it till you make it” culture and sparked a broader debate about ethical standards in innovation. She was sentenced to 11 years in prison for fraud and misleading patients. [i] [ii] [iii].

The Enron Scandal

Kenneth Lay, the founder of Enron, and Jeffrey Skilling, the CEO and chief architect of the company’s financial strategies, transformed Enron’s business model. Instead of focusing on production, Enron shifted toward brokerage, arbitration, and market forecasting. The company created its own exchanges for trading contracts related to energy, CO₂ emissions, and even weather.However, the foundation of Enron’s business was an illusion. Through complex offshore structures and special purpose entities (SPEs), the company hid its debts and inflated its revenues. Employees were forced to conceal losses, and financial analysts received heavily redacted data.The consequences of Enron’s collapse were dramatic: 20,000 people lost their jobs and savings, and the entire U.S. energy sector faced stricter regulations. The scandal led to the introduction of the Sarbanes-Oxley Act, which imposed greater transparency and accountability requirements on public companies. Jeffrey Skilling was sentenced to 24 years in prison (later reduced), and Kenneth Lay died before his sentencing. Enron’s downfall remains one of the most infamous examples of destructive leadership and “creative management” without moral boundaries.[iv] [v]

Decision-Making at Volkswagen Amid Incomplete Information

In 2015, new emission standards were introduced, and Volkswagen’s CEO, Martin Winterkorn, had to act swiftly—despite lacking full insight into competitors’ strategies. Under pressure from shareholders and with new models about to launch, his team implemented software known as a “defeat device” that drastically reduced nitrogen oxide emissions during testing.This system deceived laboratory tests, masking the fact that real-world emissions exceeded legal limits by up to 40 times. The scandal affected over 11 million vehicles globally, especially in Europe and the United States. Winterkorn, known for his micromanagement and obsession with quality control, suggests that decisions were made knowingly at the highest levels of management.The “Dieselgate” scandal cost Volkswagen over $30 billion in fines, lawsuits, and repair expenses. It triggered leadership changes, Winterkorn’s resignation, and major shifts in environmental regulations across the automotive industry. The case underscored that a lack of reliable information does not justify illegal actions—especially when public health and trust are at stake.[vi] [vii].

Command at All Costs – NASA

The NASA space shuttle Challenger was scheduled to launch on January 28, 1986. The day before, serious concerns arose regarding the O-ring seals in the solid rocket boosters. These could be damaged due to the low temperatures that had persisted for several nights prior to the launch. On the eve of the launch, NASA consulted with Morton Thiokol—the manufacturer of the boosters. Initially, Thiokol engineers recommended delaying the launch due to the risk of failure, but under pressure from their superiors and NASA, they ultimately changed their recommendation to approve the launch.This pressure stemmed from enormous media and political expectations. On board was teacher Christa McAuliffe, who was set to deliver the first lesson from orbit, broadcast to schools across the United States. The Reagan administration hoped for a PR triumph in its rivalry with the USSR.The explosion occurred just 73 seconds after liftoff. The Rogers Commission report identified not only the technical cause—a failed O-ring—but also a “disastrous culture of silence” and lack of open dialogue within NASA. Engineers had no direct channel to warn decision-makers. Warnings were filtered and downplayed by middle management.The Challenger disaster marked a turning point in how organizations think about risk management and communication in high-risk environments (known as High Reliability Organizations, or HROs). It showed that flawed expertise, potentially critical warnings, and courageous doubt can be crushed under the pressure of “command at all costs.”

The bright side of leadership

Microsoft - new company culture

When Satya Nadella took over as Microsoft's CEO in 2014, the tech giant was seen as a fossilized, non-innovative organization dominated by internal competition. To change this, the new CEO began to change the organizational culture by focusing on a "growth mindset" based on Carol Dweck's research[x]. He promoted sharing not only successes but also mistakes so that the latter were seen as an opportunity to learn and not a failure. Thanks to this, he promoted openness to experimentation and knowledge sharing. He drew attention to his teams how Microsoft technology helps people in areas such as education, health care and environmental protection. How it allows people with disabilities to find their place and roles in society. He encouraged employees to think about specific people when designing solutions, not about imaginary "market segments". He also shared his private experiences and stories, such as those related to the difficulties in raising his disabled son. This built a bond between him and his employees, empathy and allowed him to be seen as a flesh and blood human being. All these activities have led to a significant transformation that has taken place at Microsoft. The company under the management of Satya Nadella became one of the most innovative technology giants, and employees felt involved and proud of the solutions they co-created[xi].

SpaceX - questioning beliefs

Before SpaceX was founded, the space industry was dominated by the belief that rockets were a single-use technology. NASA's experience with the Space Shuttle program, launched in 1981, reinforced this approach, although it was originally assumed that the repeated use of these vehicles would significantly reduce the cost of spaceflight compared to traditional rockets. The plans envisaged greater regularity of missions and wide access to space for research and technology development. It was also intended to carry out numerous missions at short intervals, even several dozen a year, which was to foster the development of scientific research and commercialization of the sector.

In practice, however, flights were performed every 3-6 months, and each take-off required a detailed inspection of a complex vehicle, including millions of parts. In addition, two disasters – Challenger and Columbia – led to the end of NASA's shuttle program in 2011.

Elon Musk questioned the previous assumptions, formulating an idea about the possibility of recovering and reusing rockets, which could significantly reduce the costs of space exploration. Despite the scepticism of the expert community, he consistently supported the development and testing of technologies that enable rockets to land after the mission was completed. SpaceX has implemented innovative solutions, including Merlin engines designed for serial production, advanced flight control systems, and autonomous landing technologies for rockets on sea and land platforms. As a private company, SpaceX operated with fewer paperwork than state agencies, which enabled faster implementation of innovations. Elon Musk has repeatedly publicly criticized rigid organizational charts that limit technological progress. As a result, in 2015, SpaceX became the first private entity to successfully land the first stage of a rocket after launching the payload into orbit. Currently, the company carries out about 80-90% of manned missions to low orbit for NASA[xii].

Amazon - “Bias for action” — better a bad decision than none at all

In the management culture implemented by Jeff Bezos, the founder of Amazon, a key element is the principle of "bias for action", understood as the readiness to make decisions even with incomplete information. Bezos points out that waiting for the full data can lead to decision paralysis. Therefore, in his letters to shareholders, he indicated that decisions should be made when about 2/3 of the necessary information is available. This strategy allows the company to conduct experiments in real conditions, implement innovations and learn from its mistakes without excessive fear of potential failures. An example of the implementation of this concept is the introduction of the Amazon Prime program. The "fast delivery" service includes delivery of the ordered products, usually within one or two working days, and in selected locations even on the same day or the next morning. This idea was initially questionable due to the high costs associated with offering express delivery at no additional charge to subscribers. To ensure this standard, Amazon has invested in a well-developed network of logistics centres located near large agglomerations, advanced inventory management systems, and optimized courier routes. This allowed the company to quickly obtain feedback from customers and gradually improve the service, which is now one of the pillars of its competitive advantage. A similar methodology was used in the introduction of the Kindle reader and Amazon Web Services, which enabled the organization to take a leading position and flexibly respond to changing market requirements. As a result, "bias for action" has become one of the foundations of Amazon's success, supporting innovation and rapid adaptation to new challenges [xiii].

Facebook - Consistency in the implementation of plans

Sheryl Sandberg, who served as Facebook's COO from 2008 to 2022, emphasizes in her book "Lean In" [xiv] and in interviews that leaders should have conversations about job failure, including when it involves close colleagues. According to Sandberg, avoiding such conversations reduces the effectiveness of the team. She pointed out the importance of clear expectations and transparency when evaluating work – when requirements are not met, this should be communicated directly, and appropriate action should be taken to avoid long-term problems. In her speeches, she also pointed out that management is, among other things, making difficult decisions that are important for the functioning of the organization. In cases of failure to meet obligations, it is necessary to react quickly: talk about the problem, establish a recovery plan and determine the consequences of further negligence, until after the end of cooperation. This type of behaviour helps maintain a culture of responsibility and respect within the team. According to Sandberg, such actions improve performance and build trust, because the rules are applied equally to all team members.

Sheryl Sandberg's way of managing a team, which includes clearly communicating expectations, enforcing accountability, and having difficult conversations, can be applied to Eric Berne's Transactional Analysis[xv]. It distinguishes three basic states of I: "Parent" – based on norms and authorities; "Adult" – rational, analysing situations and focused on the effects of actions; "Child" – reacting mainly with emotions or with a tendency to subordinate.

Sandberg, when talking about communicating needs and responding to irregularities, refers to the "adult-adult" relationship, which is characterized by factual communication based on data and facts, and not guided by emotions or judgment, but by an open and honest exchange of opinions.