Elizabeth Holmes was at one time at the top of the Silicon mountain. As CEO of Theranos, Elizabeth managed to run her company into the ground, and was indicted on several charges of fraud, While her success would ultimately lead to failure, Her leadership traits can be a good analysis in the functions of the bases of social power theory.
According to Northosue (2019) there are six types of power: The first four (Legitimate, reward, coerce, and information) are derived from the position an individual holds. The final two types of power (referent and expert) are naturally bestowed by followers. Elizabeth Holmes employed all six methods.
Referent and Expert:
Referent and expert power is bestowed naturally by followers. Referent power comes from a positive identification from the follower. As noted in Biography (2019) Theranos employees found Elizabeth charismatic and likable. She seemed to have the ability to make her employees feel heard and recognized. Expert power comes from a followers perception of the leaders knowledge and skills. Elizbeth established this perception from her followers in two ways: Her product was considered a technological breakthrough in the medical field, and she established a well known group of wealthy investors.
Legitimate, reward, and coercive:
These types of power are derived by the position held by an individual. As CEO of Theranos, Elizabeth had the ability to wield these power types to her advantage. As discussed in Biography (2019) Elizabeth kept dissenters in place by removing whistle blowers and rewarding loyalty. This action alone is a clear example of all three types of power.
Information
Informational leadership is derived from the scarcity of knowledge. An individual that holds information others do not have the skills to acquire or the access to obtain can leverage this as a method of power. In many cases this is an ethical practice. A software developer may lead a team if he or she is the only fluent member in a certain type of code. However this was not the case with Elizabeth. By purposefully withholding information in regards to the efficiency of her technology, she was able to keep her funding afloat longer than should have been permitted.
In what ways did the use of power give rise to her stature? In what ways was it her downfall?
The technological breakthrough matched with the prestige of her investors truly led to Elizabeth’s status in Silicon Valley. These power structures however are only sustainable with a working product. Without an authentic product that efficiently did as Elizabeth stated, her power derived by follower perception was built on a house of sand. Once investors and employees realized the product was fraudulent she lost her personal power, which would then lead to the loss of her positional power as well.
What other leadership theory can you apply to the story?
As discussed by Whiaker (2009) good principals hire good teachers, and teach good teachers. Good principals must learn from the mistakes of Elizabeth Holmes. It can be all too tempting to chase the end without needing to justify the means. The manipulation of data, failure to engage teachers, or failure to implement improved strategies can come to be justified as a survival mechanism similar to Theranos. But if we wish to be ethical leaders we must lead with transparency and build our power on truth bent toward the improvement of all.
Sources:
Biography. (2019). Inside Elizabeth holmes and the downfall of Theranos. Retrieved from https://www.biography.com/news/elizabeth-holmes-theranos-scam
Northouse, P. G. (2016). Leadership: Theory and Practice. California:
Thousand Oaks
