When Success Becomes Your Downfall: The Danger of Arrogance in Business Leadership

The shadow knows: What appears as strength today can become tomorrow's weakness.

Aaron leans back in his leather chair, the satisfaction of another record quarter evident in his relaxed posture. 

The wall behind him displays three generations of family portraits—his grandfather who started the business with a small loan in 1950, his father who stabilized it through the economic turbulence of the 1980s, and now Aaron, who has catapulted annual revenue from $50 million to an astounding $350 million in just seven years.

“They said it couldn’t be done,” Aaron chuckles, as he addresses his executive team. “My grandfather would have never believed we’d be where we are today.”

The Elephant in the Room

The team nods in agreement, nobody daring to mention the elephant in the room: 78% of their revenue now comes from a single client. 

Nobody wants to dampen the celebration by pointing out that this client, for the third time this year, is demanding price concessions.

Three years later, Aaron sits alone in his car outside the very building that once bore his family’s name. 

The sign has been replaced with their competitor’s logo. His security badge—now an employee badge, not an owner’s—lays on the passenger seat. 

The HR director’s words still ring in his ears: “We’re restructuring the division. Your position is eliminated.

Seventy years of family legacy. Gone.

The cash reserves that had weathered three generations of economic storms. Depleted.

The dream of passing the business to his children. Shattered.

The Arrogance Trap: Aaron’s Downfall

Aaron’s story isn’t unique. It follows a pattern that Jim Collins outlines in “How the Mighty Fall,” a pattern that claimed Motorola and countless other once-great companies.

Aaron’s company fell victim to what Collins calls “hubris born of success.” The spectacular growth fueled by their major client created an illusion of invincibility. 

When that client began demanding price concessions, Aaron’s team saw it as a temporary inconvenience, not a fundamental threat to their business model.

As costs increased and profits decreased, Aaron’s company entered what Collins describes as “the undisciplined pursuit of more.” 

Rather than questioning their strategy, they doubled down, taking on more work from their dominant client at increasingly unfavorable terms, convinced that volume would eventually solve their profitability problems.

The warning signs were there: dwindling cash reserves, thinning margins, increasing debt. 

But like Motorola’s executives who dismissed the digital revolution while clinging to analog technology, Aaron’s team entered the “denial of risk and peril” stage. 

They rationalized their declining financial position as a necessary investment in their relationship with their key client.

By the time reality became impossible to ignore, they were already in Collins’ fourth stage: “grasping for salvation.” Desperate cost-cutting measures, hasty attempts to diversify their client base, and finally, the sale of the company to a competitor for pennies on the dollar.

The final stage—"capitulation to irrelevance or death"—came when Aaron found himself punching a clock for the very competitor who had acquired his family’s legacy, only to be eventually discarded as dispensable.

The Succession Planning Imperative

Aaron never considered what would happen if his strategy failed. He never built a team capable of challenging his assumptions or carrying on without him. 

When the business was sold, he became dispensable precisely because he had failed to distribute leadership and knowledge throughout the organization.

The Legacy Alternative

Entrepreneurs who change the world through their work are leaving a legacy. 

Working only to make money will leave you exhausted, burned out, and angry. However, working to leave a legacy will leave you energized, thankful, and fulfilled.

The key difference? Leaving a legacy only happens when you leave behind a team developed to thrive in your absence.

Breaking the Cycle of Arrogance

Harvard Business Review reports that 70% of businesses fail to make it to their second generation of leadership. 

Aaron’s company made it to the third generation before failing—but fail it did, and for reasons that could have been avoided with proper succession planning.

From Arrogance to Legacy

When life changes and we don’t adapt well, we get stuck. Pursuing a distorted vision of success causes us to embrace a set of values that produce death in our businesses—just as Aaron and Motorola did.

Conclusion: From Answers to Questions

Aaron’s downfall, like Motorola’s, wasn’t inevitable. It was the result of arrogance—the belief that past success guarantees future results, that growth equals health, that volume can compensate for declining margins.

The antidote to arrogance is humility—the willingness to ask questions rather than assume you have all the answers. Questions like:

• Have I built a team that can succeed without me?Is my business too dependent on a single client or product?

• Am I measuring success by the right metrics?

• What legacy do I want to leave through my business?

• How can my business continue to bless my community for generations?

Remember, accepting the fact of your eventual exit from your business is a first hurdle in succession planning. Accepting the responsibility for your company’s success in your absence is the next.

Don’t let arrogance keep you from asking the right questions. Your legacy depends on it.

Harry T. Jones