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Why Self-Aware Leadership Drives Business Success

Discover how self-aware leadership improves company performance and learn 4 key obstacles leaders must overcome to develop crucial self-awareness skills.

RYAN VAUGHN
Jul 27, 2025
2 min read(400 words)
Why Self-Aware Leadership Drives Business Success

What Research Reveals About Self-Aware Leaders

Daniel Goleman's research in The New Leaders uncovered striking findings about leadership effectiveness:

  • Poor-performing companies: CEOs rated themselves highly (7/10 leadership abilities) while subordinates rated them poorly
  • Top-performing companies: Subordinates consistently rated CEOs as demonstrating all 10 leadership abilities
  • Seniority paradox: The more senior the leader, the more likely they were to overestimate their abilities

"We cannot change what we are not aware of. And what we are aware of, we cannot help but change." - Sheryl Sandberg

4 Critical Obstacles to Self-Aware Leadership

1. Not Looking: The Unconscious Leader Trap

Many leaders focus solely on external business metrics while ignoring:

  • Their leadership style's impact
  • How personality affects results
  • Opportunities for personal growth

Conscious vs. Unconscious Leadership Examples:

  • Conscious: "I recognize my need to always be right stems from ego - I can choose differently"
  • Unconscious: "This is just my personality - employees need to adapt"

2. Not Asking: Overcoming Feedback Fear

Why leaders avoid feedback:

  • Childhood associations with criticism
  • Fear of negative responses
  • Organizational culture barriers

Simple Feedback Questions to Ask:

  1. What leadership strengths do I demonstrate?
  2. What areas need improvement?
  3. How could our working relationship improve?
  4. What one change would most increase my effectiveness?
  5. What values do my actions communicate?

3. Not Listening: Creating Psychological Safety

Key insights about receiving feedback:

  • Your reaction determines future feedback quality
  • Defensive responses create information bubbles
  • Leaders must actively encourage honest input

Pro Tip: Establish anonymous feedback channels to get unfiltered perspectives

4. Not Interpreting: Contextualizing Feedback

Two crucial interpretation factors:

  1. Power dynamics: Recognize how your position distorts feedback
    • Example: Employees automatically making space for the CEO
  2. Inner wisdom: Balance external input with self-knowledge
    • Not all feedback requires action
    • Align changes with company needs

Developing Self-Aware Leadership: Actionable Steps

  1. Schedule regular self-reflection (weekly/monthly)
  2. Implement 360-degree feedback processes
  3. Practice active listening without defensiveness
  4. Create safe feedback channels (anonymous options help)
  5. Work with an executive coach for objective perspective

The Bottom Line

Self-aware leadership directly correlates with:

  • Higher company performance
  • Better employee engagement
  • More adaptive decision-making

While developing self-awareness becomes harder with seniority, the business benefits make it worth the effort. Start small with regular feedback practices and conscious reflection to begin your growth journey.

RYAN VAUGHN

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