The leadership section of any bookshop is a perilous place. Shelves groan under the weight of books promising to turn managers into master captains of industry who will steer the ship without losing the crew to mutiny or, worse, professional scurvy.
Sébastian Page, head of global multi-asset and chief investment officer at US firm T Rowe Price, begins The Psychology of Leadership with goal setting.
No aspiring individual or organisation could achieve anything without setting goals, and Page makes a plea for a different kind of goal setting, one that considers what and why. Goals should not only be measured against targets; they should have meaning, he says. In this way they have more chance of being achieved.
His insights include standard lessons from Warren Buffett, Richard Branson, Elon Musk and Steve Jobs, but he also introduces two fresh perspectives drawn from well-researched and credible fields: sports and positive psychology. These are not merely illustrative examples; they serve as practical tools, demonstrating how principles from these fields can be applied to leadership challenges.
One may wonder what qualifies a financial adviser to write about the psychology of leadership, but Page relies heavily on research in positive psychology, the arm of the discipline that focuses on helping people thrive in all domains of life, as well as his encounters with Dr Daniel M Zimet, a psychologist who holds 38 national titles in handball. Zimet tells him that his best moment in handball ended in him losing the game. “How could a world-class athlete be elated by defeat?” Page asks.
Zimet explains that simply giving it his all was the biggest achievement: “That time, I played to the best of my abilities.” From then on, he saw the game differently: “Every victory stands on that match’s shoulders. That match, that point and that loss solidified my quality as a player, a competitor and a person, making it the most important moment of my career as an athlete.”
He wasn’t measuring himself against the other player, only himself. “Measurable goals can impede self-motivation. Those who focus on mastery — rather than on the scoreboard — are the biggest winners in the long run.”
Page has an engaging and accessible writing style, and the book is made more entertaining with his quirky chapter headings. He outlines 18 principles for effective goal-setting, the first being: “Don’t die on Everest — beware of the side-effects of measurable goals”. One of the most striking anecdotes is about a prominent Vancouver anaesthetist and mountaineer whose goal was to scale Everest. Dr Pieter Swart was 63 when he died of respiratory failure in the “death zone” near the summit, where oxygen is sparse and climbers have to step over frozen dead bodies.
Everest deaths are an example of goal-induced blindness, he says. Summiting the world’s highest peak is one of those measurable goals that should be more closely interrogated. Setting clear, metric-orientated goals can be a powerful motivator, create a sense of accountability and make performance evaluations more transparent, but they can also have side-effects. Mismanaged goals can lead to a narrow focus that neglects nongoal areas, and cause rising unethical behaviour, distorted risk preferences, corrosion of organisational culture and reduced intrinsic motivation.
The second section, which focuses on executing goals, is also grounded in realism. Page starts the chapter with, “Even if you clear your mental fog by setting long-term goals, your life and career can and will go astray.”
From the outset, this framing sets the tone. Page skips the sugarcoating of bland terms such as “challenges”, and treats setbacks as an essential part of any manager’s preparation, but he does so with a refreshing human touch.
In this section, Page provides guidance on how to get stress fit and how to navigate challenges while pursuing goals, maintaining a realistic understanding of the pressures and constraints leaders face. He provides a detailed explanation of the Yerkes-Dodson (YD) law, which gives insight into the link between stress and performance; how to understand and navigate it with a mindset of endurance. This practical framing helps readers approach high-pressure situations and shows how to use them to their advantage.
Page also explores the concept of working back from death, which may seem macabre but this reverse approach, called control theory, is a proposed solution for solving the multistage problem, or how to navigate the predictable reality of the unpredictable business world. Rather than leaving leaders to rely solely on intuition, he offers tools to systematically approach these challenges, showing how careful planning and reflection can coexist with adaptability in practice.
Despite the models and theories, Page is not averse to leaders exploring a more creative and less structured approach. He encourages the value of “trial and error”, reminding readers that while structured solutions can be useful, they should not become a cage. Processes, when overengineered, can stifle problem-solving rather than enable it. Sometimes leaders simply need to “blowtorch the red tape”, clearing the way for practical, immediate action when bureaucracy threatens the very progress required. This balance between structured guidance and creative flexibility is central to Page’s philosophy, ensuring that the book addresses the needs of analytical and intuitive leaders.
Much in the book goes against the orthodox grain, and for this reason alone it’s a good one to keep on the bookshelf and dip into regularly because of the different perspectives it offers. The fourth principle is “Make year-end reviews useless — prioritise relationships”, which cites a Harvard study that found the primary factor for long-term happiness was positive relationships. How many of us go to work gritting our teeth because there will be people there we don’t want to see, never mind spend eight hours with? Maybe an organisation can set goals that help us all get along better. A corporate culture that emphasises mutual respect and collaboration as a competitive advantage is a start.
Another principle is “Don’t fake it — when you talk about meaning, mean it!” You and your organisation must pursue goals that have meaning, says Page. Goals should be SMART: “Specific, measurable, achievable, realistic and time-based”. However, “making the world a better place” rates 0 out of 5 on the SMART-ometer. “You can’t prove to others that you care by making broad claims lacking in credibility because you think they are necessary to win people over.” People will know you don’t mean it. Quoting motivational speaker Simon Sinek, he says you must really believe in your “why”.
Ask the big questions, says Page; you may realise your work has more purpose than you thought. “If you are a leader, you must rally your team around meaning.” Companies need a North Star.
It’s important to give employees autonomy, the freedom and independence to make decisions and manage their work without constant supervision. He cites a study of 320 small businesses, which found that companies offering staff autonomy grew four times faster than control-orientated firms. Paradoxically, extrinsic rewards such as cash bonuses on top of intrinsically interesting tasks can dampen motivation and performance.
Overall, The Psychology of Leadership is a rare find in the crowded leadership genre. It blends practical guidance with realistic reflections on the challenges leaders face, and it consistently encourages thoughtful, ethical decision-making. Unlike many titles that promise overnight transformation, Page resists the temptation of quick fixes, instead offering principles that reward patience and resilience.
For anyone bored with leadership books that recycle clichés and read more like a theoretical MBA syllabus than a useful guide, this book is a reminder that leadership is less about conquering summits and more about pacing yourself for the climb.
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