NSIDE TRACK: The coldest swingers in town: The fairway, like the boardroom, rewards men who have a ruthless streak [by Lucy Kellaway]
What has running a blue-chip company got to do with hitting a little white ball with a metal stick?
Strange though it may seem, the answer is a lot. If a chief executive is terrific at golf, there is every chance he is terrific at his job too.
This link was established a couple of years ago in a nifty piece of research by Golf Digest magazine and The New York Times. They took the golf handicaps of Fortune 500 chief executives and compared them to the companies' share prices. The match was near perfect: the lower the handicap, the better the stock market performance. Graef Crystal, the US pay expert, said this was the strongest - and oddest - indicator of chief executive performance he had seen.
But now along comes a management guru to tell us that the link isn't odd in the slightest. According to David K Hurst, the process of a golfer improving his game is "systematically identical" with that of a manager improving his company's performance.
How so? Mr Hurst, writing in the current issue of Strategy and Business, explains how it is all connected to the three stages of the golf swing. First comes the set-up. In golf this is the point when you adopt your grip, stance and posture. In management the equivalent is found in the organisation, review systems and infrastructure. The next phase is the backswing, an intuitive reaction involving legs, hips, trunk, shoulders, arms and hands. The parallel here is employee morale and communication. The third phase, the downswing, is analogous to new product launches and information systems.
It is evident that this account - at best laboured, at worst incomprehensible - is going to make a successful business book. Mr Hurst will have his future assured as he trots the globe giving seminars on golf swings to big companies everywhere.
Back in the real world, where grown men hit dimpled balls, there are some more obvious parallels to be drawn between the putting green and the boardroom. Both are highly competitive areas and those businessmen who are good at golf are people who are doggedly determined to win.
This is only a partial explanation. After all, even tiddlywinks can get quite competitive.
First, we need to look at why businessmen like golf so much. Here you can take your pick. Golf is exclusive and expensive and you can do it when you're fat and old. It is good for networking, and even better for escaping domestic tedium. If you work long hours in the office and have a single-figure golf handicap, you never need see your wife and children.
The cultural fit is good too. Golf is male and sexist. Golf is all about bad clothes. It is inward-looking. And its effect on the environment is suspect. This explains why chief executives love golf but not why they are so good at it. Golf is not a team sport and the people who excel are not team players. Similarly, being a CEO is not a group activity either. If you are a leader, you get on with it and lead. It's a lonely business.
To excel at golf you need nerves of steel. You must never let your feelings show. You must take the ups and downs in your stride. In short, you should be a bit of a cold bastard. This is surely the perfect personality profile for the boss of a big company.
Then there is the matter of how you relate to others. On the surface, golf is a sociable game - but when the heat is on it is anything but. Good golf players psych out their opponents by distracting and terrorising them.
First-class golfers can balance risk and reward and know that it pays to go for low-hanging fruit. Ditto with big business.
What is interesting is how the parallels work only with the old business model. They break down if one assumes that modern chief executives are emotionally intelligent coaches who love to listen.
There are two possibilities. Either golf will stop being an indicator of CEO perform-ance, or all this talk about flat companies and softer management skills has no place in the boardrooms of Fortune 500 companies. I know which possibility I'm putting my money on.
Finally, a prediction. Jack Welch is in trouble. In extending his stay at the top of General Electric while his company gobbles up Honeywell, he has finally put a foot wrong. My evidence? His handicap was ranked second among CEOs in 1998, whereas in the 2000 rankings it has slipped to 16th. Sell GE.