Why All Leaders Need a Touch of Narcissism Narcissism gets a bad rap. It's almost always presented as a bad thing and rarely – if ever – spoken of positively.

I've certainly never seen it in a list of key requirements on a job description. Yet decades' worth of research tells a very different story. Because it shows that a little narcissism can go a long way, helping leaders be effective, and that, in many situations, it may actually be essential for effective leadership.

There are different types of narcissism, but it essentially involves being preoccupied with yourself, and is commonly associated with overconfidence, being overly-dominant, believing oneself to be superior to others, and having a sense of entitlement, and a need for admiration. So, to be fair, it doesn't sound like the ideal foundation for leadership. And backing this up, there is a wealth of research showing that narcissistic people can make really, really bad, ineffective and destructive leaders.

For example, they tend to be less willing to heed expert advice and more likely to rely on what they already know and over-simplistic formulas. They are thus more likely to make poorly informed decisions. Feeding off flattery, they tend to encourage ingratiation and reduce employee voice. They are also more likely to create a working culture in which bullying and fraud exist. And as a result of all that, as CEOs they tend to both be more vulnerable to lawsuits and produce extreme and fluctuating levels of organisational performance.

One could be forgiven, therefore, for thinking that narcissism isn't good. Except, when it comes to someone's suitability for leadership roles, it often is. Because there is evidence that moderately narcissistic leaders can be highly effective in many situations. The main driver of this is that they tend to a bit overconfident and so more likely to take risks and invest. So, they're more able to find and take opportunities. They also tend to be more persuasive and better at interviews and presentations, which means boards and investors are often attracted to them. For example, with investors, overconfident CEOs have been shown to be more able to secure credit and negotiate lower financing costs. And finally, the point has also been made that surviving the pressures of being a senior leader often requires the thick-skinned self-belief that narcissism gives people.

So, on multiple fronts, moderately narcissistic leaders tend to be better equipped for the challenges of leadership. And as one final piece of evidence, there's the fact that people without any trace of narcissism often lack confidence, decisiveness and assertiveness – all valuable traits in a leader. As a result, the consensus amongst researchers these days is that a mild case of narcissism can be extremely useful for leaders, especially when bold, innovative strategies are required.

The caveat to all this, of course, is that too much narcissism is almost always a bad thing. And for leaders themselves, it can be next to impossible to notice when they reach that tipping point. One of the challenges here, as well, is that the authority, control and power that come with being a leader tend to increase people's pride and confidence, and therefore also their susceptibility to hubris and narcissism.

How, then, can you walk the line between believing in yourself, but not falling foul of believing a bit too much? The key lies in watching how others react to you and to look for two things in particular. First, ingratiation or continual praise from others – as they tend to be both a sign of narcissism and a reason why it can rapidly become much, much worse. Second, the degree to which people are willing to question, challenge and disagree with you. Because they should be doing so, and if they're not, that usually means something about how you're behaving is holding them back.

So, let's give credit where it's due and hear a cheer for a little narcissism. Because being focused on you and how you feel and what you believe isn't always a bad thing. Just be careful you don't believe it too much.