The Courageous Leader

My friend Rob blogged about an observation he had in his MBA program, namely the propensity of his fellow students to act like Monday Morning Quarterbacks when it came to issues of ethics. Rob's case was the fraud that went on at WorldCom during the '90s.

Robs keen analogy to the monday morning quarterback is spot on. The element that's missing for the casual outside observer is situated context. The best example I can think of is sitting in the pilot seat of a Cessna, actually feeling the plane pivot and tip when practicing a cross-wind landing. Simulator alone won't prepare you for it. It's why I used to joke that after my morning lessons that my clothes would have the smell of avgas and fear! Situated context means "being there".

What happened at WorldCom, and Enron and what happens at thousands of other companies around you everyday is that the organizations do not have, nor value, empowerment. People have to feel empowered -- not enabled -- to stand up and "pull-the-chain" on the factory floor when they see a defect.

Social psychologists have studied this bystander effect, where shockingly the more people in a crowd or group, the LOWER the level of collective responsibility drops; in otherwords diffused responsibility. The "Genovese syndrome" so named after Kitty Genovese, a 1964 case of where her stabbing death was witnessed by 38 of her neighbors and not a single one called the police. By all accounts, we haven't progressed much given the disgusting gang rape incident that happened last year.

Essentially the same thing happens in businesses. An ethically impaired executive, in a position of authority, exercises bad judgment, putting the company, its employees and shareholders at risk. It usually starts with something small, an inappropriate charge to the company credit card here, a swank junket to play golf in the desert there, and eventually escalates into full fledged influence peddling. All the while their direct reports, those not in for the fun of the ride, are quietly whispering among themselves about how wrong it all seems. And yet no one is willing to stand up and pull-the-chain.

There's a line from a movie, and for the life of me I can't remember which one it was, had something to do with the idea that "most bad things people do in the world are because of a mortgage." (I thought it was "Thank you for Smoking"??)

When people have mortgages and families and "good jobs" -- they tend to let their high-minded ethics take a back-seat. Let's be perfectly honest for a moment:

There is no such thing as permanent employment.

If you let the fear of losing your job guide your ethics, you have no place in management.

Today's Big Idea: If you feel like your ethics or sense of right-and-wrong are being compromised by the company you keep, it's time to find a new company.

You might need a job, but you probably don't need this one. You should have faith in your own abilities and the courage to lead by example. Don't be a bystander.