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Lessons from the Great American Leaders & How They Apply Now

Archive for the ‘Ethical Leadership’ Category

The Need To Test Opinions Against the Facts

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In addition to investigating new possibilities, effective leaders tend to possess an investigative mindset. Admiral Hyman Rickover (U.S. Navy) stated, “Sit down before the facts with an open mind. Be prepared to give up every preconceived notion. Follow humbly wherever and to whatever abyss Nature leads, or you learn nothing. Don’t push out figures when facts are going in the opposite direction.”

Peter Drucker described Alfred Sloan (General Motors) in The Effective Executive. Sloan, was anything but an ‘intuitive’ decision-maker. He always emphasized the need to test opinions against facts and the need to make absolutely sure that one did not start out with the conclusion and then look for the facts that would support it. But he knew that the right decision demands adequate disagreement.” [i]

Meg Whitman (eBay) noted, “My job was to uncover what was going well. I think sometimes when a new senior executive comes into a company, the instinctive thing to do is to find out what’s wrong and fix it. That doesn’t actually work very well. People are very proud of what they’ve created, and it just feels like you are second-guessing them all the time. You are much more successful coming in and finding out what’s going right and nurturing that. Along the way, you’ll find out what’s going wrong and fix that.” [ii]

Other effective leaders used other specific techniques that were extremely beneficial and fruitful, including probing for answers. Irwin Miller (Cummins) was noted for this attribute. “He was a teacher, not by providing answers, but by asking tough questions. On many occasions his question ‘Ten years from now, what will you wish you had done differently today?’ caused business colleagues, community leaders, friends, and family members to reassess their points of view and reach for higher goals. If you came to tell him what you had already done, he always simply asked, ‘Did you do the right thing?’ [iii]

Andy Grove (Intel) was also a tough questioner, with an equally strong purpose behind it. “Andy will test his staff endlessly… If someone makes a suggestion, he’ll ask, ‘How would you do that?’ Andy wants answers that are well thought out. Gut feel doesn’t cut it with him. His test is: ‘How would you implement it?’ . . . And he challenges his staff to convince him that a particular direction is the right way to go.’

In some organizations, taking such a rigorous approach and insisting that people be prepared to thoroughly defend their ideas might discourage timid subordinates from offering suggestions – and thus stifle creative thinking. But Grove insists that isn’t really an issue.

‘If it discourages you,’ he says, ‘then you probably had a poor idea that you didn’t have much confidence in – or you are the kind of person who wouldn’t execute the idea anyway. If you can’t be expected to fill out the details of your concept, how can you be expected to execute it? It is almost a test: Do you really believe in your idea well enough to defend it? And, if you are given a go-ahead, will you have enough devotion to it – a serious enough commitment to it – to make it happen?’

Clearly, Andy Grove understands how to make things happen, which helps to explain why Intel has played such a major role in shaping the digital world of the future.’ [iv]

William Blackie (Caterpillar) used his own power of observation to investigate the facts prior to making key decisions. During the post-Second World War years, replete with growth opportunities for Caterpillar, Blackie didn’t make his decisions in some comfortable office. He went out in the field to see for himself and advised others to do the same – even though doing so in the postwar years wasn’t comfortable.

‘Seeing the changes and their effects creates more conviction than being told about it or reading about it,’ he told Iron Age. ‘Therefore, one of the first things I urge any interested or skeptical U.S. businessman to do is to go abroad himself to see what’s going on.’”[v]


[i]  Wartzman Rick, GM: Lessons from the Alfred Sloan Era (Business Week, June 12, 2009)

[ii]  Fisherman Charles, Face Time with Meg Whitman (Fast Company, April 30, 201)

[iii]  Miller Will, Joseph Irwin Miller. 26 May 1909 – 16 August 2004 (The American Philosophical Society, Vol. 150, No. 3, September 2006)

[iv]  Sheridan John H., 1997 Technology Leader of the Year Andy Grove: Building an Information Age Legacy (Industry Week, April 19-21, 2010)

[v]  Schleier Curt, William Blackie Put Caterpillar On An Upward Path Expand Your Horizons: The CEO Steered The Machinery Company’s Business All Over The Globe And Dug Up Massive Sale (Investor’s Business Daily, February 2, 2002)

Excerpt: Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Majorium Business Press, Stevens Point, WI 2011)

Read a Free Chapter

Timothy F. Bednarz, Ph.D. | Author | Publisher | Majorium Business Press
Author of Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Finalist – 2011 Foreword Reviews‘ Book of the Year)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2013 Timothy F. Bednarz, All Rights Reserved

Eight Ways Others Evaluate Trust in Leaders

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smallgroup5

As seen in numerous large-scale corporate scandals around the turn of the century, trust or a lack thereof has a dramatic impact on an organization. While an organization can be defined as trusting and empowering, it is the individuals within it who form the basis for these qualities.

The responsibility for fostering and nurturing trust does not lie with the bottom tiers of the organization, but the managers that lead it. Where there is no trust, there is no legitimacy to management.

The starting point is the personal commitment made by individual managers.

Trust and empowerment stem from the individual actions of the manager. However, once initiated, trust and empowerment create a synergy within the organization that has the ability to move it forward to unimaginable heights.

As soon as employees know they can trust the words and actions of their managers, they are motivated. All too often the words sound good, but the accompanying actions do not follow, fostering a sense of mistrust and fear within employees.

Once managers have established trust with their employees, a strong bond is formed that is difficult to break. Unless trust is broken and people feel betrayed, employees will be intensely loyal and cooperate to achieve mutual goals and objectives. This is the strongest principle of management and its essence.

Whether or not a manager is trusted is determined by his or her actions. Anyone can make statements and pronouncements; it is actions by which an individual is judged. Managers must hold to higher standards of personal behavior if they are to foster and nurture trust with their employees, who closely observe every word and action.

Managers are judged by the following criteria:

Promises and Commitments

Corporate managers are placed under an enormous amount of stress and will miss commitments, especially minor ones made in the heat of daily activities. However, they pay close attention to what they say, and do what they promise. If unable to keep their commitment, they immediately inform the other party and make alternative arrangements.

Employees take note of a manager who makes a personal commitment but fails to keep it due to political or internal pressures. If when confronted with this failure they make excuses rather than take responsibility, they will be perceived as hypocritical. Employees with little other alternative may accept the excuse, but will inwardly feel betrayed and no longer trust the manager. The foundation for management has been greatly undermined.

Mistakes

As part of the human condition, everybody makes mistakes and fails. When managers make mistakes, they often impact and affect their organization. Trust is established when managers openly acknowledge their mistakes to their employees and apologize for them.

Managers also allow their employees to experiment, make mistakes and fail without repercussions. They foster an atmosphere where employees can learn from their mistakes and move on. Managers understand that individuals can only grow when they are allowed to learn. The most effective learning experiences stem not from successes but failures and mistakes.

Loyalty

Managers give and demand loyalty from their employees. While they understand that loyalty is earned, they do not tolerate employees who are disloyal to their organization and each other.

The most open demonstration of a manager’s own lack of loyalty can be seen in his or her constant and open criticism of superiors and employees in their absence. While loyalty is not blind, managers must demonstrate, at all times, a deep sense of allegiance to the organization, superiors, associates and employees.

If a manager takes issue with the actions of others, they should openly but privately discuss it with the individual and not criticize them behind his or her back.

Information

Managers as leaders show faith in their employees when they share information with them. In many organizations, the control of information is the basis of personal power. Managers understand that employees must be informed if they are to do their job well and be empowered to make decisions affecting their work. Those who withhold information clearly demonstrate their mistrust of employees.

Involvement

Trust is established with employees when they are included and empowered to make decisions that affect them. Trust is undermined when employees are enabled to make decisions but the decisions are never acted upon and implemented.

Effective managers actively work with their employees and trust their decisions. They work with their employees in implementing their decisions and striving toward the accomplishment of mutual goals and objectives.

Recognition

Trust is fostered and nurtured when managers recognize the individual contributions of their employees and publicly recognize them for their efforts.

When new ideas and strategies work, managers who lead never accept the credit for the idea. They always acknowledge the efforts and contributions of their employees. To do otherwise betrays the trust of those employees.

Communications

Managers build trust within their organization by maintaining open communications with all employees, superiors and associates. They understand that trust is only established when they communicate regardless of the situation and circumstances, and whether or not the information is positive or negative.

Goals and objectives are effectively met when all involved have a complete picture of what is happening around them, including the barriers and obstacles to be overcome.

Respect Confidentiality

Managers understand trust is developed when they respect and honor confidential and sensitive information provided to them by superiors, associates and employees.

They also know they must trust their employees with the confidential and sensitive information they need to do their jobs and make quality decisions. Without this confidence, managers will not be able to create a trusting environment since they are evincing a basic suspicion of their employees.

Excerpt: Building and Nurturing Trust in the Workplace: Pinpoint Leadership Skill Development Training Series (Majorium Business Press, Stevens Point, WI 2011) $16.95 USD

Related:

You Are Judged by the Actions You Take

Emotional Bonds are a Reflection of a Leader’s Effectiveness

Six Ways to Enhance Your Personal Credibility

 Can You Be Trusted? The Answer May Surprise You

Timothy F. Bednarz, Ph.D. | Author | Publisher | Majorium Business Press
Author of Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Finalist – 2011 Foreword Reviews‘ Book of the Year)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2013 Timothy F. Bednarz, All Rights Reserved

Five Ways to Establish Trust and Credibility

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smallgroup3

A manager’s entire position must be predicated on trust and credibility. When either are removed from the equation, they are unable to perform. Both are required when dealing with their individual unit or department members.

Some managers feel trust and respect come with the position, when in fact they must be earned through consistently ethical and professional behavior. Inconsistent behavior and an inability to fulfill promises and commitments will develop an atmosphere of mistrust with employees. Words and actions do have meaning and should be used and taken with great care.

Like everything else in life, there are consequences attached to most everything managers say and do. When trust and credibility are removed from the equation, managers will be unable to perform effectively, and they can also see their work undermined by a demotivated and angry team.

Trust and rapport with employees is something that takes time to develop. This is especially true if there have been problems in the past. In these instances, the manager must operate while experiencing open and unconcealed mistrust of his or her words and actions. However, trust and rapport can be established, and in certain cases reestablished, by using the guidelines below.

A manager’s behavior must be consistent. If they don’t want their motivations questioned, they must treat all of their people equally. Developing consistency can be achieved through:

Setting and Uniformly Applying Equitable Standards

Managers must establish consistent performance standards that apply to each individual member of their team. The standards must be applied equally to all without favoritism, and all must be evaluated without bias.

Communicating and Providing Feedback

Managers should be openly and frequently communicating with their employees, sharing insights and expertise and helping them achieve their goals. They must provide frequent feedback regarding their individual performance. Feedback should be based upon facts and free of subjective judgments regarding personal behaviors or attitudes.

Recognizing Performance

Managers should use the standards they have established as a benchmark and openly recognize the performance of the members of their unit or department. A simple word of acknowledgement and appreciation can go an extremely long way towards maintaining enthusiasm and motivation.

Keeping Commitments

When dealing with subordinates, it is easy to let commitments slide. While many managers feel there are no consequences to such actions, if they cannot be counted on to keep their commitments, they cannot be trusted. Their employees’ motivation will suffer, which will then foster a negative and unacceptable atmosphere. Managers creating these problems for themselves can use the following techniques to help overcome them:

  1. Managers should think very carefully about each commitment they intend to make. They should make sure adequate time and resources are available to meet the commitment.
  2. Once a commitment is made, managers should make sure it is completed both as and when promised.
  3. If a commitment cannot be completed when promised, the manager should not wait until the last minute but let their employee know as quickly as possible and revise the schedule accordingly.

Developing an Open Management Style

Developing an open and trusting management style might require a shift in thinking and attitude on the part of many managers. This includes:

Remaining Impartial

Before a manager deals with any employee or situation, they must avoid making rash judgments, eliminate all emotion and gather all pertinent facts.

Trusting Others

Managers must learn to take employees at their word until the facts prove otherwise. A manager who cannot trust either his people or customers will in turn fail to earn their trust.

Listening and Being Open

Managers must be able to listen—not only to gather facts and information, but to hear issues and concerns that may arise with their employees and customers. Listening includes empathizing and showing care and concern about their problems. Managers must be open to new ideas, concepts, feedback and criticism. Trust is earned when employees and customers understand that the manager is available and responsive to them.

Excerpt: Ethics and Integrity: Pinpoint Management Skill Development Training Series (Majorium Business Press, Stevens Point, WI 2011) $ 17.95 USD

Related:

You Are Judged by the Actions You Take

Emotional Bonds are a Reflection of a Leader’s Effectiveness

Six Ways to Enhance Your Personal Credibility

 Can You Be Trusted? The Answer May Surprise You

Timothy F. Bednarz, Ph.D. | Author | Publisher | Majorium Business Press
Author of Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Finalist – 2011 Foreword Reviews‘ Book of the Year)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2013 Timothy F. Bednarz, All Rights Reserved

The Importance of Intellectual Honesty

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Louis Gerstner - IBM

Louis Gerstner – IBM

Before leaders can assess risks they must be intellectually honest to completely comprehend the reality surrounding their circumstances. A noteworthy illustration of the practice of intellectual honesty is  (IBM), who was appointed to turn around the floundering company. “He spent his first few months visiting all of IBM’s facilities all over the world taking the opportunity to explain to his concerned employees that his intention was to help the company recover, while at the same time preparing them for forthcoming tough decisions. He also spoke to customers, competitors, consultants, and analysts. Gerstner came to several conclusions:

  • Customers wanted to be provided with solutions to their problems not sold hardware.
  • Computer networking had the potential to transform the way people worked and required different hardware and software to that which IBM was producing.
  • IBM’s products were not the best in the market.
  • The existing plans to split the company were inappropriate because the company could gain many advantages through better integrating what it did.
  • Cost cutting was essential and, despite a reduction of 20 per cent in the workforce over the last six years, more employees would have to go.” [1]

Before Gerstner could transform IBM, he had to face a foreboding sense of reality. The five conclusions he arrived at provided a sobering picture of the reality of what IBM was facing. Without being intellectually honest about what he was dealing with, Gerstner would not have been able to succeed to the degree he did at IBM.

John D. Rockefeller (Standard Oil) also exhibited a high degree of intellectual honesty. Rockefeller’s greatest gift… was the ability to keep a clear head. Hope never skewed his calculations. ‘Look ahead,’ he advises. ‘… Be sure that you are not deceiving yourself at any time about actual conditions.’ He notes that when a business begins to fail, most men hate ‘to study the books and face the truth.’[2]

David Packard (Hewlett-Packard) exhibited a similar characteristic. “Even though Packard is… remembered as a gruff, straightforward man who wasn’t afraid to point out what was wrong and suggest improvements. When he returned to HP in the early 1970s after his stint as deputy secretary of defense and found the company on the verge of borrowing $100 million to cover a cash-flow shortage, he immediately met with employees and gave them what came to be known as a ‘Dave Gives ‘Em Hell’ speech. Packard lined up the division managers in front of employees and told them, ‘If they don’t get inventories under control, they’re not going to be your managers for very long.’ Within six months, the company once again had positive cash flow, to the tune of $40 million.” [3]

Jack Welch (General Electric) made the following observations concerning investment opportunities, which are risks, since the outcomes are never known and can be difficult to accurately predict. He noted, “The facts are, not all investment opportunities are created equal. But some leaders can’t face that reality, and so they sprinkle their resources like cheese on a pizza, a little bit everywhere. As a result, promising growth opportunities too often don’t get the outsized infusions of cash and people they need. If they did, someone might get offended during the resource allocation process. Someone, as in the manager of a weak business or the sponsor of a dubious investment proposal.” [4]

Sam Walton (Wal-Mart) incorporated and institutionalized intellectual honesty into his company. He observed, “From the very start we would get all our managers together once a week and critique ourselves – that was really our buying organization, a bunch of store managers getting together early Saturday morning, maybe in Bentonville, or maybe in some motel room somewhere. We would review what we had bought and see how many dollars we had committed to it. We would plan promotions and plan the items we intended to buy. And it worked so well that over the years, as we grew and built the company, it just became part of our culture. I guess that was the forerunner of our Saturday morning meetings (where company managers get together and review what they’ve seen in the stores that week). When we made a bad mistake – whether it was myself or anybody else – we talked about it, admitted it, tried to figure out how to correct it, and then moved on to the next day’s work.” [5]


[1]  Johnston Robert, IBM – Creating a Customer-Focused Organization (Warwick Business School, 2007)

[2]  Baida Peter, Rockefeller Remembers (American Heritage Magazine, September/October 1988, Volume 39, Issue 6)

[3]  O’Hanlon Charlene, David Packard: High-Tech Visionary (CRN, November 8, 2000)

[4]  Welch Jack, Bosses Who Get It All Wrong (Business Week, July 23, 2007)

[5]  Sam Walton in His Own Words (Fortune Magazine, June 29, 1992; from: “From Sam Walton: Made in America” by Sam Walton and John Huey)

Excerpt: Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Majorium Business Press, Stevens Point, WI 2011)

Read a Free Chapter

Timothy F. Bednarz, Ph.D. | Author | Publisher | Majorium Business Press
Author of Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Finalist – 2011 Foreword Reviews‘ Book of the Year)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2013 Timothy F. Bednarz, All Rights Reserved

Ethics: Actions Do Have Consequences

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womancrowd

Although ethics and personal integrity appear to have a diminishing role in our culture, when a massive failure of ethics and moral standards results in corporate implosions such as the Enron bankruptcy, as well as the collapse of the financial markets people notice. There is no question that in business, the highest moral and ethical standards are expected and demanded.

Actions do have consequences. Despite the thinking in popular culture that has helped enable a number of political leaders’ “ethical lapses,” in business ethics and integrity are closely paid attention to by superiors, associates, subordinates—and most importantly, customers.

All of these people judge managers and employees by their actions, not their words. Even a minor lapse in ethical judgment is not easily forgiven or forgotten.

This is important for managers to consider because their behavior impacts people on multiple levels. The consequences and implications of any ethical decision are far-reaching and must be carefully thought through before the action is taken.

The moral and ethical behavior of a manager has many consequences and implications beyond an immediate judgment or choice. Ethical behavior and integrity play an essential role in any manager’s position, for the following reasons:

Trust

The basis of all relationships is trust. Managers are primarily responsible for the directing of human resources. While they may also be responsible for the tools and equipment associated with business, their primary charge is the management of their individual employees. In this capacity, they are dealing with superiors and subordinates in financial terms.

Superiors are relying on the manager to provide accurate reports and records of their unit’s activities. The employee relies on the manager to assure that his or her efforts are supported and performance accurately reported.

The foundation of and glue that holds these relationships together is trust. Any ethical lapse is considered a breach of trust and will result in the pillars of management collapsing. Once this occurs, the manager has lost their effectiveness.

Rapport

Rapport is the building and nurturing of quality relationships. This is a term normally used to describe relationships among employees, but it goes beyond this. Managers require good rapport at all levels with their superiors, subordinates and associates.

The manager’s role is to act as a liaison between the various levels they are in communication with. The employee has access to his or her manager. The manager has full access from senior management to support staff.

Exceptional management, support and communication means the manager must actively maintain good rapport at every level. However, building relationships and establishing rapport is a people skill that further demands trust and ethical behavior. These are the cornerstones of building rapport on all levels. Any degree of moral and ethical failure at any level will undermine the manager’s efforts and effectiveness.

Credibility

There are managers who have undoubtedly displayed lapses in moral and ethical judgment, yet still maintained their job and position. They may have shielded their actions from their superiors, but not from their subordinates. In some instances they may have made statements or promises and failed to follow up on them.

In any ethical failure, they have betrayed the trust of their subordinates. When this occurs, these managers have lost credibility in the eyes of their people, which more often than not results in sapping their motivation.

Employees will either leave or let their performance drop knowing their manager has little integrity. While these managers might think they have won in the short-term, in the long run there are profound consequences to be paid.

Reliability

Managers who have betrayed trust cannot be relied upon. If this occurs between the manager and his or her superiors, it is dealt with on the senior level, normally resulting in termination.

A loss of credibility with individual employees will result in them being unable to trust the manager. Rapport with these individuals will be eroded to the point that all work-related effectiveness is lost.

The consequences will be a revolving door of people under the manager’s responsibility, as any respectable person will not continue under these circumstances.

Reputation

A person’s reputation is the most valued possession that they have. Once destroyed, a personal reputation is difficult, if not impossible, to restore. The same is true for a company’s reputation.

A manager holds the responsibility for both his or her reputation as well as the company’s. His or her personal actions have a double, if not triple, impact since senior managers, his or her subordinates, and the company’s customers are continually examining his or her actions. This is an awesome responsibility unparalleled in magnitude in any organizational environment.

Related:

You Are Judged by the Actions You Take

Emotional Bonds are a Reflection of a Leader’s Effectiveness

Six Ways to Enhance Your Personal Credibility

 Emotional Bonds are a Reflection of a Leader’s Effectiveness

 Can You Be Trusted? The Answer May Surprise You

Excerpt: Ethics & Integrity: Pinpoint Management Skill Development Training Series by Timothy Bednarz (Majorium Business Press, Stevens Point, WI 2011)

Timothy F. Bednarz, Ph.D. | Author | Publisher | Majorium Business Press
Author of Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Finalist – 2011 Foreword Reviews‘ Book of the Year)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2013 Timothy F. Bednarz, All Rights Reserved

Four Questions That Challenge Your Ethical Decisions

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problems

Many people are faced with a dilemma in that they want to practice conscientious and moral behavior, but are challenged to do so when difficult ethical problems and issues arise. In order to effectively deal with them, managers and their people need superior decision making tools that assist them in making the right choices.

Too many people are under the impression that they need to be deceptive and unethical in order to get ahead. They consider this line of thinking to be shrewd and “streetwise.” In business as in all other arenas, this perception isn’t shrewd: it’s foolish. Poor ethical decisions and judgments in the work environment, especially when considered cumulatively, have dramatic personal, professional and organizational ramifications.

The benefits of dealing with superiors, associates, subordinates and customers in a straight and forthright manner are obvious. Not only is it the right thing to do, it also positively impacts motivation, productivity and profitability. It is simply good business.

A profound business philosophy is to be found in a simple four-step decision making aid. While it does not direct people in what specifically to do or think, it does give them a tool to guide them in all of their business and personal decisions.

Well known to anyone ever associated with Rotary International and translated into more than 100 languages, The Four-Way Test is highly recommended as an easy decision making tool that makes a clear difference in the practice of ethical behavior.

Managers and employees must display the highest standards of honesty and integrity in their conduct to establish and sustain credibility. The Four-Way Test is a handy and simple litmus test for all personal actions and decisions.

Herbert J. Taylor developed the test during the depths of the depression in the 1930s. A young sales manager for Jewel Tea Company, Taylor was asked by Continental Bank in Chicago to take over the management of Club Aluminum Products, a manufacturer of pots and pans. The company was fraught with unethical business practices and bankruptcy. The banks had assumed control of it.

To bring the company out of bankruptcy, Taylor knew he had to change the way it did business. Ultimately, he developed the Four-Way Test business philosophy and instructed all employees to follow it in each of their dealings with customers, suppliers and associates. The philosophy turned the business around and ultimately brought it out of bankruptcy.

Is it the TRUTH? 



All decision-making must start with an objective base of facts—in other words, the truth. This is the basis for all decisions, negotiations and problem solving.

When resolving a conflict, all parties must agree on what constitutes the truth. All viewpoints and insights into the problem must be considered when defining the truth. The same process applies when making a decision. All sides of an issue or problem must be fully and objectively weighed before determining the truth of the matter.

The benefit of such an approach is that it effectively removes bias, emotion and personal agendas from the decision making process. When truth is objectively defined, viable solutions become obvious to a reasonable person.

Is it FAIR to all concerned?

Any problem or decision comes with a variety of options and solutions that are available when making a decision, solving a problem or negotiating a settlement or sale. The key is arriving at the best solution. When options, alternatives and solutions are weighed as to their impact on all parties, it becomes easier to narrow the options. When the final choices are filtered according to their fairness to all parties, the optimal decision will become obvious.

Will it build GOODWILL and BETTER FRIENDSHIPS?

It is important that decisions leave all involved parties satisfied, knowing the decision is fair to them.

Most people want to get on well with others and treat them in the same fashion that they would wish to be treated. Managers and employees must make ethical choices that build consensus and long-term goodwill. This increases employee retention and profitability of the organization.

Decisions made involving individual employees must focus on the same factors. This establishes trust and credibility, which has a direct impact on personal motivation and productivity.

Will it be BENEFICIAL to all concerned?

The final point addresses the question, “What’s in it for me?” Individuals want to know how a decision benefits them. The final question assures all involved parties that an equitable and beneficial decision has been reached.

The questions asked in The Four-Way Test are interrelated, with the answer to one question effectively creating the possible answers to the next. The answers and solutions are obvious and logical to all involved.

In the practice of ethical behavior there is an increased need for effective decision making skills and tools to guide and direct managers and employees. Only when specific individuals wish to pursue a personal agenda or achieve a decision will any interference come into play. The Four-Way Test effectively exposes such personal goals and agendas without the need for the manager or employee to directly bring attention to them.

Related:

Ethics: Actions Do Have Consequences

Seven Practical Applications of Ethics

Leaders Are Judged By The Actions They Take

Trust is Based on Truth

Excerpt: Ethics and Integrity: Pinpoint Management Skill Development Training Series (Majorium Business Press, Stevens Point, WI 2011) $ 17.95 USD

Timothy F. Bednarz, Ph.D. | Author | Publisher | Majorium Business Press
Author of Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Finalist – 2011 Foreword Reviews‘ Book of the Year)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2013 Timothy F. Bednarz, All Rights Reserved

Ethics: Actions Do Have Consequences

with 2 comments

Although ethics and personal integrity appear to have a diminishing role in our culture, when a massive failure of ethics and moral standards results in corporate implosions such as the Enron bankruptcy, as well as the collapse of the financial markets people notice. There is no question that in business, the highest moral and ethical standards are expected and demanded.

Actions do have consequences. Despite the thinking in popular culture that has helped enable a number of political leaders’ “ethical lapses,” in business ethics and integrity are closely paid attention to by superiors, associates, subordinates—and most importantly, customers.

All of these people judge managers and employees by their actions, not their words. Even a minor lapse in ethical judgment is not easily forgiven or forgotten.

This is important for managers to consider because their behavior impacts people on multiple levels. The consequences and implications of any ethical decision are far-reaching and must be carefully thought through before the action is taken.

The moral and ethical behavior of a manager has many consequences and implications beyond an immediate judgment or choice. Ethical behavior and integrity play an essential role in any manager’s position, for the following reasons:

Trust

The basis of all relationships is trust. Managers are primarily responsible for the directing of human resources. While they may also be responsible for the tools and equipment associated with business, their primary charge is the management of their individual employees. In this capacity, they are dealing with superiors and subordinates in financial terms.

Superiors are relying on the manager to provide accurate reports and records of their unit’s activities. The employee relies on the manager to assure that his or her efforts are supported and performance accurately reported.

The foundation of and glue that holds these relationships together is trust. Any ethical lapse is considered a breach of trust and will result in the pillars of management collapsing. Once this occurs, the manager has lost their effectiveness.

Related: Can You Be Trusted? The Answer May Surprise You

Rapport

Rapport is the building and nurturing of quality relationships. This is a term normally used to describe relationships among employees, but it goes beyond this. Managers require good rapport at all levels with their superiors, subordinates and associates.

The manager’s role is to act as a liaison between the various levels they are in communication with. The employee has access to his or her manager. The manager has full access from senior management to support staff.

Exceptional management, support and communication means the manager must actively maintain good rapport at every level. However, building relationships and establishing rapport is a people skill that further demands trust and ethical behavior. These are the cornerstones of building rapport on all levels. Any degree of moral and ethical failure at any level will undermine the manager’s efforts and effectiveness.

Related: Emotional Bonds are a Reflection of a Leader’s Effectiveness

Credibility

There are managers who have undoubtedly displayed lapses in moral and ethical judgment, yet still maintained their job and position. They may have shielded their actions from their superiors, but not from their subordinates. In some instances they may have made statements or promises and failed to follow up on them.

In any ethical failure, they have betrayed the trust of their subordinates. When this occurs, these managers have lost credibility in the eyes of their people, which more often than not results in sapping their motivation.

Employees will either leave or let their performance drop knowing their manager has little integrity. While these managers might think they have won in the short-term, in the long run there are profound consequences to be paid.

Related: Six Ways to Enhance Your Personal Credibility

Reliability

Managers who have betrayed trust cannot be relied upon. If this occurs between the manager and his or her superiors, it is dealt with on the senior level, normally resulting in termination.

A loss of credibility with individual employees will result in them being unable to trust the manager. Rapport with these individuals will be eroded to the point that all work-related effectiveness is lost.

The consequences will be a revolving door of people under the manager’s responsibility, as any respectable person will not continue under these circumstances.

Related: Emotional Bonds are a Reflection of a Leader’s Effectiveness

Reputation

A person’s reputation is the most valued possession that they have. Once destroyed, a personal reputation is difficult, if not impossible, to restore. The same is true for a company’s reputation.

A manager holds the responsibility for both his or her reputation as well as the company’s. His or her personal actions have a double, if not triple, impact since senior managers, his or her subordinates, and the company’s customers are continually examining his or her actions. This is an awesome responsibility unparalleled in magnitude in any organizational environment.

Related: You Are Judged by the Actions You Take

Excerpt: Ethics & Integrity: Pinpoint Management Skill Development Training Series by Timothy Bednarz (Majorium Business Press, Stevens Point, WI 2011)

Timothy F. Bednarz, Ph.D. | Author | Publisher | Majorium Business Press
Author of Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Finalist – 2011 Foreword Reviews‘ Book of the Year)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2012 Timothy F. Bednarz, All Rights Reserved

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