Badaracco: Personal Values

Page 1

• Central thesis: Personal values shape how managers interpret facts and fulfill responsibilities. Without values, decisions would be mechanical; with values, decisions are guided by what managers care about.

• Two key questions:

  • Empirical question: How do managers’ values influence their work and their effort to meet responsibilities?

  • Ethical question: How should a manager’s values influence his or her work?

• The Ideal World (ethical ideal)

  • Managers should strongly believe in the missions of their organizations and be deeply committed to meeting professional responsibilities.

  • This is demanding and aspirational; many top leaders aim for it.

  • Alignment is a conventional description of this ideal, but it can underplay the passion, commitment, and intensity of leadership.

  • The work of successful leaders expresses who they are and what they deeply care about; their responsibilities and commitments are central to their identities.

  • It is easy to romanticize commitment, but reality is hard: leadership work is exhausting and challenging, yet enduring success depends on deep personal commitment.

  • Woody Allen’s maxim: “80% of success is just showing up” captures a truth about persistence.

  • Peter Drucker’s definition (quoted): “Leadership is not rank or privileges, titles or money. Leadership is responsibility.”

  • Leaders’ values convey to the organization what is truly important and how members should treat one another and outsiders. Messages can be explicit (words), visible (actions), or unconscious.

  • Key references: Drucker quote; and related discussion in The Leader of the Future (Hesselbein, Goldsmith, Beckhard), p. xii.

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The Real World: Four (at least) obstacles to living by personal values

• While the ideal calls for steadfast commitment to shared values, reality presents several obstacles: 1) Sustaining commitment

  • Management work is hard: competition is relentless, corporate politics consume time, macro forces can overwhelm efforts, and life’s vicissitudes intervene.

  • The struggle to maintain cooperation among people can moralize or exhaust managers (Barnard’s insight).

  • Barnard’s quote (paraphrased): Maintaining cooperation among people can destroy some people morally as battle destroys them physically.
    2) Unbridled self-interest

  • Adam Smith: It is not from benevolence that merchants act, but from self-interest; markets translate self-interest into broader social benefit.

  • However, self-interest can distort or overwhelm judgment, especially when one acts as an agent or fiduciary.

  • Real-world scandals show executives acting on self-interest despite legal/ethical boundaries.

  • Unconscious self-interest is especially pernicious; unconscious mind acts like an operating system that silently shapes perception and action.

  • Cognitive neuroscience now characterizes much of mental processing as unconscious, powerful, and inaccessible.

  • Supporting evidence: behavior shifts under stress or when unconsciously biased toward clients.

  • Illustrative studies cited: the role of unconscious bias in professional judgment (auditors example).
    3) Unconscious biases and hidden influences

  • The unconscious mind drives perception, feeling, thought, and action; people may be unaware of how these biases influence decisions.

  • The phrase “strangers to ourselves” captures the surprising degree to which people are unaware of their own motivations.

  • Supporting study: auditors judging accounting vignettes; when told they were auditing for a company, 30% more likely to deem the accounting compliant with GAAP, illustrating unconscious client bias.
    4) Moral conflicts: right-versus-right, right-versus-wrong, and gray-area cases

  • Right-versus-right conflicts: dilemmas where two actions align with core values; e.g., whether to disclose rumors of a colleague’s layoff versus honoring confidentiality.

  • Right-versus-wrong situations: pressure to engage in clearly unethical or illegal acts, possibly prompted by superiors or organizational risk-taking; examples include accounting manipulation or other improper acts.

  • Right-versus-almost-wrong (gray areas): ethically dubious practices, aggressive bluffing, exploiting loopholes, or testing the boundaries of agreements without crossing them; ambiguous cases require careful judgment.

• Emotional resonance and ethical climate

  • Daniel Goleman’s research: a manager’s emotions and moods affect the organization and directly influence its bottom line.

  • Thus, embracing a high ethical ideal involves committing to common values (e.g., honesty, respect, hard work) and to values that reinforce the firm’s strategy (e.g., creativity, service, attention to detail).

  • Key reference: Daniel Goleman, Primal Leadership (2002).

• Footnotes and sources: Wilson (2002) on self-knowledge; Bazerman, Loewenstein, Moore (2002) on auditing behavior; Barnard (1982); Smith (1776/1976); Drucker (referred). Footnotes 2–6 provide the scholarly context.

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Deep dive into the value-related obstacles

• Right-versus-right conflicts (illustrative dilemma)

  • Example: Ted’s rumored layoff; you know you promised confidentiality; do you tell the truth or keep the promise?

  • These conflicts swing the moral compass and make personal values less straightforward guides for action.

• Right-versus-wrong situations

  • Clear cases of ethical or legal risk, often under explicit or implicit pressure from a superior.

  • Examples include directives to engage in deceptive or illegal practices, or nudges to bend rules to avoid culpability.

  • Sometimes, there is pressure to cross a line even when the manager believes it’s wrong.

• Right-versus-almost-wrong (gray-area cases)

  • Common practices that are ethically dubious (e.g., aggressive bluffing) or exploitation of loopholes.

  • These cases test how far one can go before crossing an ethical/legal boundary.

• The human element in leadership under pressure

  • The combination of pressure and ambiguity can push even well-intentioned managers toward questionable actions.

• Supporting references

  • Wilson (2002) on self-awareness and cognition; Bazerman et al. (2002) on how professional judgment can be swayed by context; Barnard; Smith.

  • These sources underpin the practical difficulty of living up to an ethical ideal in real-world settings.

Page 4

Exit, Loyalty, and Voice: Hirschman’s framework in organizational ethics

• When facing commitment challenges or ethical strains, managers may consider three broad options (Hirschman, 1970):

  • Exit: quitting or leaving the organization; can be quiet or noisy, and is not always ethically straightforward. Exits may provide a way out but can also give perpetrators more room to maneuver.

  • Loyalty: staying and complying with or enduring problematic practices; can be problematic if it involves complicity in unethical acts, but gray-area cases may require staying to fight issues or to pursue longer-term goals.

  • Voice: raising concerns, asking questions, offering alternatives, persuading, and sometimes warning or objecting. Voice is about pushing for change without exiting or remaining passive.

• The ethics of exiting are nuanced: exits should be evaluated against the alternatives; simply leaving is not always the most responsible action.

• The Hirschman framework has broad applicability beyond business, including economic, political, and social problems.

• Practical notes on exit strategies

  • Exit can be a prudent option when staying would cause greater harm, but it can also enable unethical behavior to persist if used solely to avoid responsibility.

  • Quiet exits may minimize disruption but reduce accountability.

  • Noisy exits may draw attention to problematic practices and force organizational change, but may have personal or professional costs.

• The role of loyalty in gray-area tensions

  • Loyalty can be ethically questionable when it entails complicity in unethical behavior.

  • It can also be a constructive force when it protects long-term values or allows for reform from within.

• Voice as a leadership function

  • Voice is not merely one option among many; it is a central leadership activity through which leaders express and enact values.

  • Successful leadership requires courageous, imaginative, and practical communication to caution, persuade, and offer alternatives.

  • If voice fails, exit and loyalty become fallback positions; thus, voice is central to aligning personal values with professional responsibility.

• Key reference: Hirschman, Exit, Loyalty, and Voice (1970).

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Synthesis: Why voice matters and its role in connecting values to responsibility

• The core claim: Voice is foundational to effective leadership and to the embodiment of personal values in professional roles.

• Leaders do more than decide; they enact values through what they do and through what they enable others to do.

• Leadership is essentially about expressing and enabling values, not merely occupying a position or achieving outcomes.

• The enduring connection between personal values and professional responsibility rests on how leaders exercise voice in practice.

• Final takeaway: To lead with integrity is to use voice to guide actions, shape organizational norms, and align daily decisions with core values.

References (selected from the notes)

• Drucker, Leadership is responsibility. See The Leader of the Future (Hesselbein, Goldsmith, Beckhard, eds.), p. xii.

• Woody Allen: “80% of success is just showing up.”

• Barnard, The Functions of the Executive (Harvard University Press, 1982), p. 278.

• Adam Smith, An Inquiry into The Nature and Causes of the Wealth of Nations (University of Chicago Press, 1976), p. 18.

• Daniel Goleman, Primal Leadership (Harvard Business School Press, 2002).

• Timothy D. Wilson, Strangers to Ourselves (Belknap Press, Harvard University Press, 2002).

• Max H. Bazerman, George Loewenstein, and Don A. Moore, “Why Good Accountants Do Bad Audits,” Harvard Business Review, November 2002, pp. 100–101.

• Albert O. Hirschman, Exit, Loyalty, and Voice (Harvard University Press, 1970).

Note: All numerical references are presented in LaTeX-compatible format where applicable, e.g., 80\% and 30\%, and quotes and citations are retained as in the source material.