Ethical slips and traps are rampant, from telling white lies that protect a friend, to ignoring a gut feeling and following orders when we know better.

Not a month goes by without some highly publicised ethical scandal. Be it tax evasion, executive pay excesses, sexual dalliances and outright fraud, many individuals are simply unable to resist temptation. 

Does this make the perpetrators corrupt sociopaths?

Sometimes, but usually not. They’re often leaders and pillars of the community, and their actions leave us shaking our heads and wondering what were they thinking.

The sad truth? No one is immune. Cheating isn’t limited to those in positions of power. While power is certainly fraught with opportunities and temptations, each of us faces daily choices that involve doing the right—or wrong—thing. Only when a CEO, politician, celebrity or sports legend gets caught does the problem rise to front-page news. Just ask Tiger Woods, Bill Clinton or more recently, Mark McInnes, former CEO of Australian retail giant, David Jones.

But the same ethical traps lie in your path. Even the little guys transgress. Often, people feel an urge to cheat—a strange pull to try to get away with something. Sometimes it’s small; other times it’s scandalous. Sometimes it matters; other times it goes unnoticed.

What exactly happens inside our heads when we choose to violate our ethical standards? Do we lose sight of what’s right? Do we take the easy way out? Are we driven to win at any price? Are we attracted to our “dark side”?

Ethical Roots

Psychology and other social sciences offer a huge body of experimental studies that demonstrate the allure of cheating. In The Ethical Executive (Stanford University Press, 2008), Robert Hoyk and Paul Hersey describe 45 ethical traps inherent in any organisational environment.

Many of these traps are psychological in nature, creating “webs of deception” that distort our perception of right and wrong. Such rationalisations lead us to believe our unethical behavior is normal and appropriate, and they have contributed to large-scale corporate disasters like the Enron and WorldCom affairs.

The Brain Science of Traps

At any given moment, we have impulses that motivate us to act. They are reactions to internal or external stimuli, which may be powerful enough to trigger automatic behavior. At this point, we may rationally ignore other (and better) options. 

Other times, we’re aware of several distinct choices, but the stimulus’ effect overrides these potential actions. We may desire a specific outcome so strongly that it propels us to move in an unsound direction. Anxiety and stress may also compel us to make choices that alleviate our short-term distress, yet lead to irrevocable long-term consequences.

Our ultimate behavior depends on a complex weave of situational factors, history and personality.

Four Basic Tribal Drives

Some experts believe we’re motivated by four basic human drives that have evolved from our primitive ancestors:

These drives are especially evident in western and other modern cultures. We work hard to provide for our families, far beyond our survival needs for food, clothing and shelter. Many of us are highly motivated to land the best job, home and/or salary possible. It’s human nature to want to acquire things that make our families comfortable and happy. Many of us are driven to be the smartest or most  prestigious person in the room.

Much of our energy goes toward protecting what we have and defending our territories, families, positions, rights and freedoms—a strong drive that explains why nations go to war.

Organisations are like theatres, where actors play out their desires to acquire, bond, learn and defend. There’s no better stage to demonstrate our tribal drives, and nowhere are there more daily opportunities to choose between right and wrong.

The Ethical Stage

As children, we were primed to obey our parents. Our very survival depended on it. Some families demanded strict obedience; others were lenient about opposition and rebellion; still others encouraged creativity and individual spirit.

But all families required obedience to authority. This conditioning continued in school. Consequently, as adults, when our boss orders us to do something, we quickly obey—often, without thinking.

If an authority figure orders us to do something unethical, our sense of obedience may be so powerful that we follow orders without acknowledging that we’re going against our ethical principles. The impulse to obey is so strong that it overrides rational judgement.

Root Causes of Traps

Obedience to authority is a “primary” trap, which means a strong external stimulus impels us to move in a certain direction, without regard for our ethical principles.

In business, people don’t abandon their ethics simply because they want to maximise profits. Rather, their drive to acquire and improve their status lures them into a social-psychological trap.

This often happens in small steps—yet another trap. If you place a frog in a pot of boiling water, it will jump out quickly. But if you place it in the pot and slowly increase the heat, it will remain there and be cooked.

Small steps and choices create minor ethical transgressions that do little harm, but they set the direction that eventually leads to major, irreversible violations.

Primary Traps

Hoyk and Hersey describe three types of social-psychological traps that occur in the workplace: primary, defensive and personality. They include:

1. Obedience to authority
2. Small steps
3. Indirect responsibility
4. Faceless victims
5. Lost in the group
6. Competition
7. Self-interest
8. Tyranny of goals
9. Money
10. Conformity
11. Power
12. Obligation
13. Time pressures

When we carefully review and understand these traps, we can prepare for—and avoid—them. Our choices become sound.

A Study of Business Ethics

Twelve years ago, Joseph Badaracco, an ethics professor at the Harvard Business School, interviewed 30 recent MBA graduates who had faced ethical dilemmas in the business world. All of them had taken an ethics class at Harvard. Half of them worked for companies that had official ethics programs.

As Badaracco notes:

“Corporate ethics programs, codes of conduct, mission statements, hot lines, and the like provided little help…the young managers resolved the dilemmas they faced largely on the basis of personal reflection and individual values, not through reliance on corporate credos, company loyalty, the exhortations of senior executives, philosophical principles or religious reflection.”

Most of the Harvard-educated managers had learned their personal values primarily from their family upbringing, not from ethics courses. Traditional ethics education based on philosophical principles does not always transfer to the workplace.

What does make for better choices in our jobs, however, is an understanding of the root causes of unethical behaviors: the psychological dynamics. If managers have a firm knowledge of how pervasive and compelling ethical traps can be, they can use this understanding to objectify what’s happening to them.

When you can think and talk about these traps with a trusted colleague, mentor or coach, then their allure and the possible distortions they evoke can be revealed. Some distance is created between the person, the choice and the trap. As a result, anxieties are reduced, improved clarity is achieved and more effective choices can be made.

Traditionally, business-ethics and MBA programs present vignettes of ethical dilemmas one may face, such as pollution, sexual harassment, product safety and discrimination. These problems have no clear right or wrong answers. To solve them, students are often provided with an outline of eight to 12 critical questions. A sample is provided here for your use.

Avoid the traps of bad business decisions with a breakthrough system in values and integrity-based decision-making at www.humanresourceschange.com.au/integrity-and-values-profile.html

In the year 2000 alone, 40 CEOs of the top 200 companies on Fortune’s 500 list were fired or made to resign. When 20 percent of the most powerful business leaders lose their jobs, something is clearly wrong.

Leaders make big promises … and then what their organisations actually deliver falls short. They have accountability problems—people aren’t doing what they’re supposed to do. Execution is a culture with a specific set of behaviours and techniques that companies must master in order to have competitive advantage. More than a tactic, it is a discipline and a system that must be built into a company’s strategy, goals, and culture, and the leader of the organisation must be deeply engaged in it.

“Many people regard execution as detail work that’s beneath the dignity of a business leader. That’s wrong … it’s a leader’s most important job.” ― Larry Bossidy, former chairman and CEO, Honeywell International

According to Ram Charan and Larry Bossidy in their book Execution (2002), a lack of focus on the discipline of execution is the main reason companies fall short on their promises. It explains the gap between what leaders want and what they deliver.

Execution should be a central part of a company’s strategy and goals and the priority of any leader. An execution and accountability culture links the three core processes of any business—the people process, the strategy, and the operating plan—together to accomplish things on time.

The execution phase forces leaders to translate the broad-brush conceptual understanding of the company’s strategy into an action plan for how it will manifest: who will do what in which sequence, how long those tasks will take, how much will they cost, and how they will affect subsequent activities. Fundamentally, execution is a systematic way of exposing reality and acting on it. Most companies do not face reality very well; hence, they can’t execute.

 Execution Questions 

• Who will do the job—and how will they be judged and held accountable?
• What human, technical, production, and financial resources are needed to execute the strategy?
• Will the organisation have the resources it needs two years out, when the strategy goes to the next level?
• Does the strategy deliver the earnings required for success?
• Can it be broken down into doable initiatives?

People engaged in the processes argue these questions, search out reality, and reach specific and practical conclusions. All agree on their responsibilities for getting things done and commit to those responsibilities.

3 Core Processes:  People, Strategy & Operations

The heart of execution lies in the three core processes (the people process, the strategy process, and the operations process), which every business uses in one form or another.

In a 10-year study of winning companies, professors William Joyce and Nitin Nohria found four primary management practices that directly correlate with superior corporate performance, as measured by total return to shareholders: execution, strategy, culture, and structure (What Really Works, 2003).

However, more often than not, these core processes stand apart from one another like silos. Typically, the CEO and his senior leadership team allot less than half a day each year to review the plans and, generally, the reviews are not particularly interactive. What is needed is:

• Robust dialogue to surface the realities of the business.
• Accountability for results discussed openly and agreed to by those responsible for getting things done.
• Rewards for the best performers.
• Follow-through to ensure that progress tracks to the plans.

Robust Dialogue

An execution  and accountability culture requires robust dialogue that brings reality to the surface through openness, candour, and informality. When mistakes are made, openness is preserved and blaming avoided. The information is used for course correction. Candour and honesty foster creativity and ultimately lead to competitive advantage and improved shareholder value.

Emotional Fortitude

Emotional fortitude is necessary to be open to whatever information you need, whether it is what you want to hear or not. It takes a special kind of confidence to encourage and accept challenges in group settings. It is necessary to accept and deal with your own weaknesses and vulnerabilities, to be firm with people who aren’t performing, and to handle the ambiguity inherent in fast-moving, complex organisations

The Core Qualities of Emotional Fortitude

Bossidy and Charan point out four core qualities that make up emotional fortitude:

1. Authenticity
2. Self-awareness
3. Self-mastery
4. Humility

Measuring the degree to which such qualities are present in leaders is a challenge. Fine-tuning these leadership qualities is an even greater challenge. The Australian firm IntegrityandValues.com has addressed this challenge, overseeing a body of research into five dimensions of emotional fortitude shown to have the greatest impact on leadership success. The result of this research is a leadership profile which supplies comprehensive and verifiable data on these five dimensions under the over-arching banner of “integrity” including:

1. Accountability
2. Responsibility
3. Truthfulness
4. Loyalty
5. Self Awareness

Clearly these qualities should be well developed in executives in top positions; however, often one or two of them are often underdeveloped. Leadership development at this level requires the services of a professionally trained executive coach to provide focus and guidance in enhancing these qualities.

Execution Is the Main Job

There’s an enormous difference between leading an organisation and presiding over it. The leader who boasts of a hands-off style is not dealing with the issues of the day, not confronting the people responsible for poor performance or searching for problems to solve and making sure they get solved. Putting the right people in the right jobs and ensuring that rewards and recognition reinforce performance are essential.

The Leader’s 7 Essential Behaviours

Accepting full personal responsibility for running the three core processes does not automatically suggest the leader is also micromanaging their business. Micromanaging is a big mistake; it diminishes people’s self-confidence, saps their initiative, and stifles their ability to think for themselves.

How does a leader in charge of execution avoid being a micromanager caught up in the details of running the business? Seven essential behaviours form the building blocks of execution:

1. Know your people and your business.
2. Insist on realism.
3. Set clear goals and priorities.
4. Follow through.
5. Reward the doers.
6. Expand people’s capabilities.
7. Know yourself.

Most executives and managers don’t understand the “discipline” of execution. Execution is not simply a matter of trying harder, paying more attention to details, or doing someone else’s job for them. Execution involves a specific set of core processes built on a foundation of leadership behaviours; it’s a culture unto itself in which accountability and responsibility thrive.

Recommended reading: Execution: The Discipline of Getting Things Done (2002) by Larry Bossidy and Ram Charan. Crown Business, New York, NY.

Resources for Execution

Bossidy, L. & Charan, R. (2002). Execution: The Discipline of Getting Things Done. Crown Business.

Bruch, H. & Ghoshal, S. (2004). A Bias for Action. Harvard Business School Publishing.

Collins, J. (2001). Good to Great: Why Some Companies Make the Leap…And Others Don’t. Harper Business.

Collins, J. & Porras, J. I. (1994). Built to Last: Successful Habits of Visionary Companies. Harper Collins.

Contrada, M. G. (2003). The Discipline of Execution. Harvard Business School Publishing.

Joyce, W., Nohria, N., & Roberson, B. (2003). What Really Works: The 4 + 2 Formula for Sustained Business Success. Harper Business.

Pfeffer, J. & Sutton, R. I. (2000). The Knowing-Doing Gap: How Smart Companies Turn Knowledge into Action. Harvard Business School Press.

Raffoni, M. (2003, February). Three Keys to Effective Execution. Harvard Management Update, 8 (2), [page numbers].

Worrall, D (2009) A Climate for Change, Life Success Publishing.

Moving forward, a new metric is proposed: the extent to which executives create organisations that are economically, ethically and socially sustainable.

The new metric is trust. Building a culture of transparency is a fundamental first step to achieving trust. Broadly defined, transparency refers to the degree to which information flows freely within an organisation, among managers and employees, and outward to stakeholders.

Trust in our leaders is alarmingly low. While exact figures and study results vary, no data compiled over the last 7 years has shown more than 50% trust for company leaders.

Easier Said Than Done

If transparency is such a vital component of trust, why wouldn’t companies promote openness and a free flow of information?

Several issues can stand in the way:

• People may be unable or unwilling to communicate upward and with honestly
• Teams may not yet have the capability of challenging their own assumptions
• Boards of Directors may be unable to clearly communicate important messages to company leadership

Further, the failure to promote transparency may stem from a leader who won’t listen to followers; as well as followers who won’t speak up.

Poor transparency also occurs when team members are ensconced in “groupthink,” usually without awareness. In this scenario, people on the same team don’t challenge each other. Sometimes, they like each other too much. Other times, they simply don’t know how to disagree with one another.

Knowledge Is Power

In all groups, leaders try to hoard and control information because they use it as a source of power and control. But the ability of a few powerful people to keep information secret is now vanishing, in part due to the Internet, as well as the facility of rapid communications.

Transitioning from a hoarding tendency to a transparency culture starts at the top when leaders:

• Share more information.
• Welcome challenge and counterarguments.
• Admit their own errors.
• Behave as they want others to behave

7 Steps to Transparency

Bennis and O’Toole offer seven steps for developing a culture of transparency:

1.  Tell the Truth

Each of us has the impulse to tell others what they want to hear. Instead, keep it simple, and be honest. Candid leaders tell everyone the same thing, and they have no need to revise their stories.

2. Encourage People to Speak Truth to Power

It’s never easy for us to be honest with our bosses. It takes courage to speak up.

But encouraging people to share their honest opinions is crucial if leaders want to build trust and open communication.  Of course, this sometimes means executives will hear unpleasant information.

3. Reward Contrarians

If you make it acceptable, are willing to listen to opposing points of view and promise to consider the merits of others’ arguments, you pave the way for a culture of transparency.

Find colleagues who tend to be oppositional, listen to them intently, and create conditions for thinking differently.

4. Practice Having Unpleasant Conversations

Few people excel at delivering negative feedback during performance appraisals. Offering negative feedback upward, to one’s boss, is even more challenging.

The best leaders learn how to deliver bad news kindly so people don’t get unnecessarily hurt. It’s certainly not easy, unless practice opportunities are provided.

5. Diversify Information Sources

Communicate regularly with different groups of colleagues, workers, customers and even competitors to gain a nuanced and multifaceted understanding of others’ perceptions.

6. Admit Mistakes

Candour is contagious. When you admit your shortcomings or errors, it paves the way for others to do the same. Simple admissions can disarm critics and encourage others to be transparent, as well.

7. Build Organisational Support for Transparency

Protect whistle-blowers—but don’t stop there. Other norms and sanctions should encourage truth-telling, including open-door policies, ethics training and internal blogs that give a voice to people lower down in the hierarchy.

Board Vigilance

Changing a system that encourages information-hoarding is the board of directors’ responsibility. Truly independent boards should provide a much-needed check on executives’ egos and truth-telling. If they fail to assess transparency at the uppermost levels, they’re not functioning appropriately.

“Boards are the last line of defence against ruinous self-deception and the suppression of vital truths,” write Bennis and O’Toole. “If they’re not vigilant in the pursuit of honesty, the organisations they serve are unlikely to have a free internal or external flow of information.”

Trust

As a species, we are hardwired to trust others, especially those who appear similar to ourselves and who have similar interests. But as recent financial scandals reveal, we sometimes trust too easily and trust the wrong people.

To trust wisely means starting with small acts that foster reciprocity. By communicating your willingness to trust, you give others the go-ahead to do the same. However, Jonar Nadar points out in How to Lose Friends and Infuriate People (2006), that communicating your willingness to trust employees is more than a simple statement or delegation of responsibility.  Deeply trusted leaders go the extra mile by removing obstructions to an employee’s capacity to communicate views and explore possibilities (Worrall, D., A Climate for Change, 2009).

Transparent Communications

Open and honest communications support the decision to trust. Lack of communication and transparency creates suspicion.

To increase the transparency of your communications:

• Increase the frequency and candour of your communications.
• Build a relationship beyond the constraints of your official role.
• Use the word “we” more often than “I.”
• Emphasise common values and goals.
• Be clear whose goals and interests you are promoting.
• Be sure your actions support your words.
• Demonstrate a clear concern for others.
• Under-promise and over-deliver.
• Ask more questions.
• Really listen to the answers.

D.Worrall (2010)

 

Corporations spend billions every year on strategic planning. They align their business goals and operations with their mission and values – their core reasons for being in business. Corporations may complete this exercise in-house or engage the services of an external Consultant who has specialized skills in areas like values alignment, cultural and business analysis,  and strategic planning. .

Executives and Small Business Owners  also involve themselves in similar planning sessions with their executive coaches. They examine their strengths and weaknesses with their coach, they look at their career and personal goals, and make strategic decisions about where and how to spend their time and energy.

Some coaches straddle the field of “executive coaching” as well as “life” coaching.. Life coaches do the same thing with individuals. They explore and clarify with you your identity, your values, and your true purpose in life. How can you know what you need to do, where you need to spend your time and energy, if you don’t know what is most important to you? This is difficult and important work. And it is hard to do alone. Taking the time to make personal definitions for yourself will make the process of goal setting and staying on track much easier.

Regardless of whether your goals are to finish a university degree, get a better job, start a business, buy a home, or lose weight, the process is the same. The aspirational goals you set must be consistent with your c ore values and true identity if you want to sustain your motivation over time. 2.

Here are three essential elements you must consider before writing down your goals:

1.            Examine your identity: Quite simply, who are you? Self-awareness is the cornerstone to emotional intelligence and so important that this one feature will do more for your success in life than any other social competency. If you know yourself well, you can choose a path aligned with your strengths and weaknesses. You will not get distracted by people, places and things that are not congruent with your true self.

How do you improve your self-awareness? Through working with your coach, doing assessments, examining your attitude, your passions, your self-image, examining your assumptions and beliefs and being willing to ask for and receive feedback.

Avoid defining yourself in terms of external things (job titles, education, family roles, etc.) and look at your personal integrity, ethics, and things that are important to you.

There are  a range of behaviour styles, leadership, team, values, wealth creation and personality type assessments available through your coach. Gaining a deeper understanding of your own preferred, natural way of behaving and thinking can greatly improve your understanding of yourself. As a side benefit, it also improves your understanding of others different from yourself. Ask your coach about the assessment tools they offer.

Here are some questions to ask yourself to gain clarity about your identity:

• When thinking about myself, what am I most proud of?
• How would my friends describe me?
• How would my co-workers describe me?
• What does my family say about me?
• What are the three most important areas in my personal life?
• How have I changed over my adult years?
• What are my strengths?
• What do I avoid or dislike doing?

2.            Define your values: What are your most fundamental beliefs? Identify three important moral values that are important to you. The more clearly defined your values are, the more energy and focus you will have for your goals. Values provide the basic structure you need to build your personal life, your career, your business and any other aspect of your life.

Consider your attitude towards other people. Think about your current obligations to your community, family and friends. Reflect on the core beliefs you have that you would want to pass on to the younger generation. If you were to mentor someone, what values would you project as being most important in the world?

Here are two exercises to help define your values. Look over the following list of values and rank each from 1 to 10 (with 1 representing values most important to you).  Be sure to add any that are important to you but not on this list.

Values Identification Exercise 1.0

What are the five values you ranked the highest? Those five values should be receiving 80% of your time and energy. Write down your five most important values on a separate sheet of paper and post them somewhere you will see them every day. This will drive your actions and keep you focused on what is most important.

Values Identification Exercise 2.0

Your highest values are nearly always reflected in how you spend your time. The things highest on your list inspire you to action. The things lowest on your list are where you find yourself procrastinating. _2.

Answer the following questions. Then list your top 3 things in order of importance.

• How do you fill the space where you live?
• What do you spend your time doing?
• What do you spend your money on?
• What do you think about and talk about?
• Where are you the most disciplined? _3.

 The values you have identified are the foundation of your success. They help you prioritise the goals you set for yourself. Without values clearly defined and prioritised, it is difficult to prioritise goals. This makes it easier to make a choice when commitments compete for your attention.

3.      Establish your goals: Goal setting is not easy. It is hard work requiring time and thought. It means soul searching. Fear of failure – and fear of success – can stop people from setting clear goals and interferes with the process of actually putting them into writing.

If you have completed steps one and two – you have examined your identity and clarified your values  –  then you have already done the hard work. The goal setting should be a natural extension of your values.

For example, if you value good health, then your goals of eating well and exercising regularly follow naturally. Focus on only three goals at a time, in order to be focused. Break each goal down to two or three components, along with specific, measurable, realistic time-frames..

D Worrall  (2010)

References:

Covey, S (1989 ) The Seven Habits of Highly Effective People, Simon & Shuster.

Worrall, D (2009) A Climate for Change, Life Success Publishing.

Demartini, J (2002) from Worrall D( 2009)  A Climate for Change, Life Success Publishing..

Resources

For more on goal setting, values and SMART goals see A Climate for Change (2009), D Worrall at www.aclimateforchangebook.com

For further information on Executive Coaching and Business Consulting for Leaders of Change, contact Di at Worrall Assoc. on enquiry@humanresourceschange.com.au

While the gig made the headlines here in Australia, what was even more interesting was what happened to Kylie after the event. After an exhausting show, she changed from her uncomfortable performance outfits into a tracksuit and headed back into the same hotel for the after party bash.

A funny thing happened. The doorman didn’t recognise her and didn’t approve of the tracksuit and so wouldn’t let her in!

What did the exhausted Kylie do with this outrage? Not what you would typically expect of an “A” list performer, nor what you would expect of most other people.  I imagine she was frustrated and a little insulted. However, she didn’t draw upon the inner diva, didn’t kick up  a stink for all the media to see and didn’t have a raging “hissy fit”. Instead she, together with her assistants  swallowed her pride, gathered her good humour and integrity and graciously negotiated a resolution to the misunderstanding.        

Now that’s a nice change.

Click the following link for your FREE subscription to Di Worrall’s newsletter  - Creating a Climate for Change  http://www.worrallassociates.com.au/

Some quick research into the red carpet phenomenon takes us beyond movie premiers and back to 485BC and Aeschylus, a Greek playright. Aeschylus created a character called Agenemon whose wife deceives him into walking onto red carpet which was intended for the gods.  Fast forward to the 1820s and we see the red carpet rolled out for a US President and in 1902 red carpet is used in ceremonial fashion to welcome guests to a classy train journey.

It’s interesting to see how the “red carpet” treatment evolved from our respect and reverence for “the gods”, to dignitaries and rulers, to ceremony and now to celebrity. Inviting someone to the red carpet is like placing them on a pedestal above the ordinary citizen for a period of time, to acknowledge and perhaps celebrate their leadership or achievement in a particular field (notwithstanding Australia’s pedestals which are more often than not used as a national pastime to shoot people off and bring them down to size).

It seems to me that the red carpet is changing again.

Is the bar being raised? It wasn’t long ago that our red carpet standards seemed to be quite different. Britain’s Sir Winston Churchill was regarded as a formidable prime minister during world war II,  yet he was previously sacked from the military for incompetence, and is known to have arrived drunk while serving in his political office.   Today, we not only send our leaders in business, politics or governance to post graduate education to earn the right to assume positions of leadership, we are now more often punishing them for incompetence or breaches of our trust and integrity. We have also created the expectation that celebrity status automatically equates with a leadership position on issues of national or global importance. 

Perhaps these trends are because our standards are rising and perhaps it is also because the media and the internet have given us a new access to probe and judge our leaders and celebrities lives.   

Click the following link for your FREE subscription to Di Worrall’s newsletter  - Creating a Climate for Change  http://www.worrallassociates.com.au/