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Chapter 6: Courage and Moral Leadership

Your Leadership Challenge

After reading this chapter, you should be able to:

• Combine a rational approach to leadership with a concern for people and ethics.

• Recognize your own stage of moral development and ways to accelerate your moral maturation.

• Know and use mechanisms that enhance an ethical organizational culture.

• Apply the principles of stewardship and servant leadership.

• Recognize courage in others and unlock your own potential to live and act courageously.

Chapter Outline

166 Moral Leadership Today

170 Acting Like a Moral Leader

172 Becoming a Moral Leader

174 Servant Leadership

180 Leadership Courage

In the Lead

171 Warren Buffett, Berkshire Hathaway

177 Ari Weinzweig and Paul Saginaw, Zingerman’s Community of Businesses

182 Colonel Sean McFarland and Captain Travis Patriquin, United States Army

Leader’s Self-Insight

169 What’s Your Mach?

179 Your Servant Leadership Orientation

183 Assess Your Moral Courage

Leader’s Bookshelf

186 Courage Goes to Work: How to Build Backbones, Boost Performance, and Get Results

Leadership at Work

189 Scary Person

Leadership Development: Cases for Analysis

189 Sycamore Pharmaceuticals

190 The Boy, the Girl, the Ferryboat Captain, and the Hermits

X erox was in a free fall when Anne Mulcahy took over as CEO in 2000. Rather than sugarcoating the dire situation, Mulcahy candidly told shareholders that the company’s business model was unsustainable and dramatic actions were needed to save the organization. Investors dumped Xerox shares, driving the already-decimated stock price even lower. Advisers urged Mulcahy to declare bankruptcy, but she chose instead to focus on a vision of restoring Xerox to greatness. Rather than becoming immobilized by a need to soothe analysts, angry shareholders, and investment bankers, Mulcahy headed out to talk to customers and employees. She

References: 4. Quoted in Betsy Morris, “The Accidental CEO,” Fortune (June 23, 2003), pp. 58–67. 6. Marist College Institute for Public Opinion and Knights of Columbus survey, results reported in Kevin Turner, “Corporate Execs: Nobody Trusts Us; U.S. Lacks Confidence in Business Ethics, Poll Says,” Florida Times Union (February 27, 2009), p. A1. 7. Ronald W. Clement, “Just How Unethical Is American Business?” Business Horizons 49 (2006), pp. 313–327. 8. Roger Parloff, “Wall Street: It’s Payback Time,” Fortune (January 19, 2009), pp. 56–69. 9. Gary R. Weaver, Linda Klebe Treviño, and Bradley Agle, “‘Somebody I Look Up To’: Ethical Role Models in Organizations,” Organizational Dynamics 34, no. 4 (2005), pp. 313–330. 10. Chuck Salter, paraphrasing Bill George, former CEO of Medtronic, in “Mr. Inside Speaks Out,” Fast Company (September 2004), pp. 92–93. 11. David Wessel, “Venal Sins: Why the Bad Guys of the Boardroom Emerged en Masse,” The Wall Street Journal (June 20, 2002), pp. A1, A6. 12. Simon Romero and Seth Schiesel, “Hubris and the Fall of a Telecommunications Empire,” The New York Times (March 3, 2004), p. C1. 15. Jamie Dimon, “America’s Traditional Strengths Will Win Out,” Fortune (May 4, 2009), p. 66. 16. This section is based on Donald G. Zauderer, “Integrity: An Essential Executive Quality,” Business Forum (Fall, 1992), pp. 12–16. 18. Patricia Wallington, “Honestly?!” CIO (March 15, 2003), pp. 41–42. 19. Carly Fiorina, “Corporate Leadership and the Crisis,” The Wall Street Journal (December 12, 2008), p. A19. 20. Al Gini, “Moral Leadership and Business Ethics,” The Journal of Leadership Studies 4, no. 4 (Fall 1997), pp. 64–81. 21. Henry Ford, Sr., quoted by Thomas Donaldson, Corporations and Morality (Upper Saddle River, NJ: Prentice Hall, 1982), p. 57. 23. J. Lynn Lynsford, “Piloting Boeing’s New Course,” The Wall Street Journal (June 13, 2006), pp. B1, B3; and Kathryn Kranhold, “U.S. Firms Raise Ethics Focus,” The Wall Street Journal (November 28, 2005), p. B4. 24. Joseph Weber, “The New Ethics Enforcers,” BusinessWeek (February 13, 2006), pp. 76–77. 25. Jere Longman, “Alabama Fires Coach for Off-Field Indiscretions,” The New York Times (May 4, 2003), Section 8, 1. 27. Curtis C. Verschoor and Elizabeth A. Murphy, “The Financial Performance of Large U.S. Firms and Those with Global Prominence: How Do the Best Corporate Citizens Rate?” Business and Society Review 107, no. 3 (Fall 2002), pp. 371–381. 28. Phred Dvorak, “Finding the Best Measure of ‘Corporate Citizenship,’” The Wall Street Journal (July 2, 2007), p. B3. 29. Donald G. Zauderer, “Integrity: An Essential Executive Quality,” Business Forum (Fall 1992), pp. 12–16. 30. James M. Kouzes and Barry Z. Posner, Credibility: How Leaders Gain and Lose It, Why People Demand It (San Francisco: Jossey-Bass, 1993), p. 255. 31. Viktor E. Frankl, Man’s Search for Meaning (New York: Pocket Books, 1959), p. 104. 33. Tom Morris, If Aristotle Ran General Motors (New York: Henry Holt, 1997). 34. J. R. Rest, D. Narvaez, M. J. Bebeau, and S. J. Thoma, Postconventional Moral Thinking: A Neo-Kohlbergian Approach (Mahwah, NJ: Lawrence Erlbaum, 1999). 35. James Weber, “Exploring the Relationship Between Personal Values and Moral Reasoning,” Human Relations 46, no. 4 (April 1993), pp. 435–463. 39. Lawrence G. Foster, Robert Wood Johnson—The Gentleman Rebel (Lemont, PA: Lillian Press, 1999); and John Cunniff, “Businessman’s Honesty, Integrity Lesson for Today,” Johnson City Press (May 28, 2000). 40. Sen Sendjaya and James C. Sarros, “Servant Leadership: Its Origin, Development, and Application in Organizations,” Journal of Leadership and Organizational Studies 9, no. 2 (2002), pp. 57–64. 42. Robert Townsend, “Leader at Work,” Across the Board (January 2001), pp. 13–14. 43. Corey Dade, “Changing Pilots; After Delta’s Recovery, New Turbulence Stirs,” The Wall Street Journal (October 4, 2007), p. A1; and Claudia Deutsch, “Volunteering Abroad to Climb at I.B.M.,” The New York Times (March 26, 2008), p. C4. 45. Robert K. Greenleaf, Servant Leadership: A Journey into the Nature of Legitimate Power and Greatness (Mahwah, NJ: Paulist Press, 1977), p. 7. 48. John McCain, “In Search of Courage,” Fast Company (September 2004), pp. 53–56. 49. Richard L. Daft and Robert H. Lengel, Fusion Leadership: Unlocking the Subtle Forces That Change People and Organizations (San Francisco: Berrett-Koehler, 1998).