Have leaders lost their moral compass?

With corporate scandals seemingly as predictable as annual reports, we hear a great deal in the business media about loss of values and the accompanying lack of leadership in the corporate world. Some experts argue that the moral compass of business leaders is no longer pointing true north.

I am deeply concerned by this state of affairs and, like many others, have thought about how it came to be. Although certainly greed played a role, I think that a more pervasive problem is an unwillingness or inability on the part of senior leaders to hear the views of others. On the way to the corner office, they have come to believe that they should know all the answers. But in today’s world, in which businesses must make complex decisions in the face of incomplete information and a rapidly changing landscape, no one can do it alone. Meaningful collaboration is the key to success.

I’m heartened that the educational institutions that are training the next generation of business leaders are revamping their curricula and teaching methods to bolster collaboration, intellectual honesty and ethical decision-making.

Concerned by the Madoff and other scandals and the near-collapse of the global financial system, business schools such as Stanford, Berkeley, Columbia, Harvard and Wharton have taken a hard look at whether they inadvertently have contributed to the moral bankruptcy evident in segments of the business world.

For example, Harvard has changed its MBA program to provide more real-world experience and stress self-reflection, hands-on learning and teamwork. The new approach is intended to help students develop their listening, communication and feedback skills, creating “leaders of competence and character, rather that just connections and credentials,” Chief Marketing Officer Brian Kenny told the Wall Street Journal.

As a leader, you can take a number of actions to bring the conversations out in the open. By eliciting what’s on people’s minds through confidential surveys, focus groups, individual interviews or company-wide meetings, you will begin to hear difficult truths. When you publicly acknowledge that you’ve gotten the message — “you think I make too much money,” “you say you want input but then you ignore it” — you give permission for people to speak up.

The MBA program will minimize reliance on the traditional case study method, which may have inadvertently discouraged collaboration by teaching students to strongly defend their point of view, rather than incorporate the views of others into their solutions.

As David Garvin, a professor of business administration at Harvard Business School, argued in a 2003 review of teaching methods at the university, few students change their minds in the course of a case study discussion. “If anything, positions tend to harden as debate continues. Skilled managers, by contrast, try to stay flexible, altering their positions as new evidence and arguments emerge,” he wrote.

In a world in which whole industries can change in a heartbeat, leaders with varying backgrounds and perspectives must listen to all the voices in the room to make good decisions. This is especially important when the messages are difficult to hear. The way senior leaders interact with one another sends a loud signal to the rest of the company about what behaviors are needed to be successful.

I applaud the recognition among business schools that to be great leaders, students must learn how to collaborate effectively and set their ethical compass in the right direction.

To learn more, please contact Susan Lucia Annunzio at the Center for High Performance.