Copyright © 2015 McGraw-Hill Education All rights reserved No reproduction or distribution without the prior written consent of McGraw-Hill Education 5-1 Chapter Values, Ethics, and Character “Leadership cannot just go along to get along… Leadership must meet the moral challenge of the day.” ~Jesse Jackson 5-2 Introduction • Leaders can use power for good or ill will • A leader’s personal values and ethical code may be the most important determinants of how a leader exercises available power sources • Recent scandals involving political, business, and religious figures highlight the need to consider values and ethics in terms of leadership • Scholarly and popular literature have turned greater attention to the question of ethical leadership 5-3 Leadership and “Doing the Right Things” • Leaders face dilemmas that require choices between competing sets of values and priorities • Leaders set a moral example that becomes the model for an entire group or organization • Leaders should internalize a strong set of ethics—principles of right conduct or a system of moral values • Gardner and Burns, Psychologists, stress the centrality and importance of the moral dimension of leadership 5-4 Leadership and “Doing the Right Things” (continued) • Four qualities of leadership engender trust: – – – – Vision Empathy Consistency Integrity • Two contrasting sets of assumptions people make about human nature: – Theory X asserts that most people need extrinsic motivation because they are not naturally motivated to work – Theory Y asserts that most people are intrinsically motivated by their work 5-5 Values • Values are “constructs representing generalized behaviors or states of affairs that are considered by the individual to be important.” • Values are learned through socialization, become internalized, and affect behavior • People in an organization vary in the relative importance they place on values – Instrumental values refer to modes of behavior (being helpful, being responsible) – Terminal values refer to desired end states (family security, social recognition) 5-6 Values (continued) • Pervasive influences of broad forces at a particular time tend to create common value systems – This may contribute to misunderstandings and tension during interactions between older leaders and younger followers • Each generation is molded by distinctive experiences at their critical developmental periods – – – – The Veterans (1922–1943) The Baby Boomers (1942–1960) The Gen Xers (1961–1981) Millennials (1982–2005) 5-7 Values (continued) • Gen Xers have a clearly different view of authority than previous generations – Leadership is viewed as removing obstacles and giving followers what they need to work – Leaders must “earn their stripes” rather than advance by seniority • Research has found little evidence of a generation gap in basic values • Studies show that Boomers, Xers, and Milliennials in the managerial workforce are more similar than different in their views of organizational leadership 5-8 Moral Reasoning and Character-Based Leadership • An important consideration is how people think and act concerning matters of right and wrong • Moral reasoning is the process leaders use to make decisions about ethical and unethical behaviors i.e the manner by which they solve moral dilemmas • Value differences often result in different judgments regarding ethical and unethical behavior • Not everyone fully develops their moral judgment 5-9 Moral Reasoning and Character-Based Leadership (continued) • Unconscious biases may affect moral judgments, which is why many organizations are developing programs to develop moral decisionmaking competence among leaders • Effectiveness of such programs depends on understanding the moral decision-making process, which is complex • Greene suggests a dual-process theory of moral judgment – Moral judgments dealing with rights or duties are made by automatic emotional responses while those made on a utilitarian basis are made more cognitively 5-10 Moral Reasoning and Character-Based Leadership (continued) • A common but challenging ethical dilemma involves choosing between two “rights.” • Kidder identified four common ethical dilemmas – Truth vs Loyalty – honestly answering a question that may compromise confidentiality – Individual vs Community –compromising the rights of an individual for the good of the community – Short-term vs Long-term – balancing spending time with family against making career investments for future benefits – Justice vs Mercy –excusing a person’s behavior due to extenuating circumstances or convicting to teach a lesson 5-11 Moral Reasoning and Character-Based Leadership (continued) • Kidder offers three principles for resolving ethical dilemmas – Ends-based thinking – “Do what’s best for the greatest number of people.” It is also known as utilitarianism – Rule-based thinking – It is consistent with Kantian philosophy and is characterized as “following the highest principle or duty.” – Care-based thinking – “Do what you want others to to you.” It is similar to the Golden Rule of conduct common in some form to many world religions 5-12 Moral Reasoning and Character-Based Leadership (continued) • Research has identified biases that affect our moral decision making – Implicit prejudice refers to subconscious prejudices that affect our decisions without us being aware of them – In-group favoritism involves doing acts of kindness and favors for those who are like us – Overclaiming credit involves overrating the quality of our own work and contributions – Conflicts of interest adversely impact ethical judgments and bias our perceptions of situations 5-13 Moral Reasoning and Character-Based Leadership (continued) • When people behave badly, they use the following methods to interpret their behavior in a self-protective way – Moral justification – Euphemistic labeling – Advantageous comparison – Displacement or diffusion of responsibility – Disregard or distortion of consequences – Dehumanization – Attribution of blame 5-14 Moral Reasoning and Character-Based Leadership (continued) • Moral potency has three key components – Moral ownership is a felt sense of responsibility not only for the ethical nature of one’s own behavior but also for one’s commitment not to allow unethical things to happen within one’s broader sphere of influence – Moral courage refers to the fortitude to face risk and overcome fears associated with taking ethical action – Moral efficacy is the confidence in one’s capability to mobilize personal, interpersonal, and other external resources to persist despite moral adversity 5-15 Character-Based Approaches to Leadership (continued) • Avolio asserts that there are two components of ethical leadership – The moral person is a principled decision maker who cares about people and the broader society – The moral manager makes ethics an explicit part of the leadership agenda by communicating messages of ethics and values and by modeling ethical behavior • There is new interest in leadership approaches that are based on the interdependence between effective leadership and certain value systems – Authentic leadership – Servant leadership 5-16 Character-Based Approaches to Leadership (continued) • Authentic leadership is based on the notion of “to thine own self be true.” • Authentic leaders are self-aware and selfconsciously align their actions with their inner values • The study of authentic leadership has gained momentum because of the following beliefs: – Enhancing self-awareness can help people in organizations find more meaning at work – Promoting transparency and openness in relationships builds trust and commitment – Fostering more inclusive structures and practices can help build more positive ethical climates 5-17 Character-Based Approaches to Leadership (continued) • Servant leadership views serving others to be the leader’s role • Ten characteristics describe servant leaders: 10 Listening Empathy Healing Awareness Persuasion Conceptualization Foresight Stewardship Commitment to others’ growth Building community 5-18 The Roles of Ethics and Values in Organizational Leadership • The top leadership’s collective values play a significant role in determining the dominant values throughout the organization • Many of the most difficult decisions made by leaders are choices between opposing values • A leader must set a personal example of valuesbased leadership and ensure that clear values guide everyone’s behavior in an organization 5-19 Leading by Example: the Good, the Bad, and the Ugly • One of the most quoted principles of good leadership is “leadership by example.” • Research shows that ethical role models are characterized by four general categories of attitudes and behaviors: – Interpersonal behaviors: show care, concern, and compassion for others – Basic fairness: show fairness to others – Ethical actions and self-expectations: hold themselves to high ethical standards – Articulating ethical standards: articulate a consistent ethical vision and are uncompromising toward it 5-20 Leading by Example: the Good, the Bad, and the Ugly (continued) • Upward ethical leadership involves individuals showing leadership by taking actions to uphold ethical standards when higher-ups misbehave • The general quality of an organization’s ethical climate affects whether or not employees raise ethical concerns – In ethical climates, ethical standards/norms are consistently and clearly communicated, embraced, and enforced by organizational leaders – In unethical climates, unethical behavior exists with little corrective action, and misbehavior may even be condoned 5-21 Creating and Sustaining an Ethical Climate • Five “fronts” of leadership action are required to create an ethical climate Formal ethics policies and procedures – formal statements of ethical standards/policies, reporting mechanisms, disciplinary procedures, and penalties Core ideology – organization’s purpose, guiding principles, basic identity, and most important values Integrity – core ideology is congruent with all public and private actions throughout the organization Structural reinforcement – organization’s structure and systems encourage higher ethical performance and discourage unethical performance Process focus – how goals are achieved is as important as achievement 5-22 Creating and Sustaining an Ethical Climate (continued) • Principle–centered leadership asserts a fundamental interdependence between the personal, interpersonal, managerial, and organizational levels of leadership – Personal: Be a trustworthy person in terms of both character and competence – Interpersonal: A lack of trust leads to self-protective efforts to control and verify each other’s behavior – Managerial: Empowering others requires a trusting relationship, team building, delegation, communication, negotiation, and self-management – Organizational: Creativity requires that the organization’s structure, systems (training, reward, communication), strategy, and vision be aligned and mutually supportive 5-23 Summary • There is a relationship between ethics, values and leadership • It is not just the content of what one believes is right and wrong, but how one makes moral or ethical judgments • Ethical dilemmas often involve a choice between two “rights” rather than right and wrong • Recent research has explored the interdependencies between effective leadership and particular value systems 5-24 ... Leading by Example: the Good, the Bad, and the Ugly • One of the most quoted principles of good leadership is leadership by example.” • Research shows that ethical role models are characterized by. .. Authentic leaders are self-aware and selfconsciously align their actions with their inner values • The study of authentic leadership has gained momentum because of the following beliefs: – Enhancing. .. explicit part of the leadership agenda by communicating messages of ethics and values and by modeling ethical behavior • There is new interest in leadership approaches that are based on the interdependence