Struggling With a Big Management Decision? Start by Asking What Really Matters

Business leaders face a wide variety of difficult decisions: whether their companies should stay small or go big, whether layoffs are necessary for survival, whether a proposed partnership is a good idea or a recipe for disaster.

When faced with difficult decisions, it can be tough for leaders to cut through all the questions that inevitably run through their heads so they can instinctively choose the right path. The best way to tackle a tough call: Start by defining on a personal level what is right, says Harvard Business School Professor Joseph L. Badaracco, author of the recently published book Your True Moral Compass: Defining Reality, Responsibility, and Practicality in Your Leadership Moments.

In the following excerpt from the book, Badaracco, the John Shad Professor of Business Ethics, explains why it’s important for leaders to ask themselves four fundamental questions to help them make smart decisions.

Excerpt from Chapter 1: Personal Moral Wisdom

The Fundamental, Inevitable Questions

My conclusion, after three years of research and interviewing, is that our moral compasses – like our consciences, our values, and our judgment—are a deep and complex facet of our humanity. They express what I came to call our personal moral wisdom. This is our personal judgment about what really matters in a situation, what is responsible, and what is possible and practical. For well or ill, when we make a final decision in a tough situation, we are relying on our personal moral wisdom. This is our true moral compass.

Early in this project, I interviewed two former CEOs, and both turned out to be avid sailors. For them, a compass was a sophisticated, computerized instrument that was critical when they sailed through treacherous waters, dense fog, or powerful winds. These compasses don’t operate automatically. Using them well requires attention, skill, experience, and judgment – as does our personal moral wisdom.

“Your true moral compass is your way of making sense of the world.”

It is natural to be skeptical about the notion of personal moral wisdom. At first, it can sound like yet another vague, inspirational phrase. But personal moral wisdom is a powerful, unorthodox, almost radical idea. It says that the right decision in leadership moments is what you finally decide is right. But this decision isn’t automatic, intuitive, or even correct. Your personal moral wisdom doesn’t resemble a simple compass that reliably points to magnetic north. It doesn’t show you what is right. Its crucial role is helping you decide what is right.

Your true moral compass is your way of making sense of the world. It is your personal way of discerning what really matters, what is responsible, and what is pragmatically wise when you face a hard, complex decision. In short, it is the lens through which you define reality, responsibility, and practicality in your leadership moments.

When you rely on your personal moral wisdom, you are inevitably answering four fundamental questions ­– and you are answering these questions personally. This book shows how important and challenging these questions are, but they can be stated simply and succinctly:

  1. What really matters?
  2. What is my responsibility?
  3. What will work?
  4. What can I live with, as a person and a professional?

It is easy to think that the four questions are yet another of the many lists offered to managers for making decisions. But this badly underestimates their power and their importance.

These questions are the basic structure, the steel beams, of our personal moral wisdom. These are the questions we inevitably answer in our leadership moments. You can phrase the questions in different ways, you can answer them explicitly or implicitly, you can do this thoughtfully or negligently, but your final decisions about what is right always reflect your personal judgment about what matters, what is responsible, and what will work.

Published with permission by Springer.

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