The ethics of leadership

If your most unhappy customers are your greatest source of learning, so too are the consequences of a tough call. Ethics and decision making are an essential part of business. But what exactly are the ethics of leadership, and what does it mean in the daily running of your business? As a business owner, you have to be willing to do things others are unwilling to do and put yourself on the line when confronted with decisions involving customers, employees, your organization’s values and make tough calls that demand risk when risk and reward aren’t clear cut.

When faced with ambiguity, how do you handle ‘grey area’ decision making?

What do you do with a tenured employee who has been with you from day one but now doesn’t fit? The employee, for example, may not be adapting to the speed of work or new technologies that have changed task processes.

What do you do when a customer threatens to cancel a contract if you change their account manager, but you know you need to make the switch? Or if a client has received another bid that is too low for you to make money on, and you are given a choice to match the price or lose the job? How about deciding between keeping and firing your best salesperson even though they are toxic to morale?

Some issues require immediate action. Others are less time-sensitive but more emotional — these are the ones that do the most damage to a company. In the case of a long-term employee who is no longer able to do his job but is given what is perceived as special treatment, the longer the decision lingers, the more it undermines team harmony.

Tough calls are not made without personal cost: you may get criticized, it may cost you relationships and you may be unpopular. But if you’re a leader or want to become one, tough calls are part of your job.

Take charge of the emotions that accompany important decisions and structure the decision around facts and key issues. Seek counsel and perspective from your inner circle, trusted advisors or peer group to get options. To make the process a little easier, make your decisions based on principles you believe in.

When making difficult decisions, I consider the following:

• Treat all employees honestly and fairly. Give regular feedback on their performance as team members.

• You can’t make money on a job you don’t have; all business you pursue or have must be profitable.

• Listen to your customers but do what is best for your business and customer base as a whole. We cannot be everything to everybody.

• Be aware of your competition, but do not copy them. Take what you admire and improve on it. Determine your own direction and let your customers’ needs and goals guide your approach.

• Treat your customer’s money as if it were your own.

There is no right way to make the right decision, but once you commit to the path, do not waffle. Take action, learn from the experience, take responsibility for the outcomes, ignore criticism if it gets in the way of your principles and move on.

Being decisive will define your leadership; if you do it well, it will take your leadership to a higher level. Be guided by values and be conscious of them when making the call. Think about the tough decisions you’ve had to make in the past and think about how guiding principles could have made the process easier. It will help you develop the best practices you need to have to make the best possible decision next time you need to make it.

Words of Wilson features a rotating panel of consultants from Wilson360, a landscape consulting firm. Bruce Wilson is founder and chairman of Wilson360 (formerly Bruce Wilson & Co.) He can be reached at bruce@wilson-360.com