Emerging leaders of any age need all sorts of skills to navigate today’s business environment, and educators play a vital role in that development. So, in honor of National Teachers’ Day, my friend Lorna Christoff, faculty member at the Leeds School of Business at the University of Colorado and instructor of a course called Leadership Challenges: Exercises in Moral Courage, agreed to share some challenging thoughts on one of the most important lessons all leaders need – how to incorporate values into their front-line decision-making. – Walt Rakowich
by Lorna Christoff
“It’s nothing personal; it’s just business.” It might be only one sentence, but it’s really an attempt to rationalize an uncountable number of questionable behaviors.
Think about it; have you ever heard people say this when they’re proud of what they’re doing? When they have no reason to believe others might be harmed by what they’re doing? Of course not, because then there would be no reason to say it. When someone tells you “It’s nothing personal; it’s just business,” he or she knows you might object to how you are being treated or to the result of the interaction. That person wants you to excuse what is going on by ignoring his or her own choice to behave in that way, as if the business had made the decision instead of that person.
The idea that the personal, the human, the personhood could be disassociated from business actions is a fallacy. People choose what actions businesses take and avoid taking; the business is inanimate. Managers cannot cast aside their humanness and become automatons when they make decisions on behalf of the company, just as the person who tells you their actions are “just business” cannot. Decision-makers at all levels of an organization cannot avoid bringing their personal beliefs and values to work with them – nor should they.
In a world of increasing technological capability and nearly real-time information flow to stakeholders through social media and news feeds, more and more of businesses’ actions (and inactions) become known widely and quickly. People important to companies’ financial success have much more ability than they have in the past to evaluate how well companies’ actions and decisions align with stakeholder values and beliefs, whether it be through annual Sustainability Reports, social media, or other sources.
Stakeholder ire over company actions they believe to be wrong can result in considerable financial harm to the company. For example, the next day in 2017 after the video of the United Airlines passenger being forcibly removed from a plane went viral, the company’s market cap fell by nearly $1.4 billion. On the other side of the same coin, creating trust in businesses to act in a manner that avoids violating its stakeholders’ values and beliefs can have “tangible, bottom line benefits” for that business.
Whether decision-makers intend to mitigate risk, prevent stakeholder pressure, reduce costs, maintain or create brand equity and customer loyalty, or otherwise create shareholder value, they can improve the odds of success by (1) understanding the values and beliefs of stakeholders and (2) using their personal moral compasses intentionally as they make decisions on behalf of their companies rather than attempting to make decisions that are “just business.”
Some business schools are preparing our students to lead this way, to make financially sound decisions through the lens of their own moral compasses and those of their stakeholders. At the University of Colorado’s Leeds School of Business, I teach a course called Leadership Challenges: Exercises in Moral Courage. The class is a culminating experience in the undergraduate curriculum that requires students to utilize their own values and consider stakeholder values in order to make and justify recommendations to high-level executives on how those executives should resolve ethical dilemmas they have faced in their careers. Students have multiple opportunities to iterate and test-drive how they will make tough choices that will inevitably face them as they progress through their careers and achieve increasing levels of responsibility in their organizations.
Preparation in classes such as mine – where future business leaders can hone their skills in making strategic business decisions that are neither “just business” nor just “personal” but instead incorporate their own morals, stakeholder trust, and financial gain – are critical for students. We educators (and by extension, society) must make our future business leaders ready to lead in a world where the personal beliefs of stakeholders can impact profitability. We must equip students to run companies in a manner that is not only personal, but also good business.
Lorna Christoff is a faculty member in the Leeds School of Business at the University of Colorado at Boulder. She has an undergraduate degree in international business from Colorado University-Boulder and a law degree from the University of Denver. In addition to her work in academia, she has owned and managed a real estate investment company and worked in residential mortgages, mutual and hedge funds, and consumer banking. You can reach her at firstname.lastname@example.org.