SwampFox

In a perfect world, there would be no need to emphasize how essential it is that a leader has impeccable integrity.

Submitted by: John Warner on Jun 30, 2009 at 9:00 am Tagged with: Leadership Source: Swamp Fox

Below is a chapter from Swamp Fox Insights: Innovation and Entrepreneurship in a Time of Profound Change, published in 2005 by John Warner and available at Amazon.com.

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Impeccable Integrity
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I am compelled to take a more impartial and unprejudiced view of things. Without claiming to be your superior, which I am not, my position enables me to understand my duty in all these matters better than you possibly can, and I hope you do not yet doubt my integrity.

Abraham Lincoln, in a letter to a friend who disagreed with his position, Lincoln on Leadership

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A leader's capacity to lead is directly tied to the personal credibility he has earned by adherence to high principles. The organization must believe that the leader puts the collective success of the organization ahead of his own personal gain. This is not to say that the leader should not benefit personally, but that the leader's gain should be a function of the organization's success.
Organizations without this leadership commitment are merely tyrannies that exist only so long as the leader can maintain his position by force, a very tenuous position in a market economy where people are free to choose.

In a perfect world, there would be no need to emphasize how essential it is that a leader has impeccable integrity. But unfortunately in the real world, leaders destroy promising careers by allowing small indiscretions to eat away at the essential trust they have with their constituents.
Essential elements of true success are honesty, integrity, professionalism, and hard work. People who do what they say they will do are highly valued. High integrity people have a high personal regard for others and seek out other high integrity people with whom to work.

Often the indiscretion - a bungled hotel burglary by lowly henchmen - could have been forgiven. But the cover ups - "I smoked but didn't inhale" - are assaults on the leader's integrity that take their toll, often without the leader realizing it. When times inevitably get hard and the leader must call on others to make bigger commitments, larger investments, or greater sacrifices, followers pause to decide if the leader can be trusted this time. The fates of companies as well as nations can hang in the balance.

Leaders too often self-destruct by allowing their integrity to disintegrate. A leader will face a small problem. Confident in his own ability to resolve the problem quickly, he cheats in a small way to cover up the problem. The fix doesn't come as soon as he expected and the slope he is on gets slipperier. By the time the situation spins out of control, the leader's lack of integrity is exposed and his ability to lead is gone.

A young entrepreneur led a start-up manufacturing company introducing an innovative superabsorbant gel to the market. At the time investors were conducting due diligence on his company, he had one customer, who repackaged his product into a retail package sold through garden shops. The product’s appearance was important to the customer. The lead investor traveled to Boston to meet in person with the customer. “I’ll invest in the company if you are going to buy the product,” was the due diligence query. “Well, I won’t commit to buying your capacity, but I will buy all I need from you,” was the good enough response.

The entrepreneur sent the first shipments to the customer, along with an invoice. For months, the receivable stayed on the books without being paid, with the investor growing increasingly agitated that the customer had broken his word. Finally, the investor felt time had come to seek a legal remedy, at least to collect the invoice. On the way home from an especially frustrating meeting with the company, the bookkeeper reached the investor on his cell phone and suggested he call the customer directly.

The story the customer related was eye opening. After the investment, the entrepreneur began running behind schedule and started to feel pressure to perform. Unfortunately, the early batches of product were brown, not white, as the customer expected. Low on cash, the entrepreneur shipped the product as it was, with no explanation to the customer. Already frustrated that the shipment was late, the customer was tremendously disappointed when the shipping containers were opened, and the product did not meet the customer’s specifications. The customer rejected the order and refused payment. Confronted by the investor with the facts, the entrepreneur conceded they were true. Trust broken, the entrepreneur’s capacity to lead the company ended.

Other times, a leader paints a rosy picture of the way things are that does not address the down side. After events turn out worse than expected several times, associates begin to perceive that either the leader is unrealistically optimistic, or worse, is intentionally misleading. They begin to feel the leader either knew or should have known of the problems. A historic line that resonated during Watergate was, “What did the President know, and when did he know it?” Constituents struggle to differentiate between gross negligence and fraud. The doubts about the leader deal a severe blow to his capacity to lead in the future.

Earle Morris was a former South Carolina Lieutenant Governor and Comptroller General, the state’s chief financial officer. At the end of his career, Earle became Chairman of a finance subsidiary of the public company HomeGold. The subsidiary failed, losing over a quarter of a billion dollars of the life savings of over 8,000 working class people, who placed their confidence in Earle because of his lifetime of public service. At his trial, former friends struggled to determine if this financial expert committed fraud or merely gross negligence as he testified that, despite huge borrowings and significant losses, he told investors the company was sound because that is what his superiors told him. The jury had little trouble convicting him, permanently tarnishing an otherwise long and commendable career as a public servant.

Some people are deceitful and for a time convincing at selling themselves, but ultimately are exposed for what they are. But more leaders who self-destruct are basically good people who destroy themselves over what in retrospect are plainly stupid decisions. When it happens, it is painful for those around them to watch. It is enough to cause every leader to be vigilant in protecting the most essential key to his leadership capacity - his integrity.

[In highly effective organizations] there is a harmony in relationships and a constructive conflict of ideas. There is a palpable unity as the people there implement their vision. There is a rhythm of innovation and renewal. There is a sense of urgency - movements are never casual. Alongside the normal tension of organized life, there is a high level of trust.

Max De Pree, Leading Without Power: Finding Hope in Serving Community