Inspiring Ethics: Designing More Moral Leaders, Kreps Symposium 2025
By Stanford Graduate School of Business
BusinessEducationLeadership
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Key Concepts
- Inspiring vs. Infuriating Leadership
- Visionary, Exemplar, Mentor (VEM) Framework
- Fundamental Human Needs (Meaning, Passion/Protection, Belonging/Status)
- Leader Amplification Effect
- Ethical Architecture (Channel Design)
- Reap (Reflect, Emulate, Intend, Practice)
1. Introduction: The Dichotomy of Leadership
- The lecture begins with contrasting stories of two captains facing crises:
- Tammy Joe Schultz (Southwest Airlines 1380): Calmly and competently landed a damaged plane, prioritizing passenger safety and exhibiting remarkable composure. Her focus was on the well-being of others, and her actions inspired hope.
- Francesco Schettino (Costa Concordia): Acted selfishly, abandoning ship and passengers, attempting to deflect blame, and prioritizing self-preservation. His actions led to imprisonment for dereliction of duty.
- These contrasting examples illustrate a fundamental dichotomy in leadership: inspiring versus infuriating.
2. The VEM Model: Three Universal Factors of Inspiring Leadership
- Big Idea 1: Inspiring and infuriating leaders exist on an enduring continuum defined by three universal factors: Visionary, Exemplar, and Mentor.
- Visionary: How leaders see the world (optimistic, big-picture, focused on "why").
- Exemplar: How leaders act in the world (calm, courageous, authentically passionate).
- Mentor: How leaders interact with others (empathetic, elevating, empowering).
- These factors are universal, appearing consistently across cultures and contexts.
3. Meeting Fundamental Human Needs
- Big Idea 2: The VEM factors are universal because they each satisfy a fundamental human need:
- Visionary: Meets the need for meaning and understanding.
- Exemplar: Meets the need for passion and protection.
- Mentor: Meets the need for belonging and status.
4. Deep Dive into Each Factor
4.1. Visionary
- Being visionary involves having a big-picture, meaningful, optimistic "why."
- Example: Reflecting on personal values to create a sense of meaning and understanding.
- Study: A Swiss employment agency study showed that unemployed individuals who reflected on their values were twice as likely to find a job within two months. This saved the agency tens of thousands of dollars.
- Teaching Lesson 1: The power of personal reflections in generating ideas and possibilities.
4.2. Exemplar
- Being an exemplar means exemplifying the vision, avoiding hypocrisy, and demonstrating calm courage.
- Examples:
- Bubalina and George Washington: Both leaders positioned themselves at the forefront, taking on the most risk to protect others.
- Passion Exercise: Participants paired up to discuss a passion, demonstrating how authentic passion is contagious and inspiring.
- Research: A study analyzing "Dragon's Den" (Shark Tank) showed that a one standard deviation increase in expressed passion led to a 40% higher likelihood of securing funding.
- Priming Power: Thinking about times when one felt powerful and in control can boost confidence and performance.
- Study: Research demonstrated that priming power improves interview outcomes.
4.3. Mentor
- Being a mentor involves treating people like people, not objects.
- Quote: "Tell me and I will forget, show me and I may remember, but involve me and I will truly understand" - Confucius
- Inspiring leaders involve others, share credit, and take responsibility, while infuriating leaders micromanage, steal credit, and deflect blame.
- Perspective Taking: Putting oneself in another's shoes to understand their perspective.
- Study: A study with medical students showed that those who practiced perspective-taking were rated as more trustworthy by patients, leading to increased patient satisfaction and adherence to treatment.
- Downward Learning: Learning from those with less power.
- Study: Research showed that mentors who engaged in downward learning were rated higher on engagement and empathy by their mentees.
5. Real-World Examples of VEM in Action
- CEO During Financial Crisis (2009): Demonstrated visionary leadership by prioritizing employees, exemplifying calm courage, and acting as a mentor by sacrificing the most and patiently answering questions.
- Dean Responding to False Accusation: Emphasized integrity (visionary), authentically expressed feelings (exemplar), and initiated an investigation to support the accused colleague (mentor).
6. Leadership Development: Inspiring Leaders Can Be Made
- Big Idea 4: Inspiring leaders are not just born; they can be developed through practice and nurturing of the VEM attributes.
- Individuals can become more visionary by being optimistic and simplifying communication, more exemplary by cultivating calm and passion, and more mentoring by empowering and empathizing with others.
- Teaching Lesson 2: The power of comparative analysis (e.g., moral courage vs. cowardice) to deepen learning and understanding.
- Teaching Lesson 3: The power of exercises and small group discussions to facilitate reflection and learning.
7. The Leader Amplification Effect
- Big Idea 5: As a leader, neutrality is not an option. The leader amplification effect states that everything a leader does (verbal and non-verbal, positive and negative) is amplified.
- Emotions are contagious, especially from leaders. Courage inspires courage, while anxiety breeds anxiety.
- Examples:
- Danny Kahneman: A casual negative comment had a deeply humiliating impact, while a brief positive comment had an overwhelmingly positive effect.
- Barry Salsberg (Global Deloitte CEO): A slight enthusiasm for bananas led to bananas being present at every meeting.
- Professor's Request to Meet: A simple request to meet caused significant anxiety due to the power dynamic.
- Solution: Self-awareness and perspective-taking are crucial for understanding and managing the impact of one's actions as a leader.
8. Ethical Architecture: Designing for Inspiration
- Big Idea 6: Think like an architect to design policies, practices, and processes that guide people towards inspiration.
- This involves opening the right channels and closing off the wrong channels.
- Example: Odysseus tying himself to the mast and plugging his crew's ears to resist the sirens' song.
- Casino Design: Casinos strategically manipulate the environment to encourage gambling (e.g., no clocks, maze-like layout).
- Organ Donation (Opt-in vs. Opt-out): Opt-out systems increase participation but can feel manipulative. Opt-in systems ensure quality participation but may result in lower overall numbers.
- Tools vs. Weapons: The same tool (e.g., a knife) can be used for inspiring or infuriating purposes depending on the intent.
- Examples of Architectural Failures:
- Kravis Hall (Columbia Business School): Placing espresso machines on every floor reduced spontaneous interaction.
- Google Cafeteria: The cafeteria's success lies in being a central hub, not a ubiquitous perk.
- The Vessel (Hudson Yards): Lack of psychological consideration led to suicides and closure.
- Personal Example: Redesigning the school drop-off routine to accommodate both children's needs.
9. Reap What You Sow (REIP)
- Big Idea 7: The energy we put out into the world is what comes back to us.
- REIP (Reflect, Emulate, Intend, Practice):
- Reflect: On experiences (inspiring and infuriating).
- Emulate: Learn from inspiring figures.
- Intend: Set intentions based on reflections and emulation.
- Practice: Consistently apply these intentions.
- Example: Joseph Stiglianiano sending personalized birthday messages to every employee.
- CEO Sending Notes of Praise: A CEO started sending daily notes of praise or gratitude, which not only inspired employees but also brought joy to the CEO.
10. Conclusion: The Power of Small Actions
- The lecture concludes by emphasizing the power of small, consistent actions to create a more inspiring world.
- By focusing on what one small mitzvah can be done each day, individuals can create a ripple effect of positivity and inspiration.
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