Leading with Values: Positivity, Virtue, and High Performance by Edward D. Hess – A Summary

Introduction

Edward D. Hess’s book, “Leading with Values: Positivity, Virtue, and High Performance,” delves deeply into the intersection of ethical behavior and leadership efficacy. Published in 2005, this work stands out in the ethical leadership genre by advocating for a leadership style grounded in positive values and virtues. The book is structured to provide both theoretical insights and practical advice, highlighting how ethical virtues can create high-performance environments. Below, we summarize the key points of the book, supported by concrete examples and actionable steps for leaders.

Hess begins by establishing the core premise that ethical leadership is the bedrock of sustainable success. He posits that leaders who are grounded in positive values and virtues pave the way for organizational trust, loyalty, and high performance.

Concrete Example: Hess highlights the case of Johnson & Johnson’s 1982 Tylenol crisis. The company’s swift, value-driven response to recall 31 million bottles of Tylenol, valuing consumer safety above profits, reinforced its commitment to integrity and earned long-term trust and loyalty.

Actionable Step: Leaders should begin by articulating and committing to a set of core values. Regularly communicate these values and incorporate them into decision-making processes.

Central to Hess’s thesis is the creation of an organizational culture that embodies ethical values. He underscores the importance of leaders modeling ethical behavior and fostering an environment where these values are celebrated and enforced.

Concrete Example: Hess cites the example of Southwest Airlines, where a culture of mutual respect and valuing employees’ well-being has led to not only high morale but also strong financial performance. Herb Kelleher, the former CEO, was known for keeping promises and treating employees fairly, thereby setting a powerful example.

Actionable Step: Leaders should take deliberate actions to model ethical behavior, such as transparency in communications and fairness in decision-making. Introducing regular training programs on ethical practices can reinforce the desired culture.

Hess leverages the principles of positive psychology to reveal how fostering a positive outlook within the organization can lead to improved employee performance and satisfaction. He suggests that positive reinforcement can amplify moral behavior.

Concrete Example: He references the case of Zappos, where a positive work environment and focus on employee happiness resulted in exceptional customer service and business success. The company’s “happiness framework” included incentives for employees to be happy at work, including a structured path to personal and career growth.

Actionable Step: Develop structured programs that recognize and reward ethical behavior and positive contributions. Leaders should practice positive reinforcement to motivate employees, such as public recognition of exemplary conduct and ethical decision-making.

Hess argues that virtues such as honesty, humility, and courage are not innate and can be cultivated through intentional practice. He outlines practical methods for leaders to develop these virtues.

Concrete Example: In the book, Hess points to the leadership style of Warren Buffett, who embodies humility and honesty. Buffett is known for his straightforward communication and candidness about mistakes, which has earned him considerable respect and trust from stakeholders.

Actionable Step: Leaders can incorporate reflective practices to develop personal virtues, such as journaling about ethical dilemmas and their resolutions, or seeking feedback from peers on their leadership behaviors.

The correlation between ethical leadership and organizational performance is explored through multiple lenses. Hess reveals that ethical organizations tend to outperform their counterparts because they build sustainable relationships with stakeholders, enjoy higher employee engagement, and minimize risks associated with unethical behavior.

Concrete Example: The book discusses the success of The Container Store, where a strong ethical foundation and a commitment to employee well-being have driven superior sales performance and customer satisfaction. The CEO, Kip Tindell, attributes their success to their unwavering commitment to their employees and customers.

Actionable Step: Implement systems to regularly measure employee engagement and satisfaction. Use these metrics to adjust policies and practices, ensuring they align with the company’s ethical commitments.

Effective decision-making is a critical component of leadership, and Hess advocates for decisions grounded in ethical considerations. He introduces frameworks to help leaders evaluate the ethical implications of their choices.

Concrete Example: Hess describes the decision-making process at Patagonia, an outdoor apparel company known for its ethical stance on environmental issues. When faced with a decision about suppliers, Patagonia rigorously evaluated their environmental and labor practices, opting only for those that met their high ethical standards.

Actionable Step: Leaders should adopt ethical decision-making frameworks such as “The Five Question Approach” which includes considerations like the impact on stakeholders and alignment with core values. Incorporate these frameworks into regular decision-making processes.

Emotional intelligence (EI) is identified as a crucial trait for ethical leaders. Hess details how EI enhances leaders’ ability to navigate complex interpersonal dynamics and maintain integrity under pressure.

Concrete Example: The book highlights the leadership of Mary Barra at General Motors, who effectively utilized emotional intelligence by demonstrating empathy and accountability in the aftermath of vehicle recalls, rebuilding trust among consumers and employees.

Actionable Step: Leaders can develop emotional intelligence through training programs focusing on self-awareness, empathy, and relationship management. Regular, constructive feedback sessions can also help leaders enhance their EI.

Crises test the moral fiber of leadership. Hess underscores how maintaining ethical standards during turbulent times not only preserves trust but also can be a defining moment for an organization.

Concrete Example: Hess revisits the Tylenol crisis to illustrate how ethical leadership during a crisis can prevent greater damage and solidify an organization’s reputation. Johnson & Johnson’s proactive and transparent approach served as a benchmark in crisis management.

Actionable Step: Develop a crisis management plan that incorporates ethical guidelines. Train crisis response teams to prioritize ethical considerations and maintain transparency with all stakeholders.

Hess concludes by emphasizing the long-term advantages of leading with values. Ethical leadership not only ensures compliance with regulations but also builds a resilient brand that can withstand market fluctuations.

Concrete Example: Starbucks is mentioned for its sustained commitment to ethical sourcing and community engagement. Despite economic ups and downs, their consistent ethical practices have kept them at the forefront of consumer trust.

Actionable Step: Commit to long-term planning that integrates ethical considerations. Regularly review and update policies to ensure they meet evolving ethical standards and communicate the long-term vision to all stakeholders.

Conclusion

Edward D. Hess’s “Leading with Values: Positivity, Virtue, and High Performance” offers a comprehensive guide for leaders aiming to create high-performing organizations through the lens of ethical leadership. Its rich blend of theory, examples, and actionable advice makes it an essential read for anyone in a leadership role striving to inspire trust, loyalty, and exceptional performance through unwavering commitment to ethical values.