This article was written with Jennifer Riel.
By the time people reach the most senior levels of a company, they are expected to have a degree of personal competence and a strong gut feel for making good executive decisions. Otherwise, they wouldn’t be considered for a top job. But how do they attain this acumen? At Procter & Gamble (P&G)—where we (A.G. Lafley and Roger Martin) served as chief executive and one of the senior advisors to the company, respectively—we developed a systematic approach to cultivating that skill among emerging and senior executives. We found that business literature contains a great deal of advice for chief executives about strategy and execution, but much less is written about how to become the kind of person who can bring the right judgment to bear on business decisions, especially when facing a disruptive environment. Thus, many CEOs develop their own form of on-the-job training, quietly honing their own heuristics for strategic thinking. That makes it difficult to tease out and develop the personal attributes that separate successful leaders from less-successful ones.
In our view, leaders would do well to take a more systematic approach to developing their decision-making capabilities. The place to start is where we started at P&G: with intellectual integrity. In common usage, the word integrity means honorable or virtuous behavior. For our purposes, though, we draw a distinction between exhibiting honorable behavior (moral integrity) and exhibiting discipline, clarity, and consistency so that all of one’s decisions fit together and reinforce one another (intellectual integrity).
In our work with companies, boards, and government agencies, we see people wrestle with the need to make tough choices—those critical decisions made in service of a relevant strategic goal for which there is no fully satisfactory option and every path seems to demand a trade-off. These are the kinds of decisions for which intellectual integrity is particularly vital.
Most people, including experienced executives, don’t like to make choices because it means giving up options. There is a clear temptation to hedge bets, to try to do everything, to attempt to keep all doors open at once by refusing to pick from among existing options or to work to create a better answer. Procter & Gamble was certainly not immune to this phenomenon. At certain times in the 1990s and 2000s, for instance, it was tempting to compete in as many markets as possible, as quickly as possible. Internally, there was a good deal of concern that competitors would make inroads into important emerging economies that P&G had not yet entered. But P&G couldn’t be everywhere at once and succeed. Judgments had to be made about which markets to enter, and in which ways. We explicitly chose to enter first those promising but underdeveloped markets where none of our global competitors had a preexisting advantage (for instance, China as it created special economic zones, Russia and eastern Europe after the fall of the Iron Curtain) and then to expand thoughtfully in other developing markets. For example, we entered many Asian countries with our baby-care products first, conscious that demographics suggested most of the world’s babies would be born in Asia for the foreseeable future. To fully engage in these countries, we had to defer or delay pursuit of other markets, in some cases indefinitely.
Intellectual integrity is the quality that enables a CEO (or any other organizational leader) to set these kinds of priorities, to articulate the rationale behind them, to stand behind them even when the outcomes are uncertain, and to provide the support that others need to stand behind those choices as well. Only a CEO with integrity can respond to the avoiding-choice temptation appropriately: “No, we can’t do everything. We must choose to do some things and not others. We just have to think harder and create the choice that is right for us.”