The Leadership Impact of Rationalizing Away Your Gut Instinct

I am spending some time on an island with my extended family and yesterday when I made my daily Dunkin’ Donuts run I ordered a coffee for my mom: a small coffee with skim milk. They accidentally put sugar in it and unfortunately I didn’t know this until I got home and my mom exclaimed, “I hate it when they put sugar in my coffee!”

When I went to Dunkin’ this morning I told the drive-thru woman about the mishap yesterday and without missing a beat she apologized profusely and took $1.39 off today’s tab. As a front-line employee she was empowered to do the right thing. As a loyal Dunkin’ customer I know this about their company. Their employees always rectify mistakes with a smile and an apology – which is part of what makes me a loyal customer in the first place!

Doing the Right Thing When Significant Money is at Stake

You might be thinking, “Lisa, this is easy to do when you’re talking about a $1.39 cup of coffee. In my business it’s not so easy.” My response to this is doing the right thing breeds loyalty and sends an important message to your entire company, which is worth a lot more in good will and profits over the long term!

For example, I am working with a CEO who has an unhappy client. This client was promised something by the CEO twice, and on both occasions he failed to deliver – for valid business reasons and some factors beyond his control. She told him she is willing to give him another chance (and how many clients would do that?) but if he fails to deliver a third time she wants her money back. He has spent more than two weeks now trying to decide if he will agree to this. He has not yet made a decision.

Why? Because he is trying to rationalize away his gut instinct that giving her money back is obviously the right thing to do. If you can’t deliver on an agreement three times in a row, how do you justify taking your client’s money? Out of fear that is stronger than one’s sense of abundance. It’s out of his fear of losing the money – a significant amount – that he is finding ways to rationalize keeping the money.

But at what cost? Not only will he lose this client if he does not agree to her proposal, she will leave with a very bad taste in her mouth about his company. This client has a large number of influential peers…word will get out. And employees of the organization who are aware of this situation will silently question the CEO’s decision.

As leaders, we cannot allow fear to allow us to rationalize away our instinct to do the right thing.

If we do, the leadership impact includes:

• A message to our employees that money is more important than doing the right thing
• A natural watering down of the commitment to company values and a questioning of whether they exist to begin with
• Confusion on the front-lines of our company about which decisions they are empowered to make and communicate on behalf of the company
• A decline in customer loyalty
• A likely decline in long-term profitability if loyal customers are lost and more money must be spent to replace them
• A weakening of our ability to garner trust, and thus a weakening of our leadership and effectiveness

 I don’t think you can rationalize any of this being worth it. Do you?

~

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Photo of Deciding Which Door to Choose by hang_in_there.