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Managing in the Gray

By Joseph Badaracco

(Harvard Business Review Press, 197 pages, $48.50)

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If Donald Trump has presented us with one face of a business leader, Harvard Business School Professor Joseph Badaracco is dealing with another in his fascinating new book, Managing in the Gray.

For Mr. Trump, it's all black and white. His decisions seem to be quick, superficial instinctive. He doesn't probe deeply. Philosophy would appear to repel him.

But Prof. Badaracco is fascinated with the grey, the complicated, the impossible to resolve. He has written a succession of compelling books – not compelling to Mr. Trump, I suspect, but compelling to me – including Leading Quietly: An Unorthodox Guide to Doing the Right Thing, my favourite business book of 2002; Questions of Character, which I rated fourth-best in 2006; and The Good Struggle in 2013.

In the current book, he notes that the more responsibilities you take on at work and in life, the more often you face problems that lie in the grey area, in which critical facts are missing, people disagree on the best actions and you are uncertain about the next step.

"Gray areas are particularly risky today because of the seductive power of analytical techniques. Many of the hard problems now facing managers and companies require sophisticated techniques for analyzing vast amounts of information. It is tempting to think if you can get the right information and use the right analytics, you can make the right decision," he says.

But tools and techniques won't always give you the right answer. You need judgment and the willingness to make hard choices. And to guide you, he recommends falling back on philosophers over the ages, using a set of five questions that people have turned to across centuries and cultures:

1. What are the net, net consequences?

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Don't oversimplify. Don't just focus on what you can count or price. Think concretely, imaginatively and empathetically about all aspects of the situation, considering everything your fellow humans need, want, fear and really care about. Sounds like common sense, but the often-praised Aaron Feuerstein failed this test when he vowed to rebuild his Maiden Mills textile company in New England after it was destroyed by fire. It was a wonderfully humane act, but the company went bankrupt after returning to operation, and Prof. Badaracco suggests that was because not all aspects of the manufacturing challenges the company faced were properly evaluated. It may have been more helpful if he had stepped back, evaluated all the options and looked directly at the ugly consequences that could result from his instinctive preference.

2. What are my core obligations?

"We have basic duties to each other simply because we are human beings. In other words, there is something profoundly important about our common human nature that creates, immediately and directly, certain fundamental obligations that we all owe to each other," he writes. Even in today's Western world, with the emphasis on individual rights, we live in a world of duties. Awaken your moral imagination. In resolving grey area problems, you must act as a human being. Jim Mullen, the CEO of Biogen Idec, faced this when he learned that an MS drug developed by his company could harm some who were desperate to take it.

3. What will work in the world as it is?

This takes us into the writings of Machiavelli, who is much reviled but whose real-world advice is still valid. Prof. Badaracco notes that the environment in which we operate is unpredictable, constrained and influenced by individuals and groups serving their own interests. You must serve the interests of the people who depend on you and also advance your own objectives – not an easy task. It's vital to make sure your plan is resilient – and so are you – since it will be challenged.

4. Who are we?

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Managers' identities are woven into the fabric of the surrounding communities. The solutions they choose, therefore, must reflect and express the norms and values of those communities. Reflect on your real self-interest, as part of a web of human relationships, and what your organization is committed to.

5. What can I live with?

No matter how good your analysis with the first four questions, he warns that you won't always find an answer to a grey area problem. "What do you do then? Basically, you create the answer, and you do this by making a decision you can live with – as a manager and as a human being," he writes. This brings it down to character, conviction and values.

Faced with such complexity, it may be tempting to just choose your favourite question and stick with it. But he insists you need to grapple with all five probes – and yourself.

The subject matter may make the book seem plodding, but in fact it's relatively short, clearly written and each question is addressed both philosophically and practically. It may not make Donald Trump's reading list, but perhaps you should consider it for yours.


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Why Are There Snowblowers in Miami? (Greenleaf, 185 pages, $28.95) Steven Goldstein asked when visiting a Sears store in that city while president of the company's credit card division in the 1990s. The consultant uses that incident as a springboard to offer five principles for better management.

Hospitals looking to improve the patient experience might gain insights from Communication the Cleveland Clinic Way (McGraw-Hill, 259 pages, $40.95) in which physicians Adrienne Boissy and Timothy Gilligan explain the communication skills program they instituted.

John Camillus, a professor of strategic management at the University of Pittsburgh, explains how companies conquer complexity and surpass competitors in Wicked Strategies (University of Toronto Press, 186 pages, $32.95).

Harvey Schachter is a Kingston, Ont.-based writer specializing in management issues. He writes Monday Morning Manager and management book reviews for the print edition of Report on Business and an online column, Power Points. E-mail Harvey Schachter

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