Balancing Strategic Integrity and Impact

Essay: Examining Strategy’s Moral Obligation for Ethical Success

Robert Greene’s classic book “The 48 Laws of Power” opens with the powerful definition of the nature of power:

“Power is essentially amoral and one of the most important skills to acquire is the ability to see circumstances rather than good or evil.”

Greene underscores that power inevitably yields both ‘positive’ and ‘negative’ outcomes, urging us to transcend this binary outlook to genuinely comprehend it.

There are many parallels between Power and Strategy. After all, they are two forces that feed into each other in the pursuit of an advantage — personal, competitive or societal.

In the study of business strategy and morality, leading minds from different fields approach the topic of morality differently. For instance, theologians are often concerned with big ethical questions about whether economic systems are morally just. Philosophers dig into the morality of specific business actions, questioning whether the logic behind decisions are sound, and psychologists are looking at how and why people include morality in business decisions. The common concern amongst these thinkers is whether strategy functions only to concern itself with exitus acta probat : the ends justifying the means — the consequentialist idea.

So, is strategy, amoral? We could argue that while the pragmatic nature of strategy may be amoral, it’s utilisation and impact can be more idealistic and moral in its desired outcomes.

When implementing strategies, there’s often tension between what is effective and what is ethical because as a society we need to operate within certain accepted boundaries set by societal and institutional norms throughout history.

I argue that a strategy doesn’t necessarily have to be detached from morally right or wrong considerations, we can achieve the sought-after objectives of competitive advantages and favourable outcomes for businesses, individuals, and the environment at the same time through a delicate balance pragmatism with idealism

Morals and Dogma

The realm of strategy has historically focused mainly on gaining a competitive edge, increasing profits, or outdoing competitors. Throughout history, these qualities have remained consistent principles underlying the essence of strategic objectives. In the backdrop of shifting contemporary social norms however, this perspective lacks a broader ethical context, leading to questionable decisions that might be a necessary benefit a particular group or organisation but have negative consequences for others or society as a whole.

Today, the assessment of morality and ethical behaviour finds itself entangled in a philosophical struggle between pragmatic and idealistic viewpoints.

Machiavellianism

In 1513, the Italian diplomat, author, philosopher, and historian Niccolò Machiavelli presented his perspective on morality, frequently linked to his infamous work “The Prince.” In this book, Machiavelli outlines a practical and strategic approach to leadership and governance based on pragmatism. Living during the Renaissance, Machiavelli’s perspective imported many of the rational thinking of the times and challenged notions of morality by suggesting that rulers and leaders should prioritise effective and pragmatic governance and the preservation of power. Undoubtedly, this pragmatic approach has endured as the dominant doctrine since the inception of the study and teaching of strategy.

Machiavelli famously stated the consequentialist idea of ‘the ends justify the means,’ asserting that if a goal holds sufficient moral significance, any means of attaining it can be deemed permissible, and the surrounding policies should be evaluated solely based on their ability to achieve the intended outcomes. While Machiavelli didn’t advocate cruelty, his idea of achieving morally important goals by any means, and many other questionable ideas, have since become victim of (mis)interpretation — what is ‘morally important’ is subjective and can often be warped to justify unethical efforts under the pretext of ‘a greater good’. Because of this the Machiavellian perspective towards strategy has been controversial and debated throughout history.

Kantian ethics

Some 300 years later, Immanuel Kant wrote about the ‘categorical imperative’ in his philosophical work “Groundwork for the Metaphysics of Morals,” in 1785.

Kant believed that moral principles should be guided by reason and universal principles of what is ‘good’ and ‘just’, rather than personal desires or outcomes. This approach, known as ‘deontological ethics’, emphasises duty and principles over outcomes, has provided an alternative perspective to consequentialist theories and has enriched ethical discourse.

Kantian ethics has provided a profound framework for morally responsible decision making. His views centred on the notion that individuals are not mere stepping stones to an end, but rather ends in themselves. Ethical decision making should be ‘universal’ with consistent ethical principles for all situations regardless of context. In Kantian ethics truthfulness and transparency is essential and actions are evaluated using universal law and respect for others. More importantly, Kantian ethics rejects short-term gains that compromise principles that produce long-term benefits. Kantian ethics have had a significant and enduring influence on society, shaping moral philosophy, ethical frameworks, and various aspects of human behaviour, creating a framework for making ethical decisions and foundational thought in law, business, and medicine to guide ethical choices.

Sadly, in today’s interconnected world where ideas are shared and observed in real time, it’s becoming more apparent that we are witnessing global phenomenon of ‘moral dissensus’— a disagreement on what constitutes as morally acceptable behaviour — expanding beyond social and political arenas and into the world of business. A blurring of the boundaries.

Even though our inter-connectedness highlights our growing similarities, a realist perspective can just as easily put the spotlight on the subtle distinctions we have due to cultural and historical backgrounds that shape our perspectives. When these boundaries remain blurred, strategy can and will be misused for unethical gains.

The Limits of Consequentialism

On August 6, 1945, the United States dropped the first atomic bomb on Hiroshima to end America’s war with Japan during World War II. The bomb, nicknamed ‘Little Boy’ was followed by second atomic bomb ‘Fat Boy’ on Nagasaki a few days later. 78 years on and the bombing was, and is still, a highly controversial and consequential event that’s often debated from both a moral and strategic standpoint.

The crux of the challenge Allies were facing was Japan’s growing expansion, unstoppable aggression and fierce fanaticism. The only way to defeat the Japanese, in their view, was to totally bring to a halt the Japans aggression and the imperial war machine. To address this, American (and British) strategists and decision-makers decided that the power of the atomic bomb would help them achieve this goal. They had three main strategic considerations for using atomic bombs during World War II: firstly, to swiftly end the war and avoid a costly invasion of Japan; secondly, to show the destructive power of the atomic bombs and pressure Japan to surrender; and thirdly, to prevent Soviet involvement to avoid their influence in post-war division. Objectively, these aims align with strategic criteria: simplicity, actionability, and leverage. However, the debate arose over measuring success in immediate or long-term outcomes in the aftermath and subsequent years. The atomic bomb decision, aimed at defeating Japan, exemplifies strategy driven by sheer force rather than humanist and philosophical reflection. This approach disregarded alternative options that were being proposed by many of the top brass advisors, and was even opposed by many prominent US generals immediately afterwards.

It was later revealed that Japan would have surrendered before November that year anyway.

Few can logically support the use of the atomic bomb as a WWII victory strategy against Japan today and we have established many guardrails to avoid this catastrophe in the futre.

The profound irrational conflicts that ensued after World War II have inflicted enduring emotional scars on forthcoming generations. Today’s dominant societal forces, represented by Generation Z and Y, have nurtured a strong dislike for any form of unwarranted behaviour. They are now setting stringent boundaries with high expectations for businesses.

But despite this heightened awareness, the principle of “Exitus acta probat” remains the prevailing approach across much of the business landscape, especially among brands favored by Generation Z, who promote the concepts of ethics and sustainability yet employ strategies that are gradually being rejected by the current and future generations.

For Gen Z and beyond, the primary motivation for consumption lies in the pursuit of truth, both on an individual and collective level. A notable 78% of Generation Z members think that brands primarily engage in empty rhetoric and lack genuine action, often making statements they don’t truly stand by. There are few things that Gen Z dislikes more than companies that engage in rent-seeking behaviour, virtue signalling, or attempting to deceive them outright.

Rent-seeking

A tool corporations love to pick out from their strategic toolkit is spending money on lobbying for government subsidies, tax breaks, or regulatory exemptions in order to be given wealth that has already been created, or to impose regulations on competitors, in order to increase one’s own market share. This form of strategy, while mostly legal and effective, is commonly viewed as rent-seeking and shady by today’s standards.

In 2021, the world’s favoured tech companies – Amazon, Apple, Meta and Microsoft allocated nearly $70 million for lobbying in Washington. To implement their lobbying strategies, they employ seasoned lobbyists, create political action committees (PACs), provide funding for think tanks, conduct public relations campaigns, and cultivate connections with policymakers.

This strategy is seen as distorting the free market’s efficiency by granting special benefits, hampers healthy competition, innovation, and fair allocation of resources. Consequently, lobbying-driven rent-seeking can lead to an unequal and inefficient economic landscape, ultimately undermining the principles of market competition and broader societal welfare.

Hypocrisy and tokenism

A strategy can inadvertently lead to a hypocritical reputation when there’s a disconnect between what an business claims to stand for and how it actually operates. Today the concept of sustainability and being socially responsible is a big consideration for leaders and strategists

Major brands like Coca-Cola, PepsiCo, and Nestlé have been charged with hypocrisy following a report alleging that despite publicly committing to reduce plastic usage, they are undermining sustainability initiatives by supporting lobbying organisations and trade associations. While the recent debate involving Bud Light‘s collaboration with transgender influencer Dylan Mulvaney for an inclusive marketing effort to drive growth among Gen Z consumers underscores the delicate balance companies need to maintain while demonstrating diversity and inclusivity. This incident should prompt brands to emphasise ethical practices and substantial initiatives over symbolic actions.

Such inconsistency always triggers customer backlash, legal issues, and difficulty attracting both future customers and talent. Today it’s essential to ensure a hones strategy honestly aligns with an organisation’s values and to transparently communicate these actions.

Deception as strategy

It is a common belief that the most successful strategies require some degree of immoral behaviour, such as deception or exploitation. While deception is frequently used and prized in military strategy, it might not be the most suitable approach for interacting with society in the world of business.

Recently, Amazon’s intense focus on gaining a competitive edge resulted in allegations and complaints about employing deceptive strategies to trap customers. These strategies, known as “Amazon Dark patterns,” have been publicly recognised for some time and have slowly gained momentum in terms of customer backlash.

Notably, the FTC has filed a lawsuit against Amazon for allegedly enrolling consumers in its subscription service without their consent and creating obstacles for cancellation. The complaint asserts that Amazon used manipulative user interface designs, termed “dark patterns,” to mislead users into auto-renewing Prime memberships. Additionally, the FTC accuses Amazon of intentionally complicating purchases for non-Prime users and failing to adequately communicate that selecting certain transaction options would result in a recurring Prime subscription. As additional legal actions and penalties emerge from various areas, this serves as a prominent illustration of the importance of excluding deceit from a strategy toolkit.

Beyond Good and Evil

In absence of moral consensus, Machiavellian pragmatism always prevails because it’s easier to think in terms of self serving rather than for the collective good, in the world of business strategy, often conflicting with modern expectations for corporate social responsibility and ethical behaviour.

In my previous piece I argued that strategy is not a purely objective and materially focused practice. Numbers and data don’t produce the strategic direction nor do they ensure lasting success. The essence of strategy involves an appreciation and application of both a philosophical and psychological approach to truly understand and connect with humans in order to develop long-lasting and impactful solutions, not solely driven by consequentialist outcomes.

Philosophy is good for examining our ethics and what’s essential is a decision-making process that doesn’t overly rely just on moral theories but also into consideration the psychology begins varying moral and ethical opinions.

Before putting a strategy into practice, the strategic thinking process should involve some inquiry —what are the grounds and justification for your belief? Do they reflect short or long term results? Does the strategy align with the values of the organisation, stakeholders and wider community? Also, a philosophers approach to strategic development can bring a healthy sense of skepticism to create an importance distance to ask the very questions that might not get asked when power and profit are involved.

There’s a second part to Greene’s powerful opening line:

“Power is a game… and in games you do not judge your opponents by their intentions but by the effect of their actions.”

In today’s heightened awareness environment, businesses and individuals face constant scrutiny for the intentions behind their actions. Easy access to information allows people to question intentions and strategies quickly.

Achieving sustainable growth requires adhering to societal and institutional norms. Disregarding these trends might yield short-term gains, but opposing collective expectations won’t ensure sustained growth. This approach fosters inventive solutions benefiting both the company and society.

Machiavellian pragmatism advocates achieving morally significant goals through any means necessary, while Kantian ethics cautions against sacrificing long-term principles for short-term benefits as a universal principle. In business strategy, this can foster sustainable practices that prioritise stakeholders’ well-being and societal impact. Balancing these two viewpoints ensures effective strategic thinking planning and execution, it’s the role of Founders, CEOs, Management and Strategists to navigate this tension to attain outcomes that safeguard the organisation’s long-term reputation and integrity.

Favouring success over morality might be tempting, embracing moral strategy can yield enduring success and garner enhanced respect and trust from others.

In the end, every strategist has a clear set of choices, don’t they?