Measuring Business Excellence

Emerald Article: Integrity capacity as a strategic asset in achieving

organizational excellence
Joseph A. Petrick, John F. Quinn

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organizational excellence", Measuring Business Excellence, Vol. 5 Iss: 1 pp. 24 - 31
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Joseph A. Petrick, John F. Quinn, (2001),"Integrity capacity as a strategic asset in achieving organizational excellence",
Measuring Business Excellence, Vol. 5 Iss: 1 pp. 24 - 31
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Joseph A. Petrick, John F. Quinn, (2001),"Integrity capacity as a strategic asset in achieving organizational excellence",
Measuring Business Excellence, Vol. 5 Iss: 1 pp. 24 - 31
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 INTEGRITY CAPACITY AS A STRATEGIC
ASSET IN ACHIEVING ORGANIZATIONAL
EXCELLENCE

Joseph A. Petrick and John F. Quinn

Joseph A. Petrick is an Associate Professor of Management at Wright State University. He has co-authored three books,
Management Ethics: Integrity at Work, Total Quality in Managing Human Resources and Total Quality and
Organization Development. E-mail: joseph.petrick@wright.edu John F. Quinn is a Full Professor of Philosophy at
the University of Dayton. He has co-authored two books, The Christian Foundations of Criminal Responsibility
and Management Ethics: Integrity at Work. E-mail: J.Quinn@notes.udayton.edu

Abstract The authors propose that international organizational
leaders can and should be held accountable for enhancing the
intangible strategic asset of integrity capacity in order to advance
global organisational excellence. After defining integrity capacity
and framing it as part of a strategic resource model of sustainable
global competitive advantage, the stakeholder costs of integrity
capacity neglect are delineated. To address this neglect issue, the
authors link the four dimensions of integrity capacity (process,
judgment, development and system dimensions) with leadership
development challenges, and recommend four management practices
to better prepare leaders to be accountable for enhancing integrity
capacity as a strategic organizational asset.
Keywords Ethics, Leadership, Intangible assets,
Business excellence
the collective realm. The focus on collective integrity
capacity is an outgrowth of the tradition of integrity
literature in philosophy and psychology. The tradition of
integrity literature, however, has gained wider
acceptance and moved from the domestic individual
level to the global collective level (Carter, 1996; Paine,
1997; LeClair et al., 1998), incorporating both
organizational and extra-organizational contexts.
Integrity capacity can be defined as the individual and/
or collective capability for repeated process alignment of
moral awareness, deliberation, character and conduct
that demonstrates balanced judgment, enhances
sustained moral development and promotes supportive
systems for moral decision making (Petrick and Quinn,
2000). The four key dimensions of integrity capacity
include: process, judgment, development and system.

B
usiness leadership affects the moral capability
and performance of organizations (see, for
example, Buller and McEvoy, 1999). However,
business leaders are often not held accountable for the
costs incurred by multiple stakeholders because of their
neglect of integrity capacity as a key intangible, strategic
asset (see, for example, Petrick and Quinn, 2000). This
paper focuses on integrity capacity as a key business
strategic asset, links its four dimensions (process,
judgment, development and system dimensions) with
leadership accountability, and recommends four
management practices to better prepare leaders to be
accountable for enhancing integrity capacity as a
strategic organizational asset.
Integrity capacity as a strategic asset
Integrity can be defined as the quality of moral self-
governance at the individual and collective levels.
The integrity capacity construct builds upon the
ordinary language distinctions and extends their scope to
Each of these dimensions constitutes an intangible
strategic asset for an organization and presents
challenges for business leaders. Business leaders and
collectives (organizations and extra-organizational
entities) with high integrity capacity are likely to exhibit
a coherent unity of purpose and action in the face of
moral complexity and conflicting values rather than
succumb to administrative evil or irresponsible decision
making. Business leaders and firms with low integrity
capacity (those that do not walk the talk in the process of
daily transactions, those that exercise poor or distorted
judgment in policy formulation, those that never morally
mature beyond manipulative acquisitiveness and
domination rituals, and those that refrain from enacting
supportive contexts for sound moral decision making)
erode their reputational capital and put themselves at a
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Measuring Business Excellence 5,1 2001, pp. 24-30, # MCB University Press, 1368-3047
2 4
strategic disadvantage (Petrick et al., 1999; Fombrun, valuation was relatively unimportant and interpreted as a
1996). Internal and external stakeholders exact a price marginal reflection of the intangible assets which could
for victimization, and ignoring the risks of neglected not be assigned a specific balance sheet value, but which
integrity capacity enhancement is the expanded strategic were held to be a source of future earning capabilities.
responsibility for which contemporary business leaders Intangible assets, however, are assuming increasingly
are being held implicitly (and often explicitly) competitive significance in rapidly changing domestic
accountable. and global markets. As the speed of comparable tangible
The strategic resource model of sustainable global asset acquisition accelerates and the pace of imitation
competitive advantage depicts the processes that link the quickens, corporations that want to sustain distinctive
key role of managing integrity capacity as an intangible global competitive advantages need to protect, exploit
resource to eventual strategic success. Achieving and enhance their unique intangible assets.
sustainable competitive advantage for firms by Sustainable global competitive advantage occurs
leveraging their relevant core when a firm implements a
capability differentials has been a value-creating strategy which
central tenet of recent theories of other firms are unable to
strategic management. While ``Integrity capacity can imitate. For example, a firm
short-term competitive with superior business
advantage is obtained by be defined as the leadership skills in enhancing
appealing to customers in individual and/or integrity capacity increases its
targeted external markets, long- reputation capital with multiple
term sustainable competitive collective capability for stakeholders and positions itself
advantage is the result of for competitive advantage
exploiting an enduring core of
repeated process relative to firms without
relevant capability differentials alignment of moral comparable leadership
cultivated by responsible performance. Integrity capacity
management of tangible and awareness, deliberation, extends the work of Litz (1996)
intangible internal skills and character and conduct who argued that firms that
assets. could perceive stakeholder
Core capability differentials that demonstrates interdependence, demonstrate
are based on skills (what the ethical awareness, and respond
company can do) and assets
balanced judgment, effectively to moral issue
(what the company has). Skills enhances sustained management put themselves at
provide functional differential a competitive advantage to
that is due to cumulative know- moral development and other firms without those
how and experience (e.g. promotes supportive internal resources, by providing
executive and team leadership a more comprehensive list of
know-how, supplier know-how, systems for moral ethics capacities. The
distributor know-how) and consequent neglect of company
cultural differential based on the
decision making.'' integrity capacity as an
collective leadership aptitudes of intangible asset is particularly
the organization (e.g. the alarming since its consequent
collective ability to manage change, team and increase in reputational capital has been established as a
organizational learning), perceive quality and improve critical competitive component of global firms
service domestically and globally. In essence, the kind (Fombrun, 1996). Due to a preoccupation with
and degree of coordinated and leveraged skills and assets managing tangible assets for short-term profits and
a firm has will determine its core capability differentials unfamiliarity with how to enhance integrity capacity to
and its ultimate sustainable global competitive contribute to the core capability differential of a
advantage. reputational capital, many business leaders teams have
Corporate assets, in turn, are both tangible and failed to capitalize on this key intangible asset, have
intangible; traditional strategic managers emphasized injured multiple stakeholders, and are now being held
the value of tangible assets (e.g. plant, equipment, and accountable.
land) and leveraged them to maximize shareholder Furthermore, the context of globalization has
wealth that was documented in the balance sheet exacerbated the adverse impacts of the neglect of
valuation. Any premium over the balance sheet integrity capacity, challenging business leaders to design

Measuring Business Excellence 5,1 2001

2 5
and use more sophisticated theoretical tools for handling
multiple, simultaneous dimensions of business moral
issues (Petrick and Quinn, 1997). The need to improve
skills in enhancing integrity capacity through more
sophisticated ethical tools is prompted by a number of
trends, including:
(1) rising workplace violence and global terrorism as
impulsive responses to settling business moral
conflicts;
(2) polarized stagnation of corporate decision processes
in collective settings due to inability to compromise
or resolve unsettled value conflicts;
(3) the prevalence of wasted, idle and scarce resources
that reduce effective global cooperation and
competition; and
(4) neglect of recent organizational research which
demonstrates that managers with behavioral
complexity (judgment integrity) skills produce
better firm performance (Dennison et al., 1995).
To avoid the perpetuation of these adverse impact
trends on multiple stakeholders, it is necessary to focus
on the set of four integrity capacity dimensions as key
intangible strategic assets and their business leadership
opportunities for more responsible accountability.
Process integrity capacity and leadership
accountability
Process integrity capacity is the alignment of individual
and collective moral awareness, deliberation, character
and conduct on a sustained basis so that reputational
capital results (Rest, 1986; Fombrun, 1996; Petrick and
Quinn, 2000). The need to address lapses in process
integrity capacity is manifest by the routine
fragmentation of business leadership moral attention
and behavior that arouses stakeholder criticism about
the moral hypocrisy of many current business practices,
e.g. multinational corporations that tout their public
relations images as responsible corporate citizens while
engaging in unsustainable development practices that
pollute the natural environment, destroy local markets
and exploit indigenous workers.
The four components of process integrity capacity are
moral awareness, deliberation, character, and conduct.
The philosophical and psychological processes to
achieve and maintain process integrity involve
conscientiousness and discernment in moral awareness,
analysis and resolution in moral deliberation,
commitment and readiness of moral character to act,
and coherence and authenticity in moral conduct. The
more business leaders and their firms are held
accountable for demonstrating these interlinked moral
processes in daily interactions, the stronger the aggregate
process integrity capacity will become as a strategic
Measuring Business Excellence 5,1 2001
2 6
asset. It is precisely at this juncture that transactional
approaches to leadership competence are appropriate,
since honoring transactional reciprocity promises is the
core of process integrity capacity. When business leaders
try to ``get away with'' hypocritical power moves, e.g. say
one thing and do the opposite, they not only erode their
credibility but they diminish an important strategic
asset. They unwittingly spurn the shared pride people
feel when process integrity capacity is honored and
upheld; they sabotage strategic readiness by contributing
to organizational cynicism and spirals of incivility.
Judgment integrity capacity and leadership
accountability
Judgment integrity capacity is the balanced and inclusive
use of key ethics theories and their cognate theoretical
resources in the analysis and resolution of individual
and/or collective moral issues (Petrick and Quinn,
2000). Among the cognate theoretical resources for
business ethics decision making are management and
economics theories. The way business leaders manage
and interpret economic approaches to moral conflicts
implicitly aligns them with one or more key ethics
theories that influence their judgment integrity capacity
(Petrick and Quinn, 1997) ± for which they are held
accountable. Business judgment integrity is formed by
the conscious balancing of connection among
management, ethics and economics theories in the
formation of business policies and practices (Petrick,
1999).
To clarify the connections between management
theories and ethics theories, the following examples are
considered. First, rational goal, ``bottom line'' leaders
who repeatedly use results as the exclusive performance
standard logically endorse and tacitly choose to accord
outcome-oriented ethics theories (teleological ethics)
preeminence over other moral values. Rational goal
leaders, who have strong role competencies in directing
and producing, are naturally predisposed toward
teleological ethics in their daily practice; they routinely
focus on economic and moral results. Second, internal
process leaders, who exhibit strong role competencies in
monitoring and coordinating, implicitly subscribe to
duty-oriented ethics theories (deontological ethics) in
their daily practice. These ``by the book'' leaders, who
repeatedly use compliance with internal policies as the
exclusive performance standard, tacitly endorse and
logically choose to accord deontological ethics priority
over other moral values; they routinely focus on
adhering to business and moral rules. Third, human
relations leaders, who have strong role competencies in
facilitating and mentoring, implicitly subscribe to
character-oriented ethics theories (virtue ethics) in daily
practice. These ``true grit'' leaders, who focus on the
``right stuff in persons'' and repeatedly use virtuous industry and fiscal policy and public policy decisions is
character as the exclusive performance standard, are crucial in determining the viable scope of judgment
tacitly endorsing and logically choosing to accord virtue integrity capacity at the microeconomic level ± for which
ethics theory preeminence over other moral values; they business leaders are being held accountable as
routinely focus on the human and moral impacts on sustainable globalization strategies are implemented.
workplace harmony. Finally, open systems leaders, who The way in which scarce resources are created and
excel in innovating and brokering for resources, distributed in order to satisfy unlimited human wants
implicitly subscribe to process improvement ethics forms the economic context of judgment integrity
theories (system development ethics) in daily practice. capacity at the extra-organizational level. With the
These ``change agent'' leaders, who use continuous collapse of Russian communism and the widespread
process improvement as the exclusive performance force of economic globalization, impersonal market
standard, are tacitly endorsing and logically choosing to prices and private property ownership have served to
accord system development ethics priority over other coordinate, to a greater or lesser extent, the distribution
moral values; they routinely of economic benefits and burdens
focus on the process and moral in most nations and industries
impact of work system today. While socialism and
improvement. ``The capacity of communism are theoretically
For business leaders and business leaders to possible and marginally enacted,
their firms, exhibiting judgment the world's major economic
integrity capacity means balance economic policy decisions are currently
achieving good consequences shaped by different types of de
or ends (outcome-oriented
traditions, rather than facto capitalism.
teleological ethics), by adhering stubbornly and Different economics theories
to standards of right conduct at the macro-level emphasize
(duty-oriented deontological uncritically adhering to different moral traditions, which
ethics), while habitually being one tradition, is crucial in in turn are implicitly linked with
motivated by proper intentions different management theories
and developing virtuous fostering balanced that ultimately shape micro-level
character traits (character- judgment integrity capacity. The
oriented virtue ethics), in an
analyses and resolutions capacity of business leaders to
ethically supportive, holistic of economically complex balance economic traditions,
context (process improvement- rather than stubbornly and
oriented system development issues.'' uncritically adhering to one
ethics) (Cochran, 1999). tradition, is crucial in fostering
Business leaders that balanced analyses and resolutions
overemphasize or underemphasize good results, right of economically complex issues. Economic complexity is
means, virtuous character and/or morally supportive the cognitive and operational capability to institutionally
contexts when facing morally complex problems incur meet human wants and generate wealth in the face of
the same adverse consequences as managers that cannot competing expectations regarding financial returns,
handle behavioral complexity, i.e. offended individuals, regulatory compliance and social welfare, managerial
neglected opportunities, eroded trust and corrupt discretion and entrepreneurial innovation. Just as the
environments. ethical business leader must be able to balance and use
In addition, judgment integrity capacity is determined all four management and all four ethics theories to
by the balanced use of economics theories in handling demonstrate judgment integrity capacity at the
moral complexity that overlaps economics parameters. organizational level, the global business leader must be
Just as judgment integrity capacity assists business able to balance and use the four parallel economics
leaders to arrive at better decisions for the organization theories to do the same at the extra-organizational level.
at the microeconomic level, the judgment integrity Global business leaders who rely exclusively on their
capacity of the collective leadership team about conceptual affinity for one economic perspective develop
economics policies that affect industries, nations and the ``economic blindspots'' and rush to judgment with an
world create contexts/infrastructures/conceptual inadequate capability to handle economic complexity.
environments that enhance or inhibit moral decisions at The four major types of de facto capitalist economics
broader policy levels. The choice of economics theories theories related to parallel management and ethics
at the macroeconomic level to support morally sound theories are depicted: investor capitalism, regulatory

Measuring Business Excellence 5,1 2001

2 7
capitalism, managerial capitalism, and entrepreneurial
capitalism. Investor capitalism, sometimes referred to as
``cowboy capitalism'' or classical economic liberalism,
emphasizes the preeminence of rapid, legal wealth
accumulation by prioritizing the short-term financial
interests of individual and institutional investors, e.g.
pension funds, bank trusts, mutual funds.
Regulatory capitalism, Kantian or otherwise, focuses
on important rules and regulations, without which there
could be no global even playing field for market
transactions.
The net result is that the extent and nature of
economic regulation is debatable but some form of
regulatory capitalism appears to be globally, regionally,
nationally and locally necessary and desirable. The basic
norms necessary for the efficient functioning of
capitalism, such as keeping promises, honoring
contracts, telling the truth, freedom of choice, the
existence of a reliable legal infrastructure to enforce
agreements, and respect for the lives and property of
those involved in economic transactions, are endorsed
by and protected by regulatory capitalism. Unregulated
or over-regulated capitalism, however, can lead to
widespread extortion, gross bribery, fraud, violations of
human and economic rights, abridgements of social
contract agreements, neglect of transnational corporate,
professional, and industrial codes, stifled economic
innovation and job growth, and other agency and
opportunity costs of economic transactions that reduce
the efficiency of the market. In effect, regulatory
capitalism has a cognate affinity with internal process
management theory and deontological ethics theory in
that all focus on following rules and adhering to
standards as key determinants in their economic,
management and moral judgments respectively.
Managerial capitalism emphasizes the role of
managerial discretion in going beyond short-term
financial interests of investors to become corporate
statespersons for social responsibility. Managerial
capitalists are expected to be building character as
corporate statespersons through facilitating committed
productivity in enhanced internal work communities and
by being responsive to external social responsibility
demands in public policy contexts. In effect, managerial
capitalism has a cognate affinity with human relations
management theory and virtue ethics theory in that all
focus on developing human potential and character as
key determinants in their economic, management and
moral judgments respectively.
Entrepreneurial capitalism focuses on generating
innovation and leading change to stimulate and
accelerate economic transformation in the marketplace.
Economic progress today is stimulated by the inventive
activity of a critical mass of entrepreneurs, working
Measuring Business Excellence 5,1 2001
2 8
occasionally alone, but more often in partnerships of
collective creativity. Entrepreneurial capitalism has a
cognate affinity with open systems management theory
and system development ethics theory in that all focus
on continual improvement as the key determinant of
their economic, management and moral judgments
respectively.
In effect, judgment integrity capacity as a strategic
asset, is shaped by the degree of managerial, economic
and moral complexity that collective business leadership
teams in industries and nations can handle in a balanced
manner. Overemphasis or underemphasis of any of the
managerial, economics and ethics theories risks the
distortion of collective judgment integrity capacity. Yet,
it is precisely the overemphasis on investor capitalism
that is depleting natural, human, social and institutional
resources that ensure global sustainability. Natural
environmental degradation, child and migrant labor
exploitation, family and community dissolution, and
weakened, ``privatized'' legal/regulatory infrastructures
to support higher short-term profits for global
institutional investors has become the mantra of ``free
trade'' globalization. Relying on a single economics
theory, however, while consistent, is not developing the
balanced collective judgment integrity capacity for
which business leaders are being held accountable. And
the adverse impacts of distorted judgment integrity
capacity with respect to economic and moral complexity
continue to diminish the environmental context within
which business must function and erode the aggregate
strategic asset of integrity capacity.
Developmental integrity capacity and leadership
accountability
Developmental integrity capacity is the cognitive
improvement of individual and collective moral
reasoning capabilities from preconventional self-
interested regard (collective connivance) through a stage
of conforming to external conventional standards
(collective compliance), and finally, to a stage of
postconventional commitment to universal ethical
principles (collective integrity). Postconventional moral
reasoning by business leaders supports group and
organizational process and judgment integrity by
establishing principled norms for work culture decision
making; morally developed business leaders make a
difference and strengthen aggregate integrity capacity as
a strategic asset.
Developmental integrity capacity can be understood
and implemented by cultivating individual, group and
organizational moral development stages that parallel
those of morally mature business leaders. Business
leaders, for example, can morally develop from
preconventional, self-interest through conventional
conformity and on to postconventional principled
conduct. Similarly, groups and businesses can morally
develop through three stages: from a preconventional
stage of collective connivance, through a conventional
stage of collective compliance, and on to a
postconventional stage of collective commitment to
principled moral reasoning in resolving ethical conflicts.
Only the last stage of collective commitment indicates
individual and collective developmental integrity
capacity ± for the attainment of which stage business
leaders are held accountable (Petrick, 1998).
In effect, the highest cumulative achievement of
individual development integrity capacity over time
forms the optimal ethical work culture, which in turn
supports collective commitment to enhancing integrity
capacity as a strategic asset. In highly developed ethical
work cultures, shared pride in moral development
intrinsically motivates associates to be responsible
organizational citizens for internal stakeholders and
goodwill ambassadors for external stakeholders.
Business leaders who do not cultivate and nurture this
highest level of work culture moral development are held
accountable.
System integrity capacity and leadership
accountability
System integrity capacity is the alignment of
organizational processes and extra-organizational
infrastructure to provide a supportive context for sound
moral decision making (Petrick and Quinn, 2000).
Collective commitment work cultures, for example,
emerge by the regular practice of principled moral
reasoning in everyday business decision making, but
they are sustained only if system integrity capacity
processes are institutionalized (Petrick and Quinn,
1997; Petrick, 1998). System integrity capacity skills of
business leaders are pivotal in sustaining a committed
rather than a conniving or conforming work culture. Part
of business leadership accountability today is
determined by the extent to which leaders continually
improve the firm's internal ethical processes and work to
improve the firm's external moral environment, so that
moral performance can be sustained and lead to
reputational capital, even in corrupt contexts.
At the organizational level, one of the key system
decisions is whether to focus on a compliance-directed
system or an integrity-directed system. Organizations
that install a compliance-based system invest in this
ethical risk management technique to minimize potential
financial losses in the event of illegal activity (LeClair et
al., 1998).
A more integrity-directed system can complement
this approach and go beyond external compliance to
collective commitment and institutionalized
Measuring Business Excellence 5,1 2001
2 9
improvement. This can be found in a values-driven
Organization Ethics Development System (OEDS) that
includes ethical work culture and ethics needs
assessments, ethics in organizational strategy and
structure, stakeholder relations, integrity capacity
training and education programs, ethics audit and
evaluation subsystems, ethics in reward/recognition
incentives (Petrick and Quinn, 1997). The Johnson and
Johnson credo is a striking example of a prioritized
values-driven statement that provides strategic direction
when threats to company system integrity capacity are
encountered.
The caliber of system integrity capacity building skills
demonstrated by business leaders determines the extent
of contextual support for sound decision making and, in
turn, the extent to which aggregate integrity capacity as a
strategic asset is operationalized. In essence, leaders,
organizations and societies will not improve system
integrity capacity by merely controlling connivance or
enforcing compliance (Petrick and Quinn, 1997). Not
only must business leaders become role models for
process, judgment and developmental integrity, but they
must also build and sustain system integrity capacity to
protect and enhance the firm's strategic assets.
Management practices for enhancing integrity
capacity competence
Since business leaders cannot afford to neglect integrity
capacity as a strategic asset, the following management
practices are recommended for executive consideration.
Practice I: Provide leadership ethics education at all
business levels so that awareness of the process, judgment,
development and system components of integrity capacity and
their enhancement as a strategic asset becomes a shared
responsibility throughout the organization. The more aware
business leaders and other stakeholders are of the nature
and importance of integrity capacity as a strategic asset,
the more likely it is that they can avoid the adverse
effects of integrity capacity neglect. In addition, by
detailed knowledge of the ways in which different
leadership approaches can contribute to process,
judgment, development and system components of
integrity capacity, business leaders and other
stakeholders are in a position to concretely enhance that
strategic asset in a comprehensive and ongoing manner.
Practice II: Create new executive responsibilities for
oversight and coordination of all stakeholder relations that
impact firm integrity capacity. Just as companies appoint
chief financial officers to protect financial capital and
other officers to safeguard tangible resources, appointing
a chief integrity capacity or ethics officer or delegating
those cross-functional responsibilities to an existing
officer makes sense to safeguard this important strategic
asset. The Ethics Officer Association, founded in 1992,
provides an excellent forum in which to begin
benchmarking against the best practices across
companies, industries and countries. This sense of
integrity capacity and reputational responsibility is
clearly evident to Japanese CEOs. However, US CEOs
have been culturally sheltered from systematically
managing integrity capacity and reputational issues. In
the USA, CEOs have not usually shouldered the blame
for reputational losses in public, despite often being the
first to lay claim to reputational gains. Formalizing the
position of chief integrity capacity or ethics officer
returns organizational accountability to the top business
leaders and coordinates previously neglected or
fragmented efforts so that integrity capacity can be
leveraged for sustainable competitive advantage.
Practice III: Conduct an annual global integrity capacity
audit. Instituting an annual global integrity capacity
audit or incorporating aspects of it into traditional
accounting audits can pinpoint and prioritize areas of
strategic improvement and document progress in the
responsible strategic management of a key intangible
asset. The audit would consist of three components:
Diagnosing current integrity capacity condition,
designing a future preferred integrity capacity state, and
managing and monitoring transition processes.
The first diagnostic component includes three steps:
(1) an identity analysis that explores the ways a
company regards and presents its self-concept to
stakeholders;
(2) an image analysis that assesses the current
perceptions of key influential stakeholders of how
well the company moral projections are
communicated; and
(3) a gap analysis that analyzes the coherence of identity
and image from multiple feedback sources.
Two steps form the second design component:
(1) a strategic integrity capacity matrix is designed to
identify the future condition desired for sustainable
competitive advantage once gap concerns are
addressed; and
(2) a comprehensive feasibility plan to provide direction
and secure resources for implementing the desired
future integrity capacity position.
The third design component consists of two steps:
(1) multiple stakeholder task force involvement to
democratically and individually address concerns
raised by the integrity capacity audit; and
(2) a systematic information campaign to build integrity
capacity credibility and visibility.
Practice IV: Compete for selected leadership and ethics
awards, as well as reputational rankings, to channel
competitive passions toward leadership skill and integrity
capacity enhancement that will lead to sustainable
Measuring Business Excellence 5,1 2001
3 0
competitive advantage. While the Fortune reputational
index is important, other leadership and ethics awards
are worth coordinated organizational efforts (e.g. the
Business Ethics Award, the Social Investing Award, the
Baldrige Award or the Deming Prize for leadership in
organizational excellence).
The habit of strategic benchmarking also counteracts
parochial strategic arrogance by forcing business leaders
and other key stakeholders to acknowledge superior
processes in other firms and industries. This expanded
network of performance comparisons can spur internal
momentum for improving global leadership skills in
enhancing integrity capacity as a strategic asset for
sustainable competitive advantage. MBE
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