Joseph L. Badaracco Jr. - Managing in the Gray: Five Timeless Questions for Resolving Your Toughest Problems at Work

Making difficult decisions is what management is all about. And the most important choices are rarely easy. Managing in the Gray provides a framework for anyone responsible for making tough decisions.

STEVE BURKE, CEO, NBCUniversal

This wonderful book is a graduate course in the science of thinking. It is rigorous and enjoyable.

CLAYTON CHRISTENSEN, Professor, Harvard Business School; author, The Innovators Dilemma and How Will You Measure Your Life?

Joseph Badaracco has got it rightleadership has to come from the heart. With insight and candor, he conveys the importance of working through managerial issues with facts and analysis, but resolving them with respect and humanity. Anyone will learn from the critical questions and useful tools of deliberation and judgment revealed in Managing in the Gray.

JAMIE DIMON, Chairman and CEO, JPMorgan Chase & Co.

Every leader faces decisions that are not black or white. Badaracco draws on examplesranging from modern-day dilemmas to the insights of ancient philosophersto provide a useful and profound guide to dealing with problems that fall into gray areas. His book is interesting, practical, and compelling.

GAIL M c GOVERN, President and CEO, American Red Cross

Leaders are most significantly defined and judged by their decisions and actions related to the toughest problems. Managing in the Gray provides a practical, nuanced, and comprehensive framework to grapple with the toughest questions of life and business.

KEVIN SHARER, former Chairman and CEO, Amgen; Senior Lecturer, Harvard Business School

Managing in the Gray paves a lively and approachable path through the maze of managerial dilemmas. Using a voice that is both friendly and smart, Badaracco advises managers on not just how to think about their most vexing problems, but also how to fix them.

DEBORA SPAR, President, Barnard College

When facing difficult issues, I revisit the spirit of our founder, Konosuke Matsushita. He highlighted the importance of the untrapped mindset, a precept that has a lot in common with what Joseph Badaracco writes about here. All business leaders, whatever their managerial problems, will find much to stimulate their thinking in this book.

KAZUHIRO TSUGA, President, Panasonic

Managing in the Gray helps managers determine what is good when the good is far from apparent. This is a book not just to read but to live.

CLARK WARNER, former Program Director, Netezza Product Management, IBM

managing in the

GRAY

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Copyright 2016 Joseph L. Badaracco
All rights reserved
Printed in the United States of America

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No part of this publication may be reproduced, stored in or introduced into a retrieval system, or transmitted, in any form, or by any means (electronic, mechanical, photocopying, recording, or otherwise), without the prior permission of the publisher. Requests for permission should be directed to , or mailed to Permissions, Harvard Business School Publishing, 60 Harvard Way, Boston, Massachusetts 02163.

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Library of Congress Cataloging-in-Publication Data

Names: Badaracco, Joseph, author.
Title: Managing in the gray : five timeless questions for resolving your hardest
problems at work / Joseph L. Badaracco.
Description: Boston, Massachusetts : Harvard Business Review Press, [2016]
Identifiers: LCCN 2016026121 | ISBN 9781633691742 (hardcover)
Subjects: LCSH: ManagementPhilosophy. | Problem solving.
Classification: LCC HD31.2 .B33 2016 | DDC 658.4/03dc23
LC record available at https://lccn.loc.gov/2016026121

ISBN: 978-1-63369-174-2
eISBN: 978-1-63369-175-9

The paper used in this publication meets the requirements of the American National Standard for Permanence of Paper for Publications and Documents in Libraries and Archives Z39.48-1992.

For my colleagues, past and present, in the
Leadership and Corporate Accountability course
at Harvard Business School, from whom
Ive learned so much.

CONTENTS

Gray areas are the hardest problems managers face at work. The reason, fundamentally, is that these are the hardest problems we face in life. When you have to deal with a highly uncertain, high-stakes problem, you face a challenge, not just to your skills, but to your humanity.

This book offers a powerful, practical way to resolve gray area problems. It is based on guidance that is unusual, even radical. The guidance doesnt come from successful or famous CEOs. It isnt found in the conventional wisdom that says serve the interests of the shareholders or all the stakeholders. Nor does it appear in the ever-lengthening mission statements of todays organizations. The soundest guidance, I believe, for grappling with hard, complex, uncertain practical problems is a set of five questions that men and women have turned to, across many centuries and cultures, when they faced this kind of problem. Gray areas demand your best judgment, and the five questions are, in essence, extraordinarily valuable tools for judgment.

This book explains why these questions are so useful for resolving gray area issues. It also gives extensive practical guidance for answering the questions and illustrates this guidance with a wide range of case studies of gray area problems. However, before we turn to the five questions, it is important to understand what gray area problems are and what makes them so important and so challenging.

The more responsibility you take on at work and in life, the more often you face gray area problems, and these problems come in all shapes and sizes. For example, some are large, complex, and infrequent. Later in this book, we will look in detail at a situation faced by the CEO of a small biotech company who had learned that a new, much-needed drug might be implicated in a very rare, but deadly brain disease. He had to decide what to doeven though he lacked critical facts or even a clear definition of the problem.

In contrast, other gray area problems are small-scale, but this doesnt make them easy or unimportant. In a later chapter, we will look at a situation that confronted a senior manager in a medium-sized company. She shared an executive assistant with three managers. The assistant had worked at the company for more than thirty years and had a strong record, but her work had been slipping badly for several months. No one knew why. The other managers who relied on her wanted to let her go, but the senior manager was seriously concerned that the standard HR approachgiving the assistant two weeks notice and a small severance packagemight do her irreversible harm. But these concerns told the senior manager nothing about what she should do about the assistant, the work that wasnt getting done, or her disagreement with the other managers.

What all gray areas have in common, whether they are major or minor, is how we experience them. When you face a gray area problem, you have usually done a lot of hard workon your own and often with other peopleto understand a problem or a situation. Youve assembled all the data, information, and expert advice you can reasonably get. Youve analyzed everything carefully. But critical facts are still missing, and people you know and trust disagree about what to do. And, in your own mind, you keep going back and forth about what is really going on and about the right next steps.