In December 2011, as a new executive I was invited with others to a dinner with a very senior Fortune 100 company executive. He wanted to know what was really going on with the company, and with us. When he asked me, I said I had been wondering recently if someone who is fundamentally honest is at a competitive disadvantage when negotiating a contract. He found the question interesting, and asked what I had concluded. I’m not sure my response was as insightful as the question.
The origin of the word virtue is strength, or perhaps ability. Before this I don’t think I ever would have thought that having some professional, academic or athletic ability could potentially be a weakness. Would being able to create an app be a weakness in some setting? Or being good at football? Or the ability to solve a differential equation?
Such an idea is absurd. Having any capability does not preclude having or using any other capability. If honesty is an ability, what then would have given rise to my wondering if honesty was a competitive disadvantage?
In asking others about this idea, I’ve found I’m not alone in wondering if this strength can be a weakness. In my informal surveys, more people seem to agree that it might be a competitive disadvantage rather than an advantage.
Why would that be?
One reason seems to be that we at times confuse one virtue with the attributes of another, thinking the two are somehow inseparable.
For honesty, I believe at times we think that people who are honest are also naïve. Yet naivety is not a virtue: intelligence and knowledge are virtues we should cultivate. Strength in honesty cannot compensate for weakness in intelligence. And the power of honesty should not be discounted because of a weakness in intelligence.
A more pernicious mistake is made when we view virtues in a simplistic way. For example, one may believe that being honest restricts actions one can take; perhaps a dishonest person has an unlimited set of actions to choose from in any given situation. If honesty is a narrow path, does dishonesty present a wide array of possible choices?
I realized that in some this belief comes because they have not master the power of the virtue by consistent application. The power of honesty comes when we learn how to see its application in so many different places.
This is similar the difficulty in learning a new math technique. When we initially learn how to solve some form of an equation, we often think, “How can this every be useful?” It is only through mastering the technique that we begin to see problems in real life that can be solved by it.
The power of a virtue comes through its repeated development. Its power is even greater when it is applied consistently. When one gets to this level, choices are available to the honest that the dishonest can never make. A choice for consistent honesty may mean one is not as skillful at dishonesty; but at the same time one who is consistently or periodically dishonest has made choices that preclude understanding the power and choices available to the truly honest.
So what is an example of that power? After a few more months of pondering, I concluded that honesty is a serious competitive advantage. Honesty enables someone to do things a dishonest person cannot do. Two consistently honest people can come to an agreement with an efficiency that will never be possible for the dishonest. They can replace textbook size contracts with a handshake. That is a significant competitive advantage.
The great thinkers of the Enlightment recognized this. They understood that a society built upon citizens committed to being law abiding would spend significantly less on police and law enforcement, legal systems, dispute resolution, restitution and reformation. We see this competitive advantage in the world today. Counties with citizens committed to this and other virtues have competitive advantages.
And as for restricted choices, an honest person is not precluded from doing business with a dishonest person, or using courts, or anything else possible to protect them. Being honest will not make up for being ignorant of dishonesty; but the scope of choices available to the honest are probably greater than those that can be made by the dishonest, particularly over time.
We might speak of virtues being competitive advantages to make them real in the messy world of our lives, but by their nature their use does not create win-lose battles; the use of virtues create win-win situations. The power they enable for the other party can at times be greater than the benefit obtained by the one who exercises them.
This pattern is true of every virtue. Each enables specific strengths. The patient person can choose to demand speed and activity when appropriate; but they can also patiently achieve things the impatient never will when patience is necessary. Every virtue enables successes not available to those who lack that virtue. Indeed, virtue is strength.
Kip on Character 