Somewhere in the mix of my father, the United States Military Academy and the Army I learned two important self tests for leadership: the “Man in the Mirror” test and the “Would I” test.  While I am human and have failed these tests and their exacting standards from time to time, I think they have on balance served me well.

The Man in the Mirror test is:  Can you look yourself in the eye (in the mirror) after you’ve made this decision?  The question is profound and very powerful.  It alone, if asked at the appropriate time, might keep you from making otherwise foolish ethical choices and poor leadership decisions.  Would it have kept Lay and Skilling, Maddoff or Kozlowski  from  violating their fiduciary responsibilities?  While I can’t answer this question, I do believe that if a person is “on balance good” and hasn’t succumbed to greed induced sociopathic behaviors, then this test will help keep them straight if asked at the appropriate times.  As we’ve written before, building tests such as these into your daily routine can help you from taking the long journey of small steps towards unethical behavior.

The “Would I” test is much more focused on the concept of “Leadership by Example” that we discuss in The Art of Scalability.  This test is also simple.  You just ask yourself “Would I be willing to do what I am asking this person to do?”  Maybe you are asking someone to work during their anniversary.  Perhaps you are asking someone to skip a child’s sporting or school event.  Maybe you’ve just given them some last minute assignment that will cause them to work all night, like completing a presentation for you to give at a conference tomorrow.  “Would I” is not an excuse to be lenient on people, or not to hold people to aggressive standards.  Rather, it is a test to determine if you are truly meeting the expectations that you hold of those around you.

In one respect, the “Man in the Mirror” and “Would I” tests fly in the face of concepts such as Strengths Based Leadership.   They exist to keep us from failing due to shortsightedness, a lack of introspection and aggressive or excessive egoism.  They are rooted in the concept that we sometimes fail because we fail to see how our actions will be perceived or acted upon by others.  Leaders are humans, and leaders make mistakes.  The “Man in the Mirror”, if employed often, helps us to avoid dangerous ethical pitfalls and the “Would I” test helps us avoid burning out our teams.

The recent consideration by Google on whether to pull up its tent stakes in China is no big surprise.  Simply perform an online search for china intellectual property and you will find news articles and blogs rich with stories of intellectual property theft.  Walk down the streets of Shanghai and you will see Chinese police browsing through collections of pirated DVDs for sale.   On one hand, the Chinese government is concerned about controlling information to the population through censorship, but on the other they encourage (at the very least through a lack of action) or engage in theft to transfer intellectual property to state or Chinese business hands.  Is there really any doubt that the attacks on Google’s mail was sponsored by the Chinese government?  The real question, I argue, is what are the responsibilities of a Western company operating in China?

As stewards of companies, our fiduciary obligations are to our shareholders and stakeholders of the company.  One argument obviously is that Google has the obligation to maximize shareholder wealth and in order to do that they need to operate within China for maximum possible advertising revenue.  But operation in China carries certain operational risk as seen by the recent breach of corporate infrastructure and resulting theft of mail associated with Chinese “activists”.  This calls into question a company’s obligation to protect the interests of the data and information that makes the company money.  Theft of intellectual property can easily reduce a company’s competitive advantage relative to its competitors not just in China, but worldwide.  What if software or other products had been stolen?  What is the risk/reward of operation in the light of potential state sponsored theft versus the revenue and profit upside of those operations?

It is difficult for companies to take on governments, especially when those companies have little recourse within the country given their foreign status.  It is more difficult when the country in question takes, sponsors or allows actions against those foreign entities for the purposes of technology or information transfer.  Given the degree to which the deck is stacked against Google, and other Western companies, why would one subject themselves to the risk and potential loss?  The obvious answer as discussed above is growth and profit.  But the question remains – can a Western company truly be successful long term in China?  Will the Chinese government ever crack down on intellectual property theft and anti-competitive behaviors (rather than sponsoring them)?

Unfortunately today it appears that the Chinese government allows foreign competitors into the country in order to more quickly transfer intellectual property through state protected theft.