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CHAPTER 6: COURAGE AND MORAL LEADERSHIP 181

Pottruck was fired as CEO of Charles Schwab, and he admits that he had to resist a
strong urge to blame everyone else for the downfall. Yet Pottruck found the courage
to publicly accept responsibility for his mistakes rather than pointing the fi nger at

others, which allowed him to reflect on the experience more calmly and move ahead
with his life and career. The acceptance of responsibility in many of today’s large,
52
bureaucratic organizations seems nonexistent. In one large agency of the federal
government, the slightest mistake created a whirlwind of blaming, fi nger pointing,
and extra effort to avoid responsibility. The absence of courage froze the agency to
the point that many employees were afraid to even do their routine tasks. 53
Courage often means nonconformity. Leadership courage means going against
the grain, breaking traditions, reducing boundaries, and initiating change. Leaders are
willing to take risks for a larger, ethical purpose, and they encourage others to do
so. Consider the following example.

IN THE LEAD Clive Warrilow, Volkswagen of America Inc.
When Clive Warrilow took over as president of Volkswagen AG’s Americas division,
the subsidiary was a mess, with sluggish sales and a demoralized workforce. For
many Volkswagen executives, it looked like a situation that called for a strong hand
at the top. As a company, Volkswagen has long favored strict hierarchy and control,
but Warrilow had come to believe that style no longer worked so well.
After years of climbing the corporate hierarchy, Warrilow had the courage to risk
his career by challenging the status quo. Whereas area managers previously had to
ask headquarters for permission to make even the smallest decision, Warrilow al-
lowed them to approach their jobs in their own individual ways. If a manager wanted
to cut back on advertising and use the money for bonuses, for example, he had the
freedom to do so, no questions asked. Warrilow also changed the relationship with
dealers. Rather than reprimanding, ridiculing, or terminating dealers who missed
their sales targets, he would ask what they could learn from the situation that would
enable them to do things better in the future.
Warrilow emphasized trust as the foundation of his leadership, and he en-
couraged other managers to build good relationships with their subordinates. He
even took three busloads of executives to a farm in Solvang, California, where they
watched Monty Roberts, the “Horse Whisperer,” create an environment for a wild
horse to learn, rather than breaking the animal’s spirit in the traditional way. It was a
metaphor for the type of management Warrilow wanted his executives to practice,
a style that emphasizes winning people over rather than bossing them around.
Volkswagen of America made an impressive comeback, thanks in large part to the
courage Warrilow showed in instituting a new style of leadership. Nevertheless, VW’s
top German executives remained wary of the more relaxed approach. “I have empathy
for what Warrilow does,” one said. “But sometimes I am afraid. Business is tough.” 54
After 4 years leading Volkswagen of America, Warrilow was
replaced by top management and decided to retire, leaving the
As a leader, you can develop the backbone
company in a stronger position than he’d found it. It isn’t clear if Action Memo
his management style had anything to do with his dismissal, but to accept personal responsibility for
Warrilow likely would have made the same choice no matter what. achieving desired outcomes, going against
He had the courage to go against the grain and do what he believed the status quo, and standing up for what
was best for the company, even if it might not be best for his own you believe. You can learn to push beyond
career. your comfort zone and break through the
Going against the status quo is difficult. It’s often easier to stay fear that limits you.

with what is familiar, even if it will lead to certain failure, than to
initiate bold change. A naval aviator once said that many pilots die