Article | Harvard Business Review | May 2011

The Wise Leader

by Ikujiro Nonaka and Hirotaka Takeuchi

Abstract

In an era of increasing discontinuity, wise leadership has nearly vanished. Many leaders find it difficult to reinvent their corporations rapidly enough to cope with new technologies, demographic shifts, and consumption trends. They can't develop truly global organizations that operate effortlessly across borders. And they find it tough to ensure that their people adhere to values and ethics. The world needs leaders who pursue the common good by striving to create social as well as economic value and who pair micromanagement with big-picture aspirations about the future. The authors, who have studied, taught, and interviewed executives in some of the world's leading companies, assert that such leaders must acquire practical wisdom, or what Aristotle called phronesis: experiential knowledge that enables people to make ethically sound judgments. Wise leaders demonstrate six abilities. They make decisions on the basis of what is good for the organization and for society. They quickly grasp the essence of a situation and fathom the nature and meaning of people, things, and events. They provide contexts in which executives and employees can interact to create new meaning. Phronetic leaders use metaphors and stories to convert their experience into tacit knowledge that others can use. They exert political power to bring people together and spur them to act. And wise leaders use apprenticeship and mentoring to cultivate practical wisdom in others.

Keywords: Communication Intention and Meaning; Interpersonal Communication; Experience and Expertise; Values and Beliefs; Knowledge Sharing; Knowledge Use and Leverage; Leadership; Leadership Development; Corporate Social Responsibility and Impact; Personal Characteristics; Power and Influence;

Citation:

Nonaka, Ikujiro, and Hirotaka Takeuchi. "The Wise Leader." Harvard Business Review 89, no. 5 (May 2011).