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Ethics Versus Efficiency – What Military Leadership Can Learn from Business

In a democratic order, leadership ethics – as ethics, not as a management tool – is not primarily concerned with efficiency, but rather with the dignity and rights of those who are led. Leadership always means hierarchy and therefore superordination and subordination. Because of this, not only in the military but also in business, it is said that conflicts of goals and values occur time and again between the basic values of the democratic order and the hierarchical organization geared to efficiency. This leads to insistent questioning of the meaning of success-oriented, hierarchically organized activity.

These tensions take on particular significance in view of changed conditions in the employment market. When it comes to recruiting the next generation (“recruitment” is a term frequently used in business, too), it is becoming increasingly clear that from the strategic perspective, sustainable success and the observance of fundamental ethical principles in practice must go hand in hand if young people are to be convinced. This article aims to outline the conditions under which this is possible without internal contradictions, using some examples.

Fundamental values – specific decision-making situations: clearing up a misunderstanding

How can we measure the ethical quality of decisions made by leaders? To simply demonstrate their efficiency is not enough. But what is the situation when it comes to implementing ethical standards and leadership principles in an ever more complex world? At this point, it is worth calling to mind the basic model of justification and application which is established in ethics.

This model distinguishes the (general) justification for ethical standards from their (specific) application via implementation in specific recommendations for decisions. Applied ethics or practical philosophy was for a long time understood to mean ethics applied directly and specifically: according to this understanding, well-founded ethical standards – such as human dignity, liberty, justice, democracy – were to be directly transferred to the application level in the form of specific yet at the same time generally valid, indeed rigorous recommendations for decisions. This would bring about ethically desirable results. Even today, much scholarly discourse on applied ethics is influenced by this thinking. Figure 1 illustrates this idea:

Under the complex conditions of the modern age, however, the cause–effect relationship between the decision and its consequences has irretriev­ably broken down. In the early days of the market economy, a boss might have known all of his subordinates and had a direct influence on the market outcome. Even in the premodern environment, this influence might have been relatively easy to observe. But deeply layered, anonymously collaborative international processes have now made this impossible – and probably not even desirable. Moreover, it is becoming increasingly difficult and often impossible in the international competitive arena to bring about a particular desired outcome – such as protecting the environment – solely by means of decisions taken by individual actors. Transferred to the armed forces, we see that an increasingly more complex environment with new security demands entails challenges of a different nature than those of the second half of the last century. But what follows from this? Do external circumstances force the enterprise – or more generally, the organization – to abandon its values and give up its fundamental principles so that it doesn’t fall behind or even fall prey to the competition? In the military context, a similar question can be asked for the basic principles and values of Innere Führung, which – using the language of economics – also appear to be under competitive pressure.

Some business ethicists tend to be skeptical about the normative powers of enterprises. According to them, the conditions for action and its consequences can no longer be influenced. This complexity has an effect on the available decision alternatives, which ultimately calls the ethical standard itself into question. In this respect, leaders are forced to abandon important basic values. Put simply, this would mean that the inability to implement a standard actually has a negative impact on its validity. The arrow pointing from the bottom to the top in figure 2 illustrates this idea:

Recent business ethics research considers this conclusion to be premature. It is true that under complex external conditions, the traditional notion of a direct influence extending from the justification of a standard to its application, i.e. from the standard to a recommendation for action (on this point, see figure 1), would be naive and bound to fail. However, well-­founded standards are not obsolete simply because they – temporarily or still – run into difficulties in implementation. At the same time, recent research is certainly guided by a conventional understanding of entrepreneurship: is it not the outstanding feature of successful leadership and entrepreneurial thought and action to respond flexibly and with foresight to new challenges, to shape developments proactively, and to search for innovations? Indeed, “being a leader” has always meant responding to setbacks not with resignation, but with innovation.

What is true for the innovative search for new markets, products, and processes is no less applicable to sophisticated, ethically reflected leadership. It is important to constantly re­­adjust one’s own standards and values to changing conditions, and to work out and implement necessary adaptations for the specific decision from the interplay of basic values and the respective circumstances – e.g. time and resource scarcity, or the competitive environment.

In my opinion, this should also be the case for Innere Führung. Changed circumstances are seen as a leadership task – not as a reason to abandon basic principles, but to strengthen them instead. Specific decisions may change and frequently need to be adapted very quickly, but the well-founded guiding principle can be maintained and protected. Figure 3 illustrates this train of thought. It is fundamentally based on the principle of a classical syllogism, according to which specific conclusions are drawn only from the interaction between normative premises and boundary conditions.

Seen in this light, the various normative prem­ises of Innere Führung in no way stand in tension with one another. For Graf von Baudissin and other founding fathers of Innere Führung, the soldier has always and quite self-evidently been regarded as a “free man, good citizen, and full soldier.” Thus, the specific challenge in the individual case does not call into question the principle as such. Instead, it asks how it can best be put into practice in the future, in the best sense of “How can we get this done?,” rather than “Why can’t this work?” This context of basic principles and specific recommendations, of justification and application, can be explained using the following example.

Leadership styles and leadership ­ethics: ethics taken seriously

If we look at management literature and the prevalent differentiation of basic principles of leadership based on leadership styles, then we initially find a confusingly large number of relevant publications, hypotheses and at times fanciful typifications. On closer inspection, however, in the context that is of interest to us here, we can make a broad – but therefore helpful – simplification, and distinguish two basic types: authoritative and participative leadership styles.

With the authoritative leadership style, there is a clear division of tasks between the superior and subordinates: superiors decide and control, while employees carry out and are controlled. The relationship between the two is usually rather distant. Decisions tend to be taken quickly. In contrast, the participative leadership style is characterized by employees being involved in the decision-making process, and decisions are regularly delegated to them. External control is sometimes replaced by self-control, and the relationship is less distant. At times it seems more like a partnership (on an equal basis). Decisions tend to take more time because of the principles involved.

Of course, there are extreme forms and variants of these leadership styles. An extreme authoritative form is the despotic style: it tolerates no contradiction, its manner is overbearing, and it imposes arbitrary punishments. Subordinates fear the despotic leader. Another variant of the authoritative style is patriarchal leadership. In distinction to the despotic type, patriarchal leaders feel responsible for the people they lead. They like them and act almost as a father or mother would toward their children (the Greco-Latin root means “the founder of the family”. In the patriarchal leader, the right and the duty to lead are united with the duty of care. Subordinates often treat this leader with honest respect. Specific behavior and attitudes therefore produce significant advantages, but in the concept itself, the person who is led remains fixed in their role. As a result, potential remains unused.

Comparison of leadership styles – and the ethical dimension

Are there any significant differences – e.g. cultural differences – between the United States and (continental) Europe with regard to the prevalence of authoritative and participative leadership styles? A number of studies would appear to suggest that there are. In the overall picture, however, there are indications that in times of rapid economic transformation (keyword “Internet”), regional or cultural differences tend to be less important than differences between industries. Plus there is the fact that “older,” generally more conservative enterprises are in any case now also moving toward more participative leadership styles and methods.

Against this backdrop, we ask: what about the specific ethical dimension? Doesn’t the participative almost perfectly symbolize the democratic, and doesn’t authoritative mean authoritarian, undemocratic, and despotic? From the business ethics perspective, this simplification is inaccurate. The situation is no doubt similar in the military. Deciding on a particular basic principle – in this case, the participative leadership style – does not automatically result in particular leadership methods and recommendations for action in the specific situation. This too would be a misunderstanding of the relationship between fundamental values, circumstances, and specific decisions. The participative leadership style in particular – also as an expression of sovereignty – can and should make use of specific decision-making pro­cesses and structures in which the leadership level, as a matter of course, makes the decision and takes the responsibility. It is not the whether but the how that counts, as long as the fundamental principle and self-image are not mixed up with the specific situation.

Starting from the basic principle and a decision in favor of the participative style, in case of doubt one should apply the rule of thumb: allow as much participation as possible and decide as little as necessary the authoritative way. As little as necessary, but not less than necessary, and especially not when external conditions such as time pressure or acute risks demand swift and responsible leadership action.

Not least, it is an ethical imperative not to demand too much of people who are led by others. Especially at lower decision-making levels and for less complex activities in any enterprise or organization, those who are led have every right to expect decisions and responsibility for those decisions to be taken by those who are their superiors and are generally paid more for doing so.

Thus, we would be well advised to refrain from using openly evaluative attributes here such as “authoritarian” or “cooperative,” because they can cause or reinforce mental blocks. One need only consider that an ethically reflected leader who is presently “authoritative” is still perfectly capable of seeing his or her subordinates as bearers of human dignity and – of course – also relies on cooperation (what else, might one ask?). It is just that cooperation involves clearly specified role assignments. Rather than being an end in itself, it is due to the circumstances or the current boundary conditions.

A provisional conclusion

From an ethical point of view, it is often believed that the relationship between ethics and efficiency in military leadership and in business involves quasi-natural and insurmountable tensions. In line with this thought, the leader is forced to take one side or the other, thereby giving up one or the other to a greater or lesser extent. As explained above, this is by no means the case. On closer and particularly more recent inspection, economically reflected business ethics research provides a series of connections between business and the military. In the present article, we have attempted to sketch out several of these to give a general overview of the subject at hand.


Detlef Aufderheide

Detlef Aufderheide is Professor of Business Ethics and Strategic Management at SiB School of International Business, Bremen City University of Applied Sciences. Previously he was the inaugural occupant of the Dr. Jürgen Meyer Foundation Chair in International Business Ethics at HSBA Hamburg School of Business Administration (university of the Hamburg business community). After completing a degree in economics, Aufderheide earned his doctorate in economic and business ethics at the University of Münster, supervised by Professor Jochen Schumann. He was subsequently invited to conduct a research fellowship at the Center for Study of Public Choice in Fairfax, Virginia, under the supervision of Professor James M. Buchanan. Aufderheide has authored, co-authored and (co-)edited numerous publications on economic and business ethics as well as new institutional economics and regulatory policy.

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All articles in this issue

Professional Soldiers and Citizens in Uniform
Donald Abenheim, Carolyn C. Halladay
Bundeswehr Without Cohesion. Negative Developments in Innere Führung
Elmar Wiesendahl
What’s the Matter with Innere Führung?
Uwe Hartmann
Innere Führung and Global Integral Competence
Kazuma Matoba, Bernd Küstner
Innere Führung and Civil Protection – Keyword "Mission-Type Tactics"
Dirk Freudenberg
Leadership in Multinational Military Organizations – the Example of SHAPE
Gregor Richter
Integrity, Moral Courage and Innere Führung
Peter Olsthoorn
Ethics Versus Efficiency – What Military Leadership Can Learn from Business
Detlef Aufderheide
Innere Führung – Leadership Culture in Camouflage
Zentrum Innere Führung
Voluntary Instead of Military Service – Young People Working for the Common Good
Angelika Dörfler-Dierken


Thomas von Buttlar Hans-Peter Bartels Peter Wendl Rabea Haß Gerhard Kümmel