Role clarity is the capability to perform a chosen role convincingly and with enthusiasm, and without losing sense of who you are behind your role. Think of an actor who in one movie is the romantic hero and a villain in the next. A leader with role clarity can step in and out of different roles in different contexts with ease and be fully engaged in any one of them, knowing that it is just a role. With role clarity, there is equanimity and clarity in crisis situations and a lack of emotional attachment—that is, you are able to experience your emotions without judging or getting attached to them.

As an example, Raj, the start-up CEO introduced in chapter 2 who was consumed by his job, was emotionally attached to the role of the start-up CEO: he was very successful in that role and valued it highly. Once he gained role clarity, however, he recognized the real value of his family roles, and his unconscious judgment that one role is better than the other disappeared. He also realized that ultimately he was more than his roles—he was first and foremost a human being—and that shift in perspective led to his sense of equanimity and happiness.

In a business context, role clarity means knowing that your role as leader is just that: a role. Today you are a director in one company, next you could be a vice president in another company, and a year later, you could be an entrepreneur—and these are merely roles you play to contribute to your organization and to yourself. Business smart and functional smart leaders tend to attach a meaning and judgment to their role—and those of others—by, for example, viewing an entrepreneurial role as being more exciting than a corporate executive role or a vice president position being more prestigious than a director title. This is because smart leaders view roles through the red or blue lenses they wear. As long as they wear these filters, they risk mistaking their role as their identity, and in doing so, they lose their perspective and act without authenticity and appropriateness. When you remove your filters, you gain role clarity, and recognize that you have the choice to step out of that role whenever you want. You will put your ego aside and begin to pay less attention to your own title and perks and more attention to the needs of others in the organization. You will even recognize that it is your role or your title that confers your power and responsibility, and when you play that role, you inherit them only temporarily. Wise leaders are able to remove their blue or red filters and enthusiastically assume the most appropriate role that they need to play to get the job done—and they do this without emotionally getting caught up in that role. In other words, leading from any position means sometimes being a leader who serves others as a servant leader.

In fact, role clarity as we define it in this book is closely related to both the concept of servant leadership popularized by Robert Greenleaf and the stewardship concept of Peter Block.¹ The concept of servant leadership itself has ancient roots not only in Western culture, particularly in Christian spirituality, but also in the Eastern traditions. Chanakya, an Indian philosopher and royal advisor in the fourth century B.C.E., wrote in his book Arthashastra, “The king shall consider as good, not what pleases himself but what pleases his subjects. The king is a paid servant and enjoys the resources of the state together with the people.”²

As a wise leader, you take full responsibility for the leadership role but don’t let your ego or personal needs or emotions get in the way. These factors still exist, but when you are within the leadership role, you don’t let them take over. You are open to either leading from the front or playing a supporting role to let others shine. And when the time is right, you willingly relinquish your role.

Some leaders in the red zone have difficulty executing their role with emotional detachment. A good example of such a leader is Bob Diamond, who in July 2012 stepped down as CEO of British banking giant Barclays after the British government fined the bank £290 million ($452 million) for manipulating between 2005 and 2009 a key interest rate, the London interbank offered rate (LIBOR), which serves as a benchmark for global borrowing.³ David Cameron, the British prime minister, ordered a parliamentary inquiry after the financial scandal raised serious questions about the integrity of the entire banking system. The government also wanted to know who was responsible and who would take accountability for damaging Britain’s financial sector.⁴

Diamond, who led Barclays to grow at a faster pace by deepening the bank’s presence in investment banking and the bonds market, was known for having instilled an “extraordinarily competitive and aggressive atmosphere” at Barclays since he joined the bank in 1996.⁵ He had been a member of the executive committee of the bank since 1997. In 2008, he led the Barclays team that acquired the U.S. securities business of Lehman Brothers—the financial services giant that filed for bankruptcy in 2008—a move that beefed up Barclays’ investment banking business. At that time, Diamond was reporting to the CEO of Barclays, John Varley. It was an e-mail that Diamond sent to Varley, which was copied to Jerry del Missier, Diamond’s lieutenant at the time, that sparked the whole LIBOR issue. Del Missier misconstrued Diamond’s comments, interpreting them as an official request to manipulate the LIBOR rates and instructed traders working for him to do exactly that. Although he authored that fateful e-mail, Diamond initially denied any wrongdoing in the LIBOR scandal. But then, in an open letter to Andrew Tyrie, a Conservative member of the British Parliament, Diamond condemned the inappropriate behavior of “a small number” of Barclays employees who had allegedly tried to benefit personally from the manipulation. According to Diamond, “The authorities found no evidence that anyone more senior than the immediate desk supervisors was aware of the requests by traders, at the time that they were made.”⁶

Not surprisingly, this statement did not end the firestorm engulfing the venerable British bank. Diamond was eventually forced out amid finger pointing and charges that the bank CEO was either complicit in the scandal or incompetent—since, after all, it was Diamond’s e-mail memo (in which del Missier was copied) that led del Missier to ask his traders to misreport the LIBOR rate. The Barclays story is still unfolding, and investigations are continuing. In late October 2012, a high court judge ordered Barclays to face trial over damages caused by the LIBOR manipulation. The case is a first of its kind to be heard in a British court.⁷ The lesson here is that when the leader at the top refuses to take responsibility for his or her own actions or errors, subordinates at every level in the chain of the hierarchy lose direction. Then when something goes wrong, nobody in authority holds himself or herself accountable and everybody suffers in the end, as we saw in the Barclays case.

Diamond appeared to be more upset about his reputation being tarnished by the scandal than about the fallout on the bank employees and investors, according to a CBS News report.⁸ Diamond turned defensive when some British politicians accused him of a lack of candor and accountability, saying that those negative comments “have had a terribly unfair impact on my reputation, which is of paramount concern to me.” And though his actions were hurting rather than helping the bank’s recovery, Diamond did not give up his role easily. In fact, he was forced out.

Let us examine the Barclays case from a functional smart leadership perspective. Functional smart leaders sometimes give up their role too easily—or become disengaged too quickly—without thinking through the implications. Jerry del Missier, who was Diamond’s lieutenant for a long time, was appointed chief operating officer in June 2012 in the middle of the investigation. As the LIBOR scandal unfolded, Barclays singled out del Missier as the key executive who was responsible for ordering false reports of borrowing costs in 2008.

In July 2012, Diamond told a British parliamentary committee that on October 29, 2008, he sent a memo to John Varley, CEO at the time, about a phone conversation he had just had with Paul Tucker, the deputy governor of the Bank of England. Tucker is supposed to have said (apparently falsely) that other banks were quoting lower rates than Barclays, and that created an appearance that Barclays had trouble borrowing money. According to Diamond, del Missier, who was copied on the e-mail Diamond sent to Varley, misunderstood this memo as an order from the Bank of England to make the rates different, and passed it on to brokers who in turn falsified the LIBOR rates. Del Missier resigned from Barclays the same day Diamond left.

Diamond’s red zone personality was brash, whereas del Missier was low key, quiet, and unassuming.⁹ Del Missier apparently operated in the blue zone in that he simply followed his boss’s instructions without raising questions about them. According to his testimony, he was instructed by Diamond to cut LIBOR rates and he did.¹⁰ He felt his role was to be an executor for Diamond’s directives—and not, apparently, a leader responsible for the well-being of his bank. His lack of role clarity could have stemmed from an allegiance to Diamond. Del Missier applied for a job at Barclays in 1987 and was sent a rejection letter. After two more jobs, he caught the eye of Diamond and joined Barclays in 1997. He hung the rejection letter framed on his wall because it was a reminder of “persevering through life’s challenges.”¹¹

Leaders stuck in the blue zone might find it difficult to engage actively with their appropriate role, and when a crisis hits, they tend to disengage quickly and recede into the background. This is as harmful to their organizations as the actions of red zone leaders who identify themselves with their role so much that they can’t separate themselves emotionally from it. Wise leaders know when to lead and when to let others do so—and they never get caught up in any role they choose to assume, as we see next in the case of N. R. Narayana Murthy of Infosys.

Murthy, cofounder of the Indian software service provider Infosys, is a widely admired business leader in India. He is in fact an exemplary wise leader in his actions and words. Murthy believes that leaders must put the priorities of their team members, customers, and employees ahead of their own and serve them with humility as servant leaders. He also believes that leaders are part of a bigger society and have responsibilities that extend beyond their day-to-day role in their organization to serve a larger purpose. Murthy demonstrated this role clarity and commitment to the concept of a noble purpose throughout his own career.

While working in France in the early 1970s, Murthy was strongly influenced by principles of socialism.¹² While he was visiting communist Bulgaria on vacation, he was arrested for having talked to a girl in French. He was locked up without food and water for ninety-six hours and charged with espionage. Bulgarian authorities told him later that he was released because he was from India, which was considered a friendly country. Murthy shuddered to think what would have happened to him if he had not been from a friendly country. That incident disillusioned him with communism as a political system, although the socialist economic principle of sharing one’s wealth with society continued to resonate with him. Realizing that he was “a capitalist in mind, [but] a socialist at heart,” he went on to start Infosys in 1981, describing his company as an “experiment in entrepreneurship to create wealth legally.”¹³ It was Murthy’s socialist belief in the distribution of wealth that made Infosys one of the first Indian companies to offer employees stock-option plans and helped create thousands of millionaires when Infosys went public in 1991.

Over the years, Murthy diligently groomed and mentored future leaders at Infosys. He was also known for delegating power and giving credit to others whenever appropriate. Rather than clinging to his CEO role, he voluntarily stepped down from his position in 2002 (when he turned fifty-six years old) and became Infosys’s chairman, a role that he relinquished in 2011 when he turned sixty-five. Since 2002, Infosys has had an orderly transition of power at the CEO level.

Despite being a billionaire, Murthy maintains a frugal lifestyle: he has lived in the same two-bedroom house in Bangalore for decades. Murthy and his Infosys cofounders walk or use scooters for short distances instead of cars. They take short showers to save water. After a number of kidnappings of prominent businessmen in India, the police top brass who manage security in India offered Murthy protection, but he declined, saying he didn’t want to annoy his neighbors and block traffic. He has given away tens of millions of dollars to charities, which is in line with his concept of “compassionate capitalism.”¹⁴

When Infosys became the first software company in India in 1999 to receive the highest level of capability maturity model (CMM level 5) certification from Carnegie Mellon University, Murthy did something unusual: he decided to share the company’s experience of the certification process with all its Indian competitors.¹⁵ Murthy believed that by helping his rivals receive certification at the same level, the entire Indian information technology (IT) services sector would become globally competitive and attract more investments from multinationals, and that in turn would also benefit Infosys. It was clear to Murthy that letting other Indian companies excel would lead Western companies to pay attention to India—a country that in the 1990s hadn’t yet made its mark in the global IT outsourcing sector—and by so doing would help increase the overall Indian market share and not just Infosys. India is now a prominent player in the global IT market.

Although he cofounded Infosys, Murthy led his company as if he were a trustee—an individual who holds or manages assets for the benefit of Infosys customers, partners, employees, and shareholders. Recognizing that the role of trustee is that of a short-lived caretaker, Infosys has given away stock options worth $10 billion to employees. “Every Indian employee at all levels of the company joined on or before March 2010 is a stock holder of Infosys,” Murthy wrote in the company’s annual report for 2010–2011. With these steps, he has helped over two thousand Infosys employees become millionaires.

Wise leaders like Murthy are willing to cede their power voluntarily. They are not caught up in their role and the power that usually comes with that position. Seeing himself as a trustee, Murthy had no qualms about letting go of his position and in fact saw it as part of his duty to ensure a smooth and well-considered transition. Kris Gopalakrishnan, another cofounder and current cochairman of Infosys, told us that when Murthy was CEO, all of his senior executives had an equal voice.¹⁶ Murthy encouraged debate and listened to multiple perspectives before making a decision. When he was chairman, he might argue with the CEO about a decision, but he enthusiastically supported whatever decision the CEO made in the end. Murthy felt that as a senior steward of the organization, he should fully support others in leadership roles. He consistently demonstrated simplicity and humility by maintaining a low profile without letting money and success go to his head. He also knew how to play a larger role in his industry and in Indian society.

We regard Murthy as a wise leader because he has demonstrated all six capabilities of wise leadership discussed in this book. In particular, he has demonstrated remarkable role clarity throughout his career and used that clarity to make wise decisions and actions.