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Tools for Judgment
Gray areas are the hardest problems managers face at work.
The reason, fundamentally, is that these are the hardest prob-
lems we face in life. When you have to deal with a highly
uncertain, high-stakes problem, you face a challenge, not just
to your skills, but to your humanity.
This book offers a powerful, practical way to resolve gray
area problems. It is based on guidance that is unusual, even
radical. The guidance doesn’t come from successful or famous
CEOs. It isn’t found in the conventional wisdom that says
serve the interests of the shareholders or all the stakeholders.
Nor does it appear in the ever-lengthening mission statements
of today’s organizations. The soundest guidance, I believe, for
grappling with hard, complex, uncertain practical problems
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Managing in the Gray
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is a set of five questions that men and women have turned
to, across many centuries and cultures, when they faced this
kind of problem. Gray areas demand your best judgment,
and the five questions are, in essence, extraordinarily valuable
tools for judgment.
This book explains why these questions are so useful
for resolving gray area issues. It also gives extensive prac-
tical guidance for answering the questions and illustrates
this guidance with a wide range of case studies of gray area
problems. However, before we turn to the five questions, it
is important to understand what gray area problems are and
what makes them so important and so challenging.
The Challenge of Gray Areas
The more responsibility you take on at work and in life, the
more often you face gray area problems, and these problems
come in all shapes and sizes. For example, some are large,
complex, and infrequent. Later in this book, we will look in
detail at a situation faced by the CEO of a small biotech com-
pany who had learned that a new, much-needed drug might
be implicated in a very rare, but deadly brain disease. He had
to decide what to do—even though he lacked critical facts or
even a clear definition of the problem.
In contrast, other gray area problems are small-scale, but this
doesn’t make them easy or unimportant. In a later chapter, we
will look at a situation that confronted a senior manager in a
medium-sized company. She shared an executive assistant with
three managers. The assistant had worked at the company for
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more than thirty years and had a strong record, but her work
had been slipping badly for several months. No one knew why.
The other managers who relied on her wanted to let her go, but
the senior manager was seriously concerned that the standard
HR approach—giving the assistant two weeks’ notice and a
small severance package—might do her irreversible harm. But
these concerns told the senior manager nothing about what she
should do about the assistant, the work that wasn’t getting done,
or her disagreement with the other managers.
What all gray areas have in common, whether they are
major or minor, is how we experience them. When you face
a gray area problem, you have usually done a lot of hard
work—on your own and often with other people—to under-
stand a problem or a situation. You’ve assembled all the data,
information, and expert advice you can reasonably get. You’ve
analyzed everything carefully. But critical facts are still miss-
ing, and people you know and trust disagree about what to
do. And, in your own mind, you keep going back and forth
about what is really going on and about the right next steps.
These situations can be dangerous traps—organizational
versions of the primeval tar pits that swallowed up the fear-
some saber-toothed tigers. You can easily get bogged down
in a gray area as you try to figure out what is going on. Even
worse, you can get lost or be paralyzed by complexities and
uncertainties. On the other hand, if you act too quickly, you
can make a mistake with serious consequences: other people
get hurt, performance suffers, and your career stalls.
Gray areas are particularly risky today because of the seduc-
tive power of analytical techniques. Many of the hard problems
now facing managers and companies require sophisticated
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techniques for analyzing vast amounts of information. It is
tempting to think that, if you can just get the right information
and use the right analytics, you can make the right decision.
It can also be tempting to hide out from tough decisions or
disguise the exercise of power by telling other people that the
numbers tell the whole story and that there is no choice about
what to think or do. But serious problems are usually gray. By
themselves, tools and techniques won’t give you answers. You
have to use your judgment and make hard choices.
These choices often come with serious emotional and psy-
chological risks. When you face really hard decisions, there
is no way to escape the personal responsibility of choosing,
committing, acting, and living with the consequences. An
MBA student presciently described this challenge by saying,
“I don’t want to be a businessman claiming to be a decent
human being. I want to be a decent human being claiming to
be a businessman.”
On the other hand, when you meet these challenges and
resolve a gray area problem successfully, you are making
truly important contributions to your organization, other
people, your career, and your sense of yourself. Hard, messy,
high-stakes problems get delegated upward in organizations
and land on managers’ desks. Go back for a moment to the
situation involving the older employee. Ask yourself what
you would do. Your assistant’s work has been slipping for
months. You don’t know why, and perhaps she doesn’t either.
Laws, regulations, and company policies set parameters on
what you can do, but you still face some very tough questions.
Will you find another job for her, somewhere in the orga-
nization, or will you lay her off? How much and what type
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of severance and support will she get? Can you treat her with
respect and compassion, when you are taking away her live-
lihood? These are all hard management questions, and you
have to answer them one way or another. And behind these
decisions is a profound social decision that society has del-
egated to you: given this employee’s age and failing perfor-
mance, you may be deciding that her work life has come to an
end. In short, when you do a good job of resolving a gray area
issue like this one, you are doing the heavy lifting—not just
for your organization, but for other people and the society in
which you live.
At the same time, when you grapple successfully with a
gray area problem, you are testing and developing your skills
as a manager. A basic test of whether you are ready for more
responsibility in an organization isn’t how well you manage
routine situations; it is how well you handle really hard, uncer-
tain, important challenges. This is because gray area problems
are the core of a manager’s work. As you meet these challenges,
you build your experience and confidence, and you add lines
to the informal, unwritten résumé that circulates inside orga-
nizations and determines who gets promotions. Good bosses
recognize and reward people who handle the tough, gray area
problems well. And, when you meet these challenges, you
are also becoming a good boss yourself—by serving as a role
model for the people who work for you.
Gray areas are basically organizational versions of the clas-
sic Gordian knot: that is, they are dense tangles of important,
complicated, and uncertain considerations. As such, they can
be some of the hardest work you have to do as a manager, and
they can feel like a serious burden. At the same time, like the
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