How: Dov Seidman May 18, 2010, 2:22PM EST

The Economy: Don't Reach for the Reset Button

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Second, the frequency, intensity, and unpredictability of our crises will only increase due to the interconnectedness and interdependence of our world. A volcano in Iceland kept planes from flying to and from Europe. And as we have seen with Greece, a small country flirting with bankruptcy can sap billions of dollars of shareholder value in one day. In the last century, our nascent global economy thrived despite the Great Depression. We were perfectly happy to suffer through recessions when they occurred only every 15 to 30 years. We are less willing to endure recessions when they threaten global stability more frequently.

Cooler Heads Make the Profits

Third, a subset of countries, companies, and individuals always responds more moderately and, as a result, more profitably to crises, and that is what is owed to stakeholders. As New Yorker business columnist James Surowiecki points out, Kraft (KFT) (Miracle Whip), Texas Instruments (TXN) (the transistor radio), and Apple (AAPL) (the iPod) are among the highly successful companies that introduced game-changing products during the depths of economic downturns.

Given the increasing frequency and intensity of the economic crises in our hyperconnected world, we need to find a bulwark against our extreme reactions. Sustainable values are just the bulwark we're looking for.

During Way of Life crises, the companies and individuals who thrive (while others batten down the hatches) embrace sustainable values over situational values. Sustainable values arise from within company cultures and focus on long-term priorities that do not waver during bursts of volatility. Situational values change in reaction to external ups and downs: We engage in questionable selling, sourcing, cost-reduction, or accounting practices because external conditions call for doing so.

Sustainable values are what Franklin Delano Roosevelt was seeking to inspire in Americans when he proclaimed that the country had "nothing to fear but fear itself" during the Great Depression. Roosevelt understood that when citizens lose hope and meaning, they hunker down, grow fearful of one another, and progress stagnates. Given that the need for sustainable values has never been greater in the modern business era, the question is, do countries, companies, and individuals have the will to embrace sustainable values?

A Crisis of Ethics

Sustainable values took center stage at January's World Economic Forum in Davos, which this year had the theme "Rethink, Redesign, and Rebuild."

It was striking to see 28 world leaders and dozens of CEOs at the world's largest and most innovative companies rallying around what a preconference survey identified as not a financial crisis but one of ethics. Rather than values-based discussions being relegated to the margins of the event, the world's breakdown in values took center stage alongside comprehensive considerations of global regulatory reform, corporate governance, and global sustainability challenges.

At the same time, Toyota (TM), the world's largest automaker, plunged into a crisis of its own. What is striking about Toyota's difficulties is how customers, regulators, and other stakeholders judge the company. Rather than dwelling on the company's faulty automobile components (Toyota's "Whats"), people are peeling back the company's culture (Toyota's "Hows") to find out if behavior and values within the company caused and/or exacerbated its problems.

Inside boardrooms, more business leaders appear to grasp the importance of behaviors and sustainable values. When John Deere (DE) hired CEO Sam Allen last summer, Allen was asked what he planned to change. His predecessor and the company's current chairman, Bob Lane, explains that Allen was very clear on that matter. "His response … was, 'It's too soon to tell what we're going to change. But what we're not going to change is the how and the way we do business.'"

Like Lane, Allen, and other inspirational corporate leaders, Davos attendees and Toyota executives now understand the importance "the how." Rest assured, the 21st century versions of Apple, Texas Instruments, and Kraft are aggressively rethinking the basics. As they do, they are no doubt focused less on 20th century levers of outperforming and more on 21st century modes—such as sustainable values and inspirational leadership—of outbehaving the competition.

So don't call it a comeback. If we treat our current problem that way, we will still be right here, mired in the 21st century's ever-accelerating crisis cycle for years. And it just may knock us out.

Dov Seidman is the founder, chairman and chief executive officer of LRN, a company that helps businesses develop ethical corporate cultures and inspire principled performance, and the author of HOW: Why HOW We Do Anything Means Everything…in Business (and in Life). LRN recently announced the acquisition of leading green strategy firm, GreenOrder.