The Four-Way Test

“Goodwill is the only asset that competition cannot undersell or destroy.” 

– Marshall Field

Last week we introduced Rotary’s Four-Way Test as a tool for ethical decision making. We also reviewed the first question of the test – “Is it the Truth?”. We learned that the truth needs to be based on facts, but goes farther than being factually correct. The truth creates transparency and clarity. Facts can be misrepresented and distorted to hide the truth. 

Rotary International adopted the Four-Way Test in 1943. The Four-Way Test starts with a preamble and then asks four questions. Here is how it goes. 

“Of the things we think, say, or do…

• First, Is it the Truth? (not just factual, but true)
• Second, Is it Fair to all concerned?
• Third, will it build Goodwill and Better Friendships?
• Fourth, will it be Beneficial to all concerned?

In this article, I am sharing what I learned from a 2017 article written by Mark DiGiovanni.

Is It Fair To All Concerned?

Life isn’t fair. One attempt to make it fair resulted in communism. It didn’t work. If life was fair, I would not get to spend eternity in heaven. It wasn’t fair that Jesus had to die on the cross for my sins. 

Fair means to be free from bias, dishonesty, or injustice. I believe the Golden Rule is the best judge of fairness. If someone was treating you the way you are treating others, how would you feel?

Will It Build Goodwill and Better Friendships?

It is said that integrity is the father of goodwill and reputation is its mother. Warren Buffett famously said that it takes twenty years to build a reputation and a few minutes to ruin it. When you or your organization has goodwill, people think good things about you when your name is mentioned. Rotary’s motto is “Service above Self.” Following that motto while walking in integrity will create goodwill. 

Friendships are built on respect, trust, reciprocity, shared experience, and mutual enjoyment of each other’s company. Will the actions you are considering create better friendships?

Will it be Beneficial to All Concerned?

Making decisions that are beneficial to all concerned requires a mindset shift. We need to shift our minds to always look for win-win outcomes. We naturally look out for our interests. This often leads us to think in terms of win-lose. Win-lose thinking results in short-term decisions. When our wins are based on others’ losses, our wins will always be brief. 

Long-term thinking requires us to win with everyone we work with. Creating win-win opportunities for everyone involved creates respect and loyalty that will generate long-term returns. 

The neat thing about The Four-Way Test is how the questions work together. If you openly and honestly run your decisions through the test (preferably with others), I know it will greatly increase the likelihood of good, honest, and ethical decisions. And those types of decisions will create goodwill for you and your organization.

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