A Model of Practical Wisdom
Some things have to be learned by experience—or, perhaps, from the experienced.
- By
- December 01, 2025
- CBR - Ethics
A common assumption among some masters of the universe and their legions of young admirers is that capitalism benefits from childish impulses.
For what else is the spirit of “move fast and break things” than a vision of capitalism that throws caution to the wind, spurred on by the belief that a visionary entrepreneur has nothing to learn from others and is best advised to smash through any barrier to success? It is the logic of the willful child, bent on having his ice cream before eating any broccoli, but it is sometimes accorded the dignity of a principled belief.
Thankfully, we have a model for a different way of thinking in Dennis H. Chookaszian, former CEO of CNA and a longtime adjunct professor at Chicago Booth, where he teaches corporate governance. In the life he has led and the lessons he teaches, Chookaszian is an illustration of the power of practical wisdom and its application to business.
A history lesson
Most moral systems, secular and religious, make room for some variety of practical wisdom. The Hindu tradition, for instance, divides life into four stages. In the third stage, vanaprastha, a person passes from being the principal actor in any situation to a trusted advisor, one who calls on the lessons of age to offer counsel on all types of matters. An individual arrives at vanaprastha at 50, the same age in Confucianism when a man may graduate to the status of junzi, or gentleman, a figure whose wisdom and personal restraint allow him to embody proper conduct in every element of human life.
Aristotle did not fix a specific age for becoming a phronimos, one who had mastered the capacity for phronesis, a word that is alternately translated as prudence or practical wisdom. In his Nicomachean Ethics, the fourth-century Greek philosopher attempted to define phronesis by contrasting it with episteme, the knowledge of things, as he explained, that do “not admit of being otherwise.”
What Aristotle had in mind by this were the immutable facts we most often associate with science or mathematics. And yet, importantly, the one-time tutor to Alexander the Great maintained that the knowledge of such truths alone was not “conducive to living well in general.” The cultivation of phronesis allowed one to be a successful steward of business, politics, or other human arrangements that tend to be highly complex, culturally anchored, and liable to continually evolve. Moreover, we come by our knowledge of phronetic matters in a very different fashion from the way we derive immutable truths. Young people, Aristotle observed, often “become skilled in geometry and mathematics,” but “a young person does not seem to be prudent.” The reason is that prudence involves the ability to successfully deliberate and weigh the “particulars” of any activities that “come to be known as a result of experience.”
The phronimos
Aristotle never deliberated on the particulars of corporate governance, but had he been a corporate director of the Athenian equivalent of, say, Qualcomm or KFC, he would have appreciated the phronetic nature of such study.
That’s certainly the approach Chookaszian takes. The practical wisdom he shares with students in his corporate governance classes comes from decades of successfully managing the particulars of a wide variety of business ventures.
If you learn business ethics the same way you learn how to ride a bike, how exactly are you supposed to pedal in the classroom?
Chookaszian’s study of business began in 1965 at what was then the University of Chicago Graduate School of Business, now Chicago Booth. Chookaszian was a freshly minted Northwestern graduate, and he assumed that the knowledge he had gained from his undergraduate degree in chemical engineering, together with an MBA, would pave the way for a fulfilling career in business. A summer job with Standard Oil (now Exxon) quickly modified his thinking of how to begin his career.
He had assumed that he would start his career using his engineering training and then become involved in the leadership of businesses. After his first year at Booth, Chookaszian went to work as a cathodic protection engineer on the West Shore Pipeline between Indiana and Wisconsin. The job, he says, was simple: He had to make sure “the pipeline didn’t rust.” While hardly the most glamorous task, it did call on the knowledge he had gained in his engineering training at Northwestern. Still, he soon realized that just because a job is reserved for the highly skilled doesn’t mean it can’t also be mind-numbing.
“I worked for a person who had been doing the job 20 years,” Chookaszian recalls. “And after about two or three weeks, I said, I know 80 percent of what he knows!” His supervisor was a “nice guy,” he grants, and he “made a fair amount of money,” but for the young Chookaszian, the lesson was clear: “I can’t imagine being a field engineer for 20 years—I will end up with one year of experience 20 times, and I won’t learn anything new.”
Having closed the door on a career in engineering, Chookaszian ended up in consulting at Deloitte after finishing his MBA. “I loved economics,” he explains, and with the help of Booth’s Robert Aliber, who died earlier this year at 94, he entered Booth’s doctoral program, juggling its dour requirements with the demands of fatherhood and the vagaries of a consultant’s life.
He soon realized he couldn’t do both the doctorate and the consulting work—not, at least, without going crackers. “I needed the income since I now had a growing family,” Chookaszian admits, and “the PhD was going to be 15–hour days for three years, which would have precluded me from working in consulting.” He eventually left the program having attained the status of ABD, which officially stands for “all but dissertation,” but is known as “all but dead” among those who have actually crossed the doctoral finish line.
Chookaszian remained at Deloitte for eight years, on the fast track to becoming partner, until he got an offer he couldn’t refuse. His consulting work had focused on the insurance industry, and even though he was only 32, he was given the chance to become the CFO at insurance behemoth CNA. In fact, he actually became the CFO and the CIO, or chief information officer—an arrangement, he notes, that would never happen today.
The reason Chookaszian was tasked with so much responsibility is that CNA was busy restructuring after a period of corporate turbulence. A year before he arrived, the nearly 80-year-old company was the target of a successful takeover after its stock price dropped off a cliff. The new owners hired Chookaszian, who eventually rose to become chairman and CEO of CNA, where he would remain for 26 years.
Even beyond questions of temerity and reticence, there is the very practical matter of knowing when to step in, why, and how exactly to bring about the right outcome.
The experience leading a storied company provides a storehouse of lessons that Chookaszian draws upon in his corporate governance class. But to my mind, the greater part of the practical wisdom he shares with students comes from his decades of service on corporate boards, more than 90 of them in all, from multinational conglomerates to fledgling start-ups. I first got to know him when we served together on one such start-up and then on a second. When I audited his class last winter, he shared this fact with students, saying the first start-up was one of the very best he had ever been part of, the other among the very worst.
Watching Chookaszian’s leadership on both boards is what prompted me to sit in on his lectures. Having worked side by side with him for nearly a decade now, I consider him a mentor, and there is no other person I have learned more from when it comes to the practical requirements of successfully building a complex business enterprise. In the counsel he has dispensed, he has come to represent, for me, the embodiment of Aristotle’s phronimos, and what I have learned from him has reaffirmed and challenged my own approach to business ethics and the practical wisdom that supports it.
Bike riding and book reading
How so? Let me explain by way of a metaphor I always share with students during the first meeting of my Ethics in Business class.
To help distinguish the course from the more data-driven offerings that make up most of the Booth curriculum, I introduce the concept of phronesis. I ask students to raise their hands if they know how to ride a bike. A phalanx of hands appears. Then I ask them to keep their hands raised if they learned how to ride a bike by reading a book. A few giggles erupt, and the phalanx collapses.
The laughter makes plain the absurdity of the proposal. You don’t read a book to learn how to ride a bike. In fact, attempting to do so would betray a fundamental misunderstanding of how one comes to learn so many everyday activities. I tell students that I’m quite confident they learned how to ride a bike pretty much the same way I did. In Lincoln Park, not far from where I currently live, there is a scrap of ground where, when I was five or six, my father ran by my side while I sat on a brand-new bike, one of his hands holding the handlebars, the other holding the seat. When he let go, I wobbled a few yards, furiously turning the pedals, before doing what everyone does the first time they try to ride a bike: promptly falling.
But I got back up, and I got back on that bike again, and with a little help from my father, I kept turning the pedals until I stopped falling—until I learned how to stop falling. That’s how everyone learns to ride a bike. You learn by doing.
The illustration tends to captivate students, so much so that they typically don’t think to ask the obvious question about the analogy between bike riding and business ethics: If you learn business ethics the same way you learn how to ride a bike, how exactly are you supposed to pedal in the classroom?
You can’t, of course, not in any way that is visceral and comprehensive. This is a challenge not only to business ethics but to the entire enterprise that is a business school.
That’s why classes like Chookaszian’s—and the example he affords—are invaluable. For what you can do in a classroom is to share those experiences that illustrate a phronetic practice, such as corporate governance, and derive conceptual lessons that provide clear ways of thinking about its execution.
In his class, Chookaszian bundles such lessons into what he calls his frameworks.
There are hundreds of lessons to choose from, but let me share a favorite of mine from Framework #16: The Roles and Responsibilities of Board Members. The lesson is as pithy as it is insightful: Noses in. Fingers out.
Chookaszian contends that, except in those instances where the company is on the brink of failure, the CEO is unable to lead following the board’s direction, or there are improper activities from the CEO, directors do not have an affirmative responsibility to run an enterprise. In fact, attempting to do so by grabbing the levers of the company only makes the job of the person who’s actually in charge a lot harder. Board members have none of the granular knowledge of an enterprise that a CEO is expected to have. They aren’t constantly reviewing internal data or having the kinds of conversations with employees, customers, and other stakeholders that help to shape strategic decisions. Even when they are convinced they know better, they should restrain themselves and keep their hands at their sides. It is very simple, he says—if the CEO is not following the direction of the board, don’t try to intervene; just replace them with someone who will.
But that doesn’t mean board members should hesitate to lean in to get a whiff of what’s going on—in other words, to put their noses in. Their role as directors is advisory and prophylactic. They give advice to the captain to help steer the ship around the shoals and bring it safely to port. They also are responsible for ensuring that, throughout the voyage, whether because of strain, sabotage, or simple neglect, the engine room isn’t on fire.
Noses in. Fingers out. It’s easy to say and simple to understand, but boy is it hard to do. I’ve now advised five companies, and the hardest part about being a director is successfully implementing that advice. At one extreme, especially when the company is failing to achieve everything you believe it’s capable of, it’s hard to restrain yourself from attempting to take the helm or browbeating the captain to sail in the direction you think best. At the opposite extreme, you may be so sensitive to overstepping your bounds that you fail to poke the skipper in the ribs when they’re asleep at the wheel or raise your voice when they’re clearly channeling Captain Ahab.
And yet, even beyond questions of temerity and reticence, there is the very practical matter of knowing when to step in, why, and how exactly to bring about the right outcome. Noses in. Fingers out: It gives you a conceptual understanding, a framework for proper action as a director, but discharging that responsibility successfully in a peculiar set of circumstances is more squarely a matter of phronesis.
I am still learning the practice myself, but I am lucky to have received an elite education from Chookaszian. Watching how he breaks down complex problems, establishes priorities, and provides counsel, all without forfeiting the trust and loyalty of the person he’s advising, has been invaluable in developing my own phronetic abilities as a board member. At the same time, it has reaffirmed for me that ethics is less a science than an art. You can study the basics in the example of a master, but you can only achieve excellence by getting on the bike and trying to pedal.
John Paul Rollert is adjunct associate professor of behavioral science at Chicago Booth.
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