Practical wisdom as an adaptive algorithm for leadership: Integrating Eastern and Western perspectives to navigate complexity and uncertainty

Abstract

AbstractIn this paper, we integrate Eastern and Western perspectives of practical wisdom to answer the question, how can practical wisdom transfer across cultural boundaries in a world of increasing interconnection? We describe key properties of practical wisdom in early Western and Eastern schools of thoughts and explain how the concept of practical wisdom in ancient philosophy aligns with modern‐day complex system science. We identify seven qualities of complex adaptive systems as a universal pattern that underlies both Eastern and Western perspectives. From these qualities, we develop an integrated conceptual framework of practical wisdom as factors both internal and external to the self that promote continuous coupling with the broader operating environment. We propose that practical wisdom functions as an adaptive algorithm capable of continuously evaluating its processing rules to maintain fit with the operating environment while generating ongoing novelty. This generativity expands developmental potential across multiple levels and fosters open‐endedness, evolvability, and antifragility. With this functional understanding, ethics can no longer be marginalized—it must be recognized as the foundation for sustainable organizing because it reliably creates a network topology that makes innovation and long‐term success possible. We close with actions leaders can take to foster practical wisdom.