Sequestration could possibly be the best and worst example of effective negotiation. There is something uncomfortably familiar about it. As I read the news, I heard Rod Serling's voice: "You're traveling through another dimension, a dimension not only of sight and sound but of mind -- there's a signpost up ahead -- your next stop, the Sequester Zone!"
It appears that nothing good can come of this. Regardless of your political views, I want to share valuable business lessons that you can learn from watching President Obama and Congress make a mockery of the democratic process. I focus on three areas: 1) Unilateral Concessions; 2) Taking Ownership; and 3) Dealing with conflicts.
I tell my clients to never give a unilateral concession. Essentially, don't give something without getting something in return. The challenge is that once you give a unilateral concession, the other party will always expect to get something for nothing.
President Obama wins in this area, and Republicans lose. The president got Republicans to agree to a tax increase without associated spending cuts. Republicans voted for over $600 billion in new taxes that went into effect on Jan. 1. The president gave up virtually nothing in return. This is an example of how to obtain an unilateral concession.
President Obama has been publicly campaigning saying that Republicans are holding the country hostage. By using public opinion (you can argue factually or in a misleading way), he is pressuring congress and Republicans for another unilateral concession.
The important lesson is that a unilateral concession often creates bad blood between the parties. In business, if a buyer gets a unilateral concession from a vendor, the vendor figures it out and then seeks "revenge" as the offended party. Once they feel they have been misled or duped, they want to get even. Sound familiar?
When you make a mistake, don't try to blame another vendor, the client, or anyone else. Take ownership. Both parties can learn something from this topic. President Obama and Republicans (yep -- they agreed on something) decided about 18 months ago that they would put the sequestration rules in place to force spending cuts. The reality is that the White House proposed sequestration and Congress agreed. (Read Glenn Kessler's article citing Bob Woodward's Book.)
When President Obama says sequestration is stupid, he is right. However, he left out the fact that he proposed it. He had an easy fix. Specifically, people forgive others when you take responsibility. Imagine if the president said "When we proposed the idea of sequestration, we never imagined it would go into effect. We made a mistake, and now we have to work together to fix it." You and I know the truth. By taking ownership of the problem and signaling a need to work together, he would get the whole country behind him. If he owned the responsibility, rather than assigning his own issue to the opposition, he would gain public support.
One of the greatest leadership qualities is the ability to own your mistakes. By disingenuously trying to shift blame to Congress and Republicans, he has emboldened them to work against him. This is the perfect example of a lose-lose scenario where nobody wins.
If you sense that your customer is raising unreasonable requests, then you might look a bit deeper. Let's say that you are selling a service and the purchasing department makes unreasonable requests. When their internal business people ask why they purchase has not happened, they can blame the vendor (you) for not agreeing to their terms (even if they are not reasonable). Let's hope that's not the root of our political situation, is it?
Dealing with Conflicts
When you call your client a lying scoundrel, do not expect to receive a basket of flowers the next day. President Obama blames Republicans, and the Republicans blame the president. Each time the other side gets more stubborn.
Years ago, I was president of a country club. When a member did something outside of the rules, we punished them. For years, we imposed fines and reprimanded members. In retrospect, it had zero impact on changing behavior. We then hired a new CEO/General Manager.
Was there a better way?
A couple of weeks later, a group of members broke some rules. A few of us thought: "These guys should get punished." The CEO, Eric Dietz (who was recognized this year as one of the top club managers), had a different approach. He approached "the ring leader" of the group, put his arm around him in a friendly way and said "I need your help. My sense is that the rules are difficult to follow and ever harder to consistently enforce. How can we make them better for everyone's enjoyment?" Instead of being defensive, the member said, "The rules are fine. We got a bit out of control. I'll take care of it. It won't happen again."
Eric figured out a way to get the offenders to work on his side of the table to find a good solution. President Obama and congressional leaders could learn a valuable lesson from that interaction.
Perhaps if they can work together, we can get out of this lose-lose scenario, curtail spending a bit, and get back to growing the economy.
What frustrates you between buyers and sellers? My next book, Same Side Selling, is co-authored with Jack Quarles of Buying Excellence. In each chapter, we look at the sales mind and the buyers mind and how to work better with buyers to achieve better results. Submit your pet peeves about buying and selling. If we include your question in the book, you'll get a free, signed copy and bragging rights with your friends.